Imperial Valley press., 1908-07-11
No. 1924.
 CONCLUSIONS OF THE COURT ON ORDER TO SHOW CAUSE AND DEMURRER.
By Chas N. Williams, Deputy Gle

Tn the Circuit Court of the United States, Ninth Circuit, Southern Dis trict of California, Southern Division.
 The California Development Com pany, Complainant, vs. Imperial Water Company No. 5, Defendant.
 One of the grounds essential to the relief complainant seeks, namely can celation of the contract of May 18th, 1905, set forth in the bill, is its owner ship of the 65,00O unissued shares of defendants capital stock, and this ownership depends upon the validity of the contract of March 18th, 1901, between the Mexican Company and defendant, and that of December "A, 1901, between complainant and defend ant. If for any of the reasons urged by defendant, the last two contracts are illegal, the court would not decree the cancellation of the first, and the temporary injunction asked for must be refused.
 1 Upon the bill of complaint and the affidavit of c. R. Redwood, which makes up complainant's showing for preliminary injunction, and the affi- davits, exhibits and other documents specified in defendants printed reply at pages and as it's showing against such an injunction, and look ing through mere corporate entities, | nd tn bn concerned and the substance of the things involved, 1 am satisfied without going into details, that compliments scheme. of which said contracts were essential parts, included the appropri- ation of water from the Colorado River for sale and distribution among ttlers in Imperial Valley, each set tier being required, before the deliv- cry of any water to him, to buy cer- tain amount of defendants. capital stock at such price as complainant might arbitrarily fix, and, in addition thereto, to pay an annual rate ot fifty cents for each acre-foot of water de- livered. The Mexican Company and defendant, as we'll as the other water companies mentioned in said affi- davits,, were simply subordinate agencies organized by complainant for the accomplishment of said purposes, and the clauses in said contracts plac- ing at complainant's disposal for it's sole use and benefit the issue and loca- tion of defendants capital stock, were but devices to enable complainant to exact of each settler, for the right and privilege of using water at the annual rate mentioned, an additional preced- ent compensation, under the guise of sale of stock.
 am further satisfied that said de- vices for additional compensation are unlawful because in violation of ar ticle 14 of the Constitution of Cali fornia, and the Act of the Legislature of California of March, the 18th, 1885, Laws of California 1885, page 95; (San Diego Land & Town Co., vs City of National City, "A Fed, 79; Lanning vs. Osborne, 76 Fed, 319; Mandell vs. San Diego Land & Town Co.,, 89 Fed, 295; Boise City Irr. & Land Co., vs. Clarke co. c. A. 9th Cir.) 131 Fed. 415; Crow vs. San Joaquin Irr. Co.,, 13O Cal. 3O9-313; Wheeler vs. Northern Colo. Irr Co.,, IF Pac. 4S7 Combs vs. Ditch Go. (Ariz.) 76 Pac. 59S; Salt River Valley Land Co.,, vs. Nelssen (Ariz.) 76 Pac. COP; and that said de- vices are so inseparably connected with other provisions of the contracts as to render the whole void.
 If, from complainant's scheme, the water companies and other subordin- ate agencies were entirely eliminated, and complainant should undertane to furnish water directly to individual users, requiring each to buy certain amount of it's stock at a stated price, as a condition precedent to the deliv- cry of water, and thereafter to pay m annual rate of fifty cents per acre foot for the water actually delivered, and a settler in Imperial Valley should enter into a contract with complaint ant for the purchase of some of It's stock and payment of an annual rate, as ahOVe indicated and thereafter re