The municipal corporation now known as the city of Troy was incorporated by chapter 121 of the Laws of 1816 by the corporate title “ The Mayor, Recorder, Aldermen and Commonalty of the City of Troy.”
By that act the common council was constituted the commissioners of highways in said city and given power to pass ordinances, among other things, to regulate the streets and highways in such city.
In the year 1851 there were four railroad corporations — the Rensselaer and Saratoga; the Schenectady and Troy; the Hudson River and the Troy and Boston — which had and used railroad tracks on River street in the city of Troy and operated their cars thereon by horse power.
One of these companies, the Rensselaer and Saratoga, had its terminus at the end of its bridge, now the Delaware and Hudson bridge, on the easterly side of River street at Federal street; the Schenectady and Troy had its terminus at the west end of said bridge; the Troy and Boston had its terminus at the north side of Hoosick street, and the Hudson River terminus was the intersection of the Troy Union Railroad Company with the Troy and Green-bush Railroad Company.
The Troy Union Railroad Company was organized July 21, 1851, in pursuance of chapter 255 of the laws of that year, which provided among other things: " The corporation of the city of Troy, and the several railroad corporations whose railroads now or hereafter shall come to the city of Troy, or which have or shall have their business terminus in, or run their trains to and from said city, may subscribe for and become the owners of stock in a railroad corporation to be organized under ” the general railroad act.
Pursuant to the power so conferred the plaintiff, the Troy Union Railroad Company, was organized with a capital stock of $30,000.
On the 3d of December, 1852, there was a contract entered into between the Mayor, Recorder, Aldermen and Commonalty of the City of Troy and the Troy Union Railroad Company and its four constituent stockholders.
The substance of the contract was that there should be one railroad running through the city of Troy, that of the Troy Union Railroad *542Company; that the defendant, the City of Troy, should consent to the construction and operation of the railroad across certain of its streets and along Sixth avenue; that the city of Troy should loan its credit to the Troy Union Railroad Company to the extent of the cost of the railroad on the new line; that the Troy Union Railroad Company should give a mortgage to secure such loan, and that “ The party of the first part agrees that the Common Council of the City of Troy shall join in an application to the Legislature of the State of New York that the Troy Union Railroad Company be exempt from taxation upon an amount exceeding the then present amount of its capital stock ($30,000) and if such law shall not be passed the Common Council shall refund to the Troy Union Railroad Company the amount equal to the city taxes imposed on the Troy Union Railroad Company for any valuation exceeding its capital stock.”
Under this agreement there were mortgages given amounting in all. to something in excess of $707,000. The four constituent companies agreed each to pay one-fourth of the mortgage debt to the city.
The Troy Union Railroad Company further agreed to construct a railroad with two or more tracks upon the courses and routes indicated by the survey attached to the contract, and to furnish all necessary police regulations for the tracks and passenger house.
In 1853, by chapter 462 of the laws of that year, it was enacted that “ For the purposes of taxation in the city of Troy, and in the county of Rensselaer, the property of the Troy Union Railroad Company shall be estimated and assessed (as the common council of said city of Troy, by its contract with said company, dated December third, eighteen hundred and fifty-two, agreed that the same should be) at the amount of the capital stock of said company, and no more.”
The contract of 1852 continued until default was made in certain payments required by the mortgage. A second contract was made July 1,1858, by the terms, of which the former contract was annulled and the city agreed, among other things, that the Troy Union Railroad Company might continue to maintain and operate its railroad in the city of Troy as located and constructed, and further “ That if the law passed by the Legislature of the State of New York, June 24, 1853, relative to the taxation of the property of the Union Railroad Company in Troy, shall at any time be repealed, the Common Council of the City of Troy shall join in an application to the Legislature of the State of New York, that the Troy Union Railroad Company be exempt from taxation upon an amount exceeding the present amount of its capital stock * * * *543and if such law not be passed, the Common Council of the City of Troy shall refund to the Troy Union Railroad Company an amount equal to the city taxes imposed upon the Troy Union Railroad Company for any valuation exceeding its present capital stock.” (See 26 R. C. L. § 264, p. 300; 60 L. R. A. 55.)
It was a further provision of the contract that in case of the failure of the constituent railroad companies who were parties to the contract to pay any of the installments of the principal or interest of the mortgage to the city of Troy, the right of such defaulting railroad company to use said Troy Union Railroad Company’s tracks and other property, should cease and thereupon its title and interest in said union railroad should vest in the city of Troy.
In 1886 the assessors of the city of Troy made an assessment against the property of the Troy Union Railroad Company in the sum of $783,984. A writ of certiorari was sued out and a review was had in which it was held that the assessment was improperly made and not in accordance with the law of 1853.
In 1901 the mortgage of the Troy Union Railroad Company and its constituent stockholders to the city of Troy was satisfied.
In 1909 the Legislature passed an act repealing the Exemption Act of 1853 (Laws of 1909, chap. 201). Then the assessors of the city of Troy in 1911 made an assessment against the property of the plaintiff of $1,000,000 and against the special franchise for $215,400. A review was had of these assessments in the case of People ex rel. N. Y. C. & H. R. R. R. Co. v. Mealy, and the question was tried out in that litigation as to whether the repealing act constituted an impairment of any contractual obligation upon the part of the city to the Troy Union Railroad Company and its constituent stockholders. The case went to the Court of Appeals (224 N. Y. 187) and the United States Supreme Court (254 U. S. 47), and was decided finally in favor of the assessors that the contract obligation had not been impaired.
Both the Court of Appeals and the United States Supreme Court were particular in their opinions to say that they did not pass upon the question as to the liability of the city to refund taxes under the contract of 1858 upon assessments exceeding $30,000.
Since 1911 the assessors have assessed the property of the plaintiff at its full value. The plaintiff has paid the taxes under protest. In 1921 the plaintiff, following the suggestion of the United States Supreme Court as to remedy, brought its action on the covenant contained in paragraph XI against the defendant to recover the sum of $288,241.59 for taxes paid since then up to the time of the commencement of the action.
The answer of the defendant to the contract is that it is ultra vires.
*544It is well established in the law that a municipality exercises merely delegated powers from the State to levy and collect taxes! It has no power to grant exemptions from taxation nor to make contracts looking to that result. (Brooklyn, Q. C. & S. R. R. Co. v. City of New York, 229 N. Y. 260, 266; People ex rel. Sweet v. Board of Supervisors, 101 App. Div. 327; Dillon Mun. Corp. [5th ed.] § 1610; Chicago, R. I. & P. R. Co. v. Union Pacific R. Co., 47 Fed. 15, 21.)
The challenge of the city is met by the railroad company with the contention that it has in good faith performed the contract of 1858, that the city has had substantial benefits therefrom and is estopped from claiming or proving its inability to make the contract.
The principle of estoppel has had wide use in this State as an answer to the plea of ultra vires. (City of Buffalo v. Balcom, 134 N. Y. 532; Mayor, etc., of N. Y. v. Sonneborn, 113 id. 423, 426; Moore v. Mayor, 73 id. 238; Vought v. Eastern Bldg. & Loan Association, 172 id. 508, 517.)
Under the circumstances of the case at bar estoppel cannot be availed of to overcome the plea of ultra vires, and this is said in the face of the determination in the Carter case that there was a valuable consideration for the contract of 1858, and conceding that contract to be a modification of that of 1852. (American Mfg. Co. v. Helena Hardware Co., 119 Ark. 282; People ex rel. Troy Union R. R. Co. v. Mealy, 254 U. S. 47.)
In this case it is not enough that there be valuable consideration. The -public interest requires that property assessable should bear its proportionate burden of support of the State.
In all of the cases which hold that an agreement may be made by a city for exemption from taxes it appears that an equivalent in money or services was rendered to such city. (Maine Water Co. v. City of Waterville, 93 Maine, 586; Cartersville Improvement, Gas & Water Co. v. Mayor, 89 Ga. 683; Hampton Beach Improvement Co. v. Town of Hampton, 77 N. H. 373; L. R. A. 1915C, 698; Grant v. City of Davenport, 36 Iowa, 396; Utica Water-Works Co. v. City of Utica, 31 Hun, 426; 26 R. C. L. § 262, p. 297; City of N. Y. v. Brooklyn, Q. C. & S. R. R. Co., 156 App. Div. 856.)
If there be no payment of taxes or the equivalent of them, then the public interest is flouted and public policy is set at naught. A quotation from Alexander Hamilton in the Federalist reveals the sensitiveness of government to the loss of power to tax: “ Money-is with propriety considered as the vital principle of the body politic; as that which sustains its. life * * * enables it to perform its most essential functions. A complete power, therefore, to procure a regular and adequate supply of it * * * may be *545regarded as an indispensable ingredient in every constitution. From a deficiency in this particular, one of two evils must ensue; either the people must be subjected to continual plunder as a substitute for a more eligible mode of supplying the public wants, or the government must sink into a fatal atrophy, and, in a short course of time, perish.” (Federalist, No. XXX, Hamilton.)
Neither the contract of 1852 nor the contract of 1858 contains any provision for the rendition to the city of an equivalent for future taxes.
The considerations moving to the city generally speaking under the first contract were but three. Of the three but one is mentioned in such contract, viz., 3, hereinafter set forth.
1. The removal of the tracks of the four railroad companies from River street. This consideration did not move from the defendant but from the four companies which had and used rights or privileges in such street. Ample consideration for the surrender of such rights and privileges was granted the plaintiff by the consent of the city to lay tracks in other streets. (Brooklyn, Q. C. & S. R. R. Co. v. City of New York, 229 N. Y. 260/266; Travelers’ Ins. Co. v. Mayor, 99 Fed. 663, 668, citing Memphis, K. & C. Railway Co. v. Thompson, 24 Kan. 170.)
2. Under the contract the plaintiff assumed the risk of expending $707,000 in the erection of a new depot and the construction of a new railroad. But actually the plaintiff assumed no risk. That was assumed by the constituent companies which agreed to indemnify plaintiff against loss. The plaintiff could assume no risk for it had no property to assume it with. All the property held in the name of the plaintiff under the terms of the contract belonged to and was owned by the constituent companies. Then too it must not be overlooked that the plaintiff received exemption from the State by the act of 1853 (Laws of 1853, chap. 462). Not for a consideration but as privilegia favorabilia. If it paid nothing to the State it is an easy inference that it expected to pay nothing to the city. Besides the plaintiff received in the property it acquired dollar for dollar for every cent it expended.
3. The policing of the streets against the dangers of crossing or passing trains.
Such duty belonged as well to the plaintiff under the general Railroad Act of 1850 and laid within the general and police powers of the city under its charter to regulate the use of its streets. (Tuttle Bros. & Bruce v. City of Cedar Rapids, 176 Fed. 86; City of N. Y. v. Brooklyn, Q. C. & S. R. R. Co., 156 App. Div. 856, 859.)
The purpose of the contract of 1858 was to extend the time of *546the payment of the mortgage. In 1858 neither the plaintiff nor its stockholders had any rights in River street to surrender. That had been done. (People v. O’Brien, 111 N. Y. 1.)
The risks of the venture had been assumed and were fait accompli. Every dollar of the money borrowed on the credit of the defendant to build a union station and new railway, as before stated, had gone into the coffers of the stockholders. The city received nothing new or otherwise under the reformed or new contract unless it were for the policing of the streets heretofore shown to be a duty primarily resting under the law upon the plaintiff.
The conclusion seems to be inescapable that neither of the agreements contemplated the payment of nor the rendition of service in value equivalent to taxes and that, therefore, the use of the plea of estoppel is superseded because the contract is at war with the public interest. (N. Y., N. H. & H. R. R. Co. v. York & Whitney Co., 215 Mass. 36, 40.)
No dollar of the plaintiff’s was laid out to accomplish a city purpose.
Estoppel will not lie for another reason. The character of the estoppel invoked is equitable. (2 Pom. Eq. Juris. [4th ed.] § 804.)
The solicitation on the part of the plaintiff for legislative authority for exemption apparent in the language of section XI, and the knowledge that nothing but the taxes or their equivalent would satisfy the demands of the law, sweep away the foundation of the claim of estoppel.
“ Where both parties have the same means of ascertaining the truth there can be no estoppel.” (Simplot v. Chicago, M. & St. P. R. Co., 16 Fed. 350.)
The plaintiff — rather the plaintiff’s constituent stockholders — have enjoyed an immunity granted by the State for fifty years. The burden of paying their taxes during all that time has fallen upon the remaining taxpayers of the city. That burden has been borne long enough. To impose it further upon the remaining taxpayers of the city would be unreasonable, unjust and inequitable.
Estoppel, though not favored in its use, constitutes a valuable remedy for the promotion of justice. On the contrary, its use should not be suffered to accomplish a wrong. To make a party whole it is useful; to secure an undue advantage forbidden. (Wormser v. Rubinstein, 89 Misc. 388; Pelletreau v. Jackson, 11 Wend. 110, 116; Pierrepont v. Barnard, 5 Barb. 364, 374; Pendleton v. Richey, 32 Penn. St. 58, 63; 21 C. J. 1118.)
Judgment for the defendant, with costs.