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writing signed by them. Section 3 provides : After the terms of the consolidation have been agreed to in one or the other of the modes above set forth, “it shall be competent for the boards of directors in each of said connecting companies to carry the same into effect, and adopt by a resolution a new corporate name for the company which shall be formed by the consolidation, and to call in the certificates of stock then outstanding in each company, and exchange them for stock in the new company, as may have been agreed by the terms of consolidation; and a copy of said consolidation agreement and the resolutions of consolidation, and the name adopted for the new company, shall be filed with the secretary of state, and shall be conclusive evidence," etc. The fourth section is in these words: “ Any such consolidated company shall be subject to all the liabilities, and bound by all the obligations, of the company within this state which may be thus consolidated with one in the adjoining state, as fully as if such consolidation had not taken place, and shall be subject to the same duties and obligations to the state, and be entitled to the same franchises and privileges under the laws of this state, as if the consolidation had not taken place."
In Banking Co. v. Georgia, supra, the legislature of Georgia had created two corporations,—the Central Company and the Macon & Western Company. Their charters limited the right of taxation to one-half of 1 per cent. upon their net income. The companies were consolidated under an act passed in 1872; and the question was whether there was a surrender of the charter of the Central Company. The court said: “It may be that the consolidation of two corporations, or amalgamation, as it is called in England, if full and complete, may work a dissolution of them both, and its effect inay be the creation of a new corporation. Whether such be the effect or not must depend upon the statute under which the consolidation takes place, and of the intention therein manifested." It is further held that there was no surrender of the charter of the Central Company, but the ruling goes upon the ground that the act only contemplated a merger of the property and franchise of the Macon & Western Company into the Central Company; the latter retaining its name and charter. In Atlantic & G. R. Co. v. Georgia, 98 U. S. 359, two railroad companies had been incorporated under the laws of Georgia, -one in 1847, and the other in 1856. By their charters they were exempt from taxation beyond a specific amount on their net income. They were consolidated under an act of that state passed in 1863, which gave them power to consolidate their stocks, and, when consolidated, to be known as “ The Atlantic & Gulf Railroad Company.” By that name the stockholders of the companies were empowered to sue and be sued, to purchase and enjoy real and personal property, and to exercise corporate powers. The act also declared that the immunities, franchises, and privileges granted by the charters of the two companies should continue in force, except so far as they might be inconsistent with the act of consolidation. Under an act passed in 1874, the property of the new company was taxed as other property. This act of 1874, it was held, would be void, as impairing contracts, but for the act of 1863; and the court, in considering the effect of the consolidation, said: “Did the consolidated companies become a new corporation, holding its powers and privileges as such, under the act of 1863? Or was the consolidation a mere alliance between two pre-existing corporations, in which each preserved its identity and distinctive existence? Or, still further, was it an absorption of one by another, whereby the former was dissolved, while the latter continued to exist ? The answer to these inquiries must be found in the intention of the legislature, as expressed in the consolidating act. We think that intention was the creation of a new corporation out of the stockholders of the two previously existing companies. The consolidation provided for was clearly not a merger of one into the other, as was the case of Central R. & B. Co. v. Georgia, 92 U. S. 665. Nor was it a mere alliance or confederation of the two. If it had been, each would have preserved its separate existence, as well as its corporate name. But the act authorized the consolidation of the stocks of the two companies; thus making one capital in place of two. It contemplated, therefore, that the separate capital of each company should go out of existence as the capital of that company; and, if so, how could either have a continued separate being ?" The court then goes on to say, in substance, that, as this new corporation took its powers and privileges from the act of 1863, it took them subject to the laws then in force, and as a result the tax act of 1874 was held to be valid and binding on the new company. The same line of reasoning is pursued in the tax cases of Maine Cent. R. Co. v. Maine, 96 U. S. 499, and in Atlanta & C. A. L. R. Co. v. State, 63 Ga. 483. The effect of consol. idating three railroad companies into one, says the court in McMahan v. Morrison, 16 İnd. 172, "was a dissolution of the three companies named, and at the same instant the creation of a new corporation." A recent text-book says: “The franchises of a corporation formed by the consolidation of several companies are derived wholly from the act of the legislature authorizing the consolidation.” 2 Mor. Priv. Corp. (2d Ed.) S 944. The same doctrine is asserted in terms,
more or less positive, in the following cases: Clearwater v. Meredith, 1 Wall. (U. S.), 38; Shields v. Ohio, 95 U. S. 323; Lauman v. Lebanon Val. R. Co. 30 Pa. St. 42.
Now, the Alexandria & Bloomfield Company had, by its charter, a capital stock of $2,000,000, divided into shares of $100 each. The act of 1869 contemplates and provides for the surrender of the stock in both of the uniting companies; and accordingly we find it provided in the articles of consol. idation that the stock issued by each of the companies and outstanding, shall be surrendered, and shares of stock of the consolidated company issued therefor. The act speaks of the consolidated company as “the new company :
and the very process by which it is brought into being makes a new company, and the effect of the consolidation was to dissolve both of the old companies. It is true, the act of 1860 does not specially enumerate the corporate powers and privileges conferred upon the new company, but the corporate powers and privileges are granted by reference to the powers of the company in this state which unites with one of another state. There is in this respect some difference between this case and that of Atlantic & G. R. Co. v. Georgia, 98 U. S. 359. But as said in Maine Central R. Co. v. Maine, 96 Ú. S. 496, a new corporation may be as readily created by the union of two or more companies as by the union of individuals ; and its powers and privileges may as well be designated by reference to the charters of other companies as by special enumeration. The conclusion is irresistible that the Missouri, Iowa & Nebraska Railroad Company is a new coporation, created under and by force of the act of 1869. Being thus created after the adoption of the constitution of 1865, the legis. lature had no power to grant to it exemption from taxation. The exemption, therefore, did not, and could not, pass to the new company. We cannot see that the fact that one of the consolidating companies was a Missouri, and the other an Iowa, corporation, affects the conclusion just stated. The new company, in this state, is entitled to the privileges and subject to the obligations imposed upon it by the laws of this state ; and in Iowa it is a corporation of that state and subject to the laws thereof. By the legislature of both states, however, it is but one company,
We are cited to a number of cases which were suits on bonds, and involved the legality of subscriptions made by counties to railroad corporations. In some of the cases the subscriptions were made to this consolidated company, but we do not see that any of them are decisive of the question in hand. It must be kept in mind that exemption from taxation will not be recognized, unless granted in terms
too plain to be mistaken. Chicago, B. & K. C. R. Co. v. Guffey, 120 U. S. 569, 29 Am. & Eng. R. Cas. 200; St. Louis v. Trust Co., 47 Mo. 150, 155. Such an exemption is a personal privilege, and cannot be assigned except by legislative authority. State v. Chicago, B. & K. C. 'R. Co., 89 Mo. 536. If the consolidated company is in any sense a new corporation, taking its powers to be a corporation and its privileges from the act of 1869, then it cannot in justice claim the exemption; for the legislature was powerless to make new grants of that charter. It seems to us the tax cases before cited are quite conclusive. The answer sets up the proceedings in the suit of Scotland Co v. Missouri, etc., R. Co., before mentioned, and reported in 65 Mo. 123. That suit was commenced in 1873 to recover county and school taxes levied for the year 1872. The judgment which was for defendant, was affirmed in 1877. It is also alleged in the answer, and not denied, that James Setor and others, stockholders in the consolidated company, filed their bill in the circuit court of the United States for the eastern district of Missouri to enjoin the company from paying taxes levied by Scotland, Clark, and Schuyler counties, and to enjoin the county courts, judges thereof, and collectors of said counties from collecting any taxes levied upon the property of the company for the year 1881 or previous years; and that the temporary injunction was made perpetual on the ground that the property of the company was exempt from taxation. According to the answer, the bill was filed in 1881. The case seems to have been determined in 1881. 9 Fed. Rep. 809.
The taxes sued for here are for the year 1886, and they accrued long after those suits were commenced and determined. This suit is for a separate and distinct cause of action, and for this reason we do not see how the for- Res adjudicamer judgments can be a bar to the prosecuting of this suit. City of Davenport v. Chicago, R. I. & P. R. Co., 38 Iowa, 633. But we do not understand it to be claimed by the defendant, in this court, that those former judgments operate as a techinal bar. The claim is that rights have been acquired on the faith of the ruling in the Scotland County Case, followed in the injunction case; and to make a different ruling at this time would be to impair the obligation of contracts, and therefore violative of the constitution of the United States. The answer to this is that this court did not then pass upon the question whether the exemption from taxation passed to the consolidated company. The question of law was doubtless involved in the agreed facts in that case, but there were many other questions then controverted, and they were decided, and we adhere to what was then said in respect of the propositions of law which were actually, considered. It seems to have been asserted on one side, and conceded on the other, in this court at least, that the exemption did pass to the consolidated company, if the exemption clause in the Alexandria & Bloomfield Company had not been repealed; and the court simply stated the question as not a controverted one in that case. All this appears from the decision itself, and we do not see how it can be said the question which we have been considering was decided in that case. The proposition that the legislature can, in the face of the constitution of 1865, exempt property from taxation, is not to be regarded as established because of a concession made by counsel in some former case. It cannot be fairly said there was a solemn adjudication upon the point we have been considering. The judgment is affirmed.
ta-Rule of property.
Exemption from Taxation-Effect of Consolidation.-In Keokuk & Western R. Co. v. County Court of Scotland Co., 41 Fed. Rep. 305, THAYER, J., of the Federal Circuit Court of the Eastern District of Missouri, N. D., dismissed a bill for an injur.ction restraining the collection, or attempted collection of taxes against the railroad company, and followed the decision of the principal case in all respects. He said :-“ This is a proceeding begun on February 13, 1888, against the county courts of Scotland, Clark, and Schuyler counties, Mo., and against the several persons who at that time were judges of said courts, and also against the several collectors of revenue for said counties, to restrain them from collecting, or attempting to enforce the collection of, certain taxes assessed against a certain railroad extending through the counties aforesaid, which at the date of the filing of the bill belonged to and was being operated by complainant, the Keokuk & Western Railroad Company. The property in question formerly belonged to the Missouri, lowa & Nebraska Railway Company. Complainant acquired title thereto and possession on December 3, 1886, by virtue of foreclosure proceedings under a mortgage executed by the Missouri, Iowa & Nebraska Railway Company. The taxes in dispute had been assessed during the ownership of the mortgagor company, and complainant's contention is, in brief, that the property in question was exempt from taration while owned by the mortgagor company. That it was exempt from assessment after the purchase by the Keokuk & Western Railroad Com. pany is not claimed. Six months before the present bill was filed suit was instituted against the complainant in the state circuit court, under the revenue laws of the state, to recover a portion of the same taxes that form the subject of contention in this proceeding. That suit has recently been decided by the supreme court of the state, and it was held, in an elaborate opinion, that that portion of complainant's railroad situated in the counties of Clark, Scotland, and Schuyler, in this state, was not exempt from taxation while owned by the Missouri, Iowa & Nebraska Railway Company. State v. Keokuk & W.R. Co., ante, p. 694. The facts on which the claim of exemption from taxation is predicated are fully stated in the opinion last referred to. It will suffice to say that the exemption claimed was contained in a special charter granted to the Alexandria & Bloomfield Railroad Company, on the 9th of February, 1857, (Sess. Laws Mo. 1857, p. 94 ;) that the last-named company, by legislative permission, first changed its name to the Alexandria & Nebraska Railroad Company, and thereafter, on May 3, 1870, became consolidated with the lowa Southern Railway Company, a corporation of Iowa, under the name of the Missouri, Iowa & Nebraska Railway Com