878 S.W.2d 819 (Mo. 1994), 76344, State ex rel. Missouri Cities Water Co. v. Hodge

Docket Nº:76344.
Citation:878 S.W.2d 819
Party Name:STATE of Missouri, ex rel. MISSOURI CITIES WATER COMPANY, Relator, v. Hon. Edward D. HODGE, Judge of the 12th Judicial Circuit, Audrain County, Missouri, Respondent.
Case Date:June 21, 1994
Court:Supreme Court of Missouri

Page 819

878 S.W.2d 819 (Mo. 1994)

STATE of Missouri, ex rel. MISSOURI CITIES WATER COMPANY, Relator,

v.

Hon. Edward D. HODGE, Judge of the 12th Judicial Circuit,

Audrain County, Missouri, Respondent.

No. 76344.

Supreme Court of Missouri, En Banc.

June 21, 1994

Byron E. Francis, Timothy J. Tryniecki, Ann E. Buckley, St. Louis, for relator.

Louis J. Leonatti, Randall P. Baker, Mexico, for respondent.

PRICE, Judge.

The City of Mexico initiated this proceeding seeking to condemn a waterworks system owned and operated by Missouri Cities Water Company ("Missouri Cities"). Missouri

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Cities seeks a writ of prohibition on the ground that the Circuit Court of Audrain County lacks jurisdiction to hear the condemnation proceeding because Mexico is without authority to take private property that is already devoted to a public use and use the property in the same manner. We hold that the City of Mexico does not have authority to condemn the property in question. Consequently, the circuit court is without jurisdiction to hear this matter. The preliminary writ of prohibition is made absolute.

I.

Missouri Cities is a privately owned corporation which in turn owns a waterworks system in the City of Mexico, and surrounding Audrain County, Missouri. It serves Mexico and the county under a certificate of convenience and necessity from the Missouri Public Service Commission. The waterworks system consists of a treatment plant, wells, pumps, and a distribution system. Through the exercise of eminent domain, the third class city of Mexico seeks to acquire Missouri Cities' waterworks system and to operate the waterworks itself.

Apparently, this controversy arises from the City of Mexico's displeasure over a 61% increase in rates for water service to Missouri Cities' Mexico customers from 1984 to 1991. According to the statements of counsel during oral arguments, Mexico appeared before the Public Service Commission to challenge the rate increases but did not appeal the Commission's adverse decision.

In 1992 the City of Mexico performed an analysis of Missouri Cities waterworks operation and determined that a municipally owned and operated waterworks could save money for its residents. Mexico made an offer of $3,952,903 to purchase Missouri Cities' Mexico operation. This offer was rejected. Mexico made a second offer of $5,200,000, which was also rejected.

On December 2, 1992, the Mexico City Council approved an ordinance declaring the acquisition of Missouri Cities' Mexico Division by condemnation to be a public necessity. The City of Mexico filed its petition on December 7, 1992, seeking to condemn all of Missouri Cities' interest in the real and personal property, fixtures, equipment, and easements used in operating the waterworks system.

After conducting a hearing on the matter, the Circuit Court of Audrain County entered an order of condemnation on April 14, 1993, but stayed enforcement to allow Missouri Cities to file its petition for writ of prohibition. This is the proper procedure by which to challenge a proposed order of condemnation. Pursuant to article V, sections 4 and 10 of the Missouri Constitution, we have jurisdiction to decide this cause the same as an original proceeding.

II.

The power of eminent domain, or condemnation, has long been recognized in Missouri. In St. Louis, H. & K.C. Ry. Co. v. Hannibal Union Depot Co., 125 Mo. 82, 28 S.W. 483, 485 (1894), it was recited that:

The power of the state to appropriate private property to a public use is an inherent element of sovereignty.

The Missouri Constitution recognizes this right by implication when it states:

That private property shall not be taken or damaged for public use without just compensation.

Mo. Const. art. I, § 26.

It is generally accepted that the power of condemnation is limited to takings for the "public use", although there appears to be no general agreement upon the precise definition of that term. 26 Am.Jur.2d Eminent Domain § 25 at 669. In Kohl v. United States, 91 U.S. 367, 373, 23 L.Ed. 449 (1875), it was stated:

The proper view of the right of eminent domain seems to be, that it is a right belonging to a sovereignty to take private property for its own public uses, and not for those of another. Beyond that, there exists no necessity which alone is the foundation of the right.

In Missouri, the right of eminent domain rests with the state and does not naturally inhere in counties, municipalities or public service corporations. The right to condemn can be exercised only upon delegation from the state. State ex rel. Schwab v.

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Riley, 417 S.W.2d 1, 3 (Mo. banc 1967). Statutes delegating this right are strictly construed. As noted in Southwestern Bell Telephone Co. v. Newingham, 386 S.W.2d 663, 665 (Mo.App.1965):

[T]he exercise of eminent domain is in derogation of the right of the citizen; that a statute delegating that power must be strictly construed, and the person or body claiming the right to exercise such delegated power must be able to point to the statute which either expressly or by necessary implication confers that right.

(Footnote omitted.)

III.

The City of Mexico primarily bases its claim to the power of condemnation over the Missouri Cities waterworks facilities upon § 91.450, RSMo 1986, which states in relevant part:

Any city of the third or fourth class ... shall have the power to erect or to acquire, by purchase or otherwise, maintain and operate, waterworks ...

Mexico concedes that § 91.450 does not expressly confer upon it the power "to condemn" or "to acquire by the exercise of eminent domain", but argues instead that this power is necessarily implied by the words "or otherwise". In support of this argument, Mexico cites State ex rel. Schwab v. Riley.

In Riley, the court held that the words "or otherwise" when used in § 71.680, RSMo 1959, contained the power of condemnation by necessary implication. That statute provided that cities could:

... acquire by purchase, construction, lease, gift or otherwise, within or without the corporate limits, ... sewage disposal plants.

The Court reasoned that because the statute listed almost every other conceivable method of acquiring title, the words "or otherwise" must have been intended to grant the power of condemnation to cities.

Missouri Cities counters by arguing that unlike § 71.680, § 91.450 does not exhaust all methods of acquiring property short of condemnation. Specifically, § 91.450 does not contain the terms "lease" or "gift". Thus, it argues that the power of condemnation is not necessarily implied and that the term "or otherwise" might merely imply the omitted terms.

While the arguments of both parties are reasonable, neither hits the mark. Riley dealt with a situation where a city was attempting to condemn private property for a public use, the creation of a sewage lagoon. This rather ordinary exercise of the power of eminent domain simply did not demand an overly "strained or narrow interpretation". Were the issue now before us one involving property held for a private use, Riley might well be persuasive, but it is not. Here we are called upon to address a different and a much more difficult question. May a waterworks system already dedicated to a public use be condemned by a municipality for the very same use?

IV.

The difficulty with the exercise of eminent domain over property already committed to a public use is apparent. If the condemnation is for a different use, what of the necessity of the original public use? If the condemnation is for the same use, why is it necessary at all?

A significant body of Missouri law has addressed the issue of when condemnation of public property may occur for a new and different public use. In State ex rel. State Highway Commission v. Hoester, 362 S.W.2d 519, 522 (Mo. banc 1962), the Court quoted with approval 29 C.J.S. Eminent Domain § 74 at 861-62, stating:

As a general rule, property already devoted to a public use cannot be taken for another public use which will totally destroy or materially impair or interfere with the former use, unless the intention of the legislature that it should be so taken has been manifested in express terms or by necessary implication, mere general authority to exercise the power of eminent domain being in each case insufficient; ...

In Kansas City v. Ashley, 406 S.W.2d 584, 590 (Mo.1966), Kansas City was not allowed to take railroad tracks from a railroad company

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to build a road longitudinally along the tracks because "its charter provides only for a general right of condemnation, and it does not provide specifically for taking the easement of a railroad company." Subsequently, in Cole County v. Board of Trustees, Etc., 545 S.W.2d 422, 425 (Mo.App.1976), Cole County was not allowed to condemn property owned by the Jefferson City Free Library District because the property was already devoted to a public use. The court noted that the county had conceded that general authority to exercise the power of eminent domain was insufficient to take property already devoted to a public use and that concession was "of course forced by the square holding to that effect in State ex rel. State Highway Commission v. Hoester, 362 S.W.2d 519, 522 (Mo. banc 1962). See also to the same effect Kansas City v. Ashley, 406 S.W.2d 584 (Mo.1966)."

On the other hand, condemnation was allowed under a general grant of authority in State ex rel. Maryland Heights v. Campbell, 736 S.W.2d 383, 386-87 (Mo. banc 1987), where the County of St. Louis sought to take a piece of land owned by the Maryland Heights Fire Protection District to widen a roadway because it was found that the taking would not materially impair the fire district's existing use. Similarly, in St. Louis, H. & K.C. Ry. Co. v. Hannibal Union Depot Co., 125 Mo. 82, 28 S.W. 483, 485 (1894), a railroad company was allowed to condemn a small piece of ground from the owners...

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