Court Opinion

ID: 6545465
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:19:12.454809+00
Date Added: 2024-06-11T15:55:57.252396
License: Public Domain

Hire, C. J., (after stating the facts.) 1. ^The franchise sought to be enjoyed was granted by the council of Little Rock, August 10, 1902, when the jurisdiction'of the city of Little Rock over the Eighth Ward thereof, where the franchise was to have been enjoyed, would have ceased for all purposes but for the injunction granted for the instance of the city of Little Rock, this appellant company, and other parties to the suit. One of the grounds relied upon for the injunction was the probability that the other municipality seeking to absorb this territory would grant therein street car franchises conflicting with those theretofore granted by the city of Little Rock. So far as this record shows, the franchise to this company, granted subject to several conditions set out in the statement of facts, was the franchise sought to be protected against encroachment and conflict. This franchise was amended after the injunction, so as to take out the conditions which prevented it from becoming at once operative. The injunction was granted upon this ana other allegations, and unquestionably was intended to preserve the status quo of the two municipalities, so far as the Eighth Ward was concerned, pending the appeal to determine whether or not the proceedings for its annexation to North Little Rock were valid. Lord Chancellor Eldon' held that where a party obtained an injunction which prevented his adversary from pursuing and enjoying rights, and the injunction was finally dissolved, the party could not take advantage of any rights which he had thus wrongfully prevented his adversary from enjoying. The Lord Chancellor said: “If there be a principle upon which courts of justice ought to act without scruple, it is this, to relieve parties against that injustice occasioned by its own acts or oversights, at the instance of the party against whom the relief is sought. That proposition is broadly laid down in some of the cases.” In such cases it is reasoned by the great chancellor that the plaintiff, seeking relief by the mere circumstances of filing the bill, would be required to submit to every thing conscience and justice required. That the plaintiff seeking the relief impliedly says that he asks it on the terms of prttting his adversary in exactly the same situation if it be determined in his favor. Pulteney v. Warren, 6 Vesey, Jr., 73. This principle has found secure lodgment in equity jurisprudence, and is appliéd to varying kinds of cases involving its application. Erequently it is applied when an injunction stays an action, and it becomes barred, or right to execution lapses; and in many cases where an injunction wrongfully prevents the assertion of a right, or causes it to lapse, then the court treats the plaintiff wrongfully causing this effect to be reciprocally bound by the injunction. Mercantile Trust Co. v. St. L. & S. F. Ry. Co., 69 Fed. Rep. 193; Hutsonpeiler v. Storer, 12 Gratt. (Va.) 579; Marshall v. Minter, 43 Miss. 666; Work v. Harper, 66 Am. Dec. 549; Sugg v. Thrasher, 30 Miss. 135. Chief Justice ScitorfiErd in applying this doctrine in a case in Illinois, said: “The only function of an injunction is to stay threatened action and suspend the conflicting claims of right of the respective parties where they then are until they can be properly adjudicated. 2 Daniell, Ch. Pr. (5th Ed.) 1639, and note. And so it must necessarily follow that to allow one party to obtain any advantage by acting when the hands of the adverse party are thus tied by the writ or the order for it is an. abuse of legal process which cannot be tolerated.” Lake Shore & M. S. Ry. Co. v. Taylor, 134 Ill. 603, s. c. 25 N. E. 588. While the hands of the town of North Little Rock were effectually tied by the injunction sought at the instance of the city of Little Rock and the street car company, then the street car company obtained from its co-plaintiff the franchise in question in territory over which the city of Little Rock would not have had at that time a vestige of jurisdiction except by reason of the injunction preserving the status quo in regard to franchises as well as police and municipal control. The statement of the situation shows more clearly than argument that it is inequitable to allow rights to be thus acquired. It is argued that these cases proceed upon the ground that the party obtaining the injunction has violated its spirit, or that the restraining party took advantage of something he could not have had before, or that the position of the party enjoined 0 was more favorable before the injunction. Many of the cases do proceed on such propositions, but the underlying principiéis that the injunction acts reciprocally, and binds in spirit the moving party, while binding expressly the other. While the city of Little Rock could have granted an absolute franchise the day it obtained the injunction, it did not do so, and when it did grant the absolute franchise, the city of North Little Rock was then under injunction from granting such franchise. If it had not been under such injunction, it could have been granted a franchise over these streets, and the city of Little Rock could not have done so. The court is of the opinion that the principles of these cases apply to this case. 2. Counsel for the appellant qpntends that the city has no property interests in the streets; that it is a mere agent of the State, to whom the State has delegated control of the streets, and the State, in the first instance, and the city, in the second instance, is but a trustee for the public. Many authorities are cited on this proposition, and it is summed up in a recent case in the Supreme Court of the United States in this language: “The statutes show that there was lodged by the Legislature of Ohio in the municipal council of Cleveland comprehensive power to contract with street railway companies in respect to the terms and conditions upon which such roads might be constructed, operated, extended and consolidated. * * * That, in passing ordinances based upon the grant of power referred to, the municipal council of Cleveland was exercising a portion of the authority of the State, as an agency of the State, cannot in reason be disputed.” Cleveland v. Cleveland City Ry. Co., 194 U. S. 517. The argument of counsel on this line is fully conceded as established in principle and by authority. But it does not follow from this status of the city that it may by its own act prolong its governmental agency, and grant rights otherwise divested from it by the State. In’ this case the State by appropriate legislation authorized the transfer of the control of the streets in question from one agent to another agent. The holding agent prolonged its holding by this injunction, contrary, as it was afterwards determined, to the act of the Legislature. Can it be said that on account of these governmental functions it is freed of the ordinary rules governing litigants? In Fort Smith v. McKibbin, 41 Ark. 45, the statute of limitations was invoked against the city’s control of an alley of the city of Eort Smith. The doctrine of governmental agency was there presented, but this court held, on a conflict in the authorities, that the weight of authority and the better reason was in favor of applying the statute. In Searcy v. Yarnell, 47 Ark. 269, this court quoted approvingly from Bailey v. Mayor of New York, 3 Hill, 555, as follows: “A municipal corporation, when in the exercise óf franchises and the prosecution of works for its own emolument or advantage, and in which the State in its sovereign capacity has no interest, is answerable as a private corporation, although such works may also be in the nature of ‘great enterprises for the public good,’ and ‘granted exclusively for public purposes belonging to the corporation in its public, political or municipal character.’ Powers granted for private advantages, though the public may also derive benefit therefrom, are to be regarded as exercised by the municipality as a private corporation.” In that case an estoppel was invoked against the'town of -Searcy. In fact, an estoppel may be invoked against the government of the United States, the government of a State, or a municipality. Indiana v. Milk, 11 Fed Rep. 389, and numerous authorities there cited; La Fayette Bridge Co. v. Streator, 105 Fed. Rep. 729; United States v. La Chapelle, 81 Fed. Rep. 152. In the case of Indiana v. Milk, supra, Judge Gresham said: “Resolute good faith should characterize the conduct of States in their dealings with individuals, and there is no reason, in morals or law, that will exempt them from the doctrine of estoppel.” If the State may be estopped, certainly the agent of the State, who prolongs the power of the State in itself, may be estopped by reason of its action in so prolonging this power. Passing, however, from the governmental agency of the city to the result of the action of the city in pursuance of this agency, in the recent case, heretofore referred to, of Cleveland v. Cleveland City Ry. Co., 194 U. S. 517, the court said: “That in the courts of Ohio the acceptance of an ordinance of the character of those just referred to is deemed to create a binding contract” is settled. (Citing authorities.) Then the court considered the question as one of general- law, without treating the decisions of Ohio as binding, and reached the same conclusion. A like view is taken of the question in this State. “Now, a grant which has been accepted and acted upon by the grantee is a contract, within the meaning of the Constituí ion of the United States, which forbids laws impairing the obligation of contracts.” Hot Springs Electric Light Co. v. Hot Springs, 70 Ark. 300. This is the general rule. McQuillin, Mun. Ord. § 238. The grants in this case were duly accepted, and constituted contracts; and hence it follows, aside from any estoppel of the governmental agent, that the grant in question was a contract right, and subject to all the protection and liability of other contractual rights, and among the latter is the sound equitable rule that such rights can not be acquired in violation of an injunction obtained for the benefit of the contracting parties. All of these reasons would be applicable if a stranger had obtained the franchise; but when it is obtained from one party to the injunction in favor of a co-plaintiff therein, they are doubly applicable. Without pursuing the question further, the. court is of opinion that neither the city of Little Rock nor the street car company can hold rights acquired over the streets of the Eighth Ward during the life of the injunction. 3. An estoppel is sought against the town of North Little Rock on account of its permitting the street car company to partially construct its line over these streets, and expend about $27,000 without protest, or resistance. The city of North Little Rock was enjoined from interfering in any manner with the jurisdiction and control of the city of Little Rock over the Eighth Ward. The stréet car company was acting with open eyes; if it won its injunction suit, its rights were peffect, and necessarily it knew that, if it lost, its rights were builded solely on rights acquired while it tied, the hands of the other municipality from exercising control over these streets. The case does not call for an estoppel on this ground against North Little Rock. The decree in the court below allowed the street railway company sixty days to dispose of or remove the rails, cross ties and other material placed by it on the streets, and that is as favorable as it can ask on this score. 4. Deciding that no rights can be sustained under the ordinance of 'August 10, 1902, does not dispose of any rights which the street car company may have under the ordinance passed June 25, 1902. It is true that the ordinance of August 10 repealed the 'conditions precedent therein to its vesting at once, and attempted to vest the franchise forthwith; but the view the court takes of that ordinance renders that action entirely nugatory, and leaves in force whatever right the street car company may have had when the jurisdiction of the municipalities over the Eighth Ward would have been changed but for the intervention of the injunction. The appellee seeks to avoid that proposition by invoking the doctrine of relation, and contends that the final act of annexation was carried back to the date the election was ordered, June 15, 1903. That contention overlooks the plain provision of the act under which the proceedings were had. It declares that, upon the declaration of the vote favorable to annexation by the council and entering it upon the record of the council such actions constitute the change of jurisdiction. Those acts raise the new flag over the territory annexed. The obtaining of the consent of the county court of Pulaski County to the use of the free bridge before the franchise could be enjoyed was clearly a condition precedent .to it vesting, and was. a reasonable and enforcible condition precedent. Joyce on Electric Law, § § 187, 352, 358, and authorities cited in notes. This and the other conditions mentioned in the ordinances would have to be complied with within a reasonable time. In determining reasonable time the subject-matter and all the circumstances are to be considered, as there can never be a fixed rule on such a subject. In this case the ordinance was passed June 25, 1903, and the election was held July 21, and the result would have at once been declared, and the jurisdiction changed, but for the injunction. The rights of North Little Rock must be determined as of date when it should have acquired jurisdiction. That date was less than one month after the passage of the ordinance. Therefore North Little Rock assumed jurisdiction over the Eighth Ward subject to a valid ordinance granting a franchise to certain streets therein subject to conditions precedent to be performed in a reasonable time from June 25, 1903. The subsequent proceedings did not alter that status, for the jurisdiction, when assumed in. February, 1904, was, so far as these parties were concerned, as of date July 21, 1903, or as soon thereafter as the vote could be declared. The rights acquired after that date should be cut off, and those acquired prior thereto given full force. The court is of opinion that one month was not reasonable time to allow the street car company to comply with the conditions precedent, and it follows, therefore, that the street car company still has a reasonable time, under the ordinance of Jutie 25, 1903, to comply with the conditions precedent. The decree of the chancellor cancelling and annulling the ordinance of June 25, 1903, is erroneous, and the same is hereby reversed. The decree cancelling and annulling the ordinance of August 10, 1903, and all other matters therein, except as above stated, is affirmed.