Baltimore, Cheaspeake & Atlantic Railway Co. v. Mayor of Ocean City

Briscoe, J., delivered the opinion of the Court. This is a suit brought by the Mayor and City Council of Ocean City, Maryland, against the Baltimore, Chesapeake and Atlantic Railway Company to recover certain taxes alleged to be due and unpaid by the defendant company. The case was tried upon an agreed statement of facts, and the judgment being for the plaintff, the defendant has appealed. It appears that the defendant is a corporation formed under sections 187, 188, 189 and 190, of Article 23 of the Code of Public General Laws, for the purpose of “owning, possessing, maintaining and operating a railroad in this State,” formerly known as the Baltimore and Eastern Shore Railroad; the latter road having been formed ⁹⁶ under the general incorporation laws of the State.

By the Act of 1886, chapter 133, the powers of the Baltimore and Eastern Shore Railroad were enlarged, and “ its franchises, property, shares of capital stock and bonds ” were exempt from all State, county or municipal taxation for the term of thirty years, accounting from the date of the completion of the road, between the termini mentioned in its charter, that is, between Eastern Bay in Talbot County and the town of Salisbury in Wicomico County. This road was completed on or about the first of August, 1891. By section 5 of the Act, the Baltimore and Eastern Shore Railroad was authorized “ to lease or purchase and operate any railroad or railroads ” either in or out of this State, for the purpose of carrying on their business, and any other railroad company in this State was also authorized to lease or sell its railroad or other property to this road. In pursuance of this power, the Baltimore and Eastern Shore Railroad, on the 30th of June, 1890, purchased the property known as the Wicomico and Pocomoke Railroad, a road about thirty miles long, extending from Salisbury to Ocean City and thus consolidating the two roads: After-wards, in August, 1894, these two roads, as thus consolidated, together with their property rights, were sold by a decree of the Circuit Court of the United States for the District of Maryland, under certain mortgage foreclosure proceedings, and were purchased by Mr. Nicholas P. Bond, of Baltimore City, who subsequently with others formed the defendant corporation, the Baltimore, Chesapeake and Atlantic Railway Company.

So the principal question presented by this appeal, is whether the property formerly owned by the Wicomico and Pocomoke Railroad, situate in the town of Ocean City and now owned by the appellant company, is exempt from taxation, under section 2 of chapter 133 of the Acts of 1886. Now, as we have seen, the Act of 1886 provided for the building and working of a railroad from the shores of ⁹⁷ Eastern Bay, in Talbot County, to Salisbury, in Wicomico County, passing through the counties of Talbot, Caroline, Dorchester and Wicomico, and it is quite clear, we think, that it was only such property as is necessary for the operation of this road, that the Legislature intended to exempt from State, county and municipal taxation, for the term of thirty years, from the date of the completion of the road. It means the railroad and its property mentioned in the Act and none other. It is admitted that the Wicomico and Pocomoke Railroad Company was entitled to no such exemption at the time of its purchase by the Baltimore and Eastern Shore Road, either under its charter or by legislative exemption.

It is a sound rule of construction, said this Court, in State v. Baltimore and Ohio R. R. Co., 48 Md. 73 , that the power of taxation is never presumed to be relinquished