Argument for the City of Marshall.

this decree both parties have appealed, the railway company denying that there was any ground of relief against it, and the city of Marshall on the ground that the complete relief which it sought had not been given to it.

Mr. W. Hallett Phillips for the city of Marshall.

I. The argument of the company is that the contract was fully performed by their establishing at Marshall the offices, machine shops and terminus, and that there was no obligation to retain them; that the county and city simply relied on the faith that, once established. the interest of the company would induce their retention.

The question then is, whether the donation by the county of $300,000 of bonds, and by the city of real estate costing $60,000, made upon the consideration that the company would make Marshall the eastern terminus, and permanently establish there its shops, car works and Texas offices, left it in the power of the company, at any time after receiving the benefits of the contract, to abandon Marshall, make another place its terminus, and remove its Texas office and shops?

Certainly such a construction of the bargain cannot be made unless imperatively called for by its terms.

The first inquiry must be as to the extent and meaning of the contract.

The petition of the freeholders of Harrison, upon which the election was ordered to determine whether the bonds should be issued to the railway, specifies "that the said donation, to be conditioned upon the fact that the eastern terminus of said railroad shall be permanently established at said city of Marshall, (the county seat,) with its Texas office and main shops." This was the proposition submitted to the electors and contained in the contract with the county and city.

The general prosperity and growth of the city were the objects of the donation. The conditions of the contract to be performed by the company were commensurate in their importance with the large expenditure incurred by the county and city. The establishments of the company were to be fixed at

Argument for the City of Marshall.

the city, and could not be removed by the company, unless acting in obedience to subsequent law applicable to the case. Unless this is the true construction of the contract, no force can be attached to the provision as to permanency; for, under the opposing argument, that which was established one day could be removed the next. In fact the company in its answer contends for this right of immediate removal and to show their understanding of the contract, introduce a resolution of the board of directors of the company by which it was resolved "that the offices be located, until otherwise ordered, at Marshall." What sort of permanency is this, when it is shown that the establishments were made at Marshall until "otherwise ordered?" The case of Mead v. Ballard, 7 Wall. 290, relied on by opposing counsel is not applicable. There the whole question was whether the institute was obliged to rebuild on the land granted, or forfeit the same. The court held that inasmuch as the institute, by the terms of the grant, had to be permanently located within a year on penalty of reversion, such right of reversion ceased when the institute was established within the year, and the title was not subsequently divested by failure to rebuild, after the buildings had been destroyed by fire.

II. Assuming the contract to be legal, it is objected that equity is without jurisdiction. The argument seems to be that the company should be allowed to violate the contract and the city left to such redress as it may find in an action for damages.

But can it be the law that the city must give up all the public advantages secured to it by the contract and which constituted its sole consideration? Could any pecuniary compensation be the equivalent therefor?

It must be admitted to be very uncertain what damages could be recovered, unless, indeed, the amount is of the donation, a very inadequate recovery.

The remedy at law is not plain; it is not adequate nor complete.

The case seems to be peculiarly one in which the remedial and preventive jurisdiction of chancery can be invoked to

Counsel for Parties.

prevent by injunction the consummation of an injury, which cannot be estimated and sufficiently compensated by a pecuniary payment.

Another objection to the decree is that the court has no adequate means of enforcing it, because the court cannot compel the company to maintain and operate the shops at Marshall; that the decree is in effect one of specific perform

ance.

But were it admitted that the court could not do complete justice to the city, that affords no sufficient reason why it should not repair, as far as lies in its power, the wrong inflicted and threatened, by an injunction, restraining the breach of the conditions of the contract, especially in a case like this where the defendant retains the full benefits resulting from the contract.

In order to sustain the decree, it is not necessary to decide whether the contract is one which, in the first instance, equity would specifically enforce. We deny that the agreement was such as is contended by appellant, or that obedience to the decree could only be enforced by undertaking the operation of the railroad. It is difficult to perceive why the court cannot prevent the removal of establishments acknowledged to have been made under the contract.

If the contract, as contended for the company, is one requiring the performance of continuous duties and supervision, that affords no reason why a court of equity should not by injunction prevent the violation of the contract. It is now settled by the decided weight of authority, that in such cases, although the affirmative specific performance of the contract is beyond the power of the court, its performance will be negatively enforced by enjoining its breach. Western Union Tel. Co. v. Union Pacific Railroad, 3 Fed. Rep. 423, 429.

Mr. John F. Dillon (with whom was Mr. Harry Hubbard on the brief) for the Texas and Pacific Railway Company.

Mr. Augustus H. Garland for the city of Marshall.

Mr. James Turner and Mr. C. B. Kilgore filed a brief for the city.

Opinion of the Court.

MR. JUSTICE MILLER, after stating the case, delivered the opinion of the court.

As regards the appeal of the railway company, two principal questions are presented. The first of these is, was there a valid contract that the corporation should not only establish its eastern terminus at Marshall City and put up there the depot buildings and machine shops, car works, etc., included in the contract, but should keep them there perpetually? Second, if this were so, is it a contract which a court of chancery should enforce?

If it were not for the word "permanent," as found in the communication of the committee of the city of Marshall to Mr. Scott, we should not think it easy to justify the inference that the obligation was to maintain forever at that place what the company engaged to establish there. The clause of the letter of this committee to Colonel Scott, which first mentions the conditions is, that the bonds of the county of Harrison were voted upon the condition, "that said company shall establish its eastern terminus and Texas office at the city of Marshall, and shall locate and construct at said city its main machine shops and car works, thereby securing at said city connections with said terminus provided for by the act incorporating said Texas and Pacific Railway Company and an act supplemental thereto." The same proposition is afterwards stated in the same letter in this form: "In consideration of the donation of the said sum of three hundred thousand dollars and said sixty-six acres of land, the said Texas and Pacific Railway Company will permanently establish its eastern terminus and Texas office at the city of Marshall, and will also establish and construct at said city the main machine shops and car works of said railway company."

The two conveyances by the city of the land which constituted the sixty-six acres in reciting the consideration for which the conveyance was made, speak of it, as we have already said, as an agreement to establish the eastern terminus at the city of Marshall, and also to construct at the city the main machine shops and car works of said railway company. This shows

VOL. CXXXVI-26

Opinion of the Court.

that while the obligation of the company to establish its eastern terminus at the city of Marshall and construct its depot and machine shops and car works is spoken of at one time as an agreement to permanently establish these appurtenances to the railroad, yet at other times, when the same subject is mentioned as the consideration for what was done by the city and the same matters recited, the word "permanent" is omitted. The object of the city might very well be supposed to have been attained by the selection of the city as a terminus of the railroad, the construction and establishment there of its offices, its depot, its car manufactory and other machinery, since there was hardly any ground to suppose that the railroad company would ever have inducements enough to justify it in removing all these things to another place. And in point of fact it appears that for a period of about eight years they were permanently located at the city of Marshall. If, however, the city desired something more than this, if it desired to make sure that these establishments should forever remain within the limits of the city of Marshall, and that the railroad company should be bound to keep them there forever, such an extraordinary obligation should have been acknowledged in words which admitted of no controversy. It would have been very easy to have inserted into this contract language which forbade the company from ever removing the terminus of the road to some other point, or from ever removing or ceasing to use the depot, or the car and machine shops, and thus have made the obligation perpetual. But it seems to us that the real essence of the contract was that the railroad company should, in its process of construction, make this city its eastern terminus, and should establish there its depot, its machine shops and its car works; and that this should be done in the ordinary course of its business, with the purpose that it should be permanent. But it did not amount to a covenant that the company would never cease to make its eastern terminus at Marshall; that it would forever keep up the depot at that place; that it would for all time continue to have its machine shops and car shops there and that whatever might be the changes of time