Third Department, July, 1920. [Vol. 192. v. Mayor, 16 App. Div. 227; Central Crosstown R. R. Co. v. Metropolitan Street R. Co., Id. 229; Richards v. Citizens' Water Supply Co., 140 id. 206; Manhattan Bridge T.-C. Line v. Third Avenue R. Co., 154 id. 704; Fanning v. Osborne, 102 N. Y. 441; Brooklyn Heights R. R. Co. v. City of Brooklyn, 152 id. 244; Delaware, L. & W. R. R. Co. v. City of Buffalo, 158 id. 266, 478; Hatfield v. Straus, 189 id. 208; City of Rochester v. R. & L. O. W. Co., Id. 323; New York Central & H. R. R. R. Co. v. General Electric Co., 219 id. 227, 237.) As the acceptance of a franchise implies the execution of the conditions and duties prescribed in the grant (3 Kent Comm. [14th ed.] *458; City of New York v. Bryan, supra, 164) it may be presumed that the Postal Telegraph Cable Company has occupied all of the places where it is authorized by law to perform its functions, and it clearly is not authorized to accept business for places where it has no franchise. Nor is it authorized by anything in the corporation laws of this State to act as the agent for those persons who may desire to transmit messages to communities served only by the Western Union Telegraph Company. Corporations," say the court in Schwab v. Potter Co. (194 N. Y. 409, 418), cannot resort to ingenious and original methods of action with the freedom of individuals, for they are confined to those expressly authorized by statute and such as are incidental thereto and necessary to carry them into effect," and "Whatever is done by a corporation without authority is done in violation of law, for all action, not authorized directly or indirectly, is prohibited. (General Corporation Law [L. 1890, chap. 563, as amended], § 10.*)" No cause of action, or other legal right, "can arise from an undertaking prohibited by statute, whether the contract is malum in se or malum prohibitum." (Peck v. Burr, 10 N. Y. 294, 299; Village of Fort Edward v. Fish, 156 id. 363, 373.) Of course, it is proper that the Postal Telegraph-Cable Company should accept a message in Albany to be delivered at some point where it has an office, and it is then the duty of the Western Union Telegraph Company, when called upon, to *Sic. See Gen. Laws, chap. 35 (Laws of 1890, chap. 563), § 9; Gen. Laws, chap. 35 (Laws of 1892, chap. 687), § 10, as amd. by Laws of 1895, chap. 672; now Consol. Laws, chap. 23 (Laws of 1909, chap. 28), § 10.[REP. App. Div.] complete a transmission begun by its rival, and upon the payment of the prescribed fees, to complete the service; that is a matter in which the public has an interest, and it was upon a recognition of this duty that People ex rel. Western Union Telegraph Co. v. Public Service Commission (160 App. Div. 144; 211 N. Y. 542) and Matter of Postal Telegraph-Cable Company (169 App. Div. 382) were decided, but that is not the problem presented here. The Public Service Commission has ordered that messages originating in Albany, we will assume, destined to non-competitive points, may be handed in at the Albany office of the Western Union Telegraph Company by the Postal Telegraph-Cable Company, and that it is not only the duty of the Western Union Telegraph Company to transmit these messages but that it must extend a credit to the Postal Telegraph Cable Company, to the end that the latter corporation, touching only the high spots in the commercial geography of the State, may be able to convey to its patrons the impression that it has the facilities which, under its charter, it does not possess. It is a fact of which the court may well take judicial notice that the Western Union Telegraph Company maintains offices in practically every community of commercial or industrial importance in the State of New York, in many instances where it is questionable whether the office is self-supporting; certainly where it would be impracticable to support a competing office. The Postal Telegraph-Cable Company, coming into the field at a much later day, and confining its franchise rights to the highly developed commercial centers, is now offering its services at a reduction of twenty per cent from that charged by the Western Union Telegraph Company, and, if it may carry on the practice which the order under review commands, it will be given all the advantages of the Western Union Telegraph Company's elaborate system in the fostering of its own business. This is not the duty the State of New York owes to its corporate creations; it is not the condition upon which they accepted their franchises. It is true, of course, that the Legislature reserves the right to alter and amend these franchises (Gen. Corp. Law, § 320; Const. art. 8, § 1), but it rests under the moral obligation to act in good faith with the incorporators who are discharging a public service, and until the Legislature in unmistakable language has authorized Third Department, July, 1920. [Vol. 192. such an invasion of the business policy of a public service corporation as is manifest in the present order, the courts will not presume that any such result was intended. We are clearly of the opinion that it is not the duty of the Western Union Telegraph Company to afford facilities to its rival in the development of its purely business affairs; that it is not called upon to become a party to the deception of the public by the practice of taking care of the Postal TelegraphCable Company's business upon the basis of financing the credits of that corporation to its customers. The Western Union Telegraph Company has a right to the prestige of its highly developed service in the promotion of its own business; that is the fair interpretation of the mutual agreement growing out of the granting and acceptance of a franchise from the sovereign power. It has a right to have the public understand the true situation, and not to have it obscured by a system which permits the customer to understand that the Postal Telegraph-Cable Company is performing a service which it has no lawful right to perform for the reason that it has no franchise right to deliver messages in territory which it does not occupy. The territory covered exclusively by the Western Union Telegraph Company belongs to it to serve; it alone has the right to conduct a telegraph business in that particular territory, and when the Postal Telegraph-Cable Company, under the provisions of the order here under consideration, holds itself out as performing this service it is acting without warrant of law. It is probably impracticable to say that the Western Union Telegraph Company might refuse to perform this service for the customers of the Postal Telegraph-Cable Company; it probably owes the duty, on compliance with the provisions of the statute, to forward any message delivered to it, but there is no reason why it should be called upon to promote the business interests of its rival by enabling that corporation to appear as serving a territory which it cannot reach lawfully. The system of accounting provided for in the order is admirably adapted to deceive and to give to the Postal Telegraph-Cable Company the advantages which belong to the chartered rights of the Western Union Telegraph Company, and the fact that the latter has, in times past, submitted to the imposition upon its just rights is not a reason for com App. Div.] Third Department, July, 1920. pelling it to continue, upon the flimsy pretext that the rights of the public are involved. No man or corporation has a lawful right to demand the sending of a message without the present payment of the established fee. If, for its own purposes in the fostering of its own business affairs, the Western Union Telegraph Company waives this right in behalf of such customers as it may choose, this does not operate to give rights to a rival corporation to extend to its own customers the privileges which belong only to the Western Union Telegraph Company. The people who patronize the Postal TelegraphCable Company, and who might be accommodated by having that company act as its errand boy in delivering messages for non-competing points to the Western Union Telegraph Company at the point of origin, do not constitute "the public " in any proper sense. The Postal Telegraph-Cable Company owes them no chartered duty in respect to messages outside of its own designated territory (Great Northern Railway Company v. Cahill, 253 U. S. 71, decided by United States Supreme Court May 17, 1920), and the language of section 10 of the General Corporation Law is that no corporation shall possess or exercise any corporate powers not given by law, or not necessary to the exercise of the powers so given." The individual customer of the Postal Telegraph-Cable Company, if he desired to send a message into Western Union Telegraph Company territory, could avail himself of the Western Union messenger service quite as readily as that of the rival corporation, and he would be entitled to the resources of that company and to such accommodations as the business policy of the Western Union Telegraph Company might dictate, but at law he could only have the right to such service upon the payment of the established fee. Under the order complained of a party who had, by his misconduct, forfeited the privilege of credit with the Western Union Telegraph Company could be given this privilege through the intervention of a rival corporation, and thus the management of the affairs of the Western Union Telegraph Company would be taken from its own directors to this extent and placed in the control of the directors of the Postal Telegraph-Cable Company, a result so at war with the language and the spirit of the corporation system of the State of New York Third Department, July, 1920. [Vol. 192. that it cannot rest upon any foundation less certain than direct language in a legislative enactment. The writ of certiorari should be sustained, and the order of the Public Service Commission reversed, and the proceeding be dismissed. All concur, except JOHN M. KELLOGG, P. J., dissenting, with an opinion in which COCHRANE, J., concurs. JOHN M. KELLOGG, P. J. (dissenting): Section 103 of the Transportation Corporations Law requires one company to receive and transmit dispatches from and for another company and from and for individuals upon payment of the cash rates. It is I think conceded that under this section the Postal Company is entitled to have its dispatches transmitted by the Western Union if cash is paid therefor. The same section, however, requires that all dispatches shall be transmitted with impartiality, and the laws governing common carriers and the Public Service Commissions Law require a like service on equal terms, under like conditions. Apparently credit is given for the majority of dispatches sent by either company, and that fact gives to the Postal Company the right to require that dispatches delivered by it to the Western Union shall be received by it and transmitted and charged to the Postal Company. For a great many years the companies have exchanged business on substantially the terms mentioned in the order now under review. Each company had substantially the same rates. But when the government released to the companies the operations of their lines, about August 1, 1919, the Postal Company reduced its rates twenty per cent, while the Western Union discontinued the practice of receiving dispatches and charging the same under the old plan. It claims that by reason of the difference in the rates, misunderstandings and frictions will grow up, especially if it is required to render bills to individuals for dispatches delivered to it by the Postal Company. The Public Service Commission is not all powerful. So far as we are now interested in it, it can require an equal service on equal terms to all. It does not appear, as I understand it, that the Western Union is now receiving dispatches from other companies under similar |