Court Opinion

ID: 8190981
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:13:59.242034+00
Date Added: 2024-06-11T16:40:36.479844
License: Public Domain

Timlin, J.
(concurring). Acting upon complaint of the city of Milwaukee the Railroad Commission of this state, in the exercise of power conferred upon it by secs. 1797 — 1 to 1797 — 38, Stats., on August 23, 1912, made an order requiring the appellant to discontinue its ticket rate of twenty-five tickets for one dollar, and to sell, through its conductors, tickets in packages of thirteen for fifty cents, each ticket to entitle the bearer to one continuous passage in the same general direction with privilege of one transfer between the single-fare points, upon the city lines of the appellant.
Before their compilation into what is now known as the Wisconsin Statutes, the acts of the legislature above referred to and the powers of the Railroad Commission thereunder were considered by this court in Minneapolis, St. P. & S. S. M. R. Co. v. Railroad Comm. 136 Wis. 146, 116 N. W. 905. It was there held that these statutes, declaring that railroad rates and services shall be reasonable and creating a commission with power to investigate existing rates and services and to fix and determine what rates and services are reasonable and providing that the rates and services.so fixed shall be in force, are valid acts of legislation, and that conclusion is not questioned in the instant case, but is here mentioned as descriptive of the proceedings in which the order of the Railroad Commission is made. Under these statutes the appellant brought an action in the circuit court for Dane county against the Railroad Commission to review the said order of the latter, averring said order to be unlawful and unreasonable because the order and any law authorizing the same is a law impairing the obligation of contracts, depriving the plaintiff of property without due process of law, and in vio*613lation of tbe constitution, of tbe United States and of that of tbe state of Wisconsin. Tbe Railroad Commission interposed a general demurrer to tbe complaint. This demurrer was sustained, and tbe appellant elected to stand upon said complaint and refused to amend, whereupon judgment was entered dismissing tbe complaint, thereby affirming tbe order of tbe Railroad Commission. No case is made for relief on tbe ground that tbe order in question, is confiscatory in that it deprives tbe appellant of a fair return upon its property invested, and tbe arguments in this court are not directed to that point. Tbe only point made is that tbe order of tbe Rcuilroad Commission and tbe statutes under which it is made are invalid as impairing tbe obligation of a contract. In order to bring tbe case within that paramount rule of law, tbe appellant avers its corporate character and shows tbe magnitude of its property and operations, that it operates under and by virtue of a certain ordinance or resolution duly enacted by tbe mayor and common council of tbe city of Milwaukee on January 2, 1900, which contained, among other things, tbe following:
“Sec. 6. After the passage, publication and acceptance of this ordinance by said railway company, tbe rate of fare for one continuous passage upon tbe lines of railway within said city limits of said city owned and operated by said railway company constructed under any franchise herein, heretofore or hereafter granted to said railway company or its predecessors, successors or assigns, -as tbe case may be, shall be not to exceed five cents for a single fare, except for children under ten years of age tbe rate of fare shall be three cents for one child and five cents for two children, and infants under three years of age free. Except where cars or carriages shall be chartered at a special price, which fare shall entitle each passenger, upon demand made at the time of payment of fare, to one transfer at established points of transfer to any connecting or cross line of said railway company, for passage, within said city, and convenient points of transfer shall be *614maintained and such, additional points of transfer established as will carry out the full intent and purpose of this ordinance to maintain and extend the transfer system now in force upon the lines of said railway company at the present standard of convenience for the people of said city. Each transfer ticket shall be good only for the passenger to whom it is issued, and for a continuous trip in the direction specified upon the transfer so given, and upon the first car leaving the transfer intersection after the time designated on such transfer.
“Provided, however, that after the acceptance of the terms of this ordinance the railway company shall, on demand made at its office in said city, or to the conductors on its cars operated- on its lines within the corporate limits of said city, sell tickets in packages of twenty-five for one dollar or six for twenty-five cents, each of which tickets shall entitle the holder thereof to use the same upon-the cars of said railway company' only between the hours of 5:30 o’clock and 8 o’clock in the morning and between the hours of 5 o’clock and 7 o’clock, central standard time, in the afternoon of each day until January 1, 1905, and shall also entitle the holder to the same privileges as are or may be accorded to passengers paying a cash fare of five cents; and the said railway company shall, from and after January 1, 1905, continue the sale of tickets in packages at the price aforesaid until December 31, 1934, each to be good at all hours of the day, with same privileges as are or may be accorded to passengers paying a single cash fare of five cents.”
The rights and privileges granted by this ordinance and all other ordinances therein mentioned and hereinafter referred to were made to expire on December 31, 1934. The ordinance provided for acceptance in writing by the appellant, and the appellant did so accept.
In addition to the usual consideration implied by such acceptance and undertaking of the duties imposed -and the disbursement of money in construction, the appellant set forth that prior to and at the time of the enactment of said ordinance of January 2, 1900, it had succeeded, on the reorganization of a corporation called the Milwaukee Street Rail*615way Company, to all the property, franchises, rights, powers, and privileges of the latter. Among these were several separate and distinct franchises, rights, powers, and privileges granted by the legislature of Wisconsin through the agency of the city and in the form of ordinances and resolutions adopted by the mayor and common council of Milwaukee, making grants to several separate and distinct corporations, to each of which the Milwaukee Street Railway Company succeeded by mesne conveyances from each of the separate corporations owning such franchises. Each of these franchises or grants covered the use of streets in distinct parts of the city and authorized the grantee to charge a five- or six-cent cash fare, provided for no commutation rates and no transfer privileges to the other lines. The appellant and each of the aforementioned corporations (except one incorporated by special act March 28, 1865) were stock corporations organized under the general incorporation laws of this state, and the term “mesne conveyances” as here used includes all modes of transfer.
While in possession of and operating said properties under the several franchise ordinances mentioned, the franchise ordinance of January 2, 1900, was enacted and accepted by the appellant. In accepting said last mentioned ordinance it is averred that the appellant surrendered to the city valuable rights under the prior existing ordinances and made certain concessions, substantially as follows: Appellant by such acceptance agreed that all said franchise ordinances should expire December 31, 1934; agreed to sell commutation tickets at the reduced rates mentioned; agreed to furnish the city electric power to swing drawbridges and to make improvements in streets prior to repaving thereof, to transport on its cars free of charge members of the police, fire, and health departments of said city when in uniform, also detectives of the police department, and to maintain transfer points and give *616transfers on its lines of railway, to strengthen and rebuild bridges over which its tracks might extend at its own expense, and to extend its tracks to the city limits when required; and that it has performed upon its part. The ordinance of January 2, 1900, which is made part of the complaint, imposes these and other obligations. By sec. 3 of that ordinance all rights reserved or secured to the city by and under all ordinances in force or by the laws of Wisconsin relating to regulating the speed and headway of cars, etc., and everything connected with the exercise of the rights thereby or theretofore granted to said railway company and its predecessors, are reserved to the city the same as though that ordinance had not been passed. By sec. 7 all rights, privileges, grants, and franchises theretofore granted by said city to said railway company and the several corporations or parties from or through whom it has acquired the same are confirmed and granted to the appellant, its successors and assigns, except as modified or changed by the ordinance of January 2, 1900.
It is noticeable that all the incorporations except the earliest, viz. that of March 28, 1865, of John Plankinton and associates, were under the general incorporation laws of this state, and all the franchise ordinances authorizing the construction and operation of the street railways in the streets of the city of Milwaukee were enacted by the mayor and common council in the exercise of the power delegated to that body by sec. 1862, Stats., which first appears as ch. 313, Laws of 1860, then became sec. 1862, R. S. 1878, amended by ch. 219, Laws of 1881, then became sec. 1862, Stats. (1898), and preserves that number in the present compilation called the Wisconsin Statutes. The act of 1860 authorized any municipal corporation to grant such use as it should deem proper of any street or streets within the limits of such corporation to any street railway company organized under general or special act of the legislature of this- state or to any individual, *617etc.; . . . “sucb grant to be made by tbe common council of any sucb municipal corporation, upon sucb terms and conditions as they may impose, and with sucb privileges as may be necessary, reasonably, to secure tbe objects of tbe grant.” This act was carried into tbe revision of 1878 as sec. 1862 and tbe language condensed and changed somewhat. “Sucb use as it shall deem proper” became “tbe use,” and “upon sucb terms and conditions as they may impose” became, “upon sucb terms as tbe proper authorities shall determine.” But there was manifestly no intention to make any material change in tbe law. State ex rel. Bergenthal v. Bergenthal, 72 Wis. 314, 39 N. W. 566.
It has long been tbe law of this state that grants of corporate powers or privileges are strictly construed and nothing will be held to pass by implication. Janesville B. Co. v. Stoughton, 1 Pin. 667. And even in tbe case of natural persons something equivalent to an express contract seems to have been thought necessary. Chapin v. Crusen, 31 Wis. 209. Where an act of tbe legislature or a city ordinance is claimed to create an irrepealable contract it will be strictly construed in favor of tbe state or city. State ex rel. Cream City R. Co. v. Hilbert, 72 Wis. 184, 39 N. W. 326. This is also tbe rule of tbe United States supreme court. Detroit Citizens’ St. R. Co. v. Detroit R. Co. 171 U. S. 48, 18 Sup. Ct. 732.
By art. 2 of tbe articles of compact contained in tbe Northwest Ordinance enacted prior to tbe constitution of tbe United States, by sec. 10 of art. I of tbe constitution of tbe United States, and by sec. 12 of art. I of tbe constitution of this state, laws impairing tbe obligation of contracts are prohibited. If a contract when made was valid by tbe constitution and laws of tbe state as then expounded by tbe highest state authorities, no subsequent action by tbe state legislature or judiciary can impair its obligation. Chicago v. Sheldon, 9 Wall. 50. A state cannot by amendment of its constitution or by tbe *618adoption of a new constitution impair the obligation of an existing contract. Gunn v. Berry, 15 Wall. 610; Fisk v. Jefferson Police Jury, 116 U. S. 131, 6 Sup. Ct. 329; Shreveport v. Cole, 129 U. S. 36, 9 Sup. Ct. 210. The interdict is not, however, unlimited.- The provision in question does not protect contracts made in breach of a public trust. Ill. Cent. R. Co. v. Illinois, 146 U. S. 387, 13 Sup. Ct. 110. Nor contracts void as against public policy of the United States. Taylor v. Thomas, 22 Wall. 479. Nor an incomplete contract. Garrison v. New York, 21 Wall. 196. Nor does it operate to limit the police power of the state so as to prevent legislation in the interest of public health, morals, or safety. Stone v. Mississippi, 101 U. S. 814; Chicago, B. & Q. R. Co. v. Nebraska, 170 U. S. 57, 18 Sup. Ct. 513; Beer Co. v. Massachusetts, 97 U. S. 25; Fertilizing Co. v. Hyde, 97 U. S. 659. Nor a contract made under delegated authority so far as it exceeds the delegated power. Water, L. & G. Co. v. Hutchinson, 207 U. S. 385, 28 Sup. Ct. 185; Home T. & T. Co. v. Los Angeles, 211 U. S. 265, 29 Sup. Ct. 50; Milhau v. Sharp, 27 N. Y. 611, 84 Am. Dec. 314; Lake Roland E. R. Co. v. Baltimore, 77 Md. 352, 26 Atl. 510, 20 L. R. A. 126; East St. Louis v. East St. Louis G. L. & C. Co. 98 Ill. 415, 448. Nor a gratuity founded upon no good or valuable consideration. Tucker v. Ferguson, 22 Wall. 527; West Wis. R. Co. v. Trempealeau Co. 93 U. S. 595; Salt Co. v. East Saginaw, 13 Wall. 373.
If this clause of the federal constitution were limited to ex-ecutory contracts, the questions arising thereunder would not be so serious and far-reaching, for these executory contracts must in a comparatively short time be either performed or' breached and so pass out of existence, satisfied by performance or existing as a right of action for damages or specific performance, closed by recovery or barred by statutes of limitations. But it was early decided that after performance there *619remains an implied contract that neither party to the original contract shall retake, but that each shall enjoy the rights transferred in the execution of the contract. Fletcher v. Peck, 6 Cranch, 87; Terrett v. Taylor, 9 Cranch, 43; Dartmouth College v. Woodward, 4 Wheat. 518; Green v. Biddle, 8 Wheat. 1; Hamilton v. Brown, 161 U. S. 256, 16 Sup. Ct. 585. Within this rule and subject to the foregoing limitations, charters to corporations other than municipal are, with reference to all contractual features thereof, considered grants and not to be impaired by subsequent legislation. State Bank v. Knoop, 16 How. 369; Pearsall v. G. N. R. Co. 161 U. S. 646, 16 Sup. Ct. 705; People ex rel. Schurz v. Cook, 148 U. S. 397, 13 Sup. Ct. 645.
“As applied to corporations, every grant of franchises is a charter. It may be a grant of the mere franchise of being a corporation or a grant of powers to a corporation already in existence. In either case the grant is the company’s charter to exercise the rights and privileges and enjoy the immunities granted. Bouvier defines the word ‘charter’ to be a grant made by the sovereign either to the whole people or to a portion of them, securing to them the enjoyment of certain rights. Bouvier’s Law Dic. ‘Charter.’ ‘All franchises,’ says Chief Baron ComyN, ‘are derived.from the king and ought to be claimed by charter.’ Com. Dig. ‘Feanchises,’ A 71. ‘Besides the charter of incorporation, a body politic has granted to it other charters, by which the crown, from time to time, adds to or modifies the powers,’ etc. Grant, Corp. 13.” State v. Comm’r of R. R. Taxation, 37 N. J. Law, 228, 237.
Without express definition this rule is made one of the bases of decision in Tomlinson v. Jessup, 15 Wall. 454.
“The charter of a corporation formed under a general law consists of its articles of association and the law under which it is organized.” Bent v. Underdown, 156 Ind. 516, 60 N. E. 307; O’Brien v. Cummings, 13 Mo. App. 197; State ex rel. Ross v. Anderson, 31 Ind. App. 34, 67 N. E. 207; State ex rel. Arosin v. Ehrmantraut, 63 Minn. 104, 65 N. W. 251.
*620This is supported by many decisions of tbe supreme court of the United States and of this court, in which distinct and separate statutes, enacted long after the corporation was organized and in existence, are treated as part of the charter and within or without the rule of Dartmouth College v. Woodward, 4 Wheat. 518, as the case might be; or within or without the reserved power to repeal or alter corporate charters as the case might be. Among such cases are State v. Railway Cos. 128 Wis. 449, 108 N. W. 594; Water Power Cases, 148 Wis. 124, 134 N. W. 330; State ex rel. Cream City R. Co. v. Hilbert, 72 Wis. 184, 39 N. W. 326; West Wis. R. Co. v. Trempealeau Co. 35 Wis. 257.
Grants by the state to a corporation of property, tangible or intangible, not in the nature of franchises, made upon a consideration moving from the corporation, are easily within the rule of the foregoing cases whether such grants be part of' the corporate charter or not. Corporations are on a par with natural persons in this respect. As to all statutes which form part of the corporate charter and which confer status, create obligations, or grant or impose powers or duties which the state is powerless to confer, create, grant, or impose without the consent of the natural persons affected, there is also a contract consummated by such consent. This also includes charter provisions indispensable to the maintenance of the status, the performance of the obligation, or the exercise of' the powers. But as regards other provisions found in a charter imposing obligations or conferring powers which the state might impose or confer upon any person or class without the consent of the latter, there is no element of contract.
In the instant case two questions are presented: (1) Was-a contract in form fixing the rates of fare to be charged during the life of the franchise ordinance of 1900 entered into by and between the city and the appellant ? Was a power delegated by the state to the city to make a contract which would. *621for the life of the franchise prevent the state from exercising its power to fix other and reasonable rates % This last cannot be justly or fully ascertained or determined without considering (a) what power the state had, and (b) what power did it intend to delegate. Because of the rule of law that reasonable doubts must be resolved in favor of the constitutionality of an act of the legislature we cannot correctly answer (b) without considering (a). The provision of the ordinance of 1900 that the rate of fare shall be not to exceed five cents is neither more nor less than a provision that the rate of fare shall not exceed five cents. Attempted distinction reduces itself to hypercriticism. Standing alone, this provision would be the mere fixing of a maximum above which the fare could not be raised by the corporation, within the rule of Georgia R. & B. Co. v. Smith, 128 U. S. 174, 9 Sup. Ct. 47; Rogers Park W. Co. v. Fergus, 180 U. S. 624, 21 Sup. Ct. 490, and cases cited. The Railroad Commission did not disturb this five-cent fare. But this provision does not stand alone, and is not in question on this appeal except for the purpose of aiding in the construction of that part of the franchise ordinance involved which asserts that “after the acceptance of the terms of this ordinance the railway company shall on demand made at its office in said city or to the conductors on its cars . . . sell tickets in packages of twenty-five for one dollar . . . each of which shall entitle the holder thereof to the same privileges as are or may be accorded to passengers paying a cash fare of five cents; and . . . shall continue the sale of tickets in packages at the price aforesaid until December 31, 1934.” Privileges to which a cash fare entitles the payer are not only transportation and the care and accommodations due a passenger, but also “one transfer at established points of transfer to any connecting or cross line of said railway company for passage within said city.” This last, as appears by the complaint, was a matter of compromise and agreement be*622tween the city and the street railway company, the latter surrendering a right or at least a bona fide claim to charge, according to existing franchises, a five-cent fare on each of its several lines without transfers, and accepting this substitute and making the concession above quoted. In construing this ordinance for the-purpose of ascertaining whether or not it constitutes a contract in the particular mentioned, we must assume for that purpose that the city had authority to contract. In other words, to get the true meaning we must first read the ordinance just as if it were a transaction between two natural persons or between two corporations having power to make such a contract. Whether or not the city had such power is another question. 'But assuming, for the purpose of ascertaining'the true meaning of the writing, capacity to contract, I think there was a contract with reference to the sale of tickets in packages of twenty-five within the rule of Cleveland v. Cleveland City R. Co. 194 U. S. 517, 24 Sup. Ct. 756; Cleveland v. Cleveland E. R. Co. 201 U. S. 529, 26 Sup. Ct. 513; Detroit v. Detroit Citizens’ St. R. Co. 184 U. S. 368, 22 Sup. Ct. 410. All the identities of a contract existed: parties, stipulations in writing, consisting of the ordinance and written acceptance, a surrender of the privileges claimed or held by the railway company, and an assumption of a new definite obligation to be continued for a fixed period, and a provision that the former ordinances should be in force except as modified by these new stipulations. The city proposed by the ordinance that the railway company shall surrender its claim to charge a five-cent fare under each of its several existing ordinances on each of its lines and shall during the ensuing thirty-four years sell tickets in packages of twenty-five at the rate named and give transfer privileges to the holder of such tickets, and the railway company, by its written acceptance required in the ordinance, relinquishes its former right or claim and agrees to sell tickets at the specified *623rates during tbe period mentioned. This, as regards that part of the ordinance in question, and aside from questions of its legality, is in form and substance a contract. Strict construction must nevertheless be fair and honest construction, and its chief office is in resolving ambiguities and cannot afford a justification for distorting the true meaning.
The constitution of this state contains the following:
Sec. 1, art. XI: “Corporations without banking powers or privileges may be formed under general laws, but shall not be created by special act, except for municipal purposes, and in cases where, in the judgment of the legislature, the objects of the corporation cannot be attained under general laws. All general laws or special acts enacted under the provisions of this section may be altered or repealed by the legislature at any time after their passage.”
Art. 8 of sec. 1 of the North Carolina constitution of 1815 and art. 8 of sec. 1 of the New York constitution of 1894 are literal transcripts of the section of the Wisconsin constitution above quoted, and California (1880), Michigan (1850), Maryland (1891), Maine (1815), Washington (1889), Arkansas (1874), and other states have substantially similar constitutional provisions. Long before the enactment of ch. 313, Laws of 1860, and but six years after the adoption of our state constitution, the case of Madison, W. & M. P. Co. v. Reynolds, 3 Wis. 287, and the case of Pratt v. Brown, 3 Wis. 603, came before this court, and the scope and effect of sec. 1 of art. XI, supra was discussed and declared. Again in 1861, in the case of Nazro v. Merchants’ Mut. Ins. Co. 14 Wis. 295, this section was under consideration. It was in effect declared that all rights and franchises of a corporation are received, held, and exercised solely upon the faith of the sovereign grantor and during its pleasure. In 1870 the case of Whiting v. S. & F. du L. R. Co. 25 Wis. 167, came before this court, and the question of reducing or regulating rates or tolls was discussed and decided, and the power to so regulate *624was considered to exist under tbe quoted section of our constitution (pp. 198 et seq.). In 1874 tbe case of West Wis. R. Co. v. Trempealeau Co. 35 Wis. 257, affirmed 93 U. S. 595, was decided, and there, following Tomlinson v. Jessup, 15 Wall. 454, and quoting therefrom, this court said: “The reservation affects the entire relation between the state and corporation, and places under legislative control all rights, privileges, and immunities derived from its charter directly from the state.”
In Att’y Gen. v. Railroad Cos. 35 Wis. 425, statutes regulating rates of carriage by railways were -upheld under the quoted section of our constitution. Both the last mentioned cases are referred to and followed in Manitowoc v. Manitowoc & N. T. Co. 145 Wis. 13, 129 N. W. 925. The latter case is in all essential respects like the instant case, and is authority for the proposition that where a corporation is organized under the general laws of this state and thereafter receives by ordinance from a municipality a-grant of the right to use a highway for the purpose of operating its railway thereon, and this grant specifies the rate of fare to be charged, the state may later, acting through the Railroad Commission, establish a reasonable rate different from and higher than the rate specified in the franchise ordinance. This, as I understand it, is exactly in line with Stanislaus Co. v. San Joaquin & K. R. I. & C. Co. 192 U. S. 201, 24 Sup. Ct. 241. Considering a similar situation somewhat stronger in favor of the corporation, the United States supreme court there said:
“The authority given by the act of 1862 enabled the board of supervisors to conditionally regulate the rates. There is no promise made in the act that the legislature would not itself subsequently alter that authority. The state simply authorized its agents, the boards of supervisors, to regulate rates, but not to reduce them below a certain point. We do not think that from this language a contract can or ought to be implied that the state might not thereafter authorize the *625boards to reduce them, or that it might not itself do so directly.”
Passing to the consideration of the reserved power as declared in the California constitution of 1849, which like our constitution spoke of the “formation” of corporations in these words: “Corporations may be formed under general laws, but shall not be created by special act except for municipal purposes. All general laws and special acts passed pursuant to this section may be altered from time to time or repealed,” it was held, following Tomlinson v. Jessup, 15 Wall. 454, that the object was “to prevent a grant of corporate rights and privileges in a form which will preclude legislative interference with their exercise if the public interest should at any time require such interference. . . . The reservation affects the entire relation between the state and the corporation, and places under legislative control all rights, privileges, and immunities derived by its charter directly from the state.”
The franchise ordinance granted by the board of supervisors under delegated authority from the state was therefore considered a part of the corporate charter and as such subject to repeal or alteration. Agencies are created and contracts are made and construed with reference to existing laws. It is not to be presumed that the legislature, by the enactment of see. 1862, Stats., intended to abrogate or suspend for a time its power of regulation or confer upon the municipal councils authority greater than that possessed by the legislature itself. Under the so-called reserved power in the constitution the legislature could not, in the conferring of corporate franchises or privileges, enact an irrepealable law. The state did not intend, therefore, that the municipality granting the use of the streets to a corporation organized under general laws should have power to do that which the legislature itself could not do. The cases of City R. Co. v. Citizens’ St. R. Co. 166 U. S. 557, 17 Sup. Ct. 653; Detroit v. Detroit Citizens’ St. *626R. Co. 184 U. S. 368, 22 Sup. Ct. 410; Cleveland v. Cleveland City R. Co. 194 U. S. 517, 24 Sup. Ct. 756; Cleveland v. Cleveland E. R. Co. 201 U. S. 529, 26 Sup. Ct. 513; and Minneapolis v. Minneapolis St. R. Co. 215 U. S. 417, 30 Sup. Ct. 118, have been brought to our attention, but they are not in point. As indicated in Detroit v. Detroit Citizens’ St. R. Co., supra, at page 397, these were contests between the city and the carrier, and the state had not undertaken to assert its rights under the reserved power nor delegated to the city the authority to exercise the power of alteration or repeal. This power is by the constitution not reserved to the city, but to the state through its legislature. The laws in existence when and where a contract is made necessarily enter into and form part of the contract. McCracken v. Hayward, 2 How. (43 U. S.) 608; State ex rel. Damman v. Comm'rs, 4 Wis. 414; Von Baumbach v. Bade, 9 Wis. 559. The rates of common carriers, whether natural persons or corporations, were, when all these ordinances were enacted and accepted, subject to reasonable regulation by the state. That rule of law, as well as the existing and declared constitutional law of this state, must be read into the delegation of power contained in sec. 1862 and into each and every grant of the use of the streets made by the municipality pursuant to that section. Counsel contend for a narrow and technical construction of sec. 1, art. XI, Const.; in substance that the power to alter or repeal relates only to the right or franchise to exist as a corporation and does not include alteration or repeal of grants of power made by the state directly or through its delegate to an existing corporation. But this is contrary to nearly all the decided cases. This notion seems to have arisen from a curious perversion of what was decided in Att’y Gen. v. Railroad Cos. 35 Wis. 425. In that case it was argued by counsel for the railroad companies that ch. 273, Laws of 1874, classifying the roads and fixing rates, was a special act and therefore obnoxious to sub. 7 of sec. 31 of art. IV of our state *627constitution, then lately adopted as an amendment. This provided that the legislature is prohibited from enacting any special or private law for granting corporate powers or privileges except to cities, while sec. 32 of the same article declared that the legislature shall provide general laws for the transaction of any business that may be prohibited by sec. 31 of this article, and all such laws shall be uniform in their operation throughout the state. This was a point of some difficulty because the statutes there in question had many of the earmarks of a special law, and because many corporate charters granted by special law were outstanding and in force and their provisions were various, and if the legislature could not alter one without altering all, or repeal one without repealing all, great confusion and injustice might result. To meet this argument the court said (p. 659) :
“It was contended that this amendment, prohibiting the grant of corporate powers by special act, operates as a repeal of the reserved power of altering existing special charters by special acts; that the prohibition to grant corporate powers includes, not only the creation of new corporations, but also the grant of new powers to existing corporations and by inference the limitation or regulation of existing corporate powers, by special acts; and so confines the reserved power to alter special charters, to general laws.
“The difficulty of altering special charters by general laws', which shall be uniform throughout the state, is very apparent. And if this were the true construction of the amendment, it would almost follow that special charters could no longer be repealed by special acts, and that the whole reserved power was relegated to general laws. It was even said by counsel that the charter of a corporation, organized under general law, could be repealed only by repeal of the general law; so that one corporation of one kind could not be subjected to repeal without repealing the charters of all corporations of the same kind under the same general law. This is almost an argument ad absurdum. . . .
“We shall not stop to dwell here on the importance of' the reserved power. ... We shall only assume here that it is a *628power of great significance and gravity; of such moment, that it is impossible to believe that the legislature and the people intended to surrender or impair it; very hard to believe that they suffered themselves to surrender or impair it by implication, in an amendment designed for quite a different purpose, quite consistent with the reserved power.
“But the purpose of the amendment, so far as it affects sec. 1, art. XI, appears to us very manifest. It was designed to áct on the first clause only of the section, taking away the legislative discretion and changing the directory provision into a prohibitory one; and not to touch the second clause of the section at all, leaving the reserved power where it found it, to be exercised thereafter as theretofore, upon special charters, by special acts. . . .
“We can see nothing in the letter or spirit of the amendment to warrant us in giving it a construction to impair the reserved power. . . . And we feel bound to hold, and find no difficulty in holding, the phrase in the amendment, to grant corporate powers or privileges, to mean in principio dona-tionis, and equivalent to the phrase, to grant corporate charters. This is implied not only by the word grant, but also by the word corporate. A franchise is not essentially corporate; and it is not the grant of franchise which is prohibited, but of corporate franchise; that is, as we understand it, franchise by act of incorporation.”
What was said, therefore, is not in the nature of a limitation upon sec. 1, art. XI, but a limitation upon sub. 7, see. 32, art. IV, of the constitution. The latter is limited so that it stands as a prohibition against the granting by special act of the franchise to exist as a corporation, but the former is unlimited and includes in its power of alteration and repeal all franchises of any kind which may at any period of its existence be conferred upon a corporation. And this has been the uniform application of sec. 1, art. XI. West Wis. R. Co. v. Trempealeau Co. 35 Wis. 257; Whiting v. S. & F. du L. R. Co. 25 Wis. 167; Att’y Gen. v. Railroad Cos. 35 Wis. 425; State ex rel. Cream City R. Co. v. Hilbert, 72 Wis. 184, 39 N. W. 326.
*629In State v. Railway Cos. 128 Wis. 449, 108 N. W. 594, tbis subject is decided and discussed at pages 505 to 508, and it was ruled in that case that an act of tbe legislature long after the corporation was organized and existing, conferring additional privileges upon the corporation and not at all limited to its right to exist as a corporation, was within the power reserved by sec. 1, art. XI. A like ruling was made in Black River Imp. Co. v. Holway, 87 Wis. 584, 59 N. W. 126; in State ex rel. Cream City R. Co. v. Hilbert, supra; in the Water Power Cases, 148 Wis. 124, 134 N. W. 330; in the opinion of this court in La Crosse v. La Crosse G. & E. Co. 145 Wis. 408, 130 N. W. 530; in Manitowoc v. Manitowoc & N. T. Co. 145 Wis. 13, 129 N. W. 925; and in a great number of cases in the supreme court of the United States. It seems strange that the decision in Att’y Gen. v. Railroad Cos., supra, should be so carelessly read as to draw from it inferences limiting the reserved power of alteration or repeal contrary to what was there decided, and to apply the restrictions there applied to sub. 7 of sec. 32, art. TV, in order to prevent the latter from limiting the reserved power so-as to limit the reserved power itself.
Upon these considerations and upon the words of sec. 1862' I come to the conclusion that no power was conferred upon the municipalities mentioned to make an unalterable or ir-repealable contract with the corporations or persons there qualified to become grantees, and hence that the municipality did not do so. There is a contract, but subject to -alteration by the state in respect to rates. The Railroad Commission was acting within its powers in making the order in question so long as the order is not confiscatory in character. I may add that in this state corporations, while subject to this reserved power, are fully protected against spoliation, confiscation of property, or even injustice by the Fourteenth amendment to the federal constitution and the equivalent provisions in our state constitution. Water Power Cases, 148 Wis. 124, *630134 N. W. 330. The natural persons behind the corporation, the shareholders, may be, under our constitution, deprived of any or all corporate powers or privileges, but not of the other acquired property of the corporation or of the use of such property in such manner as is lawful for natural and unprivileged persons. This property they may continue to enjoy as tenants in common, or they may, like other natural persons, incorporate under the general incorporation acts open to all. Thus, while the authority of the state is vindicated and its grants of power or privilege withdrawn or altered, none of the evils which the rule of the leading case in the federal supreme court was intended to guard against are possible under oúr system.
The following opinion was filed June 9, 1913: