port of their claim that they had acted in good of Smith & Kohlsaat. In accordance with this faith, being ignorant of the incapacity of the city. suggestion appellants carried their books of acBut if they could not be permitted to make such a count and certain vouchers relating to the vessel, plea for themselves in a suit of their own, upon to the office of Smith & Kohlsaat, who prepared what principle can the defendant be permitted to an account and a surviving partner's inventory, make it for their advantage in a suit to which they presenting the former in the latter part of May or are not parties? We think it is very clear that he tirst part of June, 1870, to the appellee, who said can not be permitted to do it.

it was all wrong, and filing the inventory in the Of course we regret the predicament in which county court during said month of June. A balthe furnishers of the entertainment will find them- lance of about $800 in favor of the estate was selves in consequence of this decision. We trust, found by Kohlsaat. On May 28, 1870, appellant however, that their fellow-citizens will not leave paid to appellee $800, which the latter receipted them without assistance.

for as being to apply on money in appellant's We direct that the injunction be made perpetual. hands, received from insurance of the brig Robert

Burns, and belonging to the heirs at law of Henry
L. Curran, deceased.

A suit for damages to the Robert Burns from a ACCOUNT— STATUTE OF LIMITATIONS IN

collision with another vessel was then pending, in EQUITY-CONSTRUCTIVE TRUST.

which judgment was a fterward rendered in favor MCKEOWN v. GUILD.

of the Burns for $475 50, one fourth of which,
$118 12 deceased's share, was paid to appellant

September 6, 1870, and his receipt taken.
Supreme Court of Minois.

In November, 1872, appellee brought an action (Filed at Ottawa, June 21, 1879.[

at law against appellants in the circuit court of

Cook county, which involved the same subject1. ON A BILL IN EQUITY for an accounting by an matter as this suit wherein a judgment against administrator of one partner against another, the stat

appellee by non-suit was entered July 2, 1874. ute of limitations is a bar, as in a court of law, and the mere fact that the funds in the hands of the latter

The bill in this case was filed June 4th, 1875. may be considered a trust, and that, too, a construc

The statute of limitations is set up as a bar to tive trust only, does not operate to remove the bar of this suit, it being that “actions on unwritten conthe statute.

tracts expressed or implied *** and all civil ac2. IN ORDER TO TAKE A CASE out of the statute of tions not otherwise provided for, shall be comlimitations, it is not sufficient that the debtor admits menced within five years next after the cause of the account to be correct but he must go further and

action accrued." Rev. Stat. 1874 p. 675 $ 15. Our admit that the debt is still due and has never been

statute in regard to the action of account provides paid.

that such action may be sustained by one joint SHELDON, J., delivered the opinion of the court:

tenant, tenants in common or copartners, against This was a bill for an accounting filed by Alex

the other or others, by one or more co-partner or ander Guild, Jr., as administrator of the estate of

co-partners against the other co-partner or coHenry L. Curran, deceased, against Thomas

partners to settle and adjust their co-partnership Quayle and James McKeown, as joint owners and

accounts, and dealings on book accounts, by and against

and administrators partners with Curran in the ownership and navi


all gation of the brig Robert Burns.

cases in which the same might have The master in chancery to whom there had been

been maintained by and against their testator or a reference of the cause to take and state an ac

intestate. Rev. Stat. 184 p. 100. No time of limitacount made his report stating a balance against

tion of such action specifically is provided, thence the defendants of $2,200 59. Hxceptions filed by leaving the five years limitation above named for both parties to the report were overruled and a

actions not otherwise provided for, applicable. decree for this balance was rendered against the

Story, speaking of bills for an account remarks: defendants, from which they appealed to this

“In cases of this sort, where the demand is strictly court.

of a legal nature or might be cognizable at law, It appears that on March 25, 1867 the appellants

courts of equity govern themselves by the same and Curran purchased the brig, the former taking

limitations as to entertaining such suits, as are a three-fourths and the latter a one-fourth inter

prescribed by the statute of limitation in regard to est in the vessel. The brig was employed in the wood

suits in courts of common law in matters of acand lumber trade on the lakes for the seasons of

count. If therefore the ordinary limitation of such 1867 and 1868 and until the 16th of Nov. 1869 when

suits at law be six years, courts of equity will fol. she was lost with all on board including Curran,

low the same period of limitation. In doing so who was then sailing her as captain. On May 13,

they do not act, in cases of this sort (that is, in 1870, the appellee was appointed administrator of

matters of concurrent jurisdiction) so much upon the estate of Curran. The appellants, who had

the ground of analogy to the statute of limitations, acted for the brig on shore, collecting the freight

as positively in obedience to such statute." 1 Eq. and paying the expenses, desired the appellee to

Jur. $ 529 and see Hancock v. Harper 86 Mi. 146. state the account between them and the estate.

Tharp v. Tharp 15 Vt. 105. This he declined, but recommended to them as a

The entire account here involved had accrued proper person to do it. Mr. Kohsaat, of the firm previously to May 25, 1870. So transaction on

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apply here, the payment made by appellants of $118.12 on the 6th of September, 1870, takes the case out of the statute. We do not see that this was such a payment within the five

ears as would draw the general account after it, because the general account since May 25, 1870, was no longer admitted by appellants to be an open and current account, but they had rendered an account stating the balance due which they had paid and which was in the full adjustment of it, as may be supposed to have been claimed by them. The collision suit for damages to the Robert Burns was pending at the time of the payment made May 25, 1870, judgment in which was afterward rendered in favor of the Burns, and this payment of $118 12 was the one-fourth part of that judgment. The payment was not in the general account, but was specifically appropriated by both parties to the claim growing out of the collision suit, and it is not perceived how this can be construed into an admission of anything with respect to the general account, much less promise to pay. In order to take out of the statute of limitation there must be a promise to pay the debt. It is not sufficient that the debtor admitted the account to be correct etc., but he must have gone further and admitted that the debt was still due and had never been paid. Ayers v. Richards, 12 Ill. 146; Wachter v. Albee 80 III 47. Holding the plea to be a bar to the suit, the decree will be reversed and the cause remanded for further proceedings in conformity to this opinion.

Decree reversed.




the general account has since occured. The present suit was instituted more than five years afterwards. So far as we can see the bar of this statute of limitations set up must be held to be a good defense. The same subject matter of the demand here might have been made the subject of an action at law to wit: an action of account, and where there is a legal and an equitable remedy in respect to the same subject matter, the latter is under the control of the same statute bar with the former. Kane v. Bloodgood, 7 Johns. Ch. 117.

There are but two answers made by appellee against the allowance of the bar of the statute.

1. That as surviving partners in possession of the partnership assets the appellants occupied the position of trustees, citing King v. Hamilton 16 Ill. 190; and Nelson v. Hayner, 66 m. 487; and that the statute of limitations does not apply in cases of trust.

In Albretch v. Wolf, 58 III. 186, this court held the following language: “In Farman v. Brooks, 9 Pick. 213, it was held that the statute of limitation does not apply to direct trusts created by deed or will, and perhaps not to those created by appointment of law, such as executorships and administrations, but constructive trusts resulting from partnerships, agencies and the like are subject to the statute. The doctrine of that case is supported by good authority. Walker v. Walker, 16 Sergt. & Rawle, 379. Kane v. Bloodgood, 7 Johns. Ch. 98. Merwin v. Titsworth, 18 B. Mon. 582." Wilhelm v. Caylor, 32 Md. 151, is an authority to the point, that the rule with respect to the bar of the statute of limitations is equally applicable in the case of a bill for an account by one partner against another, as in other cases of a bill for an account. See Weisman y. Smith, 6 Jones Eq.. 124.

The trust here claimed we regard as but a structive trust and so subject to the statute of limitations, and even were it a case of proper trust, which would be within the application of the statute, we would be inclined to consider that the accounting with the appellee and the payment made to him on May 25, 1870, was an abandonment by appellants of their fiduciary character; that their relationship thereby became adverse and that the statute from that time would begin to

Albretch v. Wolf, Hancock v. Harper, supra, Ang. on Lim. $174. The account made out and presented by appellants or their attorney to appellee, although not assented to by the latter, purported to be a full statement of the account between appellants and Curran, showing a balance of about $800 to be due the estate of the latter, to be a statement of the whole amount due from appellants and was equivalant to an open denial that anything more was due. The payment by appellants to appellee of $800, May 25, 1870, though not so stated in the receipt, is reasonably to be taken as having been made by appellants on their part as and for the balance due from them as found by the account rendered. This would seem to amount to an open denial or repudiation of the trust which required appellee to act as upon an asserted adverse right.

2. It is next claimed that even if the statute does





Supreme Judicial Court of Massachusetts, September

Term, 1878.


A promissory note, upon which the defendant was surety, was given by a depositor who kept an ordinary account with the plaintiff bank, and who was treasurer of the town of E, to the plaintiff, and plaintiff gave said depositor for said note a draft to be used for the payment of a tax due from the town. Said note, and the proceeds of it, were not made a part of said depositor's account with the bank, and the bank regarded said note as an official or town matter. When said note fell due, there stood to the credit of said depositor, as his balance account, a sum less than the amount of said note. At and ever since the maturity of said note, the plaintiff held another note for a larger amount, made by said depositor, and upon the maturity of the latter note, the president of the bank instructed the cashier to apply said balance upon the latter note. Thereafter the defendant brought to the bank a check of said depositor, made after the maturity of said last-mentioned note, and a sum of money, and tendered the same in payment of said first-mentioned note, but the cashier declined to

receive the same, because he had been directed to ap- he had been directed to apply the balance o ply said balance on said other note. In a suit against Benjamin's account on another claim held by the said surety on said first-mentioned note: Held, that

bank, meaning the $1,500 note. After this refuhe was not entitled to have said balance of account

sal the cashier did, at defendant's request, receive applied to the satisfaction of the note in suit.

the $120 and indorse the same on the note in suit,

it being at the same time understood that neither This case was tried without a jury. The court

party intended thereby to waive his rights in found the facts to be as follows: The action is

reference to the check. brought against the defendant as indorser of a

The $120 have been retained by the bank. About promissory note for $500, made by Joseph A. Ben

six weeks ago the $381.10 were îndorsed on the jamin, and all things necessary to hold defendant

$1,500 note as of February 16, 1876. It is not the as indorser were done at the maturity of the note

practice of the bank to charge over due notes held on February 15. 1876. On said February 15, and

by it to the account of a depositor until he has ever since, said bank held a note, which it had

sufficient credits to pay the note. It did not apdiscounted, made by the said Joseph A. Benja

pear that defendant informed the cashier or plainmin, a copy of which is as follows:

tiff bank on February 19 aforesaid, that the $120 $1,500. So. Egremont, Nov. 13, 1875.

was Benjamin's money. The said Benjamin beThree months after date I promise to pay to the

came a bankrupt in the spring of 1876, and died order of E. Elmore Callender fifteen hundred dollars at the National Mahaiwe Bank, Gt. Barrington,

in July or August of that year. The amount

which the plaintiff is entitled to recover, if at all, value received. Jos. A. BENJAMIN.

is $135.10, if judgment were rendered at the And indorsed in blank by said Callender.

present term. The said Benjamin kept an ordinary account

The court ruled and found for the defendant, with plaintiff bank. At the time of giving the

and reported the questions raised for the determinote in suit, Benjamin was treasurer of the

nation of the Supreme Judicial Court. If said rultown of Egremont, and plaintiff gave Benja

ing is correct, judgment is to be entered for the demin for the note a draft to be used for the payment of a tax due from the town. The note and the pro

fendant; but if the plaintiff is entitled to recover,

judgment is to be entered for the plaintiff for said ceeds of it were not made a part of Benjamin's

sum of $380 and interest from February 16, 1876, account with the bank, and the bank regarded the to time of judgment. note as an official or town matter. When the note in suit fell due on February 15,

M. Wilcox for defendant. J. Devey for plaintiff. 1876, there stood to the credit of said Benjaman as GRAY, C. J., delivered the opinion of the court; his balance of account the sum of $381.10, and Money deposited in a bank does not remain the the same continued to remain so standing on the property of the depositor, upon which the bank books of the bank until about six weeks before has a lien; but it becomes the absolute property of the trial.

the bank and the bank is merly a debtor to the On February 16, 1876, the day of the maturity depositor in an equal amount. Foley v. Hill, 1 Philof the $1,500 note. Mr. Dodge, the president of the lips 399, 2 H. L. Cas. 28; Bank of Republic v. bank and its principal financial manager, during Millard, 10 Wall. 152; Carr v. Nat. Security Bank, business hours told the cashier if the $381.10

107 Mass. 45. So long as the balance of account standing to Beniamin's credit was not checked to the credit of the depositor exceeds the amount out by him before the close of business hours, to of any debts due and payable by bim to the bank, apply it on the $1,500 note before mentioned. At the bank is bound to honor his checks, and liable the close of the bank for that day it was found that to an action by him if it does not. When he owes Benjamin had drawn no checks on said balance, to the bank independent debts, already due and and he then again directed the cashier to apply it payable, the bank has the right to apply the balon the said $1,500 note.

ance of his general account to the satisfaction of On February 19, 1876, the defendant brought to any such debts. But if the bank, instead of so apthe bank a check of Benjamin's made and handed plying the balance, sees fit to allow him to draw to defendant on that day, but bearing date Febru- it out, neither the depositor nor any other person ary 15, 1876, a copy of which is as follows:

can afterward insist that it should have been so apSouth Egremont, Mass., Feb. 15, 1876. plied. The bank, being the absolute owner of the National Mahaive Bank pay to the order of J. money deposited, and being a mere debtor to the A. B., Treas., note 15 inst., three hundred and

depositor for his balance of account, holds no eighty-one dollars, $381.

property in which the depositor has any title or JOSEPH A. BENJAMIN. right, which a security on an independent debt Defendant also had at the same time one hun- from him to the bank can avail himself by way of dred and twenty dollars in money which had been subrogation, as in Baker v. Briggs, 8 Pick. 182, and furnished him by said Benjamin at the same time American Bank v. Baker, 4 Met. 164, cited for the with the check, and defendant acting at Benja- defendent; that the right of the bank to apply the


balance of account to the satisfaction of such a

debt is rather in the nature of a set-off, or of an check and $120 in money in payment of the note application of payments, neither of which, in the in suit, and demanded the note. The cashier de- absence of express agreement, or appropriation, clined to receive the check and money, and told will be required by the law to be so made as to defendant he could not accept the check because benefit the surety. Glazier v. Douglas, 32 Conn.

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ness hours tendered to the cashier of the bauksaia de




39 Field v. Holland, 6 Cranch, 828; Brewer v. Knapp. 1 Pick. 333; Upham v. Lefevre, 11 Met. 174: Bank of Bengal v. Radakissen Mitter, 4 Moore P. C. 140, 162.

It is accordingly well settled that when moneys drawn out and moneys paid in, or other debts and credits, are entered, by the consent of both parties, in the general banking account of a depositor, a balance may be considered as struck at the date of each payment or entry on either side of the account; and when by express agreement or by a course of dealing between the depositor and the banker, a note or bond of the depositor is not included in the general account, any balance due from the banker to the depositor is not to be applied in satisfaction of such note or bond, even for the benefit of a surety thereon, except at the election of the banker. Clayton's Case, 3 Merid. 572, 610; Bodenham v. Purchas, 2 B. & Ald. 39, 45; Simpson v. Ingraham, 2 B. & C. 65; s. C. 3 D. & R. 249; Pemberton v, Oakes, 4 Russ. 154, 168; Pease v. Hirst, 10 B. & C. 122; s. C., 5 Man. y. Ryl. 88; Heumker v. Wigg, Dar. & Min. 160, 171; 8. C., 4 Q. B. 792, 795; Strong v. Foster, 17 C. B. 201; Martin v. Mechanics Bank, 6. Har. & Johns. 235, 244; State v. Armstrong, 4 Dev. 519; Commercial Bank v. Hughes, 17 Wend. 94; Allen v. Culver, 3 Denio, 284, 291 Newburg Bank v. Smith, 66 N. Y. 271; Voss v. German American Bank, 83 Ni. 599. In the decision in McDowell v. Bank of Wilmington and Brandywine, 1 Harring. (Del.) 369, and in the dicta in Dawson v. Real Estate Rank, 5 Ark. 283, 298, cited for the defendent, this distinction was overlooked or disregarded.

In many of the cases indeed, the money appears to have been deposited after the debt to the bank matured, so that the case was analogous to the ordinary one of a payment, which, not being appropriated by the debtor, might be appropriated by the creditor. But where the balance of account is in favor of the depositor when his debt to the bank becomes payable, it is a case of mutual debts and credits, which except in proceedings in bankruptcy or insolvency, neither the depositor nor his surety has the right to require to be set off against each other. Judge Lowell in allowing money on deposit to the credit of a bankrupt to be set off in bankruptcy against the aggregate debt due from him to the bank, said: “This deposit, though it operates as security and as payment, was not intended for either, but is made so by the bankruptcy of the debtor.". In re North, 16 Bank. Reg. 420. See also Demman v. Boylston Bank, 5 Cush. 194; Strong v. Foster, 17 C. B. 217.

In Strong v. Foster a depositor gave to his bankers a promissory note with a surety, which was not entered in his general banking account; and it was held that the surety, when sued by the banker on the note, could not set up either as payment or equitable defence that shortly after it matured the balance of account was in favor of the depositor to a greater amount, and the plaintiff did not apply that balance in discharge of the note, or inform the defendant for three years that the note remained unpaid. But the reasoning of the court applies equally whether the balance in

favor of the depositor exists at the time when his debt becomes payable, or is created by subsequent deposits. Chief Justice Jervis said: “Here the note was never entered in the account at all; the rule as to adjusting balances, therefore, does not apply. It would be essentially altering the position of the parties to establish that, because a banker who holds a note of a third person for a customer, has a balance in his hands in the customer's favor at the maturity of the note, such third person is thereby discharged, if it turns out that the note was given by him as surety. There is no authority in equity for any such position, and none certainly in law." 17 C. B. 216, 217. And Mr. Justice Willes observed : “As to what was said on the part of the defendant that, if a set-off arises between the creditor and the principal debtor, the liability of the surety on the note is extinguished; that doctrine would lead to singular results. These securities are often given to increase credits of bankers to their customers, If the liability of the maker were to depend upon the state of the customer's account any one moment, he might


the liability templated at all. The security is given without any reference to the other side of the account. This is the first time, I believe, that it has ever been suggested that when a note given under circumstances like these falls due, and there is a balance in favor of the customer at the time, that balance must of necessity be applied to the discharge of the note. Where the security is passed into the account, of course, it follows the rule in Bodenham v. Purchas and that class of cases." 17 C. B. 224.

In the case at bar it appears that the consideration received by Benjamin from the plaintiff bank for the note in suit was to be used by him in his: official capacity as town treasurer, and that the note was regarded by the bank as an official or town matter; and neither the note nor its consid-eration was ever made part of his general banking account; and that when the check in favor of the defendant was drawn by Benjamin and presented. at the bank, the bank held the personal note of Benjamin, exceeding in amount the balance of account in his favor at the time. Under these circumstances neither Benjamin, the maker, nor the defendant, the indorser, has the right to insist that this balance of account should be applied to the satisfaction of the note in suit, rather than of the other note of Benjamin, and according to the terms of the report, there must be judgment for the plaintiff.

A provision in a building contract that the con-tractor should not, without the written consent of the owner, assign any of the moneys payable thereunder, under penalty of forfeiture, etc., is for the benefit and protection of the owner alone, against the dereliction or insolvency of the contractor, and if an instalment of the moneys not yet due be assigned to: materialmen, and notice thereof given to the owner without his exception, subsequent creditors of the contractor can derive no advantage therefrom.-Burnett v. Jersey City, New Jersey Court of Chancery.

SPECIAL CHARTERS CONSTITUTIONAL The plaintiff asks that the defendants be enjoined LAW-COMMON HIGHWAY.

perpetually from exercising corporate rights as the Lawrence Bridge Company; from demanding

or receiving tolls; from obstructing or removing STATE V. LAWRENCE BRIDGE CO.

the bridge or highway and from all interference

therewith. To the petition of plaintiff the defendSupreme Court of Kansas.

ants pleaded that by the act of the late governor

and legislative assembly of the Territory of Kan[Filed Sept. 24, 1879.]

sas, entitled “An Act to Incorporate the Lawrence

Bridge Company,” approved February 9, 1858, 1. THE CORPORATION KNOWN AS THE LAWRENCE

the exclusive right and privilege of building and BRIDGE COMPANY, organized under an act of the ter

maintaining a bridge across the Kansas River at ritory of Kansas, approved February 9th, 1858, and

the City of Lawrence, was granted for the period the acts amendatory thereto, with the exclusive right and privilege of building and maintaining a bridge

of twenty-one years to defendant, C. W. Babcock across the Kansas river at the city of Lawrence, was

and others, or their assigns and such other perdissolved in twenty-one years from said February 9th, sons as might be associated with them for that 1858, by expiration of the time limited for its contin- purpose; that they and their associates, or a mauance by the special statute under which it was jority of them, were authorized to form a comcreated.

pany to be known as the Lawrence Bridge Com2. THE PROVISIONS OF SECTION 25, chapter 23, pany, with a capital stock of $375,000, in shares of General Statutes , are invalid and void, so far as they $100 each; that power was given by that act to attempt to authorize corporations organized under prescribe by-laws for the regulation of the comspecial acts of the territory of Kansas, to continue in

pany, and receive and collect subscriptions to the enjoyment and exercise of the powers, privileges

such capital stock, establish and collect tdlls for and franchises, conferred on them by their special acts of incorporation, without any limitation as to time, as

crossing the bridge; that under said act and cerin conflict with section 1 of article 12 of the State Cons

tain amendatory acts thereto, C. W. Babcock titution.

and his associates duly organized the Lawrence 3. IN 1863 THE LAWRENCE BRIDGE COMPANY con

Bridge Company, and before Oct. 1, 1863, constructed a bridge over the Kansas river at the city of

structed and completed the bridge across the Lawrence, for the convenience of the public, in the river at Lawrence, at the cost and expense of hope of profit to be derived from tolls as authorized $75,000, and have ever since maintained and by its special charter. Since 1863, the bridge has been been in possession of it; that to continue and perused as a thoroughfare uninterruptedly and without petuate the existence of the Lawrence Bridge molestation, except tolls have been demanded and ta- Company, with all the privileges and franchises ken from all persons crossing the bridge. The corpor

conferred on it by the provisions of the said act of ation had no property in the approaches to the bridge,

incorporation of 1858 and acts amendatory therenor in any of the lands on which it was built. The bridge is an immovable structure and an extension of

to, the corporation, on February 8th, 1879, by a the highway over the Kansas river. Held, that the

vote of its board of directers accepted all the bridge is a public highway. When the corporation provisions of the act of the legislature of the State expired by limitation, its franchise or license to de- entitled “An Act Concerning Private Corporamand or take tolls also expired, and the free use of tions.” approved February 29, 1868, and all acts said common highway is in the public.

of the legislature of the State amendatory to that

act, applicable to the exclusive right and privilege Original proceedings in quo wurranto; J. W.

of building or maintaining a toll bridge across the Greene and J. P. Usher for the State; Clough &

Kansas River at Lawrence and the collection of Wheat and G. J. Barker for defendants.

tolls, but said corporation did not abandon by HORTON, C. J. delivered the opinion of the

such acceptance any privilege or franchise con

ferred in its acts of incorporation, consistent court:

with the provisions of the general incorporation This is an action in the nature of quo warranto,

act of 1868, and that, therefore, by virtue of secbrought originally in this court by the State of Kansas ex rel. James W. Green, county attorney

tion 25, of said general incorporation act of Febof Douglass county, as plaintiff, charging C. W.

ruary 29th 1868, Gen. Stat. 196-7, and by the filing

of the certificate of acceptance, the bridge comBabcock, and his associates, with wrongfully assuming to exercise corporate rights as the Law

pany from February 8th, 1879, has had the exclu

sive right to carry out its objects, as described in rence Bridge Company, and with claiming and

the special acts of its incorporation, without any using, without any lawful warrant, grant, or

limitation as to time, and is still the owner of the charter, the liberties, privileges and franchises of

bridge, with all its original franchises and privihaving and maintaining a bridge over and across

leges, including the franchise of being a corporathe Kansas River, at the City of Lawrence, and

tion and the taking of tolls. Some other matters of asking, demanding and taking certain tolls and

are stated in the answer, but it is unnecessary to duties of and from persons crossing, passing over

refer more fully to it. and using the bridge. The petition also alleges that the bridge is a highway across the river at

The twenty-one years given by the special act Lawrence, and the only means accessible to the

of February 9th, 1858, incorporating the Lawrence public of crossing the river for many miles on

Bridge Company, within which it had the right to either side of the bridge.

build and maintain a bridge across the Kansas

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