The question presented on this appeal arises under section 4 of chapter 340 of the Laws of 1892. By section 1 of that act section 6 of chapter 361 of the Laws of 1863, entitled* “An act to authorize *862the construction of a" railway and tracks in the towns of West Farms and Morrisania,” was amended so as to allow the corporation formed under that act to consolidate its capital stock and property with the capital stock and property of any street surface railroad company incorporated or to be thereafter incorporated for the purpose of building or operating any street surface railroad north or east of the Harlem river, in the city of Hew York, or the county of Westchester. The name of the corporation formed by such consolidation was to be the Union Railway Company of Hew York City. By section 2 of the act all conditions, obligations and liabilities imposed by law or contract upon any railroad company or persons so consolidating was preserved unimpaired, and was to be assumed, borne and performed by the said Union Railway Company. By section 3 certain provisions of the General Railroad Law (Laws of 1890, chap. 565, as amd.) were not to be applied to the Union Railway Company. By section 4 the president and treasurer of the Union Railway Company were required to annually make a verified statement to the comptroller of the city of Hew York, on or before the first day of September in each year, “ of the gross amount of its receipts for the year ending June thirtieth next preceding, and also a detailed account of its daily earnings during that period. * * * Whenever such earnings shall, during any period of six months, exceed an average of seventeen hundred dollars per day, then, and in that event, the said company shall thereafter annually, on the first day of December, pay into the treasury of the city of Héw York to the credit of the sinking fund of the said city a sum equaling in the aggregate one per cent of its gross earnings, and an additional annual payment of one per cent of such gross earnings shall be made by said company in like manner for each multiple of seventeen hundred dollars per day of such average gross earnings. * * * The payment of the percentage of gross receipts herein provided for shall be in lien of all other percentages which any of the roads consolidating and forming the said Union Railway Company may theretofore be liable to pay on its receipts.” The complaint alleges that “ the gross earnings of defendant for the six months beginning March 1st, 1903, and ending August 31st, 1903, amounted to the sum of $630,850.34 or an average of more than $3,400 daily during said period of six months. * * * That the *863gross earnings of deféndant from. March 1st, 1903, to June 30th, 1904, amounted to the sum of $1,710,759.09,” and that there, therefore, became due and owing to the plaintiff from the defendant two per cent on said amount, aggregating $34,215.18, of which the defendant had paid the sum of $17,107.59, for the balance of which the plaintiff demanded judgment. The defendant demurred to the complaint on the ground that it did not state facts sufficient to constitute a cause of action, and that demurrer having been overruled the defendant appealed.
The defendant seeks to sustain its construction of • this provision of the statute by a contention that it imposes a tax on the defendant or its property. But it is clear that this construction cannot be sustained. It is a charge for the use of the streets and avenues by the consolidated company and in lieu of all charges which had been imposed upon or accepted by the constituent companies.
The defendant then contends that the true interpretation of this provision of its charter is that if during any six months period wholly within any one fiscal year from June thirtieth to June thirtieth the daily receipts averaged $3,400, then for that particular fiscal year the company must pay a tax of two per cent upon its gross earnings; and as there was no allegation that for any six months within any fiscal year extending from June thirtieth to June thirtieth, the average gross earnings were $3,400 per day, the complaint set forth no cause of action. The sole question presented is as to the construction of section 4 of defendant’s charter. The defendant is required to render a verified statement to the comptroller of its receipts for each year ending June thirtieth, and a detailed account of its daily earnings during that period. Thus the plaintiff was to be in possession of a detailed account of the gross amount of the defendant’s receipts from year to year. This obligation was a continuing one, so by comparing these annual statements the average earnings of the defendant for any six months could be ascertained. The statute then provided: “ Whenever such earnings shall, during any period of six months, exceed an average of seventeen hundred dollars per day, then, and in that event, the said company shall thereafter annually, on the first day of December, pay into the treasury of the city of Mew York to the credit of the *864sinking fund of the said city a sum equaling in the aggregate one per cent of its gross earnings.” There was nothing in this statute which indicates that the obligation to pay should not arise until the company should have received for six months*' of any fiscal year an average of $1,700 per day, but “ whenever such earnings shall, during any period of six months, exceed an average of seventeen hundred dollars per day ” there was imposed upon the defendant the obligation to pay to the city of ¡New York one per cent of its gross earnings. The obvious intent was to relieve the defendant from this payment until its road had been constructed and was in operation, and its earnings were such that it could afford to pay for the use of its franchise and the right to use the streets, and this obligation was to arise when the earnings should, “ during any period of six months, exceed an average of seventeen hundred dollars per day.” Thereafter the defendant was bound to pay a percentage of its gross earnings to the city regardless of its actual earnings. The provision requiring the defendant to make a verified statement to the comptroller was, first, to determine when there had been a period for six months during which the company had actually earned $1,700 per day ; and then to provide the means of ascertaining the amount of the payments to 'be thereafter made by the defendant. The provision as to the making of this annual statement and the imposition of the obligation upon the defendant were not connected, and the obligation of the defendant would arise whether the defendant had complied with its obligation to furnish a statement or not. The obligation to pay was not at all dependent upon the actual furnishing of the statement or what appeared therefrom. The defendant was bound to make the statement to the city and it was also bound to make the payments whenever the gross earnings should, during any period of six months, exceed an average of $1,700 per day and the obligation to pay, therefore, arose as soon as the railroad had received as its gross earnings for any period of six months an average of $1,700 per day. I think, therefore, the obligation to pay arose when for any period of six months the defendant’s gross earnings exceeded the daily average of $1,700 per day, and that the complaint sets forth a good canse oí action.
It follows that the judgment appealed from must be affirmed, with costs, with leave to the defendant to withdraw the demurrer *865and to answer the complaint on payment of costs in this court and in the court below.
Patterson, P. J., Laughlin, Clarke and Houghton, JJ., concurred.
Judgment affirmed, with costs, with leave to defendant to withdraw demurrer and to answer on payment of costs.
The title of the act was changed by chapter 598 of the Laws of 1894.— [Rep.