Source: https://supreme.justia.com/cases/federal/us/262/182/
Timestamp: 2019-04-24 00:27:40+00:00

Document:
1. A state has power, and it is its duty, to control and conserve its water resources for the benefit of all its inhabitants. P. 262 U. S. 185.
2. Diversion of waters from the sources of supply for this use is a legitimate function of the state, which may be left to private enterprise subject to state regulation, or be performed directly, or be delegated either to bodies politic created for the purpose or to the state's municipalities. P. 262 U. S. 185.
3. In the absence of state constitutional provisions safeguarding it to them, municipalities have no inherent right of self-government which is beyond the legislative control of the state, but are merely departments of the state, with powers and privileges such as the state has seen fit to grant, held and exercised subject to its sovereign will. P. 262 U. S. 187.
4. The power of a state over the rights and properties of cities held and used for "governmental purposes" is unrestrained by the Contract Clause, or the Fourteenth Amendment, of the federal Constitution. P. 262 U. S. 188.
5. The distinction between a municipality as an agent of the state for governmental purposes, and as an organization to care for local needs in a private or proprietary capacity, affords no ground for the application of those constitutional restraints against a state in favor of its own municipality. P. 262 U. S. 191.
6. The City of Trenton, as successor to a grant made by New Jersey to a private corporation, claimed a perpetual right, unburdened by license fee or other charge, to divert all the water that might be required for the use of the city or its inhabitants from the Delaware River, and resisted a charge, imposed under c. 252, Laws N.J. 1907, for water diverted beyond the amount being legally diverted when the act was passed and in excess of a per capita maximum prescribed by the act. Held that the city could not invoke the Contract Clause or the Fourteenth Amendment, even assuming that the private corporation might have done so if its rights had not passed to the city, and that, in view of previous decisions, the city's contention to the contrary did not present a substantial federal question. Pp. 262 U. S. 185, 262 U. S. 192.
Error to a judgment of the Supreme Court of New Jersey, affirmed by the Court of Errors and Appeal, in favor of the state in its action to recover license fees from the City of Trenton for water diverted from the Delaware River.
The State of New Jersey recovered judgment against the City of Trenton for $14,310 in an action brought in the state supreme court. The judgment was affirmed by the Court of Errors and Appeals, and is here on writ of error.
(100) gallons daily per capita for each inhabitant of the municipality or municipalities supplied, as shown by the census of one thousand nine hundred and five."
The city claims the right to take from the Delaware River all the water that it requires, without limitation as to quantity and without license fee for any part thereof, and that such right was acquired by the president and directors of the Trenton Waterworks (hereinafter called the water company) by grant direct from the state March 24, 1852, and that the city acquired this right by purchase from the water company. Briefly, the basis of the city's claim is as follows: by an act of February 29, 1804, the president and directors of the Trenton Waterworks were created a body politic and corporate. They and their successors and assigns were made capable of disposing of water to such as might apply for the same for such annual rent and under such restrictions as they might think proper, and they were authorized to lay and extend their water mains through the streets of the city. Certain springs constituted the company's source of supply, and, by reason of increase of population, ceased to be adequate. March 24, 1852, a supplement to the above-mentioned act was passed by which the company was authorized to take the water required either in whole or in part from the Delaware River. Later, March 2, 1855, an act was passed, authorizing the city to purchase the whole or a majority of the shares of the capital stock of the water company, and the city purchased all of the stock. Thereafter, an act of March 1, 1859, required the company to convey unto "the inhabitants of the city of Trenton" all the real estate, works, and property and all the corporate powers, franchises, and privileges of the company, and this conveyance was duly made.
If the provision of the Act of 1907 imposing the license fee is valid as against the city, the judgment is right.
The Court of Errors and Appeals held that it was valid, that the state, under its police power, might impose a license fee as specified in the act, and that this does not deprive the city of any contractual or property right.
The state undoubtedly has power, and it is its duty, to control and conserve the use of its water resources for the benefit of all its inhabitants, and the Act of 1907 was passed pursuant to the policy of the state to prevent waste and to economize its water resources. Decision of the Court of Errors and Appeals in this case, 117 A. 158; McCarter v. Hudson Water Co., 70 N.J.Eq. 695, 701, 702, affirmed by this Court in 209 U. S. 209 U.S. 349, 209 U. S. 355; Collingswood v. Water-Supply Commission, 84 N.J.Law 104, 110; Cobb v. Davenport, 32 N.J.Law 369, 378. The only way the city could acquire the right to take the water of the Delaware River was by grant from the state or by authorized purchase or condemnation from one to whom the right had been granted by the state. State v. Jersey City, 94 N.J.Law 431, 433. The power to determine the conditions upon which waters may be so diverted is a legislative function. The state may grant or withhold the privilege as it sees fit. Assuming, in favor of the city, that its grantor received a perpetual right, unburdened by license fee or other charge, to divert all the water required for the use of the city and its inhabitants, does it follow that the state, as against the city, is bound by contract, and is without power to impose a license fee as provided in the act?
agency for the exercise of such of the governmental powers of the state as may be intrusted to it. The diversion of waters from the sources of supply for the use of the inhabitants of the state is a proper and legitimate function of the state. This function may be left to private enterprise, subject to regulation by the state; it may be performed directly; or it may be delegated to bodies politic created for that purpose, or to the municipalities of the state. Power to own, maintain, and operate public utilities, such as waterworks, gas and electric plants, street railway systems, public markets, and the like is frequently conferred by the states upon their cities and other political subdivisions. For the purpose of carrying on such activities, they are given power to hold and manage personal and real property.
may do as it will, unrestrained by any provision of the Constitution of the United States. . . . The power is in the state, and those who legislate for the state are alone responsible for any unjust or oppressive exercise of it."
In New Jersey, it has been held that, within the limits prescribed by the state constitution, the legislature may delegate to municipalities such portion of political power as they may deem expedient, withholding other powers, and may withdraw any part of that which has been delegated. Van Cleve v. Passaic Valley Sewerage Commissioners, 71 N.J.Law 183, 198.
In the absence of state constitutional provisions safeguarding it to them, municipalities have no inherent right of self-government which is beyond the legislative control of the state. [Footnote 1] A municipality is merely a department of the state, and the state may withhold, grant, or withdraw powers and privileges as it sees fit. However great or small its sphere of action, it remains the creature of the stat,e exercising and holding powers and privileges subject to the sovereign will. See Barnes v. District of Columbia, 91 U. S. 540, 91 U. S. 544-545.
not and cannot be any reciprocity of stipulation between the parties, and for the further reason that their objects and duties are utterly incompatible with everything partaking of the nature of compact."
East Hartford, the legislature granted to it one-half of the ferry during the pleasure of the General Assembly, and that, subsequently, after the building of a bridge across the river, the legislature discontinued the ferry. It was held that this was not inconsistent with the contract clause of the federal Constitution. The reasons given in the opinion (pp. 51 U. S. 533-534) support the contention of the state here made that the city cannot possess a contract with the state which may not be changed or regulated by state legislation.
the former city. The city is the creature of the state,"
citing East Hartford v. Hartford Bridge Co., 10 How. 511, 51 U. S. 533-534; United States v. Railroad Co., 17 Wall. 322, 84 U. S. 329; New Orleans v. Clark, 95 U. S. 644, 95 U. S. 654; Commissioners of Laramie County v. Commissioners of Albany County, 92 U. S. 307; Commissioners v. Lucas, 93 U. S. 108, 93 U. S. 114.
"Thus, the whole controversy is as to which of two existing agencies or arms of the state government is authorized for the time being to exercise in the public interest a particular power, obviously governmental, subject to which the franchise confessedly was granted. In this no question under the contract clause of the Constitution of the United States is involved, but only a question of local law, the decision of which by the supreme court of the state is final. . . . In New Orleans v. New Orleans Waterworks Co., 142 U. S. 79, where a city, relying on the contract clause, sought a review by this Court of a judgment of a state court sustaining a statute so modifying the franchise of a waterworks company as to require the city to pay for water used for municipal purposes, to which it theretofore was entitled without charge, the writ of error was dismissed on the ground that no question of impairment within the meaning of the contract clause was involved. [Footnote 4] "
Commissioners v. Lucas, 93 U. S. 108, 93 U. S. 115; Meriwether v. Garrett, 102 U. S. 472, 102 U. S. 518, 102 U. S. 530; Essex Board v. Skinkle, 140 U. S. 334, 140 U. S. 342; New Orleans v. Water Works Co., 142 U. S. 79, 142 U. S. 91; Covington v. Kentucky, 173 U. S. 231, 173 U. S. 240; Worcester v. Street Railway Co., 196 U. S. 539, 196 U. S. 551; Monterey v. Jacks, 203 U. S. 360.
Some state cases holding that the state legislature is not restrained by federal constitutional provisions: City of St. Louis v. Sheelds, 52 Mo. 351, 354; Police Jury of Bossier v. Corporation of Shreveport, 5 La.Ann. 661, 665; Trustees of Schools v. Tatman, 13 Ill. 27; Board of Education v. Aberdeen, 56 Miss. 518; Darlington v. City. of New York, 31 N.Y. 164, 193. See contra: Town of Milwaukee v. City of Milwaukee, 12 Wis. 93, 109; Grogan v. City of San Francisco, 18 Cal. 590, 612-613; Mt. Hope Cemetery v. Boston, 158 Mass. 509, 519; Spaulding v. Andover, 54 N.H. 38, 56; Ellerman v. McMains, 30 La.Ann.190.
Cf. Williams v. Eggleston, 170 U. S. 304, 170 U. S. 310; Mason v. Missouri, 179 U. S. 328, 179 U. S. 335.
See City of Winona v. Botzet, 169 F. 321, 332 et seq., and cases cited. See also Brantman v. City of Canby, 119 Minn. 396 (recovery permitted for gas explosion where city furnished gas to inhabitants); Pettengill v. City of Yonkers, 116 N.Y. 558, 565 (recovery permitted for injury sustained by excavation in street to lay mains); Watson v. Needham, 161 Mass. 404, 411 (damages recovered for breach of contract by water commissioners to furnish water for plaintiff's boiler, resulting in injury to vegetables in greenhouse heated thereby); Brown v. Salt Lake City, 33 Utah, 222, 234 (city held liable for death by drowning in conduit forming a part of city waterworks system). These cases and others that might be cited serve in general to illustrate the course of decision.
See decisions per curiam: City of Chicago v. Dempcy, 250 U.S. 651; Michigan ex rel. Groesbeck v. Detroit United Railway, 257 U.S. 610; City of Chicago v. Chicago Railways Company, 257 U.S. 617; Township of Avon v. Detroit United Railway, 257 U.S. 618; Borough of Edgewood v. Wilkinsburg & East Pittsburgh Street Railway Co., 258 U.S. 605; City of Sapulpa v. Oklahoma Natural Gas Co., 258 U.S. 608.

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