Carolina Power & L. Co. v. SOUTH CAROLINA PUB. SERV. A.

• Citation: 94 F.2d 520
• Decision Date: 02 February 1938
• Docket Number: 4254.,No. 4252,4253,4252
• Parties: CAROLINA POWER & LIGHT CO. v. SOUTH CAROLINA PUBLIC SERVICE AUTHORITY et al. SOUTH CAROLINA POWER CO. v. SAME. SOUTH CAROLINA ELECTRIC & GAS CO. v. SAME.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

94 F.2d 520 (1938)

CAROLINA POWER & LIGHT CO. v. SOUTH CAROLINA PUBLIC SERVICE AUTHORITY et al.

SOUTH CAROLINA POWER CO. v. SAME.

SOUTH CAROLINA ELECTRIC & GAS CO. v. SAME.

Nos. 4252, 4253, 4254.

Circuit Court of Appeals, Fourth Circuit.

February 2, 1938.

William M. Rogers, of Birmingham, Ala., and Raymond T. Jackson, of Cleveland, Ohio (W. H. Weatherspoon, of Raleigh, N. C., Arthur R. Young, of Charleston, S. C., W. C. McLain, of Columbia, S. C., and A. J. Bowron, Jr., and Douglas Arant, both of Birmingham, Ala., on the brief), for appellants.

R. M. Jefferies, of Walterboro, S. C., and Paul Freund, Sp. Asst. to Atty. Gen. (W. J. McLeod, Jr., of Miami, Fla., James W. Morris, Asst. Atty. Gen., and Enoch E. Ellison, Atty., Dept. of Justice, Carl F. Farbach, Robert E. Sher, and Joseph B. Hobbs, of Federal Emergency Administration of Public Works, all of Washington, D. C., on the brief), for appellees.

Oswald Ryan, Gen. Counsel, Federal Power Commission, of Washington, D. C. (Howard E. Wahrenbrock, Willard W. Gatchell, and William C. Koplovitz, all of Washington, D. C., on the brief), for Federal Power Commission, amicus curiae.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

PARKER, Circuit Judge.

These are appeals from an order denying an injunction in three consolidated cases instituted to enjoin the South Carolina Public Service Authority from constructing the Santee-Cooper Power-Navigation Project and Harold L. Ickes, Federal Administrator of Public Works, from making a loan and grant in aid thereof. The plaintiffs are hydroelectric power companies doing business in the state of South Carolina, one of them, the Carolina Power & Light Company, holding a license from the Federal Power Commission for a hydroelectric project which it operates on Big Pigeon river in Haywood county, N. C. The defendant South Carolina Public Service Authority is a body corporate created as a governmental agency of the state of South Carolina by Act No. 887 of the General Assembly of 1934, 38 St. at Large, p. 1507, and authorized thereby to construct a power and navigation project on the Santee and Cooper rivers and to divert the waters of the Santee into the Cooper for that purpose. A loan and grant aggregating $37,500,000 in aid of the project has been approved by the Administrator of Public Works and an agreement to advance $6,000,000 thereof to begin construction has been executed.

The project may be briefly described as follows: The Santee and Cooper are navigable rivers, the navigable portions of which lie wholly within the state of South Carolina. While they are navigable for a considerable distance, the navigation which they carry at this time is of an entirely negligible character. It is proposed by means of the project to provide an improved water route from Columbia to Charleston which will really be useful for purposes of navigation, and which will shorten the distance of water transportation between these cities from 246 to 145 miles, and at the same time to construct a hydroelectric power plant capable of producing annually 450,000,000 kwh of primary power and 200,000,000 kwh of secondary power. This is to be accomplished by constructing a diversion dam at Wilson's Landing in the Santee, about 87 miles above its mouth, and diverting the flow of that river, with the exception of about 500 c.f.s., through a canal into the Cooper. A power dam, with appropriate navigation locks, is to be constructed in the latter river at Pinopolis, and by the use of appropriate electrical generating machinery the potential energy of the impounded water is to be converted into electric current.

The result of the construction of the project will be to decrease the navigable capacity of the Santee below the diversion dam; but provision is made in the license granted therefor to take care of any future need of navigation in that part of the river by providing that the flow below the dam shall be increased by releasing such additional quantities of water as in the opinion of the Chief of Engineers of the War Department and the Secretary of War may be necessary for the proper operation of navigation facilities to be provided by the government. The project has been authorized by the South Carolina Legislature by Act 887 of the General Assembly of 1934, which has been upheld as constitutional by the Supreme Court of South Carolina. Clarke v. South Carolina Public Service Authority, 177 S.C. 427, 181 S.E. 481. It has been licensed also by the Federal Power Commission, after approval by the Chief of Engineers of the War Department and the Secretary of War. It appears also that Congress, after being advised as to the project and the earmarking of funds for the loan and grant in aid thereof, has appropriated additional funds for carrying it on. Public Resolution No. 47, 75th Cong., June 29, 1937, c. 401, § 205(e), 15 U.S.C.A. § 728 note. See also Senate Document 184, 74th Cong. 2d Sess. p. 11, and 81 Cong.Rec. 6054 and 81 Cong.Rec. 8304.

Injunctions are sought by plaintiffs to restrain not only the making or receiving of the federal loan and grant in aid of the project but also the construction of the project itself on the ground that it involves the impairment of the navigable capacity of a portion of a public waterway. As to this, the plaintiffs contend that both the license of the Federal Power Commission and the South Carolina statute authorizing the project are invalid, the former because not authorized by a valid act of Congress, the latter because in contravention of the Constitution of the state. All of these matters are fully discussed in the able and exhaustive opinion of the court below, reported in D.C., 20 F.Supp. 854. We find it unnecessary to consider them here, since we think it clear, in the light of recent decisions of the Supreme Court, that plaintiffs have no standing in court to urge them as no right of plaintiffs will be infringed by the acts which it is sought to enjoin. Alabama Power Co. v. Ickes, 58 S.Ct. 300, 306, 82 L.Ed. ___; Duke Power Co. v. Greenwood County, 58 S.Ct. 306, 82 L.Ed. ___.

There can be no question, under the cases cited, but that plaintiffs have no standing to question the making of the loan and grant by the Administrator of Public Works, and we shall not discuss that matter further. We think it equally clear that they have no standing to question the legality of the construction by the defendant Authority of the prospective dams and waterways contemplated by the project. It is admitted that none of the plaintiffs has a franchise which is exclusive as against the Authority, that none of them has any prior or superior interest in the project or the license therefor, that none of them claims any injury or threat of injury to any special right or interest as owner of riparian lands which will be flooded, eroded or deprived of water, and that none of them has any interest in navigation on the river in question, as operator of vessels, owner of wharves, shipper or otherwise. The only interest which plaintiffs claim to have in the matter is that they will be damaged by reason of the fact that the defendant Authority will sell electric current in competition with them and that the construction of the project will enable it to produce the current. As plaintiffs have no exclusive franchise for the sale of electric current, however, no right of theirs will be invaded by competition on the part of the Authority or by any sales which it may make. So far as production of current is concerned, no right of theirs could possibly be infringed thereby, whether the obstruction and diversion of the Santee resulting in its production be lawful or not. Since, therefore, neither the sale of electric current nor the obstruction or diversion of the stream infringes any right of plaintiffs, it must follow that both together do not infringe such right. It has never yet been held, so far as we are aware, that the mere fact of competition entitles one whose rights are not invaded to enjoin the unlawful acts of a competitor. If, as held in the Alabama Power Case, plaintiffs have no ground to complain of an unlawful lending of money to enable a competitor to manufacture electric power to sell in competition with them, we fail to see how they can have ground of complaint because of the unlawful obstruction of a stream for that purpose.

In the case of New Orleans, M. & T. R. Co. v. Ellerman, 105 U.S. 166, 174, 26 L. Ed. 1015, cited as directly in point in the Alabama Power Case, it appeared that the owner of certain public wharves in New Orleans had brought suit to enjoin the leasing of competing wharves by a railroad company on the ground that such action on its part would be ultra vires. It was held that the plaintiff had no standing in court, merely because he would be injured by the competition which would result from the ultra vires leasing of the property, to question that action. The court in its opinion used the following language, quoted with approval in the Alabama Power Case: "The only injury of which he can be heard in a judicial tribunal to complain is the invasion of some legal or equitable right. If he asserts that the competition of the railroad company damages him, the answer is, that it does not abridge or impair any such right. If he alleges that the railroad company is acting beyond the warrant of the law, the answer is, that a violation of its charter does not of itself injuriously affect any of his rights. The company is not shown to owe him any duty which it has not performed." Applying this language to the case at bar we may say that the only injury of which plaintiffs can be heard in a judicial tribunal to complain is the invasion of some legal or equitable right. If they assert that the competition of the defendant Authority will damage them, the answer is that such competition will not abridge or impair any such right. If they allege that the Authority is violating the law in interfering...