459 F.2d 551 (9th Cir. 1972), 71-1216, Honolulu Rapid Transit Co. v. Dolim

Docket Nº:71-1216.
Citation:459 F.2d 551
Party Name:HONOLULU RAPID TRANSIT COMPANY, Limited, et al., Plaintiffs-Appellants, v. Lorrin M. DOLIM et al., Defendants-Appellees.
Case Date:April 11, 1972
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 551

459 F.2d 551 (9th Cir. 1972)

HONOLULU RAPID TRANSIT COMPANY, Limited, et al., Plaintiffs-Appellants,

v.

Lorrin M. DOLIM et al., Defendants-Appellees.

No. 71-1216.

United States Court of Appeals, Ninth Circuit.

April 11, 1972

Francis N. Marshall (argued), Walter R. Allen, James B. Atkin, of Pillsbury, Madison & Sutro, San Francisco, Cal., Howard K. Hoddick, Peter G. Wheelon, of Anthony, Waddoups, Hoddick & Brown, Honolulu, Hawaii, for plaintiffs-appellants.

Harry S. Y. Kim, Deputy Atty. Gen. (argued), Bertram T. Kanbara, Atty. Gen., Honolulu, Hawaii, Paul Devens (argued), Honolulu, Hawaii, Robert M. Ehrhorn, Jr. (argued), David Y. Mar, Honolulu, Hawaii, for defendants-appellees.

Page 552

Before MERRILL and DUNIWAY, Circuit Judges, and BELLONI, District Judge. [*]

MERRILL, Circuit Judge:

Honolulu Rapid Transit (HRT) is a Hawaii corporation that provides public transportation services in the City of Honolulu. It was formed in 1898, when it received its first franchise from the Territory of Hawaii to operate a public street railway. With expiration of the franchise due within a few years the Legislature of Hawaii in 1921 enacted a new franchise, Act 186 Session Laws of Hawaii, 1921, which was duly approved by the Congress 1 and submitted to HRT for its acceptance. On recommendation of the board of directors, the shareholders voted to accept the franchise and HRT has since operated under it.

The franchise, by § 20, permits the City of Honolulu to purchase HRT's property. Respecting the purchase price, it provides:

"The amount to be paid to the company for such purchase shall be determined by the public utilities commission; but such amount shall in no case exceed the actual cost of the physical property thereof, or the actual value of the tangible property so purchased; in both cases, less its bonded and all other debts and liabilities. The value of the franchise or good will or any other intangible element shall not be considered in determining the amount to be paid."

In 1970 the City resolved to purchase HRT's property and applied to the Hawaii Public Utilities Commission for valuation pursuant to the franchise terms.

HRT then brought this suit seeking (1) a declaration that § 20 is unconstitutional since it provides for the taking of HRT's property for public use without payment of just compensation, and (2) an injunction against further proceedings before the Public Utilities Commission. The suit was dismissed by the District Court for failure to state a claim. We affirm.

HRT's...

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