Opinion ID: 1501288
Heading Depth: 1
Heading Rank: 2

Heading: May the Electric Company challenge the validity of such proposed bond issue and such diversion of funds in this proceeding?

Text: The Electric Company has a franchise from the City under which it is furnishing electric energy for light and power to the City and its inhabitants. Such franchise is a contract and constitutes a property right. Frost v. Corporation Commission of Oklahoma, 278 U. S. 515, 519, 520, 49 S. Ct. 235, 73 L. Ed. 483; City of Campbell v. Arkansas-Missouri Power Co. (C. C. A. 8) 55 F.(2d) 560, 562. True, it is not an exclusive franchise. Nevertheless it entitles the Electric Company to protection against the City's undertaking to enter into competition with it through unlawful means. City of Campbell v. Arkansas-Missouri Power Co., supra; Iowa Southern Utilities Co. v. Cassill (C. C. A. 8) 69 F.(2d) 703; Frost v. Corporation Commission, supra. [2] We conclude that under the facts alleged in the bill the Electric Company is entitled to a decree enjoining the issuance of the bonds and any illegal diversion of funds received from the operation of the City waterworks, for the purpose of constructing a competing plant.