Daniel P. Holland, Appellant, vs. The State of Florida et al., Respondents, 15 Fla. 455

WESTCOTT, J., delivered the opinion of the court. The judgment of the court below, from which this appeal is taken, was a judgment sustaining the demurrer of the State to the answer of defendant, Daniel P. Holland. Defendant, Daniel P.

Holland, claims to be the owner of the road and of the franchises granted to the corporation known as the Jacksonville, Pensacola and Mobile Railroad Company, by virtue, as he alleges, of a purchase of all of the property and franchises of that corporation at :a sale under an execution obtained by him against the corporation, he being the purchaser at such sale. ■ ’ The State, while denying the validity of any such sale under the statutes of this State, affirms that it is immaterial what passed at said sale; that the State had a lien upon all of the property and franchises of the corporation ; thát this lien existed anterior to. the rendition of the judgment ; that such lien is and was admitted by the corporation; that Holland can claim only through .the company; that he takes by his sale, if anything, the interest of the defendant in' execution, and no more. ■ - ■' I do not propose to determine whether such Sale as defendant Holland claims was here had .was-void, or was' authorized by the statutes of this State, and upon this subject will simply say that this is an open-question in -this ' State.

The determination of this question is not necessary to the disposition of this case, and I examine the case upon ■ the hypothesis that such sale can be had, this’being all that’ the appellant here can or does ask in this respect. "While the entire, court agrees with m.e as to the equities and present status of the.

State, and as to the propriety .and necessity of determining her rights in, the premises, yet the other members of the court go, further, and decide -whether such sale, as is claimed was here had, was authorized by the statutes.-, Upon, this question I express no opinion, further than to'say that the general rule is that such sale cannot be had unless it is authorized by statute. . As to the effect of. the statutes of this i ¡State, I express no.opinipn. . . Do the,facts, which the State .sets up„, in, the complaints, original and supplemental, and not, put in issue by defendant,.

Holland,, show equities which entitle , it-to a sale of the property and franchises of this corporation, and -the -applb cation, of .the .proceeds to the payment ,;of t¡h¡e indebtedness alleged, notwithstanding-the purchase by Holland? .. .. ,The .effect, of suqh a.sale as-is.-claimed.w,as here had,by Holland, whpn, viewed- in reference to:the rights of.parties holclipg,,,a, priqrmnd,,paranmunti,ilien,...di#'prs; in-, n.o..essential point from ofher spies, of property under-jupior securities ,or, lieps. ■ , , . ¿ .... ., .. ,, . , | , ... ‘ Ip speaking of precisely such sale,ps .Hollppd^heip ciaiims,;, ike;.^aí,^rf>f0all tbc property aiid franchises.,, ofj p.cA'-’ppratiop.by .a ¡judgment.,.-creditor under.¡a,- .statutory., pow.qr,.;an'd ;ip)determining its o^Eecft :wj$p,,refer€®p.ii?ito> pripr ¡ liens ...equities; against,the, judgmenf,... debtor,, .¡Mi;.,, ..jBp^t.dley,,, spealpngpfojr, the.,Snpr,em:(|1,1,-, Copj;t of the Únftéd..States’ (11 Wall. 476 and 477) “ A. sale .under, $.jupipr,s’epTOtfoprist. bftsnb.ordjinate.^o one,.,, that if.^ppipr p-n(|.paramoiint..,,¡,Successive sgles.,of JhQ'.sayne,/:, franchiso.ST..c^pmp(r,m9rp^b.?;; ‡§§íp^4pgppipati^liei,.than,speee^y^j^,es,pf..tbessgip,ñjp^j0r^.j,.;^nd.y^}bfeo®¡ífe?,^.?’5. saIq,o£dapd,..ún(|e;rí ar judg.mont>Upgs., not,:. ip the;;sHglffest.,:. of, the.

«písame. lapfLinay A company., m%b$topp.gd, erty of the company at an execution sale must be estopped. It has frequently been held that such a purchaser takes only the right, title and interest which the debtor had, subject to the equities which existed against the property in his hands when the judgment was recovered.” This' doctrine as to •ordinary sales of land by judgment creditors, the plaintiff in * execution being the purchaser, is universally acknowledged by all the States.

In the case just referred to, it is applied to precisely such sale as is claimed was here had. “ The purchaser has a right to what he gets and sells,” and nothing more. Caveat, emptor is the rule. He takes only the interest of the defendant. If the defendant has no interest, then the buyer gets nothing. (McGee vs. Ellis, 4 Litt. 244; 18 Vmt. 390 ; 4 Dev. & Batt. 160; 4 Litt. 244; 14 Vmt. 325.) If, therefore, the State has any equitable lien superior and prior to Holland, and this lien is in a condition to be enforced and no good defense to the action is urged, that is an end of the case.

To this question I address myself. The claim of the State arises from bonds of the Jacksonville, Pensacola & Mobile Railroad Company,,which were exchanged by the company with the State for bonds of the State. This exchange was made under, the provision of

an act entitled li

An act to alter and amend

an act entitled

an act to Perfect the Public Works of the State, approved June 24, 1869 ; approved January 28, 1870.” This act provided : “ That in order to aid the said Jacksonville, Pensa-: cola & Mobile Railroad Company to complete, equip, and maintain its road, and to aid in perfecting one of the public works embraced in the internal improvements of the State, the Governor of the State is hereby directed to deliver to the President of the said company coupon bonds óf the State to an amount eqijal to sixteen thousand dollars per mile for the whole line of road and length of railway owned ;by. or belonging tó said Jacksonville, Pensacola & Mobile Railroad Company in exchange for first-mortgage bonds of said railroad company of the denomination of one thousand dollars, ’ when, the President thereof shall certify upon his oath that the road or parts of road for which he asks for an exchange of bonds is completed and is in good running order.' The1 said: bonds shall be of the denomination of one thousand dollars, signed by the Governor, countersigned by the Treasurer, sealed with the great seal of the State; shall bear eight per cent, interest, payable semi-annually, and shall be payable to bearer.

They shall, be dated on the first day of •January,. A. D. 1870, and shall be due .thirty years thereafter,- and principal and interest shall be payable at such place in the city of New York as the Governor shall designate. The coupons for inter.es? shall be payable to bearer, and shall be authenticated by the written or engraved signature of the Treasurer: Provided, however, That whenever the Jacksonville, Pensacola-■& Mobile. Eailroad Company, shall or may determine to pay the- interest in gold for or upon their bonds, or the bonds designated in the tenth

section of

an act entitled

an act to Perfect the Public Works of the State, approved June 21,1869, upon giving notice to the Governor of such intention, then the State bonds afore-, said and the coupons for interest on said bonds shall be payable in gold, notice of which shall be given by the Governor in some paper published in the city of New York and at the capital of this State, to- be designated by the Governor.” The 10th

section of the: act of June 21,1869, provided that “in exchange for the bonds of the State above described, the President of the company shall deliver to the Governor of the State coupon bonds of the company,, bearing a like, rate of interest, payable to the State of Elorida, authenticated by the written or engraved signature of the President. ■ The bonds shall. be of such denomination, not less than,, one thousand .dollars, asthe^ said company may choose, and principal and .interest shall be payable at the same. time, and place as the aforesaid State bonds.” The act of 28th January, .1870, provided' ; “ To secure the principal and; interest of the said':company bonds,-the State-of Florida shall, by this act, have a statutory lien, Which-shall be valid to "all -intents andpurposes as a first mortgage-duly" registered oñ the part of the road, for Which the State- ■ bonds-were delivered^ and1 on all the property of the com-' pany’real and -personal1 appertaining^ to -that part of the' line, which it may-now have, or ínáy hereafter acquire, togethef '-With all the rights, YranehiSes, arid " powers thereto- ' belonging, and in case-of failure" Of the company: to pay ■ either principal Or interest of its -bonds, or any part thereof, tor twelve-months after the Same shall become due, if shall • be lawful for" the Governor to enter upon1 and tafeé possession1 - of said property and franchises, and-sell the samé at public auction, > after- having first given- ninety days’ riotieé, -by " public advertisemérity in at- least one newspaper publishedin each Of the following -places: The city of New York, in •• the State of ;-New 'York ; the-: city of Savannah, in the State " of Georgia;"and the city of Tallahassee, - in- the State Yf’1 Florida, for-lawful money of the United’States, and1 for’ nothing élsé, except that- the State,- for its own protection, may become the purchaser'at sáid sale, andinay pay on sriid purchase any evidences of indebtedness the State may holdagainst said road, which purchase money, or said- evidences of indebtedness, shall 'bé' paid on thé day of sale into’the Treasury of this State,1-Or within-tcri- days thereafter ; and all moneys arisingirom said-sale; arid -paid into the Treasury of’this - State, as "‘heretofore prescribed,’ -shal!-be-prdxñptly and-exclusively applied-to -the payment and satisfaction of the "bonds issued by the-1 State of -Florida under -this act; and iri case "the holders of said bonds do not present them for- redemption within-ninety days after Sáid sblep’thé'TféaS-' " urer'shall invest'the samej of -any-part thereof, which may be'rémaiñing'in his hands,, ;in'-the secrifities of the United " States,- to he hekl by the State of Florida, as": Trustee for the bondholders, until said; bondholders shall' démárid thé ' same, upon which demand the Treasurer shall ' immediately turn- over or -pay 'said 'securities te 'th'é boridHóld'érs:f"' The A purchaser or purchasers of said road shall be by said sale ■.pósSesséd of all the rights, privileges, and'franchises of said ■defaulting company, together with the franchise of use and 'being a body politic; and the Governor shall, upon the pay■inent of the said purchase money into the Treasury Of this State as above provided, immediately cause the purchaser hr .purchasers of said road, at said sale, to be placed in the actual possession, use, and enjoyment thereof, and cause all the books, papers, and real and personal property of said company of every description, together with the franchise of use and being a body politic and corporate; and may us,e any new corporate «name they see fit, and make and use a new seal, upon signifying their action in writing to the Governor, and thereafter may exercise all the rights Of a body ‘corporate, and privileges thereof, and of said defaulting "company, under said new name for the term of thirty-fiye years, to date, from the time of the purchase as aforesaid. ‘That any such sale shall be' ratified by the legislature before the same shall become effective.” ’ This act further provided : “ That the Governor shall, for the purpose of further aiding said Jacksonville, Pensacola & Mobile Railroad Company in the speedy construction of its road, deliver to the President of the said company coupon bonds of this State, of the same charácter as those above described in this act, to the amount of sixteen thousand dollars per mile, upon receiving for and from the President of said company first mortgage bonds of like amount, on any part or portion, of the road between Quincy and Jacksonville: Provided, however, The State bonds under this

section shall not be exchanged for first mortgage bonds .'for a greater length than one hundred miles of any part of railroad between Quincy and Jacksonville: Provided, The Said railroad company or companies shall not issue first-mortgage bonds to a greater amount than sixteen thousand -dollars per mile.” ■ The first question which arises in reference- to this legislation is whether it was within the power of the Legislature to issue the bonds here: authorized to be issued.

The Constitution authorizes the Legislature to issue bonds “for seeuringthe debt, for the erection of State buildings, support of State institutions, and. perfecting public works.” This court has already determined and decided that this clause ip the Constitution is a limitation upon the-power of the Legislature in the matter of issuing State bonds. : Mi; In Cheney, et ux., vs.

Jones, 14 Fla., 587, this court,, ip construing this clause, said: “ The power of the' Legislature of this State over the subject of issuing State bonds-is'limit-, .ed by the provisions..of the Constitution, because.it has pre-; scribed the several subjects and, occasions for' and upon which the Legislature may authorize their issue.” “It,-is not necessary that a limitation of power should- be framed in express terms., If a power .is, granted to do certain, things, as, for instance, the levying of taxes, for certain specified- and enumerated purposes, and it is mot essential to the ¡carrying put of the purposes of tire government that any such power should be exercised, except for , the purposes specified, the effect of such prescriptions, is, equally prohibitory.as,-tp the purposes not specified,,as, though ,,the prohibition wer.e declared in affirmative terms. ' (Cool.

Con. Lims, 64, 87, 176 15 N. Y. R. 543; 30 Iowa, 9; 13 Mich. 127, 158 ; 21 Rep. St. 147; 1 Story’s Con. Sec, 448.) ’’ -In, speaking, of th# power to issue bonds, a ,question involved.;in the, case,-the .court-said: “And , as • to, the ¡power .to-issue bonds, of- the State thcUonst-itution.'provides;-that--the- Legislature shall .have- po.w.er,,for-,-issuing: State, bonds,, bearing interest,ifer securing the.deb,t,.and ipr, the. erection of.-State? buildings, support of.

State institutions, ¡and..perfecting., public;works, ;and by the- same rulelounded, in -principle, and sustained'!,by f authority-in upbrolcen.-;Currents,:,it, is equally.-prphibitorytas though it should declare that the Legislature, shall; havenp .ppwer to pro-vide.-for .therissiie-.of.■;bonds,;,except for,:securing the debt,” &c. ■ “The power Of the-Legislature to issue bonds wás circumscribed and limited to the issuing of bonds for: securing existing public indebtedness, the'erection of State buildings, the support of State institutions* and perfecting public works.

The Constitution has. specified-these as the objects for which bonds may be authorizedi The purpose and: intent of the Constitution must, have'been to limit -the exercise of the legislative power upon this subject, for we. must impute to it some purpose, and some object to be accomplished by it: : If that was not the object, we must disregard it entirely* for it would be-utterly meaningless.” • This clause being thus a limitation upon the power of the Legislature, the question next arising is, -is the line of road, authorized to be- aided by the act, one of the public works, to perfect-which the Legislature was authorized to use the credit of the State ?

What were these public works ? ■ We do not think that this question can be better answered than in the language of the Justices of this court, in reply to an Executive communication,-bearing date the'-6th of February, A. D.1871. (13 Fla. 699.) Two of the questions propounded in the Executive communication of the 6th of February, A. D. 1871, were: “ Are railroads public works referred to by the Constitution?

Has the Legislature power, under our Constitution, to aid in the construction and completion of these public Works V,’ To the first question Chief Justice Randall replied (13 Fla. 721): “ I answer that* according to the common idea as'to what a railroad- is, they are pnblie works. They are constructed, ■ whether by the State or the citizen, for the use and convenience of the 'public for purposes of travel,’ of facilitating commerce and commercial and social intercourse, of affording markets for all the productions of the country.

They enhance values, encourage and promote immigration, increase the extent of productive agriculture* ánd áre like natural streams — public -necessities, - - the' highways upon which, all may trayel and transact business, access to them, being open to all the'people on equal'terms, Und can be denied t'o none.

The action Of the several branches of the-Government of this State, in reference to railroads and like enterprises, and in view of which action the terms of the Constitution were doubtless used, have given us an unmistakable guide in determining the meaning of such terms employed in it on this subject as seem to require interpreta,tion.” , • . To the second question, which was, '“Hgs the Legislature power,.under .our Constitution, to aid in the construction of these public, works ?'” the Chief Jussice ■ replied: “ This, in the form presented, admits, in my judgment, ■neither an affirmate nor a negative answer.

The language of the Constitution is special. . The term * perfecting ’ does not mean in its broad sense, ‘ constructing ’ public works. If the framers, of'that; instrument had intended, that the Legislature might have power to authorize an unlimited bonded, indebtedness for the general inauguration and construction of public Works, they would not have used a, term which merely includes the completing or finishing wor%s of public utility already . authorized and incomplete.

As is suggested by my brother Westcott, and as everybody, knows, who has examined the legislation of this State and recognizes the existence of a system of internal improvement, . long since inaugurated by the. people through the legislative branch of the State Government, this system was in progress of development and completion at the time of the adoption of the Constitution..There was • but one system or series of such public measures in progress, and none, I .believe, under• the exclusive control of the State.1 My opinion is, that the terms ‘ perfecting public works’ refers strictly to the completion of such public works, including railroads, as were projected and; in progress, or partially constructed, at the time of .the , adoption of that phrase in the fundamental law of the .State.” ■ In answer to the same Executive inquiry I used this language:- “ The clause, an

interpretation-of which you desire, isas follows: 4 The Legislature -shall have power to provide for issuing State bonds, bearing interest, for securing the debt, and- for the erection of State buildings, support of • State institutions, and perfecting public works.’ ” ' Upon,-the- - face of -this clause it is seen -that the term public works is-used in contradistinction to State buildings and State institutions. If this is not so, and a public work,, within the-meaning of tlje clause, is the same thing as a State institu- - tion or building, then the term public works-is surplusage— is unnecessary.

This court held, in 12 Fla. 205, an early case involving the construction of a clause in the Constitution that such a construction of a clause in the Constitution as made one portion of it surplusage is not to be given, if the clause in question is capable of receiving another intelligent and consistent construction.

The term “ State-building ” has a more enlarged signification, indicating, in a limited and strict sense, such institutions as the State establishes to discharge its duty in the matter of the administration of the criminal'laws, such as State prisons, as well as such as it establishes to discharge its duty to the unfortunates of society, such as the indigent, insane, the deaf and dumb, the blind, and others in like conditions. The terms “ perfecting public works,” in my opinion, clearly indicate, and mean, that works of a public character,- already commenced, are to be perfected.

They indicate something inchoate, something began, but not u perfectedand which should be perfected or finished. The inquiry at once presents itself, were there any such works of this character and in this condition when the present Constitution was-framed % .

It is unnecessary to cite authorities to show that a clause of this character, in a Constitution framed under the circumstances that our present Constitution received its existence, must be interpreted in,- the light of the then, present conditions of things, as -well as with reference to the-past ¡legislative and judicial history of the State in this respect.' In the light of the past history of this State, and guided by the action of the Judicial arid Legislative Departments of the Government, I inquire, what unperfectéd public works are here referred to?

At once we say that these words cannot, and do not, refer to any works owned exclusively by the State, for there were none such, either commenced or perfected. There was no such thing as a State institution, in its strict sense, existing in the State,1 to which these terms could be held to apply. What had been the action of the Legislative, Executive and Judicial branches of the Government upon this subj'eet anterior to that time?

The'first Constitution of this State — the Constitution of 1839 — was framed by' a body, of men of distinguished ability — by men who knew what were the proper functions and the legitimate powers of a State in the complex system of government obtaining in this - country — by men Who undeffetood as well the State’s proper relations to the General Government as they did her duties to her ówri citizens.

Believing, as they no doubt did, that it was the peculiar, if not exclusive province of the State to aid in the construction of internal improvements,' the benefits of which should be confined principally to State limits, and that it was proper to invest the Legislative Departmént of the Government with the discretion of determining what were proper obj’ects of State bounty, they adopted the followirig clause covering that subj'eet: “ A liberal system of internal improvements being essential to the development of the resources of the country shall be encouraged by the Government of this State, and it shall be the duty of the General Assembly, as soon as practicable, to ascertain by law proper obj'ects of improvement in relation to' roads, canals' and •navigable'streams, and to provide for a suitable application of such funds as may be appropriated for such improvements.” This body having the best reasons (derived from many sources, but particularly from the history of the Ter.ritory ,of Florida), for .prohibiting «the. issxie, of State bonds, or pledging the faith of the State, for any-.purpose of .this kind, inserted another clause in that Constitution which provided that..“ the General Assembly shall not pledge the faith and. credit, of the State, to raise funds, in aid of any , corporation.whatever.”« The effect of this Constitution was,. therefore, to acknowledge this-duty, and, while providing ample power for its discharge, it established such a check as would save the State credit and prevent -that.financial ruin which generally follows an unlimited power .-in the Legislature to pledge the credit of the State for such. purposes. ..It could- aid by an “ application of the funds appropriated,” but it could not pledge the faith or,, credit of the State to raise such funds.

In 1845 Congress appropriated , for the purpose of internal improvements, in this State five hundred thousand acres of land. Notwithstanding this mandate of the organic law1 and this.bounty by Congress, and. notwithstanding the fact that Florida nearly equalled in square miles of territory the States, of New York, New Jersey and Connecticut, making such improvements a great necessity, , no. established line of railway .affording any considerable, facilities to the people of the State was constructed for years. ; In .1855.. a •system of internal improvements was .provided for by an. act entitled “

An act to provide for an encourage a liberal system of internal .improvements'in. this State.” .The five hundred .thousand;; acres- of. land ..granted for, that, purpose by Congressj as.well as .millions..of.acres-,,of.what is known as swamp.lands, were constituted a fund, for the. purpose of internal improvements, and' the Legislature designated eertain lines-of railway., and canals as proper improvements to -.-be aided-.from- this. fund.

Quite, a .number, of «casesíhave been adjudicated in.this court,, in .which the companies entrusted by the State to construct the lines of railway indicated have been parties, and the courts, in speaking of these • contemplated improvements,. have styled them- “great pub-lie-enterprises;” as “ enterprises in which the public have interests.”; This court,;in 1862, said that it couldnot forget that the community have rights in..reference to these, improvements, and that the happiness and well-being, of every .citizen.depends;on their preservation.

Mr; Justice Walker, of this court, in 1862, speaks of this act as one “inaugurating a great constitutional system ; a system whieli has enabled the- State, of Florida, the. weakest in, population among, her sisters, to build.more railroad in the same length of time than any other State in the.«yoiid.” ■ At-the time of the adoption of the present 'Constitution, the system of public improvements had advanced greatly.

There were a number of lines of road in. operation, but there was a considerable and very important portion.unfinished.. ■ The highest interest of the State required its. completion. /With this /system -incomplete, the capital, of the/State was-reached with difficulty by citizens south and west, and-many of the people in the western portion of the State were anxious, for the want of these facilities, combined with-other reasons, to become a portion of the State of Alabama.

In my opinion these incorporated lines of railway, and the internal improvements contemplated. in the system- created by the act referred to,, were the unperfected public works which the Constitution of 1868 contemplated should be;£c perfected.” We next inquire: Is the road authorized to be constructed by this act one of the internal improvements designated by the act of January. 6,1855,¡which.organized a-State system?

The line of road which the Jacksonville, Pensacola & Mobile Railroad Company-was authorized by this act to construct was, a railroad from Quincy* Florida, to. the. dividing line between the States -, of .Florida and- Alabama; in .the direction of the city of Mobile, Alabama, crossing the ' Pensacola and Louisville Railroad, - with the privilege, of.: continuing-the same to Mobile, and of connecting with any railroad running to Mobile. ., ./ ¡ ,. .i.,/ .■.•--.sí i . ■ The.internal improvement-act, which gives us the lines of road and canal which were embraced in the system, provides: “That a line of railroad, from the St.Johns river,, at Jacksonville, and the waters of the Pensacola bay, with ah .extension from suitable points on said line to St.

Marks fiver or Crooked river, at White Bluff, on Apalachicola bay, in Middle Florida, and to the waters of the St. Andrews bay, in West Florida, and a line from Amelia island, on-the Atlantic, to th.e .waters of Tampa hay, in South Florida,, wftn an extension 'to. Cedar Keys, in. East Florida,* also, a canal from the w.atgrs of the St.

Johns river, on ¡Lake Harney, to the waters of Indian river, are proper improvements to be aided from the Internal Improvement Fun.d,” , A reference.to the contemporary recommendations pf the Executive Department-of the State.aud of the Board of Internal Jmprp veinen.t will giye up, some light upon the subject. . .The Governor, in. his .message, of November .24,1854,-uses this language (Message of. the Governor, November,24,1§54, joiu’nals p.f ,185b) i Jhie..framers -.pf .tbe Constitution,, were deeply-impressed-yyitli the, importance of a liberal, system. of internal,improvements, and provided, that such a system should be encouraged by our State, Government. .

The, time has.probablyarrived. when,our duty to, ,our,selves.aqd our ,cqnsti(uent|syg;quirec,up tp ,fj.x upon and,adopt;a,^,tate,.system, and determine the extent to which wé, can, as a-governmeqt, aid ip its cppstructionj.

I. fepl no .hesitation, in.declaring that, in'myjud^ppt, po'Sta(e,system,will bp-,worthy,of trépame , yGiii?h fails;,t.o;,t,connect, Feynpndina, or., sppie^ otherpqpajly accessible .point on our .Atlantic .coast,, yuth Taprpa baylntbe sppthrpnd Pensacola bay. in, tbe 'wcst/; .Thespas gyept maip trunks* would foi;m the bas.is of .a.syptepi Which;, wouhjjbe, Worthy , pf^He sea-gi^t Stpte,” . „ „,0ni theri2^d .P.bjjecembpr, lSlB-thp.

Board of Internal, Ipiprovén^,entl;biade, a. rqpoy t.tp .-^^^p^ralí^^e^ly^nyhídi it bgst ijp rcqpm-fpfipjtb6 a®qgptr|,tipn„,,pf jthe^e.^mqap.S uponya syntgjp,bti?ppyoyempnts, having reference -to the wants of general commerce as well as local necessity, for the growth of the State in population and wealth being thus most rapidly developed, the means necessary for local connections and improvements would very soon be produced. The system we’recommend for aid consists of a railroad between the waters of Escambia bay and the St.

Johns river, at Jacksonville, with an extension from suitable points on the line to the waters of St. Andrews bay, in West Florida, and the St. Marks river, in Middle Florida, and from Amelia island, on the Atlantic>to the waters of Tampa bay, in South Florida, with an extension' to Cedar Key, in East Florida, and to connect the country east of the St. Johns with the system, and thus to comprehend that

section more fully in its benefits, we recommend, also, the construction of a canal to connect- Indian river with the St. Johns.

In adopting a system, it was necessary to ascertain if we possessed within our own borders suitable harbors upon the two seas for the accommodation •of the commerce which would pass over our roads, for otherwise it would be necessary to point our improvements to suitable connections with the system of our neighboring States.” After mentioning Pensacola and Fernandina as suitable harbors, and particulars as to depth of water, &e., the board then state: “We have felt justified, therefore, in resting our system upon ports located within our own limits.” The act of Congress of May 17, 1856, which proposed to aid this system, extended aid for the construction of a railroad from St.

Johns river, at Jacksonville, to the waters of Escambia bay, at or near Pensacola: The then Constitution of the State directed that a liberal system of internal improvements should be encouraged by the government of this State. Thus we find, from a simple examination of the statutes, that when the Constitution of 1868 was adopted, there was no public work authorized from Quincy to Mobile, orto the Alabama line in the direction of Mobile, and we find •that it was the purpose of this legislation to secure a State system with; the terminal points of the several- roads at harbors within the-.

State. • ■■ ■ ■■ , : :;.C 1 It may be áaid that a large portion of the road tó bé constructed by the, Jacksonville, Pensacola: & Mobile Nailroád' Company is in the direction of Escambia bay, but, upon mature reflection, I do not think that the Consiíution can be held to.sanction aid toan .enterprise of this character to the Alabama line in the direction of Mobile, notwithstanding a part of, the line might be available in reaching the waters of Escambia bay.

Such a material change-as this in ¿ railway charter would release; the-subscribers to stock from any obligation to ,pay calls,, It .would be a fundamental alteration, a6 distinguished from an alteration' only auxiliary to the main design. (1 N. H. 44; 11 Ga. 438 ; 29 Vmt. 545 ; 8 Mass. 268 ; 18 Ib. 384 ; 13 Beav. 7; 3 Eng. Law & Eq. 144; 10 Beav, 1; 9 Fla, 311.) No one at all. conversant with the history of the internal improvement system of this State can hesitate to say that a line of road from Quincy to Mobile was not embraced in that system. .

The object and purpose of the authors of that system was to restrict, the terminal points of the lines of railway to harbors in the State, and changing these terininal points, looking to connections with Mobile, is a fundamental and material alteration* The charter of an-ordinary.priTáte corporation is a limitation upon the power of the -Legislature and the, company, when either proposes to act with reference to the shareholder, and it cannot be denied that such- a change as is here made would release him. from calls. -.The Constitution here is a limitation upon thepower of the Legislature’ when it proposes to pledge the ¡credit of tjtie State or bind her people, by,the issue of bonds.

I think^re nature of the.. subject; to. ^hich the limitation applies is spgh aé to requiré a liberal construction in behalf of the people, and that ho act of- the Legislature which pledges the credit of < the State and involves a resort to. taxation should receive judicial sanction where- there is such a difference a&; here exists ..between what, the Legislature is authorized tó do arid What it has done.

The limitation must receive a reasonable construction, and. while I admit arid approve of the gerieral rule that the legislativeconstruétión of the Constitution is entitled to great weight, yet in a case of'. clear error; as I'deem-this to -be; the duty of the judiciary is plain.: - - 1 The Legislature must be held; to somé limitation in the matter, and looking to the executive,' legislative and judicial' history of the .State, it-is too blear for dotibt that'a line Of road .from Quincy to Mobile cannot be held: to be a public ■ work, within the meaning of the Constitution, as- it has been heretofore defined' by the justices’ of this'court.' ’ Such a road is beyond and: outside of the: general scope and design of the original enterprise; and the Constitutiori does'riot áüthorize the Legislature to aid-any other railway than thoséembracecb in the then existing system.

It may be said that the road to Mobile will be of much gfealef';beuefit''to' thb people, and other suggestions" of like character ínay be niade. • With questions of policy of this character this Court has ribthirig to do, arid they should not and do not weigh one gram In reaching a: conclusion. The bofíds of the State of Florida here authorized to be Issued are, therefore, unconstitutional. The power of the Legislature is- líiriit'éd in this -respect, and-the bond here sanctioned'is not enibriaeed within the limitation.,.

One of theConse’quences'bf’thisis that neither the State nor her ]3eoplé are bourid fori the bonds now in the ■hands of those who "hold”' them: ' Nb -ílóctriñé' o'f' estoppbl can operate rigainst the State:'f'!:; It is Contended upon the part of defendant Holland that another conséquenbe is that there is’riio■ lien upon the property arid franchises of the company which" Cari’’ be eriforcéd at the .suit of the State; 'that With the failure Of its obliga^ tion therei's a failure of any equity-existing in its behalf; that there is'rib consideration from !the State1 tó“th,eriáilfeíad;! 'l'W'é will net herehepeat the’ VkriokstsectienB 'bf-thé" laíri’wMclr' define-the relation of the State;-’df -the foibigri'be'ridM'older;": and of the company towards each other.

A careful and strict examination of this statute will show that the State of Florida was to occupy two distinct and different relations to the holders of the State bond and to the company.- The first relation was that of primary debtor to the holder of the State bond, under and by virtue of the obligation of this bond, and also of mortgage creditor of the company, under and by virtue of the bond of the company.

The right of the State, viewed in this light, was to be simply that of a mortgage creditor of the road, and its liability to the holder of the State bond was that of a simple bond debtor. ■ In this relation the holder of the State bond was to have no security for his protection and payment except the liability of the State in its own right and its good faith and capacity ; the State at the same time as a result of this relation being given, for its own protection against this bond debt, the right to become the purchaser at the sale of the road and to pay for it in the bonds of the company.

The other relation 'which it was to occupy was, in the language of the act, “ a trustee ” for the holders of the State bonds. In this relation the lien created by the statute was for the benefit of the holder of the State bonds. The proceeds of the sale, if he declined to surrender his bonds, were to be invested for him, and he was to have the beneficial interest of a cestui quetrust. The lien of the statute and the company bond, viewed in this light, was for his benefit, and the property and franchises of the company were to be his security for payment.

And as the, company received his money and the State received nothing, the company was to be held to the obligation of common honesty in the matter of payment and satisfaction. ; There are other things in this statute besides the express declaration that the State is a trustee which sanction this view of the State’s relation. The company could, by its own act, change the nature of the claim of the State bondhonders for interest to that of a gold-bearing bond.

The act provides no special method, for the,payment of the State bond and interest ás distinct from the liability'of the' company to the1 State,' and-it is apparent that the State- herself was to look to the' company for the-interest which'1 the bondholder was to receive. All of these-'things show that‘the 'State was' to' be’ the1 instrument or trustee through whom a liability of the company to the bondholder should1 be discharged.

This, coupled with the express’ declaration of the -statute, leaves no doubt of this additional relation of the State-. • To this relation I know of noconstitutional objection. -Thérebeing no primary lia-' ability of the Státej it-'would seem1 to'be a’ consequencé-that' such portions of the act as exists for its protection against sueh liability as the Legislature presumed the State incurred, would- fail and ceasé to -be- operative, and I'am-'inclined to this view.

Rut, however this máy bé, f he accent’ amendment ■ to the Constitution of the State-'prohibits'the State from be-coining'any such Owner or ’stockholder ntt1 - a1 corporation ásv the statute authorizes the;ptirchasef -to-become in this casé.That amendment" (Article- XIII.) provides that' “the1-credit of'the State shall nót be pledged- !or bound- to' any "ihdi vid- * uál, company, corporation or association, nor shall the State ' become'a joiñi-oionér or'eto'cleKoidefr-^Miyeompa/rvy^assooiar' iron or -corporationWhat'-’is'-’meant -here- -bydhé ’terms1-“joint-OWUer '-o'r'stOckholder iha corporation ?”■ -Such-terms - as-these,!when hséd iñ féfererice t'ó the ’State',1Ar'e’hdt appli'--' cable to ¿trictly^publie cO'rp'orafcibh'spsuch'hs' álefouhdedby'government-fór-public polifical'-purposespas1 tówná,'OitieSy•' parishes and-couhtiésp-'bécáusé-'su!ch’'á;-ftón| as the'-'St-áte'bé’-'coming a stbekhoIdér,--Or'-part'bwhér 'in-such''1á;-cdfpOfátiónV--' is1 i-mp'Ossible from-tlie 'Very hature!-of ‘thé’-'rérátión -betweeh'-' ration is used Here in the’:sámé serísems ffanchise1/'RdyS Mif1'-Ju's’tice '-’Blaéksfone-,'-(if Cdml'^?)': is'''aicffhnchise?ior -’a number'OFp'éi'áóhS; fó béine'Orpofátedhn’d -'exiht%li-‘a body •• póli’tiényífch a power•máfntáin-'peiípctühlkfcbOssídh ahát-o do-* <»fphfafh?á^^nü^bR^índi;é?S'íffl,'*l|'(iif::;áficK'*<íí(f^^iStiiñÍ"s''iSí said to have a franchise or freedom.” This clause ' clearly prohibits the State from becoming a part owner of the franchise to be a corporation, and other franchises appertaing to corporations for ordinary, commercial and business purposes, such as a company With power to operate a line of railway or bank.

"Where the capital stock in such a corporation is owned by private persons, it is a private corporation. The act of the Legislature here would make the State the sole owner of the stock and franchises in the event it became the purchaser, and in such case the result would be simply that the corporation would be a public and not a private corporation, and would be under the 'control of the Legislature, the same as municipal corporations.

There would be no such ' vested rights of property as are beyond the control’of legislative authority. (Dartmouth College case, 4 Wheat. 518.) We cannot, however’, see that this can make any difference. The State would be the only and sole stockholder in such corporation, and that is prohibited. The command of the Constitution to the State is that it shall not be a “ stockholder in any company, association or corporation.” The prohibition extends as well to a public corporation of this character as to a private one.

And it is well that it does, for such a corporation, if a source of profit to the State, would be a' fund to tempt her officers, and if it resulted in loss, would be a burden to her people, unless they hoisted the flag of repudiation behind the shield of sovereignty. Those who administer a government and exercise powers executive, legislative and judicial, appertaining thereto, can well be prohibited from running and operating railways, banks and other commercial institutions.' If these persons perform honestly and' properly the trust, of administering the government, the people will be satisfied.

In this amendment, the people have said that such* persons shall not, as their representatives, .involve them in such undertakings. • Having thus defined the status of the State, and her general rights as trustee under the statute, it is. only necessary to consider the questions presented by-the particular pleadings in the case-to ascertain whether the State’s'equities ‘are now operative. '■- - . - ’..... " The complaint alleges an exchange of bonds by- the J. P„ &-M.

Railroad Company and the State to the amount of' three millions of dollars on that part of the road which-defendant Holland claims to have purchased under a fi. fa.:r the complaint alleging that-this- exchange"wasr made*at the rate of $16,000- per mile in bonds: ■ That ■ before such exchange the President of the road filed with-the Governor of the State the certificate required by the act: The amended complaint of June 22, 1872, alleges jion-payment- of" the interest on the -State bond's, and that on the first-of' July, A.

D. 1870, there was due as interest on the bonds of the-company held by the State the sum of $120,000, and that-on the first day of July, A. D. 1872, - there will bé a further suia of $160,000, which will have remained due and’-'uhpaid twelve months. Defendant Holland*was - brought •' into' the case by a supplemental complaint filed March'21, 1874.

This complaint states that Holland recovered'his'judgment since the -commencement of this action, and -that his: sale was had while this suit-was pending-. -The supplemental complaint alleges also that none of the interest-accrued upon the bonds' of the company, .nor upon;tlie bonds held by the State, has been paid since the eomméncejpéüi ofithis suit; which was about' two -yéars. ’ The answer -of-defendant Holland consists of several statements-of fact -ás'RefónséS'to the action. . , The first three state -the obtaining of his -éxecxxtioU,' ‘ his salé and-purchase'.

He admits the previous’'1 execution' and' exchange of bonds as stated in- the complaint. - The‘ fourth denies-' the' execution -by the-J. P. M; Company "of any mortgage or deed of-trust tó the State to ‘secure’ any of ¡the bonds, and affirms that-the mere execution by thecOihpanyof the bond to1 the-State did-not’ create any lien,' as Veil-' as that-there was-no'cónstitutidnal'powér iix- the State" (dLe^is-’-'' lature) to issue such bonds. The act of the Legislature did not require at the hands of the company the execution of a formal mortgage or deed of trust in addition to its bond.

The Legislature provided for a simple company bond, and declared that the State of Florida should, “ by this act,” have a statutory lien to secure the principal and interest of the said company bonds, which shall be valid to all intents and purposes as a first mortgage duly registered on the part of the road for which the State bonds were delivered. There was to be this statutory mortgage lien attached to the bond of the company in the hands of the State, and it was not contemplated that the company should execute a mortgage or deed of trust in addition to its bond.

As to the matter of the constitutionality of the State bonds, we have already seen that while this may relieve the State from any obligation as a debtor, it does not relieve the company or the property in the hands of Holland, where it is affected by all the equities affectftg it, when in the control of the company. The fifth ground of defense states that the Governor of Florida has never designated any place in the city of New York where the bonds or coupons of the State might be paid.

The act provides that the principal and interest of the State bonds should be payable at such place in the city of New York as the Governor shall designate, and that the coupon of $he company bond shall be payable at the same place. The failure of the State to designate a place in New York for such payment does not constitute a defense to the action upon the part of the company or Holland. "What is tp be paid here is the coupon upon a bond authorized by a statute, and it is now well settled that such coupons have the incidents of negotiable commercial paper.

Holland, while not denying that this interest is due, makes no tender of the money or offer of páyment, nor does he allege that he was ever ready to pay at any time or place. The fact that no place has been designated does .not excuse him from payment when demand is made through an action at law or suit in equity. In ordinary cases of indebtedness even a tender and refusal of the sum due #at the time and place where payable does not constitute a defense to the action. Such tender would not bar the debt. It could be pleaded only with a profert in curia of the money — 17 Mass. 392; 14 Fla. 247.

The sixth alleges that the company was not in default in the payment of its interest when this action was commenced, because the company had paid the corresponding coupon upon the State bond. If the allegation was that the interest due upon the State bonds, as set up in the original, amended and supplemental complaints, had been paid by the company, the defense might have been good, viewing the State as a trustee, but the defense is only partial.

The supplemental eomplaint against Holland, filed two years after the commencement of the action, sets up a default in non-payment of interest both by the company and State for this period. Neither the company -nor Holland deny this default, and it is sufficient to give the right of action to the, trustee. The seventh defense has reference to the claim of the Trustees of the Internal Improvement Fund under the bonds issued under the internal improvement act of 1855.

The eighth denies that Greeley was ever legally in the possession of the road, and admits that the Jacksonville, Pensacola and Mobile Railroad Company was a corporation. It is only necessary to mention these facts to see that they constitute no defense. ' • t The ninth alleges that the State of Florida “ never in legal effect ” issued or delivered a State bond. The "bare naked statement of a legal opinion entertained by a pleader, -as to facts not alleged as a matter of defense,-amounts to nothing.

So far as this proposes to set up the want of power in .the Legislature to authorize the issue of the State bonds, the demurrer reaches that point by the simple statement in ■ the complaint of the fact that they were issued, and the legality of their issue is raised properly by the demurrer, and is improperly attempted to be raised by an answer stating the presumed “ legal effect ” of the act of issuing them. The tenth alleges that the President of the Jacksonville, Pensacola and Mobile Nailroad Company never made the certificate under oath required by the act of 1870r as preliminary to the issue of the bonds.

The complaint alleges that such certificate was made. The issue made is immaterial. If the company received ■ the State bonds and gave its own, neither it nor Holland can now be heard-to urge its own default in the simple matter of failure to give a formal certificate. The company has had the benefit of everything it would have got, with it, .and it and Holland must be held to the. corresponding liability. This ends the consideration of the defenses set up in the answer of Holland.

None of them constitute a defense to the action. * Objections to the levy and sale in this case have occurred to me, but I have not stated them, wishing, as far as this court was concerned, that we should take as broad a view of the whole matter as possible in order to the speedy conclusion of this controversy. No question of jurisdiction has been raised by the pleadings or presented in the argument in this case. It is apparent from the pleadings that the road is now in the possession of the receiver of the Supreme Court of the United States.

Upon the case made upon the demurrer, Holland Having answered, and being within the jurisdiction of the Circuit Court of Duval county, the State has a clear equity to perpetually enjoin him from obstructing, or in any manner hindering, the Governor of the State from entering upon, taking .possession of, and selling the road, in accordance with 'the ternas of the statutes as in this opinion defined. . No question of priority of liens as between the bonds issued under the. internal improvement act, and the State, is involved or considered upon this appeal.

The judgment of the Circuit Court upon the demurrer should be affirmed. Randall, C. J., and Van Vabkenbers, J.,had been-.counsel in the case, and Judges Bryson and Goss were called in.