Appeal from the District Court of the United States for the Northern District of New York.
Before L. HAND, AUGUSTUS N. HAND, and CHASE, Circuit Judges.
AUGUSTUS N. HAND, Circuit Judge.
The plaintiff brought suit (1) to recover past damages from the defendant railroad company because it had maintained tracks across plaintiff's land and had unlawfully operated locomotives and cars thereon; and (2) to restrain the maintenance and operation of the railroad upon the land in the future. The answer admitted the ownership by plaintiff of the lands described in the complaint, but alleged that they were subject to an easement on the part of the defendant to maintain and operate its railroad across the same, and asked that it be adjudged that the defendant had such an easement, and therefore was not liable to pay damages. The trial occupied by the defendant free from any easement on the part of the latter and that it had unlawfully occupied the same and operated its railroad thereon. It awarded $1,500 to the plaintiff for past damages, and enjoined further operation unless the defendant should pay $6,000 as additional damages for the future easement of operation.
This appeal raises the questions whether (1) the defendant had acquired a mere revocable permit or an easement for the laying of its tracks and operation of its trains across the land in question; and (2) whether, in case it had acquired only a revocable interest and its rightful occupancy ended prior to the beginning of this suit, the award of damages was excessive. The trial court held that the railroad acquired only revocable rights, and that upon revocation was subject to damages for an unlawful occupation. We must first determine what was the nature of the rights which the defendant acquired.
On July 29, 1915, the railroad received from the superintendent of public works of the state of New York a permit to construct, maintain, and operate at its own expense an extension of its railway line parallel with the Erie Canal from Utica to Whitesboro, passing under the southerly approach of the Yorkville bridge. The instrument recited that it was issued purusant to authority delegated to the superintendent by the canal board on July 21, 1915, and that $10,000 was to be paid by the railroad to the superintendent as its share of additional work necessary to be performed in providing a passage for the railroad under the southerly approach of the bridge being constructed over the Erie Canal. The instrument went on to say that the payment by the railroad would not vest it with a right for any length of time to maintain its tracks through the bridge approach or upon the state land and would only vest it with such rights "as are covered by this revocable permit." Finally the instrument gave the superintendant "the right at any time to revoke and annul this permit and cause said Delaware, Lackawanna and Western Railroad Co. to remove said railway line, and any or all structures placed thereon under this permit at its own cost and expense from off State land; also the right on the part of the State of re-entry and re-occupancy of such lands covered by this permit, as the free and perfect use of said Canal at any future time may require, or as may be necessary for making any repairs, improvements or alterations in the same; or for any cause whatsoever."
The foregoing permit provided that pursuant to the Canal Law, § 35 (chapter 13, of the Laws of 1909, Consol. Laws N.Y.c.5), the superintendent of public works should have supervisory power over so much of the railroad as might be constructed within ten rods of the canal or upon lands belonging to the state for canal purposes. In addition to the powers of the superintendent above mentioned, section 35 provided that no railroad corporation should construct its railroad over, or at any place within ten rods of, any canal belonging to the state unless it had written permission from the superintendent. It also provided that:
"All such permits heretofore or hereafter granted shall be revocable whenever the free and perfect use of any such canal or feeder may so require, or if such railroad company shall fail to make any such repairs when required by the superintendent of public works. The railroad company using or occupying any bridge over the same shall, within a reasonable time after the service upon it, by the superintendent of public works, of written notice of such revocation, or to make such repairs, remove at its own cost and expense its railroad from such bridge and from the limits of ten rods of said canal or feeder."
When the railroad proposed to build the spur along the canal, a special act of the Legislature (chapter 584 of the Laws of New York 1915) was passed authorizing the superintendent to change the plans for the construction of the bridge over the Erie Canal in the village of Yorkville so as to provide facilities for construction of a railroad along the bank of the canal under the southerly approach to the bridge, in order to develop the barge canal terminal harbor from Schuyler street, Utica, to the second Yorkville bridge, and for that purpose to enter into contracts to cover the additional cost of the abutment and changes and to contract with any railroad company interested in the construction of a railroad under the southerly approach to such bridge to provide for any additional cost incurred in making provision for the construction of a railroad under such southerly approach. On the application of the defendant, the permit which we have before us was issued, the defendant paid the state $10,000 for the privilege of passing under the bridge, and expended the further sum of $6,618.77 in building its tracks. From the above it appears that the permit was granted under the Canal Law relating to the granting of permits by the superintendent of public works and also under the more specific provisions of chapter 584 of the Laws of 1915.
The state decided to abandon the canal at this point in 1922, and therefore conveyed to the city of Utica by quitclaim deed the property on which the defendant had constructed its tracks in 1915. On March 20, 1924, the plaintiff purchased from one Bach a parcel of land adjacent on the south to the parcel belonging to the city of Utica, and on December 9, 1927, received a conveyance from the latter of the strip on which the switch track had been constructed.
In June, 1922, the superintendent of public works published in the Utica Observer-Dispatch and the Albany Evening Journal notices directed to all persons, firms, or corporations occupying or maintaining (whether by virtue of permits or otherwise) buildings or structures of any character on, under, or across the canal lands in the city of Utica from the east city line to the easterly line of Third street and from the westerly line of Schuyler street to the west city line. The notices stated that he revoked each and every permit theretofore issued authorizing or empowering the use or occupancy of any part or portion of such canal lands, and that he required all persons and corporations forthwith to remove from said lands and to vacate and surrender to the state possession of the same. No personal service of this notice was given to the defendant, but it was published after the state had decided to abandon the canal lands and shortly before the conveyance to the city of Utica.
It is argued that section 35 of the Canal law above quoted provided for the revocation of the permit only (1) whenever the free and perfect use of any canal or feeder might so require, (2) if the railroad failed to make any repairs required by the superintendent. The section also provided that the railroad company should remove the railroad from the limits of ten rods from the canal or feeder upon written notice of revocation. neither condition making the permit revocable happened, but the right which the railroad enjoyed was, by it terms, only a revocable one, and under settled rules was revoked without without the necessity of any notice when the state abandoned the canal lands and sold them to the city of Utica. Eckerson v. Crippen, 110 N.Y. 585, 18 N.E. 443, 1 L.R.A. 487; Eggleston v. New York & H.R. Co., 35 Barb. 162. This is because such a license is personal and will cease with the death of the grantor or the sale of the "dominant tenement." The license here contained a clause that it should not be "assigned * * * without the written permission of the Superintendent, * * *" and it contained no provision dealing with a situation where the canal lands were abandoned and sold, and such events evidently were not within the contemplation of the parties. The ordinary rule that a license is revoked if the grantor sells the land should therefore be applied.
We are likewise satisfied that the plaintiff was not estopped to assert his legal rights. it is said that the railroad had paid a large sum of money to acquire the permit and had made other expenditures on the faith of it, but the $10,000 was merely to cover the expenses that the state was put to in making the changes necessary for the installation of the spur, and the railroad expended moneys in laying the tracks with full notice of the limitations contained in the instrument which fixed its rights. That instrument definitely provided for revocation for any cause whatever, and was effective without personal notice wherever the law gave rise to a revocation, as well as with notice in the particular instances specified in the permit.The defendant made no payment upon any misrepresentation of fact, and is not in position to invoke an estoppel.
It may also be suggested that a quitclaim deed by the state to the city of Utica ought not to be regarded as a revocation. The state, however, had abandoned the canal and by means of the quitclaim deed, which contained a "grant" of its interest, had transferred all its rights to the city of Utica. We cannot see that it makes any difference that the conveyance contained the words "quitclaim" and "grant" rather than a grant with a covenant of warranty which a state could hardly be ...