State v. Morgan

Lxjdelixg, C. J.,

dissenting. This suit is to collect taxes, alleged to bo duo by the defendant on account of his Louisiana and Texas Railroad. The defendant claims that the capital stock and all property attached to the railway is exempt from all taxation.

Tho New Orleans, Opelousas, and Great Western Railroad Company was chartered by act of the Legislature in April, 1853.

The second section of the charter declares that “ tho capital stock of said company shall bo exempt from taxation, and its works, fixtures, workshops; warehouses, vehicles of transportation, and other appurtenances shall be exempt from taxation for ten years after the completion of said road within the limits of this State.” And act No. 194 of the General Assembly of 1856 provides that “ in addition to the powers conferred by law upon railroad companies, any railroad company established under the laws of this State may borrow, from time to time, such sums of money as may be required for tho construction or repairs of any railroad, and for this purpose may issue bonds or their obligations, secured by mortgage upon the franchises and all the property of said companies,” etc. Acts of 1856.

Section nine of the charter of the company also authorized tho conr-pany to borrow money on bonds, and “ to secure said bonds by mortgaging-the property of the company, in whole or in part, as they shall deem proper.” Acts of 1853, p. 121.

*493Under these statutes the company executed two thousand bonds oí one thousand dollars each and secured their payment by mortgaging the completed grand division oí the road, extending from New Orleans to Brashear, including depots, lands, equipments, franchises, etc.

After the war this mortgage was foreclosed, and Charles Morgan bought the railroad with its franchises from New Orleans to Brashear, that is, the property covered by the mortgage. Subsequently, he purchased the other portions of the road to the State line, which was partially graded, with the franchises, etc. Thus he became the owner of the entire road, with all the rights' and franchises of the original company.

I am at a loss to imagine why the property is not exempt from taxation. The Legislature had unquestionably the power to exempt the property from taxation, and it did exempt it, and it authorized the franchises to be mortgaged and sold. Morgan acquired at public sale all the property and franchises of the company. Is not the exemption from taxation a franchise property ? At this day this is not an open question in this country. 7 Cranch. 165; 1 Black. 536; 8-Wall. 437; 13 Wall. 264, 269; 16 Wall. 244; 18 Wall. 392; 20 Wall. 36; 21 Wall. 492; 11 Ala. 437; 28 Ala. 321; 4 Met. 200; 30 Vermont 182; 70 Penn. 355; 17 Conn. 40; Redfield on Railway, 477, 480.

By the textual provisions of the Code, not only corporeal objects may be sold, “ but also incorporeal things, such as a debt, an inheritance, a servitude, or any other rights.” C. C. 2449.

Franchises, therefore, are incorporeal hereditaments, known as a species of property, as well as any estate in lands. ' Bouvier says: “A franchise is a certain privilege conferred by grant from the government.” Worcester defines it to be “ a certain privilege or exemption bestowed by grant from the government and vested in individuals — immunity.”

Had the franchise been forfeited ? I think not. There is no limit to the grant, except that it should cease to exist after ten years after the completion of the road to the State line. The road is not yet completed. It is said, however, that the defendant is not trying to complete the road. Be that as it may, no steps have as yet been taken to forfeit the grant, and, in my opinion, it can not be done in this suit.

I therefore dissent from the opinion of the majority of my associate justices.

Rehearing refused.