Boise City v. Boise Artesian Hot & Cold Water Co.

ROSS, Circuit Judge (after stating the facts as above). It will be seen from the foregoing statement that the trial court held in effect that the ordinance of July 10, 1890, granted to the Artesian Water & Land Improvement Company, one of the predecessors in interest of the defendant in error, a franchise to use the streets and alleys of the city for the purpose of supplying it and its inhabitants with water for the period of 50 years. If that be so, then manifestly the attempted imposition by the ordinance of June 7, 1900, of the license fees in question was of no effect. The court below held that the fact that the plaintiff in error was incorporated and exists under a special charter does not render inapplicable to it the provisions of section 2710 of the Revised Statutes of Idaho of 1887, and that the provisions of that section should be read into the ordinance of July 10, 1890, as a part thereof, and thereby fixed the life of the franchise or privilege granted by that ordinance at 50 years. [709] Section 2710 of the state statutes so referred to reads as follows : “No corporation formed to supply any city or town with water must do so unless previously authorized by an ordinance of the authorities thereof, or unless it is done in conformity with a contract entered into between the city or town and the corporation. Contracts so made are valid and binding in law, but do not take from the city or town the right to regulate the rates for water, nor must any exclusive right be granted. No contract or grant must be made for a term exceeding fifty years.” We are unable to give to this statute the effect attributed to it by the court below. Its terms and purposes, we think, seem quite plain. Every corporation formed to supply any city or town of the state with water is thereby prohibited from doing so unless previously authorized by an ordinance of the authorities thereof, or unless done in conformity with a contract entered into between such city or town and the corporation. Such contracts are authorized by the statute, subject to the express provision that they shall not take from the city or town the right to regulate the rates for water, nor, further expressly declares the statute, shall any exclusive right be granted, nor shall any such contract or grant be made for a term exceeding 50 years. This is very far from saying that no such contract or grant shall he made for a shorter period than 50 years. It fixes a maximum beyond which no contract or grant is permitted to extend, hut leaves the matter of time, within that limit, to he fixed by contract or by grant of the municipality. In the case of Water Co. v. Knoxville, 200 U. S. 22, 33, 26 Sup. Ct. 224, 227 (50 L. Ed. 353), the Supreme Court said: “ ‘Grants of franchises and special privileges are always to be construed most strongly against the donee, and in favor of the public.’ Such were the words of this court in Turnpike Co. v. Illinois, 96 U. S. 63, 68 [24 L. Ed. 651]. The universal rule in doubtful cases — this court said in Oregon Railway Co. v. Oregonian Ry. Co., 130 U. S. 1, 26 [9 Sup. Ct. 400, 32 L. Ed. 837] — is that ‘the construction shall be against the grantee and in favor of the government’ As late as Coosaw Mining Co. v. South Carolina, 144 U. S. 550, 562 [12 Sup. Ct. 680, 36 L. Ed. 537], this court said: ‘The doctrine is firmly established that only that which is granted in clear and explicit terms passes by a grant of property, franchises, or privileges in which the government or the public has an interest. Statutory grants of that character are to be construed strictly in favor of the public, and whatever is not unequivocally granted is withheld; nothing passes by mere implication. This principle, it has been said, is a wise one, as it serves to defeat any purpose concealed by the skillful use of terms to accomplish something not apparent on the face of the act, and thus sanctions only open dealing with legislative bodies.’ Slidell v. Grandjean. 111 U. S. 412, 438 [4 Sup. Ct. 475, 28 L. Ed. 321], We have never departed from or modified these principles, but have reaffirmed them in many cases. It is true that the cases to which we have referred involved in the main the construction of legislative enactments. But the principles they announce apply with full forcé to ordinances’ and contracts by municipal corporations in respect of matters that concern the public. The authorities are all agreed that a municipal corporation, when exerting its functions for the general good, is not 4o be shorn of its powers by mere implication. If by contract or otherwise it may. in particular circumstances, restrict the exercise of its public powers, the intention to do so must be manifested by words so clear as not to admit of two different or inconsistent meanings.” Turning to the ordinance of July 10, 1890, it is seen that it only granted to the Artesian Water & Rand Improvement Company, one of the predecessors in interest of the defendant in error, the privilege [710] of laying down and maintaining water'pipes in the streets and alleys then laid out in Boise City or thereafter to be laid out and dedicated, with provisions for the proper performance of the work with reasonable diligence. In effect the provisions of that ordinance were precisely similar to those of the previous ordinance of October 3, 1889, granting to the Eastman Bros., also predecessors in interest of the defendant in error, similar rights, which were held by this court in the case of Boise City Artesian Hot & Cold Water Co. v. Boise City, 123 Fed. 232, 59 C. C. A. 236, to have conferred on the Eastmans a license merely, revocable at the pleasure of the city; we there saying: “The ordinance of October, 1889, granted permission to the Eastmans and to their successors in interest to lay and repair their pipes in the streets of the city, and to furnish water to the inhabitants thereof. No term was fixed for the duration of the privilege, and no contract was in terms made between the city and the grantees of the privilege. It is plain that the ordinance was either the grant of a license revocable at the will of the grantor, or, by its acceptance on the part of the grantee, it became an irrevocable and perpetual contract. No middle ground is tenable between these two constructions. In the Constitutions of nearly all the states it is provided that no exclusive or perpetual franchises shall be granted, and, irrespective of such constitutional limitation, it is clear, both upon reason and authority, that no municipal corporation, in the absence of express legislative authority, has power to grant a perpetual franchise for the use of its streets. The city of Boise was incorporated by the territorial Legislature of Idaho on January 11, 1866. It was given power ‘to provide the city with good and wholesome water,’ and to erect or construct ‘such waterworks and reservoirs within the established limits of the city as may be necessary or convenient therefor.’ There can be no doubt that under this provision of its charter the city had the power to grant the use of its streets for a fixed reasonable period of time, either to an individual or to a corporation, for the purpose of furnishing a water supply to the inhabitants. It had no authority, however, to make a perpetual contract. A municipal corporation intrusted with the power of control over its public streets cannot, by contract or otherwise, irrevocably surrender any part of such power without the explicit consent of the Legislature. Cooley’s Constitutional Limitations (2d Ed.) 205, 210; Dillon on Municipal Corporations. §§ 715, 716; Barnett v. Denison, 145 U. S. 135, 139, 12 Sup. Ct. 819, 36 L. Ed. 652. And legislative grants of powers to municipal corporations are to be so strictly construed as to operate as a surrender of the sovereignty of the state no further than is expressly declared by the language thereof. Charles River Bridge Co. v. Warren Bridge, 11 Pet. 426, 9 L. Ed. 773, 938; Syracuse Water Co. v. City of Syracuse, 116 N. Y. 167, 22 N. E. 381, 5 L. R. A. 546; Long Island Water Supply Co. v. Brooklyn. 166 U. S. 685, 696, 17 Sup. Ct. 718, 41 L. Ed. 1165; Stein v. Bienville Water Supply Co., 141 U. S. 67, 11 Sup. Ct. 892, 35 L. Ed. 622. From these principles and authorities it follows that, the Eastmans were given no exclusive or perpetual right, and that the ordinance operated to grant them a license only, and left the city free at any time to' revoke the privilege granted, or to put in its own waterworks, or to grant a franchise to another company. The most that the licensees could cláim under it was that it legalized their use of the streets for supplying water, and gave them permission to occupy the same until such time as the city might see fit to terminate the privilege.” If a revocable license only, it does not seem to be questioned that the city might either terminate the license, or impose a license fee as a condition of its continued enjoyment. It results from what has been said that the judgment must be and is reversed, .with directions for further proceedings in accordance with the views here expressed.