Case ID: ohio-cir-dec_11/html/0805-01.html
Source: Caselaw Access Project
Author: {"author": "Giffrn, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

MUNICIPAL CORPORATIONS — FRANCHISES.
    [Hamilton Circuit Court,
    January Term, 1901.]
    Smith, Swing and Giffen, JJ.
    
      W. M. Ampt etc., v. Cincinnati et al.
    1. Pneumatic Conductors not Authorized by Sec. 2651-17, Rev. Stat.
    An ordinance granting to a corporation the right to the use of the streets for pipes or conduits for the purpose of supplying compressed air, to transmit packages of the various individuals who may apply and pay for such service, is not within Sec. 2651-17, Rev. Stat., authorizing franchises for the transmission of heat and power. Such ordinance does not authorize the conveyance of compressed air as a power for the benefit of the inhabitants of the municipality, as required by the terms of that section.
    2. Shourd fix Maximum and Uniform Arrowance.
    And if in other respects valid, an ordinance for purposes mentioned should fix a maximum and uniform rate to be charged the public for the service contemplated. Otherwise it would be unreasonable and against public policy.
    3. Shourd Arso Regurate Construction.
    Such ordinance should also prescribe the number, size, dimensions and material of the pipes or conduits, and the manner in which they shall be laid, or the details necessary to a complete conduit system, so that the city may know beforehand exactly what is to be built and may protect itself against abuses or unreasonable construction.
    4. Perpetuar Franchise is Urtra Vires.
    A franchise for sucha length of time as “the public shall be served by the delivery of power, etc.,” and as long as the company shall pay to the city a certain percentage of its gross receipts, is perpetual and the act of the city, in thus surrendering control over its streets, is ultra vires.
    
    5. Taxpayer’s Action Against a City.
    Upon the refusal of corporation counsel to bring suit for an injunction against the city to prevent it from allowing, and to prevent a private corporation from using, its public streets for certain purposes (laying pneumatic tubes, for carrying packages by means of compressed air and supplying compressed air) a taxpayer has, under Secs. 1777 and 1778, Rev. Stat., authority to bring such suit.
    6. Joinder of Parties Defendant — Quo Warranto not the Remedy.
    Such an action, seeking to restrain the city from allowing and the corporation from using the streets, is not a joinder of separate causes of action against several defendants, or a case in which it is necessary to proceed by quo warranto against the private corporation. The action is to enjoin alleged misuse of streets and the defendant company and all parties against whom relief is sought may be joined as defendants.
    Appear from the court of common pleas of Hamilton county.
    
      W. M. Ampt, for plaintiff,
    cited:
    1. The franchise cannot be upheld under Sec. 3471a, Rev. Stat.,, because granted to a person and not a company.
    Because said section does not authorize an underground franchise for any purpose.
    Because the elimination of Sec. 3461 from Sec. 3471a, Rev. Stat., as amended, leaves no authority under the latter section to grant the franchise in question. •
    
      Because the power conferred by the franchise is not automatic, and conduits to supply ” compressed air ” are not authorized.
    2. Nor can the franchise be upheld under Sec. 2651-17, Rev. Stat., because this section only authorizes the delivery of heat and power as a commodity to the inhabitants of a municipality whilé the franchise is for the delivery of merchandise and compressed air is not necessarily as a public service and to “ use,” but not to furnish “ power.”
    As to the restrictions governing the action of municipal councils : Gas Co. v. Avondale, 43 O. S., 266 [1 N. E. Rep., 527]; Railroad Co. v. Defiance, 52 O. S. 260, 306, 307 [40 N. E. Rep., 89]; Davis v. N. Y., 14 N. Y„ 506, 532, 620, 621, «22; Williams v. Sharp, 27 N. Y. 611; Coleman v. Railroad Co., 38 N. Y., 201; Street Railroad Co. v. Covington, 9 Bush (Ky.), 127; Toledo Elec. St. Ry. Co. v. Light and Power Co., 4 Circ. Dec., 43 [10 R. 531]; Wellston v. Morgan, 59 O. S., 147 [52 N. E. Rep., 127].
    The franchise ordinance is unreasonable in its provisions (a) because perpetual and not forfeitable: Flynn v. Water Co., 74 Minn., 180 [77 N. W. Rep., 38; 18 N. W. Rep., 106]; 9 Kulp (Pa.), 241, 256; Goszler v. Georgetown, 19 U. S. (6 Wheat.), 591, 595; Lewis v. Newton, 75 Fed. Rep., 884; Brenham v. Brenham, 67 Tex., 542 [4 S. W. Rep., 143]; 31 Pa. St., 182.
    (b) Because not for a public purpose: Mikesell v. Durkee, 34 Kan., 509 [9 Pac. Rep., 278]; 36 N. J. L-, 79; State v. Murphy, 134 Mo., 548, 562 to 567 [31 S. W. Rep., 784; 34 S. W. Rep., 51; 35 S. W. Rep., 1132; 56 Am. St., 515],
    (c) Because not fixing a maximum charge for serving the public, and the public is not required to be served except upon terms fixed by the grantee, nor upon terms equal to all. Herbert v. Benson, 2 La. Ann., 770.
    (d) Because exclusive in the sense that no other person or grantee has the right to use grantee’s conduits.
    (e) Because city has reserved no right of control over the conduit or underground system of construction,, and has failed to prescribe what it shall be.
    4. The grantee, Quill, had no right to sell and transfer, and the defendant company had no right to buy or accept the transfer of the franchise in the absence of statutory authority authorizing the transaction. Morawetz, Coroorations, 924, 931; See 1120, 1129 ; Coe v. Railroad Co., 10 Ohio St., 372; Atkinson v. Railroad Co., 150hio St., 21, 38; State v. Telephone Co., 36 Ohio St., 296 [38 Am. Rep., 583].
    
      Philip C. Swing and Charles /. Hunt, corporation counsel, and Herbert Jenney, and Campbell, Bates, Cien Dening & Meyer, for defendants.
    
      
      For decision of the court of common pleas, see 9 Dec., 394.
    
   Giffrn, J.

(announcing judgment, no opinion).

The petition alleges that on January 17, 1898, the city of Cincinnati passed an ordinance which granted to Thomas A. Quill, his heirs, associates, assigns and successors, permission to lay pipes and other necessary appliances in the streets, avenues, alleys and public places of Cincinnati for the purpose of transmission of packages, letters, telegrams and other articles, which may be transmitted therein by the use of electricity, compressed air, or any other motive power which may be applicable to such systems as are now known as “ underground pneumatic systems ” and also for the purpose of supplying compressed air, provided that the transmission be granted upon the express conditions named in the ordinance. The conditions were that the grantee, his associates, heirs, assigns and successors, shall furnish to the city of Cincinnati, on its streets, alleys, lanes, avenues, commons, etc., the service contemplated and authorized to be carried on, and similar services for the public buildings used by the city or any of its departments, at a price not exceeding that charged private consumers, but the city was not obliged to make use of said service. The board of administration was to have supervision of all work of construction, and to designate what portions of the street shall be broken up at a time, and at what and how many points the work shall be carried on. A bond of $50,000 was to be given to the city to insure the restoration of its streets and to indemnify the city against any loss or damage consequent upon laying any pipe. Work was to be begun within one year from date of grant, and four miles of pipe were to be laid within three years, otherwise the ordinance shall be void. After three years from date of grant the grantee was to pay a percentage of his gross income, of one per cent, for the first year, two per cent, for the second year, three per cent, for the third year, four per cent, for the fourth year, and thereafter, annually, five per cent. Any assignee of the grantee was ¡ equired to give the same kind of a bond as a condition to his acquiring any right under the assignment. The board of administration or its successor were authorized to call upon tbe police department to enforce any of the provisions of the ordinance.

The Cincinnati Delivery, Power and Refrigerator Company, one of the defendants, became the assignee of the franchise from Quill.

The suit was brought by the plaintiff as a taxpayer under Sec. 1778, Rev. Stat., who claimed in his petition the franchise ordinance was void.:

First: Because for a purpose unauthorized by law.

Second : Because made for an undeterminate period of time.

Third: Because it is an exclusive grant.

Fourth: Because not for a public purpose, or for the benefit of Cincinnati or its inhabitants, but for a private purpose and private profit.

- Fifth : Because unreasonable in its provisions in not reserving in the city the privilege of regulating charges thereunder from time to time.

Sixth: Because failing to fix a maximum limit of charges, and in failing to prescribe the number, size, dimensions or material of the conduits and pipes to be laid, the manner in which they shall be laid, or the depth under the surface of the street.

Injunctions allowed for the reasons stated in the opinion of thi court of common pleas, 9 Dec. 394 (6 N. P., 401), except the one that the grant is exclusive.