Hatch v. Consumers Co.

AILSHIE, J. — This is an original action commenced in this court, praying for the issuance of a writ of mandate — 210 — against the defendant corporation, requiring and commanding that it connect plaintiff’s water pipes with defendant’s water system in the city of Coenr d’Alene. The complaint alleges that the plaintiff is the owner of a lot or tract of land in Krotzer’s addition to Coenr d’Alene City, and that he has bnilt a dwelling-house thereon and has placed water-pipes therein, extending from his house to the curb line in Third street in front of his premises. He alleges that the water rate for the service he requires and has demanded is $1.50 per month, payable in advance, as fixed by the water commissioners, appointed in conformity with the law for the establishing of water rates to be charged by the defendant company. He also alleges that he tendered the company, at its office, one month’s water rent, and demanded that it make the connections and turn on the water for his use; “that the company thereupon refused and declined to do so unless he would also pay it the sum of $8.50 for making the tap in its water main, or deposit the sum of $15.00, the same to be refunded when the tap is taken out, less the actual cost of labor and cost of one corporation cock, or in lieu thereof that he should deposit $40 in cash, the same to be applied on payment of water to be used from said tap”; that the company now is and has been for more than five years last past operating in the village of Coeur d’Alene, under the terms of a franchise of the village embodied in ordinance No. 93 of said village, and that it is collecting monthly water rates in advance for water furnished to the inhabitants of the village; that the water rates have been established by a commission appointed in conformity with law, and which said commission established rates to be charged on the 14th day of October, 1907; and that the rate so established that applies to a service such as plaintiff demands is $1.50 per month; that the defendant company has a water main on Third street in front of plaintiff’s property, and is furnishing other consumers along that street with water for which it is charging and receiving the sum of $1.50 per month in advance; that the company has an abundant supply of fresh water unsold and is able to supply the plaintiff with all the water he demands. — 211 — Plaintiff prays that a writ of mandate issue against the defendant requiring and compelling it to make the necessary conneetion with its water main and supply plaintiff with water upon receipt of the rental rates as established by the board. An alternative writ of mandate was issued against the defendant and it has answered, admitting plaintiff’s demand, and that it has a water main upon Third street in front of plaintiff’s house, and that it has refused to supply the plaintiff with water unless he accede to its requirements as set out in plaintiff’s complaint. Defendant has also pleaded further matter in defense of the action, in substance as follows: That prior to the construction by plaintiff of the house for which he now claims a water supply, plaintiff carried water from the faucet at the houses of some of defendant’s water consumers, for which he became indebted to the defendant in the sum of $28, which sum the plaintiff has neglected, failed and refused to pay, and that the defendant refused to supply plaintiff with water in the future until such time as he paid the balance due for water previously supplied to him in the manner above mentioned. It also alleges that plaintiff’s property is not within the corporate limits of Coeur d’Alene City. It further alleges that commissioners have heretofore been appointed in conformity with the law for the purpose of fixing rates to be charged by the defendant, and that in pursuance of the power and authority vested in them they met and fixed and established rates, and that the rate to be charged for service such as plaintiff demands is $1.50 per month in advance, and the further sum of $8.50 for making “water service connections”; and that the company has made and established a rule that where demand is made to have water supplied to a place that has not previously been receiving water, it requires that the applicant pay one month’s rent in advance, and also the sum of $8.50 for tapping its main and making connections, or deposit the sum of $15.00, the same to be refunded when tap is taken out, less actual cost of labor and cost of one corporation cock, or a deposit of $40.00 cash, the same to apply on payment of water used. — 212 — Defendant alleges that the plaintiff declined and refused to comply with the rules and regulations of the company with reference to these several deposits, with the exception of the $1.50 monthly water rate, and that the defendant accordingly declined and refused to make the connection and furnish plaintiff with water. It is also alleged that the commissioners took into consideration the payment of $8.50 for making tap and service connection in the fixing of monthly water rates. On motion of the plaintiff, the court made an order striking from defendant’s answer that portion thereof relating to the “rate to be charged for making service connections” as established by the commissioners, for the reason that under the provisions of our statute, see. 2839, Rev. Codes, the commissioners had no authority to fix any rates except “the ratesi to be charged for water.” They had no authority to fix rates or charges for the construction or alteration of any part of the defendant’s pipes or water system, and had no authority to establish any rate for any labor or service or material or thing, other than for the Use of water to be supplied by the corporation. The court also sustained the plaintiff’s motion to strike from the answer all the allegations with reference to the failure and neglect and refusal of the plaintiff to pay the sum of $28, balance due for water used by the plaintiff while residing at a different place and carried by him from a faucet at the residences of some of defendant’s other consumers. The court thereupon ordered a reference to take testimony, and upon the coming in of the report and the submission o'f all the evidence on the part of both plaintiff and defendant, the case was argued by the respective counsel, and has been submitted for our final determination. We have heretofore held in Bothwell v. Consumers Co., 13 Ida. 568, 92 Pac. 533, and Pocatello Water Co. v. Standley, 7 Ida. 155, 61 Pac. 518, that the mains and laterals laid within the streets and alleys are the property of the water company, and that the franchise granted such company authorizes it to dig in the streets and alleys and use and occupy them for the purpose of laying and maintaining their pipe — 213 — lines and delivering water to consumers. We discover no reason for departing from the rule announced in those cases. (See, also, sec. 2840, Rev. Codes.) On the other hand, the consumer has no right or franchise to excavate the streets or to lay or maintain pipes therein. When he undertakes to pass beyond Ms property line with pipes he is met by the public authorities and the franchise held by the water company. He is in no position to acquire a property right in the streets and alleys by laying pipes therein. The water company, on the contrary, is clothed with this power and right and all the necessary authority for creating and establishing property rights therein and the protection of such property. There is no reason in saying that the company has no interest in laterals it may lay in the streets from its main to the line of abutting property owners. These laterals are of just as much use and as valuable to the company as its mains in proportion to the amount of water to be delivered through such laterals as compared with that delivered through the main. The only difference whatever is in the extent of the service. The capacity of a main is ordinarily such that it will supply a large number of consumers along the street from the one main; the capacity of a lateral is ordinarily such that it will only supply one or two consumers. The relative value to the company of the main and laterals is measured by the extent of the service from the two. The necessity, however, for one is just as great as for the other. Without a main none of the residents along a street can be supplied. Without a lateral the individual consumer cannot be supplied. The law of ownership is the same in the one case as the other, and the right of property and control is the same in each instance. Water companies maintain waterworks for the purpose of collecting rates and tolls. They operate them for gain. In order to collect tolls they must deliver water. The consumer, on the other hand, pays his money for service. Unless he is served there is nothing for which he may be called upon to pay. We are aware that some courts have held that the consumer may be required to pay the expenses of “service connections,” as it is sometimes called, or rather for laterals — 214 — extending from the curb line to the main. So far as we have been able to examine, however, these decisions are based upon express statutes. There is a line of decisions to that effect in Wisconsin. The case of Gleason v. Waukesha County, 103 Wis. 225, 79 N. W. 249, is a leading authority on this point, and holds that the expense of laying water-pipes from the curb line to connect with the main may be properly assessed against the property of the abutting owner, but this is based upon the express provision of the Wisconsin statute authorizing the levying of assessments against abutting property owners for such purposes “whenever the council shall order the paving or repaving of any street in which water, gas mains and sewer or either of them shall have been previously laid or constructed.” In that case it was claimed that the statute was unconstitutional in that it authorized a taking of property without due process of law. The court upheld the statute on the ground that the laying of the gas and water pipes was an improvement to the property of the abutting owners and that it conferred a benefit. We know of no case, however, that has held to such a rule in the absence of a statute or ordinance authorizing and providing for levying an assessment for such purposes. Counsel for defendant seem to place great reliance on the case of Foley v. Hillyard Water Co., 49 Wash. 232, 94 Pac. 1080, but an examination of that case discloses that it was decided on entirely different grounds. As we read and understand that case, the court denied Foley relief on the grounds of waiver and estoppel by reason of his previous action and conduct in the matter. The question involved in the case at bar does not seem to have been urged or considered in that case. In Haugen v. Albina Light & Water Co., 21 Or. 411, 28 Pac. 244, 14 L. R. A. 424, in considering the respective rights and duties of the water consumer and the water company with reference to laying pipes and acquiring property rights in the streets, Justice Lord, speaking for the Oregon supreme court, said: “The pipe which was laid by the defendant in Tillamook street was laid under the franchise granted by the city, and — 215 — it bad no authority to lay any other kind of pipe or main than prescribed by the ordinance, or for any other purpose than conducting water to supply the city and its inhabitants, without discrimination, to all persons having buildings or lots on the lines of their pipe, upon tender of the proper compensation. There is no claim that Hughes and Prescott had any right to dig up the street, and to lay such pipe. It could only be done by the defendant, so far as disclosed by this record, under the grant, in the mode prescribed, and for the purposes already stated.” As to the right of a water company to refuse to supply the consumer until he pays overdue rents, there is not entire harmony among the authorities. Farnham on Waters and Water Eights, vol. 1, sec. 164a, contains the following résumé of various decisions of the courts on this subject: “A very effective method of compelling the payment of water rates is the stopping of further supplies until arrears are paid. There is nothing to compel either a municipality; or a water company to furnish water to one who will not pay for it, and a regulation that in case a consumer is in default his supply will be cut off is reasonable and may be¡ enforced. But such a regulation cannot be made the instrument by which the water company can become the judge in its own case, and shut off water to enforce payment of dis-i puted bills. Nor, by its means, can payment be enforced; which it is not the duty of the consumer to make. Nor can. it be used as a means of collecting bills for independent matters not connected with the premises on which the water is. desired.” On one phase of the question the authorities seem to be, in entire harmony, and that is to the effect that a water company can make and enforce such reasonable rules and regulations as are in harmony with law and justice, for the conduct of its business and the collection of its water rentals. A regulation requiring a consumer to pay a month’s rent in advance, or in default thereof the company will shut off the water, or requiring the consumer to pay at the end of the month the rates for the preceding month, or in default thereof the company will shut off the water, has generally been held — 216 — reasonable and within the power of such public service corporations. (Tacoma Hotel Co. v. Tacoma Light & Water Co., 3 Wash. 316, 28 Pac. 516, 14 L. R. A. 669; Shepard v. Mil waukee Gaslight Co., 6 Wis. 539, 70 Am. Dec. 479; Harbison v. Knoxville Water Co. (Tenn.), 53 S. W. 993; Williams v. Mutual Gas Co., 52 Mich. 499, 50 Am. Rep. 266, 18 N. W. 236; State v. Board of Water & Light Commrs., 105 Minn. 572, 127 Am. St. 581, 117 N. W. 827; Cedar Rapids Gaslight Co. v. City of Cedar Rapids (Iowa), 120 N. W. 966.) The rules of some companies seem to require one month’s payment in advance, while others have required a quarter’s payment in advance. It has been held, however, that, a requirement that a consumer pay one year in advance was unreasonable. (Rockland Water Co. v. Adams, 84 Me. 472, 30 Am. St. 368, 24 Atl. 840.) It has likewise been held that where the water has been shut off from a consumer on account of a default in payment of rentals when due, he cannot be charged the additional sum of $1 for turning the water off and on. (American Waterworks Co. v. State, 46 Neb. 194, 50 Am. St. 610, 64 N. W. 711, 30 L. R. A. 447.) It seems to be quite generally held by the authorities that such a company may not refuse to supply the water to a consumer upon payments of rents in advance as required by the rules and regulations of the company, merely because he declines and refuses to pay a disputed bill or to pay past due water rents for some other and independent use, or at some other place or residence, or for a separate or distinct-transaction from that for which he is claiming and demanding a water supply. (Crumley v. Watauga Water Co., 99 Tenn. 420, 41 S. W. 1058; Wood v. City of Auburn, 87 Me. 287, 32 Atl. 906, 29 L. R. A. 376; American Waterworks Co. v. State, 46 Neb. 194, 50 Am. St. 610, 64 N. W. 711, 30 L. R. A. 447.) A public service corporation cannot safely be invested with a power and authority which will allow it to become both judge and jury in the determination of a disputed claim due it from a consumer. To do so would be dangerous and investing it with a power that invites extortion, and is too — 217 — liable to be abused. As was very aptly said by tbe supreme court of Maine in Wood v. Auburn, 87 Me. 287, 32 Atl. 906, 29 L. R. A. 376: “The parties are not upon equal ground. The city, as a water company, cannot do as it will with its water. It owes a duty to each consumer. The consumer, once taken on to the system, becomes dependent on that system for a prim© necessity of business, comfort, health, and even life. He must have the pure water daily and hourly. To suddenly deprive; him of this water, in order to force him to pay an old bill» claimed to be unjust, puts him at an enormous disadvantage/ He cannot wait for the water. He must surrender, and-swallow his choking sense of injustice. Such a power in a-water company or municipality places the consumer at its-mercy. It can always claim that some old bill is unpaid. The receipt may have been lost, the collector may have embezzled} the money; yet the consumer must pay it again, and perhaps still again. He cannot resist, lest he lose the water.To* oblige a person to follow such a course would be a violation1 of the fundamental juristic principle of procedure. The water must be supplied to the complainant so long as he will promptly pay current instalments, and otherwise conform to the reasonable rules governing the supply of water.* The respondent must now, in its turn, resort to judicial process, if it desires to enforce any further payment.” The foregoing conforms to our idea of justice and comports with the principles of fair dealing. Such companies receive a public franchise for the purpose of serving the people for reasonable compensation, but they have no right to use the privileges granted for the purpose of oppression, discrimination, or harassing or annoying the water consumer. Courts will not tolerate any such conduct for a moment. In the case at bar the bill the defendant was seeking to collect was for water alleged to have been used by plaintiff while residing at different places, and where he carried the water from the residences of other consumers, and the claim covers a period of over two years. This claim, if an obligation against plaintiff, was a wholly separate transaction, and must be collected — 218 — in the usual way in which debts are collectible. It cannot be wrung from the plaintiff by preying on his present rights and necessities for an essential to life and health. It is argued by the defendant that plaintiff’s property is not within the corporate limits of Coeur d’Alene City, and this contention grows out of the following conditions: In 1904 the city council passed an ordinance, known as ordinance No. 99, extending the city limits so as to include Krotzer’s addition, in which plaintiff’s property is located. It appears from the evidence in the case, however, that there is intervening between the original boundary line of Coeur d’Alene City and this addition a strip of land 2,663 feet in length by 2.8 feet wide at the westerly end and 67 feet wide at the easterly end. It also appears that this tract of land has never been included within the corporate limits of the city under any ordinance or resolution of the city council. It is contended on behalf of the defendant that the action of the board in the passage of ordinance No. 99, incorporating the Krotzer addition within the city limits, is void for the reason, first, that the city clerk failed.to file a copy of ordinance No. 99 with the county recorder in accordance with the provisions of see. 2 of an. act approved March 8, 1905, as appears at page 392 of the 1905 Session Laws, and which provision has been incorporated in sec. 2173, Rev. Codes. Whether or not this failure on the part of the clerk would defeat the purposes and objects of the ordinance is a question that we will not consider here, for the reason that this statute was not in force at the time of the passage and approval of ordinance No. 99. The ordinance was passed and approved in April, 1904, whereas the statute invoked was not approved until March 8, 1905. It is next urged that under the provisions of see. 2172, Rev. Codes, it is only competent for city or village authorities to* incorporate within municipal boundaries the “land lying contiguous or adjacent” to the city, town, or village. It is contended that this addition was neither contiguous nor adjacent to the city of Coeur d’Alene, while the strip of land above described was intervening between the city boundary — 219 — and tbe addition laid out and platted. This contention is answered by tbe provisions of see. 9 of tbe act of February 9, 1899, with reference to cities, towns, and' villages, as appears on page 109 of tbe 1899 Session Laws. It provides, among other things, that land or territory laid off or subdivided as provided by statute “shall be regarded and treated as contiguous to such city or town, notwithstanding any stream or embankment or any strip or parcel of land not more than 200 feet in width may be or lie between such land or territory and the corporate limits of such city or town.” Whether that provision of the statute be in force and effect now is immaterial. It is sufficient to say that it was in force and effect at the time of the passage and approval of ordinance No. 99 of the city of Coeur d’Alene, and completely answers the contention as to intervening territory between the original city limits and the Krotzer addition. Over and above the foregoing answers given to defendant’s contention, there is another reason why defendant’s position is not tenable here. The ordinance extending the city limits so as to include plaintiff’s premises was passed and approved in April, 1904, and the city authorities proceeded at once to exercise municipal jurisdiction over the territory, levied and collected taxes, exercised police jurisdiction over the new territory, and so far as appears in this action all parties acquiesced in the action of the city council, and proceeded to and did transact their business upon the theory and under the assumption that this addition was within the corporate limits of the city. This was not only true as to the plaintiff and Coeur d’Alene City, but it is true as to the defendant itself.. It appears affirmatively from the record that the defendant operated its water plant on Third street running through this addition upon the theory that it was within the corporate limits, and charged consumers therein the regular rates established by the water commission. This is a collateral attack, and the water company could not be permitted at this late date and in this manner to raise a question of so serious import involving the jurisdiction and authority of the municipality. (Kuhn v. City of Port Town — 220 — send, 12 Wash. 605, 50 Am. St. 911, 41 Pac. 923, 29 L. R. A. 445; Clement v. Everest, 29 Mich. 19; Mullikin v. City of Bloomington, 72 Ind. 161; Frace v. City of Tacoma, 16 Wash. 69, 47 Pac. 219; McQuillin on Munic. Ord., see. 279; Coler v. Dwight School Tp., 3 N. D. 249, 55 N. W. 587 (589), 28 L. R. A. 649.) Defendant invokes the provisions of sec. 10 of ordinance No. 98 granting it a franchise to operate within the corporate limits of Coeur d’Alene City, and contends that nnder that provision of the ordinance it cannot be compelled by mandar-mus to supply a water consumer on an ungraded street. That provision of the ordinance is as follows: “Said Consumers Company, its successors or assigns may extend said distributing system of mains, pipes, laterals and other facilities along any of the streets or alleys of said village, whether such street or alley shall have been graded at the time of such extension or not, but shall not be required to extend the same along any ungraded street or alley.” It appears that Third street in front of plaintiff’s premises is an ungraded street, but whatever might be said with reference to the foregoing provision of the ordinance granting the franchise, it is sufficient answer for the. present case to say that notwithstanding this provision of the ordinance the defendant has laid its main along this street. It is already there, and therefore needs no coercion for that purpose. It is consequently liable to supply the inhabitants along the street who tender the established water rates and demand service. Finally, it is argued that to grant a writ of mandate in this case would amount to a confiscation of defendant’s property and be in violation of the fourteenth amendment to the federal constitution. This contention cannot be sustained. The reasons are numerous against the position of defendant. In the first place, the defendant is a creature of the laws of this state created for a special purpose of a public character. It is not permitted, like a private party, to charge whatever ■it pleases or to serve those only whom it may choose to serve. It must, on the contrary, serve the inhabitants of the municipality from which it receives a franchise for a reasonably — 221 — uniform compensation to be established in conformity' with law (sec. 2839, Eev. Codes), and it must serve all persons without distinction or discrimination who pay the rate established and comply with the reasonable rules and regulations of the company. (Secs. 1, 2, art. 15, Const, of Idaho; secs. 2839, 2840, Rev. Codes; Watauga Water Co. v. Wolfe, 99 Tenn. 429, 63 Am. St. 841, 41 S. W. 1060; American Water Co. v. State, 46 Neb. 194, 50 Am. St. 610, 64 N. W. 711, 30 L. R. A. 447 (449); Haugen v. Albina Light & Water Co., 21 Or. 411, 28 Pac. 244, 14 L. R. A. 424; Mahoney v. American Land & Water Co., 2 Cal. App. 185, 83 Pac. 267; Olmstead v. Proprietors, 47 N. J. L. 311; Rushville v. Rushville Natural Gas Co., 132 Ind. 575, 28 N. E. 853, 15 L. R. A. 321, and note.) It was said by Chancellor Pitney in Long Branch Commission v. Tintern Manor Water Co., 70 N. J. Eq. 71, 62 Atl. 474, in speaking for the court of chancery of New Jersey, that “A company which seeks and obtains a franchise to supply a certain territory with water for public and domestic uses is under a moral, and, in my judgment, a'legal obligation to furnish a supply which shall be equal to all emergencies which may be reasonably anticipated, including unusual droughts and unusual conflagrations, and to bear constantly in mind the prospective increase in population and a consequent increased demand for water.” To compel the defendant to live up to the law of its existence can in no case amount to a confiscation of its property, and still in every instance wherein it is compelled by compulsory process to do any given act, the exercise of such judicial power necessarily involves either the use of the company’s property or the expenditure of its money. To abide by the law and discharge its public duties, however, is a part of the contract it impliedly enters into with the state and municipality when it receives its charter and franchise and commences business. For the discharge of these duties and obligations it agrees to invest money and acquire property, and by that means serve the public indiscriminately for .a reasonable compensation. When it neglects such duty it may — 222 — be coerced by judicial process. This is not confiscation or taking property without due process of law. It is a procedure almost daily invoked throughout the country against irrigation companies, gas and light companies, and railroad companies, as well as water companies. There is.nothing new or novel about it. The company must either live up to the requirements of the law, or when that becomes too burdensome it may go out of business, but it cannot reap the benefits of its charter without assuming the duties thereof. In this case the rates have been established, and the defendant-makes no contention that the rates are too low or that it cannot make a fair income at the rates as established. It has never questioned these rates, and in fact from the evidence submitted in the record, it would seem that they are sufficient to net the defendant an exceptionally large return on the investment. Now, those rates were necessarily established on an estimate, among other things, of the total amount of investment and the number of consumers being served at the time the rates were fixed by the hoard. It is conceded that $8.50 will cover the total additional investment necessary to be made in order to serve the plaintiff, and thereby secure the additional revenue of $1.50 per month or $18 per annum. This does not sound like confiscation to us. An income of $18 per annum on an investment of $8.50 is certainly, a splendid profit. But the water company replies that it has no assurance that the plaintiff will take water for more than one month. This argument leads to an inference that the water company wants someone to insure its perpetual income. "While there can be no such thing as an absolute certainty that any one of its consumers will continue to use water for a whole year, or that they may not all quit using water at the end of the current month, yet it would be a violent and unjustifiable assumption to say that the plaintiff or any other consumer will only use water for one month. The defendant, like all individuals and corporations, must do business, in a measure, upon confidence and the assumption that the people with whom it is dealing are ordinarily honest (Harbison v. Knoxville Water Co. (Tenn. — 223 — Ch.), 53 S. W. 993; Cedar Rapids Gaslight Co. v. Cedar Rapids (Iowa), 120 N. W. 966), and that they are going to conduct their business in their own interests. It is scarcely likely that a man is going to build a dwelling-house on his lot and fit it up with water-pipes and pay for water for one month, in order to force a public service corporation to expend $8.50 in making the necessary connections, and then depreciate his own property and discommode himself or his tenant by having the water shut off and thereafter doing without. Such an assumption is not sufficient on which to transact business, and no individual or corporation would proceed upon such an assumption, and it is equally true that the courts are not going to render decisions on any such assumption. The common experience of mankind disproves such a theory. It is possible, and indeed probable, that an occasional instance will arise where, for want of a tenant or some other sufficient cause, a proprietor may not receive water from the company regularly every month, but such a case will be the exception, and will by no means constitute the rule. These exceptions will be no more frequent among the new consumers than among the old patrons of the company, and there can be no more excuse on this ground for refusing a new consumer water than there would be for refusing to supply one who has been previously receiving water. The supposition is that the rates received by the company are sufficient upon the whole to amply compensate the company for any such loss or diminution of rents as may arise from the exceptional instance where a consumer will cease to pay regular monthly water rates. This objection is entirely too imaginary, chimerical, and improbable to receive serious consideration from the hands of the court as a ground for denying an applicant a water supply upon the tender of the payment of the established rate. It follows from what has been said that a peremptory writ of mandate must issue, commanding and requiring the defendant to make the necessary tap and connection with its water main, and to supply plaintiff with water upon receipt of the monthly water rate heretofore tendered by plaintiff. — 224 — The rule and regulation of the water company requiring the consumer to pay for the laterals and connections from its main to the street line of the consumer’s property is unreasonable, and in conflict with the statute and charter and franchise under which the defendant is operating, and such regulation cannot be upheld by the court. The writ will issue as prayed for by plaintiff, and the defendant will be required to make return to the clerk of this court within thirty days from date of filing this opinion, showing that it has complied with the order of the court, and it is ordered and decreed accordingly. Costs of this action will be taxed against the defendant. Sullivan, C. J., and Stewart, J., concur.