Flash v. Conn.

time, and conditioned upon a suit being first brought against the company within a year after the debt becomes due; why it must follow that the contract cannot be executed alieno foro.

Suppose the law of New York limits the liability upon civil contracts made in that State to the term of six years from the accruing of the cause of action, is that such a qualification of the liability that the courts of another State will not enforce the contract within six years? Or suppose by the law of New York an action cannot be maintained against a surety, or guarantor, until a recovery against the principal, is that such a qualification of the liability that the courts of another State will not entertain a suit against the surety after judgment against the principal? Or if the liability is limited by statute to a certain pro rata amount of indebtedness, contracted by several individuals, or by a corporation, is that such a qualification that the liability will not be enforced in another State? And yet, if we understand the court in Halsey v. Mc Lean, it is the opinion of the court that in either of these cases the statute has so qualified the liability the courts of another State will refuse to enforce it. The court further remarks that it regards the principles laid down in Erickson v. Nesmith, 15 Gray, 221, as applicable to all the provisions of the New York act, which they examined in that case.

Turning to the case of Erickson v. Nesmith, we find that the Massachusetts court refused to entertain a suit where the liability arising under the charter of a New Hampshire corporation could be enforced by the law of New Hampshire only by bill in chancery, a law which the Massachusetts courts could not recognize as binding upon them, and in the nature of things only valid in New Hampshire, as it prescribed the particular form in which the remedy must be sought, the court holding "that when a statute creates and prescribes a remedy, that remedy is exclusive, and no other can be pursued." We cannot regard the New Hampshire decision as laying down any principle applicable to the case at bar which will preclude the courts of that State from entertaining this plaintiff's suit. The ruling of the courts of New York, where the company was incorporated, is to the effect that the stockholders are liable by the terms of the act of incorporation, which is the substance of their contract, in the first instance, for the debts of the company, not as insisted by defendant, upon the failure of the officers to file their certificate; but are so liable to the amount of

Flash v. Conn.

their stock until the happening of a certain event, for all the debts contracted to be paid within one year after suit and execution against the company in its corporate capacity. These terms are but limitations of the liability which was incurred by the contracting of the debt, and do not create liabilities depending upon any other event. A statute of limitation is not a qualification of a contract, so that the liability depends upon the happening of any event, but the event or lapse of time merely relieves against a suit; the right to a remedy ceases to exist. The limitation is for the benefit of the stockholder and a means of relief, and not a condition of liability.

A surety may sometimes demand that legal remedies shall be first exhausted against his principal before he shall be compelled to pay, but this is because the surety is already bound, and not because the liability is not fixed by his contract; that is operative already, and dependent upon nothing but its own condition. The stockholder here is a surety of the company of which he is a member, and his liability as a surety is a part of the contract entered into by becoming a member of the company. No event was necessary to charge him as a member except the contracting of a debt to be paid within one year, upon which suit must be brought within one year after the debt is due; and if this is not done he is discharged. This, and the amount of his unpaid stock, merely limit the personal liability upon the contract.

We have seen by the decision of the courts of New York already cited, that the personal liability of the stockholders, when they are made liable by the terms of the charter or act of incorporation, is from the inception of the debt. They are originally liable, and the remedy upon this liability may be enforced after the creditor has exhausted his efforts to collect from the company. Bird v. Hayden, 1 Rob. 383; Eaton v. Aspinwall, 19 N. Y. 119; Weeks v. Love, 50 id.; Derrickson v. Smith, 3 Dutcher (N. J.); Corning v. McCullough, 1 Comst. 47; Bank v. Price, 33 Md. 487.

In Van Riper, Ex parte, 20 Wend. 614, the court say: "The charter does not confine the creditor to any particular remedy. It raises in his favor a debt against an individual, and leaves his remedy to the general methods of the law. This view also answers another objection, that the remedy given by the charter is local to the State of New Jersey. The charter, in fact, institutes no remedy. It binds Van Riper as a debtor. It raises a debt against him, VOL. XXVI - 92

Flash v. Conn.

which may, in its own nature, be enforced wherever the debtor or his property can be found, according to the forms of law at the place where found."

In a suit against a stockholder of the Rossie Galena Company, where, by the charter, the stockholders were "jointly and severally, personally liable for the payment of all debts or demands contracted by the said corporation," but could not be sued until a judgment had been recovered against the corporation, and an execution returned unsatisfied, it is held that the stockholders in their individual, as well as their corporate capacity, were principal debtors. Harger v. McCullough, 2 Denio, 119; Moss v. Oakley, 2 Hill, 265; Bailey v. Bancker, 3 id. 188.

In these cases, as in Ex parte Van Riper, and in Corning v. MeCullough, the individual liability extended to all debts of the company, while in the case at bar the extent of the liability was limited by the charter to the amount of the capital stock owned by the defendant. In neither case is it apparent that the liability is in the nature of a penalty, and there is as much show of reason for classing it as a penalty in one case as in the other.

The defendant's liability as a stockholder, under the articles of association, clearly rests in contract and not in tort, or dependent upon the conduct of the officers or agents of the company, but only upon the non-payment of the debt by the principal debtor, and limited by the amount of his stock. If he has paid any of the debts of the company, that is matter of defense under his

contract.

We discover no substantial objection to the form of the allegation in the declaration. The gist of the action is the indebtedness of the company, the suit and judgment against the company unsatisfied, the amount of the defendant's stock and the fact that the liability has not been extinguished by the making and filing of the certificate as prescribed by the articles.

The judgment must be reversed, and judgment entered in favor of the plaintiffs upon the demurrer, and such further proceedings may be had according to law and the practice of the court as the parties may be advised.

Rehearing denied.

Johnson v. Pensacola & Perdido Railroad Co.

JOHNSON V. PENSACOLA & PERDIDO RAILROAD Co.

(16 Fla. 623.)

Common carrier — measure of compensation.

A common carrior is bound to carry for a reasonable remuneration, but is not bound to carry at the same price for all.*

A

SSUMPSIT against a railroad company. The opinion states the facts. Defendant had judgment on demurrer.

R. L. Campbell, for plaintiff in error, cited Chicago & Alton R. R. Co. v. People, 2 Railway R. 242; 67 Ill. 11 McDuffee v. Portland, etc., R. R., 52 N. H. 430; New England Express Co. v. Maine Central R. R. Co., 57 Me. 188; Messenger v. Pennsylvania R. R. Co., 7 Vroom, 407; Camblos v. Phila. & Reading R. R. Co., 4 Brewst. 563; Indianapolis, etc., R. R. Co. v. Rinard, 46 Ind. 293; Andenreid v. Phila. & Reading R. R. Co., 68 Penn. St. 370; Vincent v. Chicago & Alton R. R. Co., 49 Ill. 33; Eclipse Tow Boat Co. v. Pontchartrain R. R. Co., 24 La. Ann. 1; Shipper v. Penn. R. R. Co., 47 Penn. St. 338; Chicago, B. & Q. R. R. Co. v. Parks, 18 Ill. 460.

E. A. Perry, for defendant in error.

Under

WESTCOTT, J. [After disposing of a point of pleading.] the charter of this company it has the general power "to levy and collect tolls from all persons, property, merchandise, and all other commodities transported" on its road. There is no statute in this State regulating the matter of freights and charges by railroad companies. It is not denied that this company is a common carrier. We must, therefore, look to the common law for the settlement of the question involved.

The fact here stated is, that defendant compelled plaintiff to pay for lumber shipped over its road fifty cents per one thousand feet

* See Messenger v. Penn. R. R. Co. (37 N. J. 531), 18 Am. Rep. 754; s. c. (36 N. J. 407), 13 Am. Rep. 457; N. E. Express Co. v. Maine Cent. R. R. Co. (57 Me. 188), 2 Am. Rep. 31; Mo Duffee v. Portland & Rochester Railroad (52 N. H. 430), 13 Am. Rep. 72.

Johnson v. Pensacola & Perdido Railroad Co.

more than it charged another party for transporting lumber over its road at the same time, and the plaintiff insists that this difference of fifty cents was an illegal charge, and that he is entitled to judgment for $2,200, having been compelled to pay freight at that rate and in this manner on 4,400,000 feet of lumber.

The question here is, what was and is the extent of the obligation of a common carrier at common law to the public, when viewed in reference to charges for tolls and freights?

In Peek v. North Staffordshire Railroad Company, decided in the House of Lords in 1863, 10 H. L. Cases, 511, Mr. Justice BLACKBURN says: 'A common carrier is bound to carry for a reasonable remuneration." In one of the earliest cases upon the subject (Bastard v. Bastard, 2 Show. 81) it is said that "where there is no agreement as to price" (and this is really the best method by which to fix the common-law right), "the carrier might have a quantum meruit for his hire." This means simply that he could recover the value of his service. In Harris v. Packwood, 3 Taunt. 264, it is said: "A carrier is bound by law to carry every thing which is brought to him for a reasonable sum to be paid to him for the same carriage, and not to extort what he will." We cannot say that the carrier is bound to carry any thing beyond articles of such class as he is under a legal obligation to carry (3 Story, 34), but it is unquestionably true that his charge must be "reasonable." So in Comyn's Digest we find it announced that in the absence of an agreement for a price certain, the common carrier may have a quantum meruit. 1 Com. Dig. C., citing 1

Sid. 36.

In the case of the Citizens' Bank v. The Nantucket Steamboat Company, 2 Story, 35, Mr. Justice STORY, speaking of the hire or recompense of common carriers, remarks that "it may be in the nature of a quantum meruit." The same view is announced in 5 Wend. 340, and id. 350.

Says PARKE, B., in Pickford v. The Grand Junction Railroad Company, 8 M. & W. 378: "The carrier is bound to receive the goods on the money being paid or tendered, and the bailor to pay the reasonable amount demanded." In 2 Steph. N. P. 978, it is said "common carriers are bound to receive and carry the goods of the subject for a reasonable reward." In 1 Duval, 146, the Court of Appeals of Kentucky says: "A common carrier cannot, like a merchant or mechanic, consult his pleasure or caprice as to