Imperial Valley press and the Imperial press., 1906-05-26

State and of the United States. Sec ond, its validity as far as the rights and interests of the stockholders are con- cerned. Third, its validity as respects the rights of Water company No. In view of the preceding contract between Imperial Water company No. l and the Sociedsd de Ynigacion of date of April 9th, 1900 Fourth, as to wheth- CT the waters and water rights affected by this contract coming to Water com pany No. would while under its con- tol or in that of either of the other parties to the agreement be subject to any public use whereby the Board of Supervisors would have power to fix rates. Fifth, whether the circum- stance that a majority of the No. l board were also members of the board of directors of the California Develop
 ment company would tend to lnvalidate the agreement. and sixth, whether cer- tain special clauses incorporated in this contract are invalid or beyond the pow CTS of the Board of Directors to adopt and If so what are the liabilities flow Ing from them.
 The attorneys opinion though hasti- ly prepared supports the legality of the contract and points out number of Its advantages over the old arrangement. In the first place this contract brings the operations of both the Sociedad de Yrrgaclon and the California Develop ment company under the laws of Cali fornia so far as the delivery of water under this agreement is concerned.
 We quote from Mir. Varle's opinion:
 The two parent corporations, the Cal ifornia Development Company and its other self, the Mexican Company, will furnish and deliver the water; the Cal ifornia Development will own the main canal within the State of California, and it will deliver the water to your com pany and to the other distributing water companies, at the heads of their several laterals.
 By the incorporation of the clause whereby the California Development Company guarantees the performance of all the obligations of the Mexican Company, and the Mexican Company all the obligations of the California Development Company, you and your stockholders are fully pro- tected from any possible evasion under this contract through the circumstances that one of them is foreign corporation, residing without this State, and having no property in it.
 You will be protected against the Mexican Company, because the Calif- ornia Development Company has prop ertv within this State. You will be pro- tected against the California Develop ment Company, because you will semi be bound to pay certain sums of money to the Mexican Company, which may be subjected by you to your claim against tine Mexican Company under it's guaranty.
 From my examination of the statues and decisions of the courts, neither your company nor the other two com panies, so far as the waters affected by this contract and which are to come to and be distributed by your company, will be subject to any public use.
 See McFadden vs. Supervisors, "A Cal p. 57l.
 The general law of California ap- proves contracts beween furnishers of water and their users, and makes them valid.
 See Statutes of 1897, p. 49.
 The courts generally now incline strongly to uphold such contracts.
 San Diego Plume Go vs. Souther, l04 Fed Rep, p. 7O6.
 Fresno Canal Co.,, ys. Park, 62 Pac. Ran n QZ