Source: https://supreme.justia.com/cases/federal/us/251/192/
Timestamp: 2019-04-23 14:09:54+00:00

Document:
Justia › US Law › US Case Law › US Supreme Court › Volume 251 › Winchester v. Winchester Water Works Co.
A city cannot regulate the rates chargeable by a water company unless authority to do so has been plainly granted by the legislature. P. 251 U. S. 193.
Such authority cannot be implied from powers to grant water companies rights of way in the public streets and grounds and to supervise and control their use. P. 251 U. S. 194.
Kentucky Statutes, § 3490(8), (25), (30), (33), considered. Id.
The Winchester Waterworks Company filed its bill in the United States District Court for the Eastern District of Kentucky seeking to enjoin the enforcement of an ordinance establishing maximum rates for water to be furnished the city for public use and to the people thereof for private use. By the bill and amended bill, it was charged that the city had no authority to pass or enforce an ordinance fixing such rates, because (1) no power had been granted to the city so to do by the Legislature of Kentucky; (2) because the rates established were so low as to be confiscatory in their character, and, consequently, the ordinance was violative of rights secured to the company by the Fourteenth Amendment to the federal Constitution. An answer was filed, and the court decided the case and made a final decree in favor of the company upon the ground that, under the laws of Kentucky, the city had no authority to pass or enforce an ordinance fixing rates. The court found it unnecessary to pass upon the question of the confiscatory character of the rates. The bill invoked jurisdiction upon a constitutional ground, and the case was brought here by direct appeal.
It appears that the company had a contract with the city, which expired in 1916, and thereafter the ordinance in controversy was passed. That a city has no power to regulate rates of this character unless it has legislative authority so to do is established, and does not seem to be disputed by the appellant.
other public service corporations in the absence of express or plain legislative authority to do so."
3 Dillon on Municipal Corporations, 5th ed., § 1325. Nor does such authority arise from the power to regulate the opening and use of streets, nor a grant of the general right to control and regulate the right to erect works and lay pipes in the streets of the city. State v. Missouri & K. Telephone Co., 189 Mo. 83; Jacksonville v. Southern Bell & Tel. Co., 57 Fla. 374; Lewisville Natural Gas Co. v. State, 135 Ind. 49; Mills v. Chicago, 127 F. 731; State v. Sheboygan, 111 Wis. 23.
"The board of council may grant the right of way over the public streets or public grounds of the city to any railroad company or street railroad company on such conditions as to them may seem proper, and shall have a supervising control over the use of same, and regulate the speed of cars and signals and fare on street cars, and, under like condition and supervision, may grant the right of way that may be necessary to gas companies, water companies, electric light companies, telephone companies, or any like companies, and may compel any railroad company to erect and maintain gates at any or all street crossings, and to prevent railways from blocking or obstructing the streets or public ways of the city, and to fix penalties for the violation of these provisions: Provided,"
railroad companies. This is the full measure of the grant of authority to deal with water companies. The right to regulate fares is in the same sentence which grants authority to deal with water companies, and is specifically limited to fares on street cars.
Nor do we find in other subsections of this section any provision from which the right to fix the rates of water companies can be inferentially deduced.
stating that the authority of a municipality to regulate rates to be charged by public service corporations is limited to cases in which express or plain legislative authority has been given was quoted with approval. Cases from other states in which the principle has been approved were also cited.
"The purpose of § 3290 was to provide the inhabitants of cities of the third class with the services mentioned -- water, light, power, heat and telephone. They could be provided by the cities directly, or they could be provided by private persons; but, whatever way provided, the power was given to regulate the management and fix the rates of the services, and this was but the endowment of a common governmental power."
in an unmistakable way. We find nothing in the Owensboro case which at all conflicts with the construction which we have given to § 3490, applicable to cities of the fourth class, to which the City of Winchester belongs.
"3490. The board of council, in addition to other powers herein granted, shall have power within the city:"
"(8) To provide the city with water, or erect, purchase, or lease waterworks and maintain same, or to make all necessary contracts with any person or corporation for such purposes; to erect hydrants, cisterns, fire plugs and pumps in the streets within or beyond the limit of the city."
"(30) The board of council shall have power, by ordinance, to prescribe the punishment, by fine not exceeding $100, or imprisonment not exceeding 60 days of any person who shall molest, damage or interfere with any system of waterworks laid in said city, or the pipes and mains, hydrants, or any part thereof, and shall have power to punish by ordinance and impose the same penalty as for damaging or molesting any other public property, and may, subject to the rules of any water company which may establish such system, select persons who shall have the right to open, tap, or make connection with such pipes or mains in streets, alleys, or public ways of said city."
"(33) Said city council shall have legislative power to make bylaws and ordinances for the carrying into effect of all of the powers herein granted for the government of the city, and to do all things properly belonging to the police of incorporated cities. Said board of council may change the boundary line of any ward or wards of any city now divided into wards, or hereafter divided into wards, under the provision of this act, not less than sixty days previous to any November election."

References: v. 
 § 3490
 § 1325
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 § 3290
 § 3490