Case: ROGERS PARK WATER COMPANY v. FERGUS
Abbreviation: Rogers Park Water Co. v. Fergus
Decision Date: 1901-03-25
Docket Number: No. 56
Citation: 180 U.S. 624
Volume: 180
Reporter: United States Reports
Court: Supreme Court of the United States
Jurisdiction: United States
Parties: ROGERS PARK WATER COMPANY v. FERGUS.
Judges: 
Pages: 624–633

Head Matter:
ROGERS PARK WATER COMPANY v. FERGUS.
ERROR TO THE SUPREME COURT OF THE STATE OF ILLINOIS.
No. 56.
Argued and submitted October 31,1900.
Decided March 25, 1901.
So far as the contentions in this case are the same as those passed upon in Freeport Water Company v. Freeport City, ante, 587, and irr Danville Water Company v. Danville City, ante, 619, they are governed by those cases.
A governmental function in a statute granting powers to a municipal corporation cannot be held to have been granted away by statutory provisions which are doubtful or ambiguous.
There is no complaint in this case that the rates fixed by the ordinance of 1897, passed by the city council of Chicago, were unreasonable; and as the plaintiff in error relies strictly on a contractual right, and as it has no such right, the judgment below is affirmed.
This is a petition for a writ of mandamus which was brought by the defendant in error on the 13th of December, 1897, in the circuit court of Cook County, State of Illinois, against the plaintiff in error, to compel it to furnish him water at rates fixed by an ordinance enacted by.the city of Chicago. •
The defence is that such ordinance impairs the obligation of the contract which plaintiff iff error claims to 'have with the village of Rogers Park before its annexation to the city of Chicago, as hereinafter mentioned.
The village of Rogers Park was from November 12, 1888, and until April 4, 1893, a rhunicipal corporation organized un der the laws of Illinois. At the latter' date it was annexed to the city of Chicago.
The Rogers Park Water Company, plaintiff in error, was a corporation, incorporated about the 24th of January, 1889, under the laws of Illinois, to construct and operate a system of waterworks in the village of Rogers Park, and to acquire such property and exercise the powers necessary thereto.
The company constructed and operated a system of Waterworks in said village, and the premises of the defendant in error were connected thereto and supplied with water therefrom. The rates for such water under the ordinance of the city of Chicago were $8.72, payable in advance, for the current half year, from November 1, T897, to May 1, 1898. Those rates were tendered to the company, and a supply of water demanded of it. The company refused to comply, demanding $13.50 for such supply, claiming that sum under section 12 of an ordinance of the village of Rogers Park before its annexation to Chicago, and which ordinance empowered the construction of the waterworks system.
The contract, which plaintiff in error claims, is based on that ordinance. It was passed November 12,1888, and was entitled “ An ordinance to provide for a supply of water to the village of Rogers Park, 111., and its inhabitants, contracting with H. E. Keeler, his successors and assigns, for a supply of water for public use, and giving the said village of Rogers Park, IU., an option to purchase the said works.”
It was provided that in consideration of the public benefit to be derived therefrom the village of Rogers Park, Illinois, granted the exclusive right and privilege for a period of thirty years .from the time the. ordinance should take effect “unto H. E. Keeler, his successor and assigns, of erecting, maintaining and operating a system of waterworks in accordance with the terms and provisions ” of the ordinance. There was a grant of the use of the streets and alleys, for mains and conduits, and. power given to extend the system to new territory, if any should be acquired by the village. There were provisions prescribing the character of the system to be constructed, and that the village should pay “an annual rental for fire protection, for less than five miles of mains within the corporate limits of said village, for the aforesaid period of thirty years, at the rental rate of five hundred and seventy-five ($575) dollars for each mile of main, to be payable semi-annually.” There were also provisions for payment of taxes by the company, the flushing of sewers, and the maintenance of fountains, for the supply of water to the inhabitants, the quality of water and the manner of the supply before prescribed, and for the acceptance in writing by the company of the terms of the ordinance. Provision was also made for the purchase of the system by the village.
Section 12 ivas as follows:
“ The said grantee or assigns shall charge the following annual water rates to consumers of water during the existence of this franchise, and they shall have the right at any time to insei’t a water meter into the service pipe of any consumer and to charge and collect from him at meter rates, provided that in such case the minimum annual rate paid by any one consumer shall be five dollars.”
Then follow the rates for the particular pui’pose for which the water might be used.
Section 13 provided for the levy of a tax to meet the payments stipulated by the ordinance, which should be irrepealable.
Section 14 was as follows:
“ "Within sixty days after the passage of this ordinance said H. E. Keeler, his successors and assigns, shall file with the village an acceptance of the same, which acceptance, duly acknowledged before some officer duly authorized to administer oaths, shall have the effect of a contract between the village and said H. E. Keeler, his successors or assigns.”
The plaintiff in error is the assignee of Keeler.
The plaintiff in error claimed in its answer that said ordinance of the village of Rogers Park constituted a contract with plaintiff in error by which it had the' right to charge the rates contained in section 12, and that the ordinance of the city of Chicago reducing their rates impaired such contract and violated' not only the constitution of the State of Illinois, but also violated section 10, article 1 of the Constitution of the United States, as well as the Fourteenth Amendment.
One of the defences of the plaintiff in error was that the premises of defendant in error were connected with the system by reason of his written application,- ivhich application was accepted and became a contract. That defence, however, is not made in this court, and further reference to it is omitted.
There was a demurrer filed to the answer of the plaintiff in error, which set up its defences under the Constitution of the United States. The demurrer was sustained. Certain issues of fact were made on other pleadings, upon which there was a trial by jury, resulting in a verdict for petitioner and judgment on the verdict. The judgment was affirmed by the Supreme Court of the State, 178 Illinois, 571* and this writ of error was sued out. The assignments of error present constitutional questions only.
Mr. Newton A. Partridge for plaintiff in error.
Mr. Jesse B. Barton, for defendant in error, submitted on his brief.

Opinion:
Mr. Justice McKenna,
after making the above statement, delivered the opinion of the court.
At the time of the passage of the ordinance in November, 1888, by the village of Rogers Park, counsel for plaintiff in error says " two general acts were in force in Illinois, which related to the power of municipalities to pass ordinances for waterworks to be built and operated by private enterprise.'-' The first is as follows:
" An act entitled £ An act to enable cities, incorporated towns and villages to contract for a supply of water for public use, and to levy and collect a tax to pay for the water so supplied.'. • Approved April 9,1872." In force July 1,1872. Laws, 1871-2, p. 271. This title is as amended by act approved June 26, 1885. in force July 1, 1885, p. 64.
££ Seo. 1. Be it enacted by the People of the State of Illinois, represented in the General Assembly, That in all cities, incorporated towns and villages where waterworks have been or may hereafter be constructed by any person or incorporated company, the city, town'or village authorities in such cities, incor-. porated towns and villages may contract with such person or incorporated company for a supply of water for public use for a period not exceeding thirty years." As amended by act approved June 26, 1885. In force July 1,1885, Laws, 1885, p. 61.
" Sec. 2. Any such city or village so-contracting may levy and collect a tax on all taxable property within .such city or village to pay for the water so supplied."
The second, passed one day later and taking effect on the same day as the first, was the cities, villages and towns act. The title to. that act and the article and. section bearing upon this case are as follows : ' ' -
" An act entitled ' An act to provide for the incorporation of cities and villages.' Approved April 10, 1872. • In force July 1, 1872. Laws of 1871-2, p. 218.
" Article X, Section 1. The city council or board of trustees sba.ll have the power to provide for a supply of water by the boring and sinking of Artesian wells, or by the construction and regulation of wells, pumps, cisterns, reservoirs or waterworks, and to borrow money therefor, and to authorize any person or private corporation to construct and maintain the same at such rates as may be fixed by ordinance, and for a period not to exceed thirty years; also to prevent the unnecessary waste of water; to prevent the pollution of the water, and injuries to such wells, pumps, cisterns, reservoirs or waterworks."
These acts are. urged to establish the power in the village of-•Rogers Park to grant to the plaintiff in error.the right to charge and collect for thirty years the rates prescribed by the ordinance of November, 1888. We' have passed on a similar contention in Freeport Water Co. v. Freeport, and in Danville Water Co. v. Danville, and we need not repeat the reasoning. Besides, it is disputable if the ordinance of 1888 justifies the claim of plaintiff in error. The' Supreme Court of the State held that it did: not. • A strict construction must be exercised. The contract claimed concerned governmental functions, and such functions cannot be held to have been stipulated away by doubtful or ambiguous provisions.
Section 1 of the ordinance recites " that in consideration of the public benefit to be derived therefrom, the village of Rogers Park, Illinois, hereby grants the exclusive right and privilege for a period of thirty.years '. . . unto H. E. Keeler, his successor or assigns," of erecting and maintaining a system of waterworks. The use of the streets was also granted for such purpose.
Section 3 recites " in consideration of the public benefits and the protection of property resulting from the construction of said system of waterworks," the village agrees to pay a certain annual rental proportional to the length of the mains.
The grantee, on his part to pay " all municipal and' village taxes," (sec. 3,) " in consideration of the rentals herein agreed to be paid and in consideration of the rights and privileges granted " (sec. 4,) agreed to furnish the village and the residents thereof an adequate supply of water. Failing to supply water for a year in quantity or quality stipulated, the 1£ franchise and all their rights and privileges granted under this ordinance, and the contract entered into, shall be null arid void."
If the ordinance contained any other provisions it could not be claimed that the company's charges to consumers of the water furnished them were free from regulation by the municipal^ if it otherwise had power of regulation. There are other provisions, and especial stress is laid upon them. Section 12 provides as follows:
££ The said grantee or assigns shall charge the following annual water rates to consumers of water during the existence of this franchise, and they'shall have the right at any time to insert a water meter into the service pipe of any consumer and to charge and collect from him at meter rates, provided that in such case the minimum annual rate p&id by any one consumer shall be five dollars."
Then follows an enumeration of uses' and the rates for such uses. There is a schedule for meter rates, and also the following provision:
" Rates for all other purposes that may be applied for, not named in the foregoing schedule of maximum rates, will be fixed by estimation or meter, at the option of the grantee of assigns."
This, it will be observed, is the language of command, not of contract; of limitation on power, not a bargain giving power. The right to charge the inhabitants of the village for the water supplied to them resulted from the right to construct and máintain the system. Section 12 was a regulation of the right. There is no stipulation that it will be the only instance of regulation ; that the power to do so is bartered away, and that the conditions which determined and justified it in 1888 would remain standing, and continue to justify it through the changes of thirty years. It would require clearer language to- authorize us in so holding. The predecessor of the plaintiff in error was given the monopoly of the supply of water. That might be necessary to induce the investment of capital, and for its security the obligation of a contract might be sought and given. There was no such inducement for an unalterable rate. A reasonable rate the law assured, and assured even against governmental regulation. And the statute of 1891, which is especially complained of, assures it. By section 1 of that statute municipalities are " empowered to prescribe by ordinance maximum rates and charges," and if unreasonable rates and charges be fixed they may be reviewed and determined by the circuit court of the county in which the municipality may be. There is no complaint in this case that the rates fixed by the ordinance of 1897, passed by the city council of Chicago, were unreasonable. Plaintiff in error relies strictly on a contractual right. We think it has no such right, and the judgment of the Supreme Court is
Affirmed.