Johnson Co. v. Miller

Citations

• 174 Pa. 605
• 34 A. 316
• 1896 Pa. LEXIS 932

Syllabus

<p>iStreet railways — Corporations—Sale of property.</p> <p>When the operations of a corporation are matters of direct public inter est and concern, its property which is reasonably essential to the exercise of its franchises cannot be aliened by the corporation or sold by its creditors piecemeal so as to stop its operations or defeat the object of its charter ; but this rule does not apply to property which has not become a part of the company’s structure, and for which it has no present use.</p> <p>A street railway company bought steel rails and distributed them along its projected line, but before they were laid in place the company was enjoined from proceeding with the construction of its road until it had obtained the consent of the municipal authorities. In the meantime the company having become insolvent resold them to the manufacturer from whom they were purchased. This was done by a written instrument signed by the officers of the company in pursuance of a resolution of the board of directors. Possession was taken of the property resold, and subsequently another creditor of the street railway company attached them as the property of the company. Held, that as the company had not completed or operated any part of its road it had the right to sell the rails which had not become part- of its structure and for which it had no present use.</p>