Title: STATE HIGHWAY COMMISSION OF WYOMING v. SHERIDAN-JOHNSON RURAL ELECTRIFICATION ASSOCIATION

State: wyoming

Issuer: Wyoming Supreme Court

Document:

STATE HIGHWAY COMMISSION OF WYOMING v. SHERIDAN-JOHNSON RURAL ELECTRIFICATION ASSOCIATION1989 WY 220784 P.2d 588Case Number: 89-77Decided: 12/18/1989Supreme Court of Wyoming
STATE HIGHWAY COMMISSION 
OF WYOMING, APPELLANT (PLAINTIFF),

v.

SHERIDAN-JOHNSON RURAL 
ELECTRIFICATION ASSOCIATION, APPELLEE (DEFENDANT).

Appeal from the District 
Court, SheridanCounty, James N. Wolfe, 
J.

Joseph B. Meyer, 
Atty. Gen., Peter J. Mulvaney, Deputy Atty. Gen., Lawrence A. Bobbitt, III, Sr. 
Asst. Atty. Gen., Cheyenne, for 
appellant.

Robert W. 
Conner, Jr., Sheridan, for appellee.

Before CARDINE, C.J., and THOMAS, URBIGKIT, MACY 
and GOLDEN, JJ.

GOLDEN, 
Justice.

[¶1.]     Appellant State 
Highway Commission of Wyoming (Commission) challenges an order 
dismissing its petition for declaratory relief against appellee Sheridan-Johnson 
Rural Electrification Association (Sheridan-Johnson), and granting summary 
judgment to Sheridan-Johnson. The Commission sought to establish that 
Sheridan-Johnson was responsible for the costs of relocating all of its power 
transmission facilities from state highway lands that it occupied under a 1972 
license granted by the Commission. Condition No. 2 in that license states that 
any relocation of facilities within the existing right-of-way will be completed 
without cost to the Commission. The district court found that the term "existing 
right-of-way" referred only to the sixty-six foot wide strip underlying 
U.S. 
Highway 16-14, and not to the parallel strip of land 
acquired by the Commission in 1954 for future improvements. Reasoning that the 
Commission could have expressly required relocation of all poles without cost if 
that was its intent, the court held that Sheridan-Johnson was not liable for the 
cost of relocating the utility poles from state property covered by the license, 
but outside the sixty-six foot strip.

[¶2.]     We reverse, and direct 
summary judgment for the Commission as a matter of law.

[¶3.]     As will be discussed, 
common law requires that public utilities bear the expense of removing and 
relocating their facilities placed along public roads when such relocation is in 
the public interest. This is an exercise of the police power of the state, which 
may be modified only by the legislature and cannot be waived by acts of state 
employees.

[¶4.]     Sheridan-Johnson first 
obtained a license from the Commission to place its facilities - power lines, 
poles and down guys - on state lands used for highway purposes in June 1960. The 
license covered Sheridan-Johnson's poles located on the sixty-six foot wide 
strip on which Highway 14-16 was originally constructed, and on a parallel strip 
of land that the Commission acquired for future improvements from the Old 
Wyoming Railroad Company in 1954. It was granted by the Commission under 
authority of W.S. 1957, § 1-791, "Right-of-way along public ways granted; 
permission necessary for new lines," which permits public utilities to place 
their poles, lines, or other facilities along state roads after obtaining 
permission from the Commission.1 The parties entered another, nearly 
identical licensing agreement in March 1970.

[¶5.]     As a result of a 
project upgrading its power lines, Sheridan-Johnson executed a third license 
with the Commission in June 1972. This license was on a new form which was 
worded somewhat differently from the two preceding licenses. Where the earlier 
licenses had been silent about the cost of relocation when it was required by 
the Commission, Condition No. 2 of the 1972 license 
stated:

Any future alteration or 
modification of the Facility within the existing right of way, required and 
requested by the Department, shall be completed without delay and without cost 
to the Department.

[¶6.]     In February 1985, the 
Commission notified Sheridan-Johnson that it was proceeding with reconstruction 
of a section of U.S. 
Highway 14-16, that the project required relocation 
of a number of Sheridan-Johnson's power poles, and that Sheridan-Johnson would 
bear the cost of relocation of its facilities located in the public 
right-of-way. Sheridan-Johnson agreed that it was responsible for the cost of 
relocating the poles within the sixty-six foot strip of land underlying the 
highway. However, the utility argued that the poles on the adjacent land owned 
by the Commission were not within the "existing right-of-way," and as a 
consequence, the state should bear the expense of relocating 
them.

[¶7.]     The parties were unable 
to agree on liability for relocation costs, but entered into an agreement for 
adjustment of facilities on August 6, 1987. This agreement provided that the 
Commission would advance the costs of relocating the power poles pending a 
resolution of the dispute, and would then seek a declaratory judgment that 
Sheridan-Johnson was responsible for those costs. The Commission filed its 
motion for declaratory relief on November 10, 1987, and the district court 
denied the motion and granted summary judgment for Sheridan-Johnson on February 
17, 1989.

[¶8.]     Summary judgment is 
proper when there is no genuine issue of material fact, and judgment for the 
prevailing party is correct as a matter of law. We apply our well-established 
standard of review, viewing the record and according inferences from the facts 
in a manner favorable to the party opposing the motion. Case v. Goss, 776 P.2d 188, 190-91 (Wyo. 1989). In this instance we find that 
there is no issue of material fact, but that judgment for Sheridan-Johnson is 
incorrect as a matter of law.

[¶9.]     The district court 
erred in focusing on the definition of "existing right-of-way." Even if the 
meaning assigned by the district court is correct,2 the phrase in the 1972 license is 
no basis for granting Sheridan-Johnson a windfall where there has been no 
legislative modification of the common law rule that utilities shall bear the 
expense of relocating their facilities placed along public roads. This rule is 
an expression of the state's police power, and it is beyond the authority of 
state employees to enter an agreement which compromises reasonable exercise of 
the police power unless they are authorized to do so by statute. As a result, 
even if "existing right-of-way" is something less than the public way covered by 
the license, the Commission is still not responsible for Sheridan-Johnson's 
relocation expenses.3

[¶10.]  The common law requires that utilities 
pay the cost of removing and relocating their facilities placed upon public 
highways when necessitated by highway improvements. New Orleans Gaslight Co. v. 
Drainage Commission of New Orleans, 197 U.S. 453, 25 S. Ct. 471, 49 L. Ed. 831 
(1905); State 
Road Commission of Utah v. Utah Power & Light Company, 10 Utah 2d. 333, 336, 353 P.2d 171, 173 (1960). We have often said that the common law remains the law in 
Wyoming unless it is set aside by statute, Condos v. Trapp, 717 P.2d 827, 831 
(Wyo. 1986), on rehearing 739 P.2d 749 (Wyo. 1987), and this rule of law 
concerning relocation and expense of relocation has not been annulled or 
modified by any Wyoming statute. Other jurisdictions have made similar 
statements about the application of common law while addressing utility 
relocation costs, holding that only an express statute will shift the burden to 
the state. State of Arizona ex rel. Herman v. 
Electrical District No. 2 of Pinal County, 12 Ariz. App. 222, 469 P.2d 114, 117 (1970).4

[¶11.]  We have consistently said that our 
statutes will be read in harmony with the common law. Wetering v. Eisele, 682 P.2d 1055, 1061 (Wyo. 1984). In this light it is apparent that 
the "in such manner as not to incommode the public in the use of such roads * * 
*" language in W.S. 1957, § 1-7915 expresses only the limited user 
granted by common law. A utility may not inconvenience the traveling public by 
either the location of its facilities in the public way, or with the expense of 
removing and relocating those facilities, should that be required by the public 
interest.

[¶12.]  The common law rule requiring removal and 
relocation at the utilities' expense is an expression of the police power of the 
state. Utah Power & Light, 10 Utah 2d at 340, 353 P.2d  at 176; Washington Natural Gas, 
373 P.2d  at 135. We have described the police power as "a government's ability 
to regulate private activities and property usage without compensation as a 
means of promoting the public health, safety, morals and general welfare." 
(emphasis added). CheyenneAirport Board v. Rogers, 707 P.2d 717, 726 (Wyo. 1985). Police powers are an essential 
attribute of the state as sovereign and cannot be bargained or contracted away. 
New Orleans Gaslight, 197 U.S.  at 460, 25 S. Ct.  at 413, 49 L. Ed.  at 835; State Highway Commission v. Clackamas Water 
District, 247 Or. 216, 428 P.2d 395, 397 (1967); City of Paris v. Paris-Henry County Public Utilities District, 207 
Tenn. 388, 340 S.W.2d 885, 888 (1960). Consequently, even if the district court were correct 
regarding the intent of the Commission, any attempt to limit the police power by 
agreement is invalid because it is beyond the authority of state employees to do 
so. Sheridan-Johnson cannot rely on the district court's interpretation of the 
license language where that interpretation compromises reasonable exercise of 
the police power. Only the legislature may authorize reimbursement for utility 
relocation. Utah Power & Light, 10 
Utah 2d. at 
340, 353 P.2d  at 176.

[¶13.]  Sheridan-Johnson claims that it relied to 
its detriment on the license language, and argues that equitable estoppel should 
be applied to compel the state to pay the relocation costs. The utility contends 
that estoppel is available where it was misled, and the state was acting in a 
proprietary capacity in managing the lands in dispute. This claim fails for two 
reasons. First, because management of lands for highway purposes concerns the 
welfare of the public at large and is undertaken at the direction of the 
legislature, it is a governmental rather than proprietary function. Biscar v. 
University of Wyoming Board of Trustees, 605 P.2d 374, 376 
(Wyo. 1980). 
Estoppel does not apply to governmental or sovereign functions, especially where 
it would defeat the public interest. Big Piney Oil & Gas v. Wyoming Oil and Gas Conservation Commission, 715 P.2d 557, 
560 (Wyo. 
1986). Second, the state may not be estopped for the unauthorized acts or errors 
of its officers or employees. State ex rel. Cartwright v. Tidmore, 674 P.2d 14, 17 (Okla. 
1983). See also Big Piney Oil & Gas, 715 P.2d  at 560. Even if the license 
was intended as interpreted by the district court, the state is not estopped by 
the unauthorized actions of the employees who prepared and executed the 
license.

[¶14.]  Sheridan-Johnson also contends that its 
reliance has made the license irrevocable, so that it is entitled to just 
compensation for a "taking" by the Commission. Sheridan-Johnson argues from its 
premise that the 1972 license, at least as it pertains to lands outside the 
sixty-six foot strip, is not a statutory license issued by authority of W.S. 
1957, § 1-791. This is simply wrong. There has been no showing that the license 
was issued by any other authority, or for reading the license as being statutory 
regarding some, but not all of the lands it covers.

[¶15.]  This cannot be a question of the taking 
of a property right created by reasonable reliance precisely because the 1972 
license, which applies to all of the Commission property along Highway 14-16, 
was issued only by authority of W.S. 1957, § 1-791. Our public way right-of-way 
statute reflects the common law, permitting utility facilities on the public way 
so long as they do not interfere with dominant rights of the traveling public. 
The license could not be relied on to provide any more right than the common law 
grants, which is no more than a right to some location in the public way, not to 
any specific location. New Orleans Gaslight, 197 U.S.  at 461, 25 S. Ct.  at 473, 49 L. Ed.  at 835. Because Sheridan-Johnson could not rely in good faith on any more 
than this, nothing has been taken from it and there is no basis for a just 
compensation claim.

[¶16.]  Consequently, we grant summary judgment 
for the Commission. Even if there is a question as to the meaning the parties 
intended by the term "existing right-of-way," it is not material under the 
Commission's motion. Barring a statute to the contrary, the common law places 
the expense of relocation on utilities, and any attempted waiver of this 
manifestation of the state's police power is invalid as a matter of law. Here 
the only relevant statute reflects the common law. The drafter of the license 
was without power to limit the state's authority to require relocation at the 
utility's expense.

[¶17.]  We will continue, as a matter of law, to 
apply common law principles unless the legislature directs otherwise. As a 
result, Sheridan-Johnson and other public utilities in Wyoming will continue to 
bear the expense of relocating their facilities from public roads when 
relocation is required in the interest of the traveling public. We emphasize 
that public utility facilities such as the power poles at issue are located in 
the public way only by authority of licenses issued pursuant to W.S. 1-26-813 
and its earlier codifications. Any facilities licensed under this statute are 
subject to the relocation requirements of the common law, regardless of what the 
license may say, or not say, concerning this subject. Only the legislature may 
shift the burden of relocation expenses to the state.

[¶18.]  Reversed, with direction to enter summary 
judgment for the State Highway Commission of Wyoming.

FOOTNOTES

1 W.S. 1957, § 1-791 
stated:

Corporations organized * 
* * for the purpose of constructing, maintaining and operating * * * electric 
transmission and distribution lines * * * are authorized to set their poles, 
piers, abutments, wires and other fixtures along, across or under any of the 
public roads, streets and waters of this state in such manner as not to 
incommode the public in the use of such roads, streets and water; * * * no 
person or firm or corporation shall, for the purpose of commencing construction 
of any new * * * electric transmission and distribution lines, enter upon any 
such state highway * * * without first obtaining permission from the state 
highway commission * * *.

The public way 
right-of-way statute is presently codified as W.S. 1-26-813 (June 1988 Repl.), 
in substantially similar language:

Corporations authorized 
to do business in this state for the purpose of constructing, maintaining and 
operating a public utility may set their fixtures and facilities along, across 
or under any of the public roads, streets and waters of this state in such 
manner as not to inconvenience the public in their use. * * * A person or firm 
must first obtain permission from the state highway commission * * * before 
entering upon any state highway * * * for the purpose of commencing 
construction.

2 It is not obvious to 
this court that the assigned meaning is correct. Neither "existing right-of-way" 
nor "right-of-way" appear to be terms of art. Regarding the sixty-six foot 
limitation, we note that W.S. 24-2-102 (Cum.Supp. 1987) (previously codified as 
W.S. 1957, § 24-37; W.S. 24-2-109(a) (1977)), provides that highway 
rights-of-way may be up to three hundred feet wide, or wider where the 
right-of-way includes enumerated features such as deposits of roadbuilding 
materials, excavations or parking facilities. In addition, Sheridan-Johnson 
places emphasis on the meaning of "existing" and cites to its application in 
several cases. However, those cases concerned structures such as buildings and 
bridges, which were held not to be existing until they were completed. See e.g., 
State ex rel. Saylor v. Walt, 66 S.D. 14, 278 N.W. 12, 15 (1938). In contrast, 
highway right-of-way is a land status that inures when the land is acquired by 
the Commission for highway purposes. We explicitly recognized this in State of 
Wyoming ex rel. State Highway Commission v. Meeker, 75 Wyo. 210, 214, 294 P.2d 603, 604 (1956), where we said, "[t]he State Highway Commission did not 
immediately take possession of the right of way thus acquired, but did let a 
contract for the construction of a highway over and along the acquired right of 
way * * *."

3 The district court based 
its decision on the Commission's failure to expressly require that 
Sheridan-Johnson bear the relocation expenses for its facilities on the lands it 
found outside the existing right-of-way. We have said, however, that principles 
of law are implied terms in any agreement, even where there are apparently 
contrary terms present. Black & Yates, Inc. v. Negros-Philippine Lumber Co., 
32 Wyo. 248, 258, 231 P. 398, 401 (1924).

4 The Commission argues 
that requiring the state to pay the relocation costs would violate Wyo. Const. 
art. 16, § 6, which prohibits donations of public funds to private enterprises. 
As is our practice when a case may be resolved on other grounds, we do not 
address the constitutional issue. KN Energy, Inc. v. City of Casper, 755 P.2d 207, 210 (Wyo. 1988).

Although the same 
argument has been made against statutes which shift the cost of relocation in 
states with similar constitutional provisions, the majority of state courts 
considering this question have found such statutes constitutional. Utah Power & Light, 10 Utah 2d. at 336-39, 353 P.2d  at 
173-75.

5 W.S. 1-26-813 uses the 
phrasing "in such manner as not to inconvenience the public in their 
use."