Central Railroad & Banking Co. v. Mayor of Macon

McCa.Y, Judge,

dissenting.

I agree, that, under the Act of 1853, and under the charter of the Macon and Western Eailroad, it is competent for the Central Eailroad Company to lease the Macon and Western Eailroad, and that it is also competent for the Macon and Western Eailroad to be leased. And were this contract *655only a lease, I should agree to the judgment of the Court. But, as I understand this agreement, it is for more than a lease. It is a contract, that if the Legislature consents, the Macon and Western Eailroad Company shall lose its separate existence, and be merged into the Central Eailroad Company. Now, as I understand the law, this is a contract that a majority of the stockholders of a company cannot make, either without or with the assent of the Legislature. Any one stockholder in either company may, of his own motion, and at his option, prevent it, unless the power be in the charter, or be assented to by all the stockholders. In every charter, there is first the contract between the company and the public, and second, the contract between the stockholders themselves. The leading idea of the latter contract is, that the majority may make every contract and do every act authorized by the charter, and no more. If it be desirable to get new powers inserted into the charter, all the corporators must assent to it. A subscriber who has taken stock in one enterprise, does not agree that the majority shall, even with the legislative assent, divert his funds to a new and different enterprise against his consent. And this I understand to be the settled rule of all the Courts, both in England and America. But it is replied, that admitting this to be the law, the argument before the Court is for the lease, and the contract to manage the companies is not a part of the lease; that in fact, it contemplates, on its completion, that the lease shall be merged into it; that it is an independent affair, and even if not itself within the power of the majority, that it does not affect this lease. I do not think so. The consideration of the lease is stated to be the mutual covenants of the parties, and one of these covenants is this agreement. Who shall say that one of the leading motives of those who have assented to the lease, was not that, as soon as the Legislature consented, the two roads should be merged? And without doubt, under this contract, if the Legislature does consent, either of the contracting parties can compel the other to con*656sent to this merger. If this be so, then the contract now entered into is a contract of merger, and in my judgment, must . have the assent of all the stockholders. At any rate, any one may dissent and break it up.

I think the State a proper party to this bill. As a matter of course, if the companies have the right to make the contract, the bill is not a good bill in the name of any body. If, however, this contract is contrary to the charter — an assertion of a franchise not granted to the company — 'then tiie attempt to make it is contrary to law, contrary to public policy, and the State has a right to be a party, either under its general power to prevent violations of the law, or by virtue of its interests in the Macon and Brunswick road.

The bill is filed on this idea, that the companies are violating their charter, not only infringing on the rights of the dissenting stockholders, but violating the public law, to-wit: setting up a chartered right that belongs to neither road. I think, therefore, the State was a proper party if the bill was good, and as I think the bill mas. gaad, I think the State a proper party.