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and 140 New York State Reporter The relator is a foreign corporation organized under the laws of the state of New Jersey, and having its principal office at Jersey City. It also has a branch office in the city of New York. Its business is that of buying and selling grain, hay, and feed and storing the same. Its capital stock as provided by its articles of incorporation was $25,000. It began business by buying a mill in New Jersey and paying $22,000 therefor, and the remaining $3,000 was invested in personal property in New Jersey. No dividends were paid for the first three years and a large amount accumulated, to wit, about $125,000, which the relator calls surplus. This accumulation was at least in part reinvested in the active business of the corporation, and the moneys expended in New York state and taxed here are undoubtedly part of this accumulation. The dividends paid within the last year amounted to $50,000. This was assumed by the Comptroller to be 200 per cent. upon the $25,000 of capital named in the certificate of incorporation, and the tax was assessed upon that basis. After a rehearing the Comptroller refused to reduce the assessment, and by this writ the relator seeks to have the determination reviewed.
Argued before SMITH, P. J., and CHESTER, KELLOGG, COCHRANE, and SEWELL, JJ.
A. Dudley Britton, for relator.
SMITH, P. J. We do not agree that the relator should be entirely exempt from taxation on the ground that all of its capital was employed within the state of New Jersey, and that the amount held to have been employed as capital within this state is a part of the company's surplus. 'To uphold such a contention would be to open the way to an easy evasion of the tax law of this state. Sce, also, People ex rel. Commercial Cable Co. v. Morgan, 178 N. Y. 433, 70 N. E. 967, 67 L. R. A. 960. In the case cited, Judge Werner, in writing for the court, says:
"In construing this section of the corporation tax law, the authorized issue of the share stock of a corporation needs to be considered only as fixing the limit beyond which the corporate franchise cannot be taxed in a case where all of the corporate capital is employed within this state."
Nor can it be material that the money was expended upon leased ground, and that the structures erected thereby might become in law the property of the owner of the ground. It is nevertheless capital employed within this state, whether invested in structures upon leased ground or upon ground that was the property of the corporation itself.
If these moneys be deemed a practical increase of capital stock as is suggested by Judge Bartlett in People ex rel. Singer v. Wemple, 150 N. Y. 46, 41 N. E. 787, then the dividend should be estimated as a dividend upon the increased amount of capital stock. The capital stock authorized by the charter to the amount of $25,000 was actually invested in New Jersey. It appears that the amount of $12,500 in round numbers was in addition invested in this state. The $50,000 of dividends should be estimated, then, as paid upon a capital stock of $37,500, instead of upon a capital stock of $25,000. Otherwise the surplus actively used in this state would be deemed capital stock, for the purpose of taxation, but not capital stock for the purpose of determining the amount of taxation. This would be an unnecessary construction of the statute, and in my judgment an unjust one. The as
sessment should therefore be modified to this extent, and, as modified, the determination of the Comptroller should be affirmed, without costs.
Determination of the Coinptroller modified, and, as modified, affirmed without costs. All concur.
(JJ Visc. Rep. 555.) GANNETT V. INDEPENDENT TELEPHONE CO. OF SYRACUSE et al.
(Supreme Court, Special Term, Onondaga County. August 20, 1907.) 1. TRIAL-OBJECTIONS-TIME.
Where, in a suit to restrain the erection of a telephone pole in a street opposite plaintiff's property, it was assumed by both sides that the street was a city street in a thickly populated district, plaintiff could not for the first time on the argument object that there was no evidence but that the locus in quo, though within the city limits, had the characteristics
of a rural highway. 2. EVIDENCE-JUDICIAL NOTICE-POPULATION OF CITIES.
The court will take judicial notice of the census showing the population of a city within the state.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 20, Evidence, $ 17.] 3. MUNICIPAL CORPORATIONS–STREETS-CHARACTER-EVIDENCE.
In a suit to restrain the erection of a telephone pole in a street in front of plaintiff's residence, evidence that the locus in quo was within half a mile of the center of a city having a population of more than 100,000, and in a block 340 to 350 feet long, on which there were seven residences, and that the street was paved with concrete and sustained two street railway tracks, was sufficient to make the street a city street in
a thickly populated territory. 4. TELEPTIONES PROPER USE OF STREET-HIGHWAYS.
While the erection and maintenance of a telephone line in a country road between the center and exterior road lines, on property held by the adjoining owner in fee, is an additional burden not within the public use, the erection and maintenance of such line in a city street in front of the premises of an adjoining owner is within the public easement and a proper street use.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 45, Telegraphs and
Telephones, $ 6; vol. 36, Municipal Corporations, $ 1403.] 5. SAME-FRANCHISES-RIGHT TO USE STREET.
A public telephone company, organized as provided by Transportation Corporations Law, Laws 1890, p. 1151, c. 506, art. 8, obtains its right to use the public easement in streets for the construction and maintenance of its lines directly from the Legislature independent of the ordinances
of the city, except such as provide police regulation. 6. INJUNCTION-NOMINAL DAMAGES-DENIAL.
Where, pending suit to restrain a telephone company from erecting a pole in a street in front of plaintiff's premises, in violation of a city ordinance requiring the company's predecessor to place all wires underground, such ordinance was repealed, and a new one passed authorizing the erection of poles in accordance with maps approved by the commissioner of public works, whereupon a map was filed and approved showing the pole in question, which facts were pleaded by a supplemental answer, complainant was no longer entitled to more than nominal damages, which were insufficient to sustain an injunction.
(Ed. Note.-For cases in point, see Cent. Dig. vol. 27, Injunction, $ 307.] Action by George O. Ganett against the Independent Telephone Company of Syracuse and another. Complaint disinissed.
and 140 New York State Reporter This action was brought by the plaintiff to restrain the Syracuse Telephone Company of Syracuse and its alleged successor, Independent Telephone Company of Syracuse, defendants, from placing a pole and stringing wires in front of the plaintiff's premises on the westerly side of Townsend street, in the city of Syracuse. The plaintiff maintains that the defendants were attempting to act in violation of the express ordinances of the city of Syracuse bearing upon the subject, were in the act of creating a public nuisance to result in special injury to his property in attempting to locate the pole aud string the wires, because they had no franchise or consent from the public authorities of the city authorizing their proposed action, and that their proposed action would be an invasion of his property rights. The plaintiff's house and lot are situated on the west side of Townsend street in the city of Syracuse, and he owns the fee to the center of the street in front of his premises, subject to the rights of the public to the use of the street for street purposes. The plaintiff's premises are situated within a half mile of the center of the city of Syracuse, a city of more than 100,000 inhabitants. The defendant Syracuse Telephone Company, a domestic corporation, was organized under article 8 of the Transportation Corporations Law (Laws 1890, p. 1151, C. 566) in the year 1899. The defendant Syracuse Telephone Company established a telephone system in Syracuse with an exchange in 1899, and continued to conduct that system until December, 1905.
In 1896 a certain telephone franchise was granted to Eugene Hughes & Co., which required notices to be filed with the city clerk of intended construction by said company, stating exact location of poles, their dimensions, the height above ground, the number of wires to be suspended thereon, etc., and providing that such construction should not be made until approved by the commissioner of public works or the common council. This franchise became the property of the Syracuse Telephone Company. In 1899 the common council of the city passed an ordinance giving the Syracuse Telephone Company permission to erect poles and string wires in the streets of the city, and requiring, among other things, that the poles should be erected and maintained at such points as least to obstruct the streets or interfere with their use fulness and in suitable places with reference to trees standing in the streets, and requiring the approval of the common council or commissioner of public works of the location and eharacter of the poles, number of wires to be suspended thereon, and the height of the same from the ground, before they should be erected or located. The ordinance contained a reservation of the right to require the company to remove its poles and place its wires underground at any time. On the 7th day of January, 1901, the common council passed an ordinance requiring the company to place its wires underground and not upon poles erected in the streets. June 30, 1905, the defendant Independent Telephone Company was organized under article 8 of the Transportation Corporations Law. It acquired all the capital stock of the Syracuse Telephone Company and made use of its exchange. At that time the Syra. cuse Telephone Company discontinued the active operation of its plant and has never since operated the same. On or about October 30, 1905, the defendant Independent Telephone Company began the cunstruction of a telephone line on the westerly side of Townsend street, and was engaged in digging a hole on the west side of Townsend street between the center of the street and the plaintiff's house, when this action was brought and a temporary injunction obtained prohibiting the proposed construction in front of the plaintiff's premises. The Independent Telephone Company up to that time had not obtained from the city authorities any consent or direction relating to the proposed construction. On the 11th day of December, 1905, the common council repealed the ordinance of January 7, 1901, requiring the Syracuse Telephone Company to place its wires underground. At the same time the common council passed an ordinance requiring the Independent Telephone Company, as the successor of the Syracuse Telephone Company, to file with the commissioner of public works all applications for permission to erect poles, accompanied with maps showing the proposed location of the poles, authorizing the commissioner of public works, in behalf of the council, to direct the points at which the poles might be erected and maintained, and forbidding the erection of any more poles without compliance with the ordinance.
Thereafter, and on February 16, 1906, the defendant the Independent Tele phone Company filed an application and maps showing its proposed construction and the location of the proposed pole in front of the plaintiff's premises, and obtained the consent of the commissioner of public works for such construction. Thereupon the defendants served a supplemental answer, setting forth the repeal of the ordinance of January 7, 1901, and the passage of the said ordinance of December 11, 1905, the filing of the application and map, and the consent of the commissioner of public works above referred to; the court having given permission to serve such supplemental answer upon certain terms. There are two ordinances of the city prohibiting any person from injuring or tearing up any pavement, street, or cross-walk, or digging any hole or trench in any street, without first obtaining permission of the commissioner of public works in writing; and prohibiting any person from erecting any pole in the streets, sidewalks, or public squares of the city, or extending any wire for telephone, telegraph, or electric purposes in or across any street or public square of the city, without permission by ordinance of the common council.
George W. O'Brien, for plaintiff.
DE ANGELIS, J. The fundamental question in this case is whether or not the use of a city street for the maintenance of telephone poles and wires is a street use. Upon the trial of this cause, it was assumed by both sides that Townsend street was a city street in a thickly populated district. After the evidence was closed, and upon the argument for the first time, the counsel for the plaintiff raised the point that there was no evidence in the case but that the locus in quo, although within the city limits, was sparsely populated and had the characteristics only of a rural highway. In view of the course of the trial, I think it was too late to raise that point; but, beyond this, the court will take judicial notice of the census, which shows the population of Syracuse to be considerably over 100,000. The evidence shows that the plaintiff's residence is within a half a mile of the center of the city; that it is in a block from 340 to 350 feet in length, on which there are seven residences; that the street had been known by the plaintiff for nearly 60 years; that 60 years ago there were but a few houses on the street; that it has been built on since; that the street is paved with a concrete pavement; and that there are two street railroad tracks in the street. I think enough was shown to bring the street within the category of a city street in a thickly populated territory.
The Eels Case (Eels v. American Tel. & T. Co., 143 N. Y. 133, 38 N. E. 202, 25 L. R. A. 640) establishes the rule of property in this state to be that the maintenance of a telephone line in a country road between the center line and the exterior line of the highway upon property, where the owner holds the fee to the center of the road, is an additional burden, not conteniplated by the original dedication of the highway, and not within the scope of the public use. The reasoning of the court in that case has been the subject of considerable criticism; but, in whatsoever light that reasoning may be regarded, that case establishes a rule of property in this state.
But a distinction has been made between city streets and rural roads or highways in respect of the public easement. Whether this distinction is well founded in its last analysis does not require discussion here.
and 140 New York State Reporter In the present condition of the adjudicated cases, I think I am required to hold that the maintenance of a telephone line in front of the plaintiff's premises on Townsend street is within the public easement and a proper street use. Castle v. Bell Tel. Co., 49 App. Div. 437, 63 N. Y. Supp. 482; Johnson v. N. Y. & Penn. T. & T. Co., 76 App. Div. 564, 78 N. Y. Supp. 598. These cases were both decided in this department, and, while I recognize that there is a distinction between what was actually decided in the cases and the questions arising in the case at bar, the discussion in the two cases which I deem it my duty to accept upholds the contention of the defendants in this case.
It seems to me that, with this proposition settled, the plaintiff can have no private injury to be redressed in this litigation, for it must be conceded that there was no attempt in this case to invade the property of the plaintiff or interfere with any of his private rights. There is no doubt but that telephone companies get their right to the use of the public easement in streets directly from the Legislature, but subject to police regulation by the municipal authorities. Village of Carthage v. C. N. Y. T & T Co., 185 N. Ý. 448, 78 N. E. 165. I am inclined to the belief that the Independent Telephone Company of Syracuse was engaged in constructing its line in front of the premises of the plaintiff in its own right, and hence was not subject to any of the ordinances affecting the Syracuse Telephone Company. But assuming that the Independent Telephone Company was extending the lines of the Syracuse Telephone Company, and in its right and subject to the restrictions of the ordinances, the rescinding of the ordinance of January 7, 1901, and the filing of the map and the approval of the proposed construction by the commissioner of public works, on the 16th of February, 1906, which the defendants were enabled to prove under their supplemental answer, would leave at most a technical cause of action for trespass with the possible right to the recovery of six cents damages, which would not justify by any possibility the exercise of the injunctive power of the court, or entitle the plaintiff to a recovery in this case. I do not think the general ordinances of the city put in evidence by the plaintiff affect the questions under consideration.
My conclusion is that the complaint be dismissed, and the temporary injunction dissolved; but, in view of the supplemental answer, without costs to any party or parties in favor of any party or parties. Findings may be prepared and submitted.
(121 pp. Div. 366.)
TOMPKINS V. J. & R. LAMB.
(Supreme Court, Appellate Division, Third Department. September 26, 1907.) 1. SALES-REMEDIES OF BUYER-BREACH OF CONTRACT.
A purchaser under an executory sale may have an action for breach of the contract as well as for a breach of warranty or upon a rescinded contract.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 43, Sales, $ 1146.) 2. SAME-EVIDENCE-SUFFICIENCY-ACCEPTANCE.
In an action for breach of a contract of sale of a monument, evidence held to sustain a verdict that there was no acceptance of the monument,