Stone v. Wisconsin/Opinion of the Court

The only question presented in this case, not decided in Chicago, Milwaukee, & St. Paul Railroad Co. v. Ackley, supra, p. 179, is as to the effect upon the rights of these parties of the charter of the Milwaukee and Waukesha Railroad Company, passed by the territorial legislature of Wisconsin, March 11, 1847. This provides (sect. 15) that 'on the completion of said railroad, or any portion of the track, not less than ten miles, it shall and may be lawful for the company to demand and receive such sum or sums of money for passage and freight of persons and property as they shall from time to time think reasonable.' It is claimed that this gives the company the charter or contract right to fix its own rates of fare and freight, subject only to a judicial determination as to whether they are reasonable. Without admitting that such would be the effect of this provision, we shall dispose of the case upon another ground.

The first section of the act appoints commissioners to receive subscriptions to the capital stock. The second section provides:--

'That the capital stock of said company shall be $100,000, in shares of $100 each; and as soon as one thousand shares of stock shall be subscribed, and five dollars on each share actually paid in, and a statement shall be deposited with the treasurer of the County of Milwaukee, authenticated by the oath of the secretary and two or more of said commissioners, that such subscriptions and payments have been in good faith made, the subscribers of such stock, with such other persons as shall associate with them for that purpose, their successors and assigns, shall be, and they are hereby, declared and created a body corporate and politic, by the name and style of 'Milwaukee and Waukesha Railroad Company,' with perpetual succession, and by that name shall have all the privileges, franchises, and immunities incident to a corporation.'

The commissioners named in the first section met and organized, Nov. 23, 1847. Books of subscription were opened, and one of the commissioners was authorized to procure an amendment of the charter. Upon application made under this authority, an amendment, not at all important to the present inquiry, was passed by the territorial legislature, March 11, 1848. The requisite amount of stock was subscribed on or before April 5, 1849. It does not appear that any was subscribed before; but on that day the necessary certificate under sect. 2 was filed with the treasurer of Milwaukee County.

Wisconsin was admitted into the Union as a State, May 29, 1848, 9 Stat. 233, under a constitution ratified by the people, March 2, 1848, which provided, art. 11, sect. 1, that all laws for the creation of corporations 'may be altered or repealed by the legislature at any time after their passage.'

Upon this state of facts the Supreme Court of Wisconsin decided, in the case of The Attorney-General v.Railroad Companies, 35 Wis. 599, 'that the charter was accepted and the corporation organized many months after the adoption of the Constitution and the admission of the State into the Union by Congress.' Previous to that time it 'remained a naked unaccepted proposition.' p. 601. For this reason, it was held that 'its acceptance after the organization of the State, so far as it is a contract, makes it manifestly a contract with the State.' p. 605. The ground on which the decision was placed is that, as the act of incorporation had not been accepted when the territory ceased to exist, there was no contract between the corporation and the territory; but the State Constitution having continued the act in force, it became thereafter a State statute for the incorporation of the company, and, as such, subject to the reserved power of alteration and repeal. This construction of the statute and Constitution is binding upon us as a question of State statutory and constitutional law.

This being so, we are not called upon to consider any of the other points which appear in the case in opposition to the effect claimed for the territorial act by the plaintiff in error.

Judgment affirmed.

MR. JUSTICE FIELD, with whom concurred MR. JUSTICE STRONG, dissenting.