BEEKMAN v. HU1>soN RIVER WEST SHORE RY. oo. 13
bonds to secure which the mortgage was executed were, as recited in the
mortgage, bonds of the West Shore Hudson River Railroad Company, is-
sued for the purpose of enabling the latter company to acquire a lease of
the road and entire property and franchises of the former, and to build,
furnish, and operate its own road. The demurrants contend that a rail-
road company has no power to mortgage its property to secure the debt
of another company. Without discussing the precise question thus
raised, it is sumcient to call attention to the fact that the mortgage is a
ioint one executed by both roads, and covers "all and singular the rail-
ways of the parties of the first part hereto, constructed or hereafter to be
constructed, [between the state line and Newburgh,] and also all and sin-
gular the franchises nowowned, possessed, or acquired by the said par-
ties of the first part, or either of them, for the purpose of building, main-
taining, and operating their respective lines of railway/’ etc. Either
prior or subsequent to the mortgage—the phraseology of the bill does not
leave the date altogether certain—the Hudson River West Shore Rail-
road Company leased its road for the entire term of its corporate exist-
ence to the West Shore Hudson River Railroad Company, and its entire
capital stock was transferred to the latter company. The right ofthe
West Shore Hudson River Railroad Company to mortgage its own prop-
erty to secure its own bonds is not disputed; and, even if the lease and
transfer or stock werenot made until after the mortgage, they would be
covered by it as after-acquired property, unless such lease and transfer
were void. That they were void these demurrants contend, but their
own title depends upon the validity of these very transfers. The conces-
sion of congress was to the Hudson River West Shore Railroad Company.
Nothing is shown qualifying the title of that corporation to this conces-
sion, except the mortgage, the lease, and the transfer. The two last in-
struments are operative, if at all, in favor of the West Shore Hudson
River Railroad Company; and nothing is shown qualifying the title of
the latter company to the property thus sought to be transferred except
this mortgage, and the transfer of July 27, 1871, to the New York, West
Shore & Chicago Railroad Company, discussed under the lastpoint, and
under which the demurrants claim. They are, therefore, in no position
to dispute the sufficiency of thelease and transfer of capital stock. There
is no force in their argument that, if they "are to be considered as suc-
ceeding to the property and rights of the Hudson River West Shore Rail-
road Company, they can of course question the validity of the mortgage,
if its validity could have been questioned by the corporation itself, " be-
cause the very instruments which make them successors to the property
and rights of the Hudson River West Shore Railroad Company also op-
erate to make the mortgage valid. If these rights were passed to the
West Shore Hudson River Railroad Company, and thence to demur-
rants’ grantor, they were covered by the mortgage, which was in exist-
ence, and operative to cover after-acquired property, before the West
Shore Hudson River Railroad Company passed them on.
The demurrer of the defendants the West Shore Railroad Company
and the New York Central & Hudson River Railroad Company is over-
ruled, with leave to answer. `