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U.S. Supreme Court

Tioga Railroad v. Blossburg & Corning Railroad, 87 U.S. 20 Wall. 137 137 (1873)

Tioga Railroad v. Blossburg & Corning Railroad

87 U.S. (20 Wall.) 137


1. Where, in a judicial proceeding, the matter passed upon is the right under the language of a certain contract to take receipts on a railroad, the judgment concludes the question of the meaning of the contract on a suit for subsequent tolls received under the same contract.

2. The highest courts of New York, construing the statutes of limitations of that state, have decided that a foreign corporation cannot assail itself of them, and this notwithstanding such corporation was the lessee of a railroad in New York, and had property within the state, and a managing agent residing and keeping an office of the company.

Page 87 U. S. 138

3. These decisions upon the construction of the statutes are binding upon this Court, whatever it may think of their soundness on general principles.

4. No error can be assigned on a general finding.

The Tioga Railroad Company was a corporation duly organized under the laws of Pennsylvania, and was the proprietor of a railroad extending from Blossburg, a town in that state, a little south of the line between Pennsylvania and New York, up to that said line. The Blossburg & Corning Railroad Company was a corporation organized under the laws of the State of New York, and was the proprietor of a railroad connecting with the above-mentioned road at the state line and extending thence to Corning in New York; the two roads forming a complete line of railroad from Blossburg to Corning. The latter company had acquired its part of the road by purchase in 1855, succeeding to the rights of a former company called the Corning & Blossburg Railroad Company. By contract made in 1851, the Corning or New York end of the line was leased to the Tioga Railroad Company under certain terms and stipulations, amongst which was the following:

"For the use of the said railroad of the said Corning & Blossburg Railroad Company, and the use of their depots, enginehouses, machine shops, grounds, water stations &c., the Tioga Railroad Company agrees to pay to the Corning & Blossburg Railroad Company two-thirds of the receipts for passengers, mails, and freights which shall be taken for the said Corning & Blossburg Railroad, the expenses charged customers for the loading and unloading coal, lumber, and other freights, and for the warehousing, and such additional charges, by way of discrimination, as shall be made for short distances for motive power, not to be included in the term receipts, as above mentioned."

The parties soon disagreed as to the meaning of the words italicized. The lessees asserted that they were entitled to keep any excess of way-fares and freights for intermediate places and short distances above the through rates for those places, and did not account for, but retained the same, and

Page 87 U. S. 139

for this difference, running through many years, the Blossburg & Corning company, on the 6th of May, 1864, sued the other company in the court below.

Previously to the bringing of this, the present suit -- that is to say in January, 1855, the Blossburg company had brought a suit in the supreme court of New York against the Tioga company on the contract in question in which this question of difference was litigated. The record of that case, which went to final judgment (see 1st Keyes 486), was given in evidence in this one.

The present suit was brought for the same class of receipts which had accrued since the commencement of the former action. Besides the defense above mentioned, the Tioga company in this case pleaded the statute of limitations as to all receipts which accrued more than six years before the commencement of the suit. The plaintiff replied that the defendant was a corporation organized under the laws of Pennsylvania, and not created or existing under the laws of the State of New York, and that when the supposed cause of action accrued in favor of the plaintiff, the defendant (the Tioga company) was out of the State of New York, and so remained until this action was commenced. The defendant denied that at or since the commencement of the action it had been out of the state.

The significance of these pleadings was derived from the New York statute of limitations. The period limited for bringing an action of this kind is six years. But by the one hundredth section of the Code of Practice it is enacted as follows:

"If, when the cause of action shall accrue against any person, he shall be out of the state, such action may be commenced within the terms herein respectively limited after the return of such person into this state; and if, after such cause of action shall have accrued, such person shall depart from and reside out of this state, the time of his absence shall not be deemed or taken as any part of the time limited for the commencement of such action."

The Blossburg company insisted that as the Tioga company

Page 87 U. S. 140

was a Pennsylvania corporation, it could have no legal residence or existence in any other state than Pennsylvania, and hence that it was not in the State of New York when the action accrued, and had not been therein at any time since, and therefore could not claim the benefit of the statute of limitations. This the Tioga company disputed, and its counsel relied on certain sections of the Code of Practice of New York, which showed that foreign corporations might be sued in New York under certain circumstances, as where they had property in the state, or where their officers, agents, or directors are found within it, and were served with process. Thus, by act of 1851 (§ 134 of the Code), after providing for service of process on a corporation by delivering a copy to the president, secretary, treasurer, director, or managing agent, it is said:

"Such services can be made in respect to a foreign corporation only where it has property within this state, or the cause of action arose therein."

Or, by the Act of 1859,

"Where such service shall be made within this state personally upon the president, treasurer, or secretary thereof."

The case, according to the New York practice, in cases which it is anticipated may involve the examination of long accounts, was referred to and tried by a reference.

Evidence was given which, as the counsel of the defendant asserted, showed -- what he alleged was not denied --

"that during all the time of the existence of the contract of 1851, the Tioga company had property within the State of New York, an office at Corning, directors, officers, and agents, constantly within that state and at all times amenable to the process of its courts, and in fact, in 1855, that the Blossburg company availed itself of this condition of things by bringing a suit against the defendant for a portion of the demand claimed under the contract now in controversy, recovered judgment and collected the same, and that in fact this suit was commenced by personal service of a summons upon the defendant's agent at Corning. "

Page 87 U. S. 141

The referee refused to find as facts what is above stated in regard to the Tioga company, and found generally in favor of the plaintiff. Judgment being entered on the finding the case was now here on error.

Page 87 U. S. 142

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