Kentucky Electric Co. v. Barrett

— 718 — Opinion op the Court by Judge Barker Affirming. The general council of the city of Louisville passed an ordinance “creating the franchise or privilege of stringing and maintaining Wires under the streets, alleys and public places of the city of Louisville and distributing and selling electricity by means of such wires, and providing for the sale of said franchise.” The board of public works were proceeding to execute this ordinance, whereupon this action was instituted in the equity division of the Jefferson circuit court for the purpose of obtaining a judgment perpetually enjoining them from so doing. Upon motion of the plaintiff a temporary order of injunction was awarded by the chancellor, and thereafter the defendants entered a motion before Judge Hobson, a member of this court, to dissolve the order. Deeming the matter of sufficient importance, Judge Hobson requested all of the members of the court to sit with him upon the hearing of the motion. After full discussion at the bar of all the questions arising upon the motion, elaborate briefs were filed by the respective parties, and thereafter Judge Hobson, with the concurrence of all the members of the court, dissolved the temporary injunction, and filed his written reasons for so doing, which are as follows: “The board of public works of the city of Louisville advertised for bids for a franchise ordered to be sold by an ordinance of the city. Before the sale was made under the ordinance, this suit was brought by the Kentucky Electric Company to enjoin further proceedings under the ordinance, on the ground that' — 719 — the ordinance was void. The chancellor granted the injunction, and this motion is now made before me to dissolve it. Five grounds are relied on, and these will be briefly disposed of in the order1 in which they are made. “It is insisted that the ordinance is void because it was not properly passed by thejaoard of councilmen. The ordinance was properly passed by the board of aldermen, and was approved by the mayor. ■The only ground for objection is as to the proceedings of the board of councilman. The president declared the board adjourned, over the protest of a majority of the members of the council, and left the chair. Thereupon they elected another person to the chair, and proceeded with the business. • After this the session was extended*, and the ordinance passed. At the next meeting of the council the minutes were approved as written. The council must speak by its minutes, and when the minutes have been approved by the council, in the absence of fraud or mistake charged, and, if denied, proved, the court will not'go back of the minutes. Although the meetings.of the council regularly adjourned at 10 :30 a majority might extend the session and, when the session was extended, the council had the same power to act as before. The minutes show that the ordinance was regularly passed, and the facts alleged are hot sufficient to invalidate it. “It is insisted the ordinance is void because it delegates to the board of public works the power to accept the best bid when his can only be done by the council. If this were a suit to enjoin the purchaser from proceeding under his franchise because the council had not accepted his hid, this objection would — 720 — be well taken. But it is nob sufficient objection to the validity of the ordinance, for, after the board of public works receives the bids, it should report its action to the council, and the council must exercise its judgment as to. which is the best bid. The board of public works cannot grant a franchise. The grant must be made by the council. But the board of public works may advertise for the bids, and may report to the council the result of the bidding. The rights of the purchaser will depend upon the .acceptance of his bid by the council; but the plaintiff cannot enjoin the sale of the franchise on this ground, because, until the sale has been made, there is nothing for the council to accept. “It is insisted that the ordinance excluded' bidders, in violation of the Constitution. The words in the ordinance, ‘every one in any way connected with either of said companies’ mean any one connected with either of said companies in bidding. We think this is the natural meaning of the words, in view of the connection in which they occur, and this construction of the ordinance was at the time put upon it in the advertisement which was made for the bidding. “It is insisted that the advertisement is so-.framed that no one save the George G. Fetter Company can bid at the sale, or comply with the terms of the franchise. This contention is based on the idea that at certain points the space under the streets' is so taken up by the conduits that other conduits cannot be laid at a reasonable expense, and that by the ordinance the place where the conduits are to be had are indicated by red lines on the map made a part of it, and that these red lines conform to' the Fetter conduits. — 721 — The fact that it may be expensive to put in the conduits, from the space underneath the street being so occupied, is no reason that the city may not sell the franchise. Were the rule otherwise the constitutional provision providing against exclusive franchises would be of little value. The map referred to is not drawn to a scale. The red lines on the map are not to be understood as indicating the precise location of the conduits, but simply as indicating the approximate location of the conduits, so as to show by the eye exactly what was granted by the ordinance and avoid any misapprehension as to the meaning of the terms used. The map simply serves to illustrate the meaning of the ordinance, and does not require the conduits to be laid precisely where the red lines are. “It is insisted that the ordinance impairs the obligation of the plaintiff’s contract. In the ordinance granting the franchise under which the Kentucky Electric Company holds there are these words: ‘Nothing in this ordinance shall be construed as exclusive or as preventing the city of Louisville from granting a like privilege or franchise to any other person, firm or corporation.’ This is not a restriction upon the power of the general council, but a restriction upon the franchise granted. The eiiy of Louisville may grant a like franchise or privilege to any other person, or, if it sees proper, it may grant an unlike franchise or privilege to another. There is nothing in the words quoted to create a contract between the city and the Kentucky Electric Company by which the city was bound not to grant any other franchise or privilege different from that granted to the Kentucky Electric Company, and the council, under the Constitution, could not do this if it had attempted to do so. — 722 — “* * * The temporary injunction granted by the chancellor is therefore dissolved.” After this written opinion was filed in the circuit court, and the temporary injunction dissolved, the board of public works proceeded to sell the franchise according to their original purpose, with the result that it was purchased by George G. Fetter for the sum of $5,005, which, being duly reported to the general council, sale was approved, and Fetter thereby became the owner of the franchise in question in so far as he could acquire it under the ordinance creating it. Afterwards the appellant filed an amended petition, by which it undtertook to take its cause of action from without the principles enunciated in the opinion dissolving the injunction. To the petition as amended the appellees (defendants below) interposed a general demurrer, which was sustained by the court, and, the plaintiff (appellant) declining to amend, its petition was dismissed, and from this judgment it has prosecuted this appeal. It is manifest that the only new questions which could now arise upon the record are those created by the filing of the amended petition. All of the other questions were directly involved on the motion to dissolve, and were given upon' the hearing of that motion the fullest consideration, and disposed of adversely to appellant. This is notably true of the contention that the ordinance violates sections 51 and 164 of the Constitution, and the question as- to whether or not the ordinance under the allegations of the original petition was properly passed. If either contention of appellant with reference to these questions had been considered sound, the motion to dissolve the injunction would, of necessity, have been — 723 — overruled. They may be now disposed of by saying that we adhere to our former views as expressed in the opinion of Judge Hobson. This leaves in the case, undisposed of, the question as to whether or not the petition, as amended, states a cause of action for the injunction prayed for. This question is to be answered by ascertaining whether or not the amended petition adds any substantial strength to the original petition on the question of the right of the appellant to go behind the minutes of the clerk, and show that the ordinance was improperly passed by the council. What happened on the passage of the ordinance through the lower board of the general council was very fully and circumstantially set forth in the original petition as follows: “Plaintiff further states that said pretended ordinance under which the defendants propose to make said sale is totally void for the reason that it was never passed by the board of couneilmen of the city of Louisville in the manner provided by 'law and the rules of said board; that said ordinance was attempted to be introduced at a meeting of said board held on February 7, 1908, but, before same was permitted to be offered, a motion was made that said board' adjourn, and said motion was put to a vote of the members of said board by the president, who declared the same carried, and said meeting adjourned; that the president thereupon left the chair and the council chamber, together with a number of other members of the board, and said session ended. It states that certain members of said board remained in said chamber after said adjournment, and organized a pretended meeting of said board, and elected one of the members, who remained president without notice — 724 — to those members who had departed, as aforesaid; that at said pretended meeting said ordinance was introduced; that the rules of said board provide that the body shall stand adjourned at the hour of 10 :30 p. m., and that in order to extend any session beyond said hour, said rules must be suspended by the affirmative vote of at least two-thirds of the members elected to said board. Said rules are printed in the Sixth Biennial Compilation of General Ordinances of the City of Louisville. It states that said ordinance was not introduced until after 10:30 o’clock p. m. at said alleged meeting, and the rules of said board were never suspended by a two-thirds vote of the members elected to said board, nor was said session extended by a two-thirds vote of said members; that said pretended meeting was not finally organized until after the hour of 10:30 o’clock p. m., and said ordinance was not attempted to be passed until after 11 o’clock p. m.; that said' board consists of 24 members; that at no time did more than 13 members, or a bare majority of said board, vote affirmatively on any question at said pretended meeting, or participate therein; that while said pretended meeting was in progress, the president of said board returned1 to the council chamber, and demanded the right to preside at said meeting, but was refused. It states that the president of the board of councilmen refused to sign the minutes of said meeting, and the same have never been signed, and said president refused to sign said' ordinance alleged to have been passed at said pretended meeting, and has never signed the same, nor did the member elected as president of said pretended meeting sign same; that said ordinance was approved' by the mayor of said city — 725 — and advertised without ever having been signed by any presiding officer of the' board of councilmen, although, according to law and the rules of said board, all ordinances must be signed by the presiding officers.” The amended petition is as follows: “The plaintiff further states that the minutes of the pretended meeting of the board of councilmen, held on February 7, 1908, are false and fraudulent, and do not correctly or truthfully state or show what was done at said alleged meeting; that said minutes show that the ordinance known1 as the ‘Fetter Franchise Ordinance’ was passed at a regular meeting of the board of councilmen, held on said date, when in fact said regular meeting adjourned prior to the pretended passage of said ordinance, and the same was never voted on or passed at any regular meeting of said council, and said minutes do not truthfully state or show what was done at said1 council, or at said pretended meeting. ’ ’ It will be seen that the sum total which the amendment adds to the original petition consists in the allegation that the minutes of the clerk are false and fraudulent, and do not correctly of truthfully state or show what was done at the alleged meeting. It further shows that the falsity or fraud complained of consisted in the fact that the minutes did not show the attempted adjournment of the council, and the holding of the special meeting by a majority of the board after the chairman who had sought to adjourn ■the meeting had left the hall. All of these facts ha'd been set forth in the original petition with the greatest particularity, and. we held, upon the motion to dissolve, that they did not constitute such irregularity as invalidated the ordinance. In other words, — 726 — we upheld the action of the board as against the action of the chairman. We held that a majority of the board, even after the declaration. of the chairman that the board stood adjourned, had a right to remain, reorganise, appoint another chairman, and carry on the business of the municipality; that the action thus taken was valid, and the ordinance, having been passed in this manner, was valid. The addition of the words “false and fraudulent” add nothing to the original petition; and1 especially is this true when the amended petition shows wherein the minutes were alleged to be false and fraudulent, and these facts have already been passed upon adversely to the contention of the pleader. This appeal is, for all practical purposes, a rehearing of the motion to dissolve already disposed of. Section 90, Code Civ. Prac., requires the facts which constitute a cause of action or- defense to be-pleaded, and if facts are stated which constitute fraud, the court will give them their legal weight, whether the word “fraud” be used in connection with-' them or not. In Pryse v. McGuire, 81 Ky. 608, it is said: “On the other idea that the word ‘fraud’, or its equivalent, is necessary to the charge of fraud, we are of a different opinion. Por if the facts be true as alleged, and they must be so treated on demurrer, and Mleguiar knew of their existence, and made material statements to Pryse in conflict with, them, which misled him, it is not necessary to denominate his-acts as ‘fraudulent,’ for the facts themselves state substantive fraud. Where the facts show fraud, the law will presume the animus.” In Bruce v. Morrison, 5 B. Mon. 33, it is said: “Neither usury, nor mistake, nor fraud is specifically charged, but — 727 — though they are not, we have condudedl that if the facts charged clearly constitute fraud, that relief ought to be afforded.” See, also, Riggs v. Stevens, 92 Ky. 393, 17 S. W. 1016. Newman, in his work on Pleading and Practice (page 263) thus states the rule: “The converse of. this rule is equally true. If the circumstances or constitutive facts be alleged, from which the law will necessarily presume the general or material fact to which the law must be applied, it will be sufficient without alleging distinctly the general or legal fact. As a humorous judge has said: “A bear well painted and drawn to life is yet the picture of a bear, although the painter may omit to write over it, “This is the bear.” Where the petition is so unskillfully drawn- as not to charge expressly fraud,, mistake, or usury, yet if the facts stated do nevertheless show either, and the proof will justify it, the court will grant relief.” We conclude, therefore, that the amended petition adds nothing to the weight of the original petition by appending the word's “false and fraudulent” to the allegations of the original petition in reference to the passage of the ordinance; that, the facts stated in the latter having been passed upon on the motion to dissolve, we-are able to perceive no reason for reversing the judgment of the chancellor, dismissing the petition upon the failure of the appellant to amend after the general demurrer was sustained. Judgment affirmed.