Vol. III.] WILMER V. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

[No. 1.

254; Olcott v. Bynum, 17 Ib. 44; Pope v. Durant, 26 Iowa, 233; Ex parte Fisher, 1 Maddox, 159.

Upon the case as presented, I am therefore of opinion, if any part of the road is sold, the whole may and should be sold.

If a sale of the whole is made, it will be then time to consider what shall be done with the proceeds. That is a question which, it seems to me, does not, under the practice of courts of equity, present any grave difficulty.

It is objected to a sale of the whole property of the defendant railroad company, that the property is owned by two distinct corporations, and one of which, a resident of South Carolina, owns the property of the railroad in that state; that there can be no merger of railroad corporations extending through several states which will so destroy their individuality as to confer on the united corporation all the franchises of the several parts; that a corporation cannot be chartered by two states so as to have a common individuality in both.

The inference drawn from this proposition is, that this court can only order a sale of the railroad property in Georgia which is owned by the Georgia corporation, which alone is a party defendant to the bill, and that the court cannot order a sale of the property in South Carolina, which is owned by a distinct corporation which is not before the court.

It would seem to be a sufficient reply to this proposition to say that the Atlanta & Richmond Air Line Company has answered, admitting the union and consolidation of the two companies into one company, has contracted as one and not as two companies, has issued bonds and secured them by a deed of trust as one company covering its entire line of road and property, and has agreed that the whole might be sold by one sale, at Atlanta, in the State of Georgia. Even if this proposition of defendants' solicitor were true, we think the facts would estop the South Carolina company from setting up its separate existence and separate property, and we think that it has, by the answer of the Atlanta & Richmond Air Line Company, entered its appearance in this cause.

But is it true that a corporation cannot be chartered by two states so as to make one and the same corporate body?

When this case was up on motion for the appointment of a receiver, I passed upon this question, and held that two states might by concurrent legislation unite in creating the same corporate body. It is unnecessary to repeat what I then said. See Railroad Co. v. Maryland, 10 How. 392; Railroad Co. v. Harris, 12 Wall. 92.

Counsel for defendants refer to the following cases as establishing the doctrine upon which they rely: Ohio & Mississippi Railroad Co. v. Wheeler, 1 Black, 286; Marshall v. Baltimore & Ohio Railroad Co. 16 How. 325; Railway Co. v. Whitten, 13 Wall. 270; Tomlinson v. Branch, 15 Ib. 460; Railroad Company v. Jackson, 7 Ib. 262; The Delaware Railroad Tax, 18 Ib. 206.

I have examined these cases and cannot find in them anything to overturn the positive declaration of the court in The Railroad Co. v. Harris, supra. On the contrary, The Delaware Railroad Tax case, supra, strengthens the view of the court in that case.

I am of opinion, therefore, that the Atlanta & Richmond Air Line Rail

Vol. III.]

WILMER V. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

[No. 1.

way Company is one and the same corporation both in Georgia and South Carolina, and that this one corporation is properly before the court.

But concede that there are two corporations under the name of the Atlanta & Richmond Air Line Railway Company, one created by and residing in Georgia and the other created by and residing in South Carolina. It is made perfectly clear by the pleadings and evidence that these two corporations, if there be two, have joined under their common name in executing the bonds and deed of trust in the bill mentioned, over the common property of the two corporations. Now the Georgia corporation has been served with process and is before the court, and the South Carolina corporation has entered its appearance, and both the corporations have united in a common answer to the bill. The court therefore has jurisdiction over both; for while the South Carolina corporation, if it exists as a distinct corporate body, has the right to demand that it shall be sued only in the district where it resides or is found, it may waive this right and enter its appearance as a defendant in any district it please. Northern Indiana Railroad Co. v. Central Railroad Co. 15 How. 242. It has appeared in this court in this cause as a defendant, and it therefore may be bound by its decree.

It is further insisted by the defendants' counsel that as a large part of the property covered by the deed of trust is beyond the territorial jurisdiction of this court we are without power to order the sale.

The paper executed by the Atlanta & Richmond Air Line Railway Company is a deed of trust to trustees, conveying to them all the railway and other property of the company, with power to sell the whole at the city of Atlanta, in the State of Georgia, if default should be made in payment of interest or principal. Now it cannot be seriously contended that these trustees could not without the aid of this court, by following the direction of the deed of trust, have sold the entire line of the defendant company's road and have conveyed a good title to the whole, extending as it does from Atlanta to Charlotte. Is the power of the trustees any less because this court has been asked to construe the deed of trust and to order them to execute the trust? If the trustees under the direction of this court sell the whole road, they do so by virtue of the power vested in them by the deed of trust. We are not asked to foreclose a mortgage. We are not asked to confer on the trustees any power which they do not already possess, by virtue of the deed of trust, or to impose upon them any new duties, but simply to tell them what their powers are under their deed, and require them to exercise their powers for the benefit of the cestuis que trust.

I think what has just been said is an answer to the argument that under the Code of Georgia a mortgage can only be foreclosed when the entire principal or an instalment of it is due. No foreclosure is asked here. The complainants seek only to exercise what they think to be their rights under the deed of trust, by a sale according to the terms of the trust deed.

The conclusions I have reached are the following:

1. That the Atlanta & Richmond Air Line Railway Company, whether it is a single corporation or two corporations of that name, is properly before this court.

Vol. III.]

WILMER V. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

[No. 1.

2. That it is the meaning of the deed of trust, that the road of the company, or so much as may be necessary, may be sold to pay interest coupons due and unpaid without waiting for the maturity of the bonds.

3. That the road is an entirety and cannot be sold piecemeal without injury to the value of the road, and therefore the entire road may and should be sold.

4. That the trustees, by virtue of their power under the deed of trust, can, by the direction of this court, sell the entire road lying in three states and convey a good title to the whole.

5. That the trustees ought to be required to make the sale in accordance with the directions of the deed of trust.

6. When the proceeds of the sale are brought into the court, the court will direct how the residue, remaining after the payment of the interest due, shall be disposed of.

In accordance with the foregoing opinion a decree was made by which there was a finding of the amount of interest due and unpaid, and the trustees were ordered to sell at Atlanta, Georgia, in the manner, and after the notice prescribed by the trust deed, the entire line of the defendant company's road, extending from Atlanta to Charlotte, North Carolina.

.

The Atlanta & Richmond Air Line Railway Company prayed an appeal from this decree to the supreme court of the United States, which was allowed, and the penalty of the appeal bond was fixed at $800,000. This sum was arrived at as follows: It was made to appear that the property conveyed by the deed of trust would not probably sell for more than the principal and interest owing upon the bonds at the date of the decree, and that the cause would remain pending in the supreme court at least two years before final hearing, and that the interest which would accrue upon the bonds during that time would amount to a little more than $798,000. Under rule 32 of the United States supreme court, 6 Wall. the penalty of the bond was therefore fixed at $800,000, and it was ordered that upon the execution by the appellant of a bond in that sum, with sureties to be approved by the clerk, the appeal should supersede the execution of the decree.

A parol contract for the sale of real estate, however specific, cannot be enforced. A parol contract was made whereby B agreed to sell A certain real estate at a certain price, a part of which was paid at the time of the agreement, and executed a deed which was placed in the custody of B's attorney to be surrendered to A upon the execution and delivery, upon a day certain, of notes and a mortgage to secure their payment. A duly executed the notes and mortgage, delivered them to B's attorney, and demanded the deed, which was refused. Held: that, under the statute of frauds, the contract to deliver the deed could not be enforced; that the deed was not an escrow, and that B was not estopped to deny the validity of the contract. Thomas v. Sowards, 25 Wisc. 631, modified.

THE case stated most favorably to the plaintiff was briefly as follows: The plaintiff and the appellant, Thomas, entered into a parol agreement for the sale by the latter to the former of certain land, at a stipulated price, to be secured and paid as hereinafter mentioned. In accordance with such parol agreement, the plaintiff paid the appellant a small sum on account of the purchase money, and the latter signed, sealed, and duly acknowledged a deed of the premises to the plaintiff, the deed being in the usual form of a warranty deed, and delivered the same to Judge Hand, his codefendant, with directions to deliver it to the plaintiff, if the latter should, two days later, deposit with Hand his notes for a certain sum, part of the price of the land, and a mortgage executed by him on the same land to secure the payment of such notes, and at the same time pay to Hand, for the use of the appellant, the balance of the agreed price. These proceedings were all in accordance with the parol agreement aforesaid.

At the appointed time the plaintiff deposited with Hand the notes, mortgage, and money as agreed, and demanded the deed of the land; but, acting in obedience to instructions from the appellant, Hand refused to deliver the deed. At the same time the appellant tendered to the plaintiff the money which the latter paid him when the verbal agreement was made, and, on the refusal of the plaintiff to receive it, left the same with Hand for the plaintiff.

The action was brought to compel Hand to deliver to the plaintiff the deed deposited with him by the appellant. The circuit court gave judgment for the plaintiff, that the defendant Hand deliver such deed to him, and that the appellant pay the costs of the action.

Van Buskirk & Ritchie, for appellant.

Fash & Lee, for respondent.

LYON, J. If the deed deposited by Thomas with Judge Hand was an escrow, we have no doubt the conditions upon which the same was to be delivered to the plaintiff, who was the grantee named therein, might lawfully rest in parol and be proved by parol.

VOL. III.

4

Vol. III.]

CAMPBELL V. THOMAS.

[No. 2.

Was the instrument an escrow? If Thomas, notwithstanding the deposit, retained control of it, it was not; and he might lawfully reclaim or prevent a delivery of it to the plaintiff. See Prutsman v. Baker, 30 Wis. 644, and cases cited.

It is very clear that unless there was a valid contract between Thomas and the plaintiff for the sale and purchase of the land described in the deed deposited with Judge Hand, such deposit was the mere voluntary act of Thomas, which in no manner interfered with or affected his control of the instrument. Fitch v. Bunch, 30 Cal. 208. Hence, the controlling question to be determined is, did Thomas and the plaintiff make a valid contract for the sale and purchase of the land?

They agreed verbally-the plaintiff to purchase and Thomas to sellon certain terms, which included the execution of a mortgage on the land by the plaintiff to secure the payment of a portion of the purchase But such verbal agreement was a nullity, by the statute of frauds, there having been no such part performance of the agreement as would take it out of the statute. There was no valid contract unless the same, or some notes or memorandum thereof, expressing the consideration, was in writing, and subscribed by Thomas. R. S. ch. 106, sec. 8. The only writing subscribed by Thomas, which relates to any such contract, is the deed he deposited with Judge Hand. That instrument expresses a consideration, and if it contained the whole contract we should have no difficulty in holding that it answered the requirement of the statute. But the difficulty is that the deed does not contain the whole contract. It is essential to the plaintiff's case to maintain, and he does maintain, that he was to give Thomas his notes for a portion of the purchase money, and was to execute his mortgage on the land in controversy to secure the same. No note or memorandum in writing of this portion of the agreement was made, and the same still rests in parol.

The contract expressed in the deed deposited with Judge Hand is a contract to sell and convey the land — the whole title thereto, absolutely, and without any reservation whatever-to the plaintiff, for a specified sum of money. But proof of such a contract is not sufficient to entitle the plaintiff to judgment. His right of action depends upon proving that Thomas was to retain a mortgage interest in the land as security for part of the purchase money. Had the mortgage been drawn and signed by the plaintiff at the same time the deed was signed by Thomas, and deposited with the deed, it would probably have been a sufficient compliance with the statute. By a familiar rule of law the two instruments would, in such cases, be construed together as constituting a single contract. But the mortgage was not then drawn and signed, and a most material portion of the verbal agreement that portion upon which the plaintiff's right of action depends-was suffered to remain in parol.

It necessarily follows that there was no valid contract between the plaintiff and Thomas for the purchase and sale of the land; that the deed deposited with Judge Hand was not an escrow, but remained under the control of Thomas; and that Judge Hand properly refused to deliver it to the plaintiff, after such delivery had been forbidden by Thomas.

This case, in principle, is much like that of Thomas v. Sowards, 25 Wis. 631, which was sharply criticised by the learned counsel for the