Asplund v. City of Santa Fe

OPINION OP THE COURT PARKER, C. J. The city council of the city of Santa Fe was about to grant a franchise for the erection, and operation of a waterworks system and an electric light and power plant when this action was brought to enjoin such action upon the theory that, before such franchise could be granted, the question must first be submitted to a vote of the- people, which had not been done. The city council demurred to the complaint upon the ground that there existed no such requirement, and, consequently, the injunction could not be maintained. The court sustained the demurrer, and, the plaintiff electing not to plead further, the court dismissed the complaint, from which judgment the case is here on appeal. It is apparent that the question involved is. a very narrow one and turns upon a proper interpretation of the statutes. The first statute on the subject is chapter 39, Laws of 1884. Subsection 67 of that act is as follows': “They shall have power to erect waterworks, or gas works, or authorize the erection of the same by others; but no such works shall be erected or authorized until a majority of the voters of the city or town, voting on the question at a general or special election, by vote approve the same.’ ’ •This section is carried forward as subsection 68 of section 3564, Code 1915. It is argued in behalf of appellees that this section applies only to waterworks constructed by or for the city as a municipal enterprise, and does not include franchises for private enterprises for such purposes. We deem the argument faulty. This section is the only one in the act granting the power to construct or authorize the construction of waterworks..If it does not include private enterprises, then there is no authority to grant such franchise. This could not have been the intent of the Leislature for the reason that, in subsection 69 (subdivision 70, of section 3564, Code 1915) it is provided that in case the right is granted to a private concern, the term of the franchise shall not exceed 25 years, and the city may regulate rates to private consumers, and contract with such private concern for water for the city for fire protection and other purposes, and may pay the agreed price therefor. This section does not grant the power to authorize private concerns to construct waterworks, but merely provides for the regulation of such concerns by. the city. It thus appears that the Legislature intended subsection 68 to include private enterprises; otherwise subsection 70 would appear to be futile. Such lack of understanding could hardly be attributed to the legislative branch of the government. The same consideration controls the interpretation of subsection 69 of section 3564, Code 1915 (subsection 68 of the Act of 1884). This section provides for the construction of such waterworks outside the city limits, and does not in terms require a vote of the people. But subsection 68, Code 1915, is a general provision as to a vote of the people in all cases where erection or construction is to be resorted to, either without or within the city limits. The decision of the district court was therefore doubtful upon the pleadings before him, as appears from the transcript. The scope of the iniquity here, however, has been somewhat enlarged by the submission to the court by stipulation of the parties of a copy of the proposed ordinance granting the franchise. An examination of the franchise discloses that it is not a franchise to erect or construct waterworks, but it is a franchise to operate and maintain a waterworks system. It contains recitals that in 1880 the board of county commissioners of Santa Fe county granted to the Santa Fe Water & Improvement Company, a predecessor in title to the grantee of the present franchise, a right of way for the construction, maintenance, and operation of a water and light system in the territory now occupied by the city of Santa Fe; that the city of Santa Fe in 1893, by ordinance, granted to the predecessor in title of the present grantee a franchise to supply the city with water for the period of 25 years, which franchise expired January 18, 1918; that it is now the desire of the city to provide for additions and betterments to the existing water system, and to provide for the storage and impounding of sufficient water to afford an adequate supply for the city and its inhabitants; that the grantee of this franchise is willing to continue the operation of the present plant and to make betterments and improvements later in the franchise specified, provided he is granted the right to operate and maintain said system for 25 years; and that the grantee has acquired by purchase all of the property rights and franchises of the Santa Fe Water & Light Company, and its predecessors, and the city is willing to grant said grantee, his successors and assigns, a franchise for the construction, maintenance and operation of a system of waterworks for the collection and storage and distribution of water. Then follows the granting clause of the ordinance. Section 1 of the ordinance is as follows: “That there is hereby granted for the term and period of 25 years from and after the date of this ordinance to the said John Davis Bowles, his successors and assigns, hereinafter called the grantee, the right, .privilege and franchise to construct, maintain and operate in the city of Santa Pe, as now and hereafter constituted, a system of works for the collection, storage and distribution of ‘water for the purpose of furnishing and supplying to the said city and its inhabitants water for domestic, irrigation, industrial and sanitary purposes, and for fire protection and other useful purposes." Section 3 of the ordinance provides that the grantee, his successors and assigns, shall have the right during the term and period aforesaid, and subject to the limitations and conditions in said ordinance provided, to enter upon the streets for the purpose of constructing, maintaining, and operating his or their system of water pipes, conduits, and works with the improvements and additions thereto, and to maintain the same. Section 6 provides that in the event that during the life of the franchise the grantee, his sucessors and assigns, should desire to construct, operate, and maintain one or more equalizing or supplemental reservoirs within the corporate limits of said city, he or they must apply to the city council for the right and authority so to do. Section 7 provides that the existing pipe lines, and water mains shall be maintained in good working order and extended, improved, and enlarged from time to time, as contemplated herein and as the needs of the city may require. Section 8 provides that'in consideration of the granting of said franchise, the grantee himself and his successors and assigns agree and covenant to build and construct a reservoir, or series of reservoirs, between the present storage reservoir and the upper reaches of the Santa Fe river, which will be adequate to supply, in conjunction with the existing reservoirs, sufficient water for a city of 10,000 people; such reservoir or reservoirs to be complete in every respect, with a system of channels, conduits, pipe lines, and other equipment for the distribution of water thereby collected to the city and its inhabitants.. Section 11 requires that the city shall pay an annual rental of $35 each for not less than 80 fire and sprinkling hydrants as now existing, or as may be required by order of the city council. The ordinance provides further for the regulation of rates and contains provisions concerning forfeiture of the franchise. It thus appears that this is not a franchise for the erection or construction of a water plant, but is a franchise for the operation of a plant already in existence, with provisions for betterments, additions, and extensions. There is no grant of a franchise to construct storage reservoirs outside the city limits. The grantee merely covenants that he will construct such reservoir or reservoirs and augment the present supply of water. The question then is.: Has the city power to grant by ordinance a franchise to maintain and operate an existing water plant in the city 1 By subsection 90 of section 3564, Code 1915 (section 6 of chapter 46, Laws 1893), it is provided: “All towns and villages shall have power to grant, by ordinances, franchises and privileges for street car lines, waterworks, lighting purposes and other public conveniences and comforts, for the furnishing of which such franchises and privileges are necessary.” By subsection 67 of the same section (section 1 of chapter 70, Laws 1897) it is. provided: “Any incorporated city, town or village in this state having a population of at least 1,000, *' * * shall have all powers given by law to incorporated towns. * * * ” We deem this legislation as granting a different power from that granted by subsections 68, 69, and 70. If it is not a different power, then it was a useless piece of legislation, for the power was already granted in the above subsections. The only subject-matter to which it can apply, so far as waterworks are concerned, is the maintenance and operation of a plant .alreday erected and installed. It requires no referendum to the people. There is reason for this distinction. A public utility already installed and capable of sufficient service, under regulation by the city, satisfactory to the people and the city council, may well be continued for an additional period upon the same terms as before. Not so when a new plant is to be installed. In that case the people are interested in the kind of installation to be made, the quality and amount of supply of water, and the ability of the concern to carry out its undertakings. No doubt other considerations may enter into the proposition. And so the Legislature has provided for a vote of the people in such case. Bnt not so when the question is whether a franchise is to be granted to operate, improve, extend, and maintain a plant already installed. This interpretation harmonizes these statutes, leaving all of the sections in force. They are to the effect that in all cases a referendum to the people must be had where a waterworks is to be erected; when a franchise is to be granted to maintain and operate an exist-ting plant, no referendum is requried. It follows that the judgment of the district court was correct and should be affirmed, and the cause remanded with directions to proceed accordingly, and it is so ordered.