Boyce v. City of Gastonia

Winborne, J. Appellant in brief filed in this Court concedes that: “It is well settled in this State that construction, maintenance and improvement of streets is a necessary expense for municipalities,” and “that it is immaterial what 'medium of exchange’ is used in paying for said improvement as long as the same can be reduced to a money value.” *144 Thereupon, appellant so conceding challenges the authority of the city of Gastonia to carry out and perforin its agreement of 14 October, 1946, upon two grounds : (1) That since it is found as a fact that the North Carolina State Highway and Public Works Commission has agreed to appropriate a sum of money for the widening and improving of Franklin Avenue in the city of Gastonia, but only upon condition that the tracks and other facilities of said Railway Company be removed therefrom, and that its franchise be surrendered and abandoned, in so far as it relates to said avenue, the city will lose such sum of money if the condition be not met; that such loss comes within the purview of the clause within the franchise that “the holder thereof shall be liable to compensate the said city of Gastonia against, and save it harmless from, all damages or loss that said city may suffer on account of anything that should grow out of the construction and operation of said railway”; that, hence, the payment of the expense of removing the tracks and of buying a new right of way is a responsibility assumed by defendant Railway Company as assignee of the franchise; and that, therefore, when the city undertakes to bear such expense, it is granting to the Railway Company a special emolument, not in consideration of public service, in violation of Article I, Section 7, of the North Carolina Constitution. Such construction, we think, is somewhat strained. In this connection the General Assembly of North Carolina has authorized cities and towns “to grant upon reasonable terms franchises for public utilities, — such grants not to exceed the period of sixty years, unless renewed at the end of the period granted.” G. S., 160-2. This authority as so written became effective 11 March, 1907, and was in effect on the date when the franchise under consideration was granted. See P. L. 1907, Chapter 978. The laws existing at the time and place of a contract form a part of it. See Nash v. Bd. Comm., 211 N. C., 301, 190 S. E., 475; Bank v. Town of Bryson City, 213 N. C., 165, 195 S. E., 398; Abernethy v. Ins. Co., 213 N. C., 23, 195 S. E., 20; Spain v. Hines, 214 N. C., 432, 200 S. E., 25; Rostan v. Huggins, 216 N. C., 386, 5 S. E. (2d), 162, 126 A. L. R., 410; Dunn v. Swanson, 217 N. C., 279, 7 S. E. (2d), 563; Barker v. Palmer, 217 N. C., 519, 8 S. E. (2d), 610; Motsinger v. Perryman, 218 N. C., 15, 9 S. E. (2d), 511; Bank v. Derby, 218 N. C., 653, 12 S. E. (2d), 260; Spearman v. Burial Assn., 225 N. C., 185, 33 S. E. (2d), 895, 161 A. L. R., 1297. Moreover, as stated in 38 Am. Jur., 227, Municipal Corporation, Section 542, “The franchise of a public service corporation or other grantee, granted by a municipality, expires at the end of the specified time where the charter of the municipal corporation expressly provides that all franchises and privileges granted by it shall be limited to a *145 specified number of years. Sucb a limitation is as mucb a part of the franchise as if it were expressly included therein. Hence, although the provisions of a municipal ordinance granting a franchise, where taken by themselves, indicate an estate in perpetuity, the grant must be deemed to be one for years where the municipal charter expressly declared that all franchises shall be limited to a specified term of years from the granting thereof.” See Denver v. N. Y. Tr. Co., 229 U. S., 123, 33 S. Ct., 657, 57 L. Ed., 1101. Applying these principles to case in hand, it would seem that the franchise now owned by defendant Railway Company would be for a term of sixty years from the granting thereof, 10 September, 1908, and that it has now more than twenty years to run. Furthermore, this Court in construing the statute G. S., 160-2, held in the case of Railway Company v. Asheville, 109 N. C., 688, 14 S. E., 316, that after a city, by ordinance, has granted a right to construct a street railway line over certain streets, it cannot by subsequent ordinance arbitrarily annul such license. Indeed, the grant of such right is not a mere license, but a property right protected by the Constitution from arbitrary revocation or destruction, and may not be taken except by due process, of law. 38 Am. Jur., 217, Municipal Corporations, Sec. 536-7. To like effect are decisions of the U. S. Supreme Court in Owensboro v. Cumberland Tel. & Tel. Co., 230 U. S., 58, 57 L. Ed., 1389; Boise Artesian H & C Water Co. v. Boise City, 230 U. S., 84, 57 L. Ed., 1400. Hence, it may not be said with reason that the parties intended the indemnity clause in the franchise as a reservation of right in the city to revoke the franchise at will and without due process of law. In fact, appellees forcefully contend that the expense to be incurred does not arise out of an exercise of right under the franchise, but out of the abandonment and extinction of those rights, and is the price which the city shall pay for their abandonment and extinction. The Court finds that the amounts to be expended by the city of Gastonia pursuant to said agreement are very substantially less than the loss which will be sustained by the defendant Railway Company. (2) Appellant next contends that the provision in the contract of 14 October, 1946, relating to the width of the new rights of way constitute an unlawful delegation of authority by the city to the Railway Company. The only authority delegated is to say what additional width will be required to take care of proper slopes of cuts and fills. This is more nearly an engineering matter than a delegation of authority. The contention is without merit. The burden is on the appellant to show error. On this record he has failed to do so. Hence, the judgment below is Affirmed. Denny, J., took no part in the consideration or decision of this case.