Case Name: WEST SIDE ELECTRIC CO. v. CONSOLIDATED TELEGRAPH & ELECTRICAL SUBWAY CO.; PEOPLE ex rel. WEST SIDE ELECTRIC CO. v. SAME
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1905-12-22
Citations: 96 N.Y.S. 609
Docket Number: 
Parties: WEST SIDE ELECTRIC CO. v. CONSOLIDATED TELEGRAPH & ELECTRICAL SUBWAY CO. PEOPLE ex rel. WEST SIDE ELECTRIC CO. v. SAME.
Judges: 
Reporter: West's New York Supplement
Volume: 96
Pages: 609–620

Head Matter:
(110 App. Div. 171)
WEST SIDE ELECTRIC CO. v. CONSOLIDATED TELEGRAPH & ELECTRICAL SUBWAY CO. PEOPLE ex rel. WEST SIDE ELECTRIC CO. v. SAME.
(Supreme Court, Appellate Division, First Department.
December 22, 1905.)
Electricity—Municipal Corporations — Grant of Franchise — Use of ' Streets.
Laws 1879, p. 562, c. 512, subsequently amended by Laws 1882, p. 70, e. 73, authorized the formation of corporations to carry on the business of lighting hy electricity. Section 2 of the act empowered such corporations to construct suitable wires with the consent of the municipal authorities. Laws 1887, c. 716, p. 929 constituted a board of electrical control for the city of New York, and transferred to it all powers previously conferred on the commissioners of electrical subways by Laws 1885, p. 852, c. 499, in- relation to placing and maintaining electrical conductors in said city. Transportation Corporations Law, Laws 1890, p. 1146, c. 566, art. 6, § 61, subd. 2, authorized a company incorporated for the purpose of using electricity to erect suitable wires or other conductors over or under streets of any city, with the consent of the municipal authorities thereof. Held, that the board of aldermen of the city of New York (prior to the adoption of the charter of 1897), and not the board of electrical control, was the body competent to grant the consent of the city to the laying of electric wires in a subway by a corporation organized under the transportation corporations law.
Ingraham, J., dissenting.
Appeal from Special Term, New York County.
Action by West Side Electric Company against the Consolidated Telegraph & Electrical Subway Company, and mandamus proceedings by the people on the relation of the West Side Electric Company against the same defendant. From a judgment entered on dismissal of the complaint in the action, and from a final order dismissing the alternative writ in the mandamus proceedings, plaintiff and relator appeals.
Affirmed.
Argued before O’BRIEN, P. J., and McEAUGHRIN, PATTERSON,. INGRAHAM, and EAUGHEIN, JJ.
W. D. Guthrie, for appellant.
Elihu Root, for respondent.

Opinion:
PATTERSON, J.
The matter in contest between the parties to this record is brought before the court by two appeals—one from a judgment in an action in which the relief was sought of a perpetual injunction against the defendant to restrain it from interfering with or obstructing the plaintiff in the maintenance of certain cables and electrical conductors, located in subways or ducts in the city of New York, and the other from a final order dismissing and quashing an alternative writ of mandamus, which had been directed to the defendant, to enforce a right claimed by the appellant to lay. or place other cables for electric lighting purposes in subways in the city of New York.
The single question involved in both the action and the special proceeding" relates to the existence of a right on the part of the appellant to use the subways, as claimed by it. It is conceded that it has what may be called an apparent authority to use those subways; that is to say, it has received the consent and authority of the board of electrical control of the city of New York, and it insists that under the law, that consent and authority is all that is required to enable it lawfully to lay, construct wires, and maintain other appropriate appliances for conducting and distributing electricity in subways under the streets, avenues, and public places in the city of New York. The defendant and respondent insists that the apparent consent and authority referred to is inadequate and insufficient 'to confer upon the appellant the right it asserts ; but on the .contrary that the power to grant the necessary consent and authority resided only in the board of aldermen of the city of New York. The situation, so far as the appellant is concerned, may be stated in a few words: It is an electrical company organized in October, 1896, under the transportation corporations law, which became operative on May, 1891. Its corporate purposes are to manufacture and use electricity for lighting, heating, or furnishing power, in lighting streets, avenues, public parks, and places, and public and private buildings in the city and county of New York. By subdivision 2 of section 61 c" article 6 of the transportation corporations law (chapter 566, p. 1146, of the Laws of 1890), it is provided that if a company is incorporated "for the purpose of using electricity for light, heat, or power" it shall have power—
"To carry on the business of lighting by electricity or using it for heat or power in cities, towns and villages within this state, and in the streets, avenues, public parks and places thereof, and public and private buildings therein ; and for the purposes of such business to generate and supply electricity; and to make, sell or lease all machines, instruments, apparatus and other equipments therefor, and to lay, erect and construct suitable wires or other conductors, with the necessary poles, pipes or other fixtures in, on, over or under the streets, avenues, public parks and places of such cities, towns or villages, for conducting and distributing electricity, with the consent of the municipal authorities thereof, and in such manner and under such reasonable regulations, as they may prescribe."
The appellant, on October 30,1896, procured from the board of electrical control of the city of New York, an authority, permit, or certificate, which recited 'that the appellant had petitioned the board of electrical control for a franchise to do business in the city of New York, and had filed a certificate of its incorporation with that board and it was therefore resolved—
"That the West Side Electrical Company having filed the necessary certificate with the secretary of the state of New York and the clerk of the city and county of New York permitting it to do business, be, and it hereby is, authorized and empowered to lay and construct suitable, wires or other conductors in subways under streets, avenues, public parks, and places in the city of New York for conducting and distributing electricity under the direction of the board of electrical control, subject to all existing rules applicable thereto, and to all regulations which the board may hereafter impose by resolution or otherwise, provided always, and this consent is given on that express condition,. and not otherwise, that until the further order and resolution of this board, the electrical conductors of said company shall be laid or constructed by the Consolidated Telegraph & Electrical Subway Company, under and in pursuance of the statutes of the city of New York, and under the ordinance of this board."
Acting under the authority thus conferred, or sought to be conferred, the appellant procured permits to open the streets and to introduce its wires or cables in subway ducts-.
The respondent, the Consolidated Telegraph & Electrical Subway Company, was incorporated in December, 1885, under the telegraph act, but such powers as it possesses as a subway company are derived from two agreements—one of July, 1886, and the other of April, 1887, confirmed by section 6, c. 716, p. 929, of the subway act of 1887. As is well stated by counsel for the appellant:
"The general nature of the obligation of the subway company under said contracts and statute, is to supply ducts to all corporations duly authorized to install and operate electrical conductors in the streets of the city, giving equal facilities to all, and receiving equal rentals from all."
After the appellant received the permit or certificate from the board of electrical control, the respondent permitted it to open the streets and lay cables in the ducts, and for some time the appellant used those cables and ducts and paid rent therefor, and the right of the appellant seems to have passed without challenge until June 15, 1903, when it was notified by the respondent, through its secretary, and general superintendent, that it had been advised that the appellant was a company not having lawful power to operate electrical conductors in any street of the city of New York, and that the respondent was not therefore authorized to lease its subways and ducts to or permit the use by the appellant. Reasons in the nature of excuses for the respondent delaying action in the premises are then set forth in the notice (which reasons it is not now necessary to consider); but the distinct requirement was made that the appellant forthwith remove and withdraw all its cables from the subways and ducts of the company "on the ground that you are not a company having lawful power to operate electrical conductors in the city of New York, or any part thereof." Counsel for the appellant calls attention to the history of the legislation respecting electric lighting-in the state of New York, and points out that the first statute concerning that subject was chapter 512, p. 562, of the Laws of 1879, subsequently amended by chapter 73, p. 70, of the Laws of 1882, whereby the formation of corporations was authorized to carry on the business of lighting by electricity; and section 2 of the act provided that such a corporation shall have power to lay, erect, and construct suitable wires in cities, towns or villages—
"With 'the consent of the municipal authorities thereof, under such reasonable regulations as they may prescribe."
It is conceded that at the time of the passage of the act of 1879, the common council of the city of New York was the municipal authority vested with the powder to grant consents on behalf of the city, and it is also admitted that that power remained in the common council until the year 1887. In 1884 and 1885, a new body to be known as the board of commissioners of electrical subways in the city of New York, was created by the Legislature, and to that new board was confided the duty of regulating and controlling the use of the streets of the city of New York for electrical wires or conductors. In 1887, the Legislature passed an act (chapter 716, p. 928) relating to electrical conductors in the city of New York, and by that act was constituted the board of electrical control in and for the city of New York. By section 1 of that act, it is provided that:
"All the powers and duties conferred or imposed by the said act (chapter 499 of the Laws of 1885) upon the commissioners appointed thereunder in and for the city of New York, and all the powers and duties heretofore by any law conferred or imposed upon the local authorities of said city, or any of them, in respect to or affecting the placing, erecting, construction, suspension, maintenance, use, regulation or control of electrical conductors or conduits or subways for electrical conductors in said city are hereby transferred to and conferred and imposed upon, and shall hereafter be exclusively exercised and performed by the said board of electrical control, constituted as provided in this act, and its successors as hereinafter provided."
That is the board from which the appellant received the consent upon which it relies.
What has been heretofore stated is sufficient to indicate the general aspect in which the controversy now comes before us, and it will be seen that the real issue is whether the appellant acquired a franchise to do business in the city of New York under the provisions of the transportation corporations law. The court below determined that it had not, and we are compelled by authority to acquiesce in that determination. It is evident that the appellant and the respondent and the board of eletrical control were all of opinion that the municipal 'authority referred to in subdivision 2 of section 61 of the transportation corporations law was the last-mentioned board—a view which would be now adopted by us were it not for a contrary expression of opinion by the Court of Appeals, which -we deem to be controlling. Subdivision 1 of section 61 of the transportation corporations law relates to gas companies. Among the powers conferred are:
"To furnish such quantities of gas as may be required in the city, town or village where the same shall be located, or said two or more villages or towns, not over five miles distant from each other and to lay conductors for conducting gas through the streets, lanes, alleys, squares and highways, in such city, villages or town.s, with the consent of the municipal authorities thereof, and under such reasonable regulations as they may prescribe," etc.
In Ghee v. Northern Union Gas Co., 34 App. Div. 551, 56 N. Y. Supp. 450, a taxpayer brought an action under the Laws of 1881, to restrain the laying of gas mains in certain streets of the city of New York, upon the ground that that company had no" franchise or right to do so, and that certain officials of the city, the commissioner of highways and the deputy commissioner of highways of the borough of the. Bronx had illegally granted a permit for the laying of such mains. The Northern Union Gas Company was organized in 1897, under the transportation corporations act for the purpose of manufacturing and supplying gas and electricity to public and private buildings in the city of New York. The question arose in the case as to the power of the commissioners to issue the permit or grant the authority which was given to the gas company. Upon a consideration of the whole subject, it was determined by this court that the proper municipal authority under the provisions of the Greater New York Charter of 1897, to grant the consent was in the commissioner of highways and not the common council of the city of New York, and we remarked in that case that:
"It is difficult to avoid the conclusion that the municipal authorities whose consent is necessary for the laying of gas mains in the streets are the department of public buildings, lighting and supplies, and the department of highways. This is an undoubted departure from the plan or scheme under which. the old government of the city was conducted, for therein the local "authorities to which reference is made in nearly all prior legislative acts were the municipal council or board of aldermen."
On appeal to the Court of Appeals our decision was reversed (158 N. Y. 511, 53 N. E. 692), and it was held that in the city of New York the municipal authority," within the meaning of that term as used in section 61 of the transportation corporations law, whose consent is required to lay conductors for conducting gas through the streets of the city, is the municipal assembly. That determination of the Court of Appeals is announced as a general proposition, not confined to a case arising under the provisions of the Greater New York Charter, and the reasoning of the opinion is, in our judgment, decisive of the present case. Were it not for that, it might well be claimed that a franchise to carry on the business of generating and supplying electricity, or of making, selling) or leasing apparatus or other equipment, is granted directly from the state without any consent of the municipal authorities required by the statute, and that such consent, if so required, relates to the exercise administratively of a granted franchise to lay, erect, and construct suitable wires or other conductors in, over, or under the avenues, streets, public parks, and places of said cities; or, in other words, that the authority was only that of an administrative authority as to the methods and manner in which particular things pertaining to the exercise of the franchise' once granted, should be done. But in the Ghee Case, the Court of Appeals has gone much farther, and has declared that a part of the franchise is the distinct specific right which the appellant claims as against the respondent and that that right was not complete, and a franchise was not duly conferred, until the municipality gave a supplementary consent to the general power which the appellant sought to acquire under its' certificate of incorporation. If it be true that the right to the use of the streets is a part of the franchise of the appellant, then it results from the Ghee Case that the board of aider-men was the legislative body, having the power to grant a franchise to use the streets. In the case cited, it was held in effect, that previous to 1897, the board of aldermen of the city of New. York, the legislative branch of the city government, was the body which had the power to confer franchises to use the streets. Therein it is said that:
"The accumulation under ground, during the past few years of sewers, electrical subways, cable and electrical railway conduits, pneumatic tubes, steam-heating, water and gas pipes, seems to.indicate that the day may come when there wijl be no more unoccupied space beneath the surface of the streets, and of this situation the Legislature and the learned commissioners who drafted the charter undoubtedly had full knowledge. It is difficult to believe that, with such knowledge, they would attempt to take away from general and responsible representatives of the people, the power to grant such, important and valuable rights and vest them in subordinate administrative officers," etc.
Those words are significant with respect to the intent of the Legislature in passing the act of 1887, conferring powers on the board of electrical control, and although nothing is definitely decided on that subject, the question is left fairly open for consideration when it is presented in a proper case.
We are unable to see that the language of the act of 1887, confers upon the board of electrical control any different .power than was conferred upon the department of buildings, lighting, and supplies, by the charter of 1897. The points decided in the Ghee Case, ín a few words are these: That the right and power to use the streets under the provisions of the transportation corporations law is part of a franchise; the consent of the municipal authorities is necessary to the full acquisition of that franchise; it can be given only by municipal authority, and that municipal authority is the body legislating for the city. There are some inaccuracies in the. opinion of the Court of Appeals in the Ghee Case concerning the history of the granting of consents to gas companies to lay gas pipes and mains in the city of New York. The power to grant consents was not always exercised by the common council of the city of New York, but express legislative authority was at one time given to a board to grant such consents. In 1886 (section 15, c. 321, p. 515, Laws 1886) an act was passed to authorize the formation of gas companies in the city of New York, and to regulate the powers and duties of the same. By section 15, it is provided that:
: "Any company subject to this act may lay its mains or pipes, and supply its gas through the same, without any further proceedings, conditions, or authority, than those herein contained, save the consent thereto of the mayor, comptroller and president of the department of taxes and assessments of the city of New York."
. The reference to this subject made in the opinion of the Court of Appeals proceeds upon a concession which was seemingly made by all the. parties to that case. The inaccuracy is not material, if we correctly apprehend the full force and effect of the opinion. In the light of that decision, the provisions of the act of 1887, relating to the board of electrical control, and the powers and duties conferred upon local authorities in respect to or affecting the "placing, erecting, construction, suspension, maintenance, use, regulation or control of 'electrical conductors in said city are hereby transferred' to and conferred and imposed upon, and shall hereafter be exclusively exercised and performed by the "board of electrical control," do not relate to granting a consent which in and of itself would' operate as a completion of a franchise.
Notwithstanding the very elaborate and learned argument of the counsel for the appellant, we feel constrained by the authority of the Ghee Case to affirm the judgment and order appealed from.
The judgment and order should be affirmed, with costs.
O'BRIEN, P. J., and McLAUGHLIN, J., concur. LAUGHLIN, J., concurs in result: