Alabama Power Co. v. City of Carbon Hill

• Citation: 234 Ala. 489,175 So. 289
• Decision Date: 20 May 1937
• Docket Number: 6 Div. 127
• Parties: ALABAMA POWER CO. v. CITY OF CARBON HILL.
• Court: Supreme Court of Alabama

175 So. 289

234 Ala. 489

ALABAMA POWER CO. v. CITY OF CARBON HILL.

6 Div. 127

Supreme Court of Alabama

May 20, 1937

Rehearing Denied June 28, 1937

Appeal from Circuit Court, Walker County; Ernest Lacy, Judge.

Action by the City of Carbon Hill against the Alabama Power Company. Judgment for plaintiff, and defendant appeals.

Reversed and rendered.

Arthur F. Fite, of Jasper, and Martin, Turner & McWhorter and J.C Blakey, all of Birmingham, for appellant.

Chas R. Wiggins, of Jasper, for appellee.

FOSTER Justice.

The City of Carbon Hill, a municipal corporation, instituted this suit at law for the recovery of the sum of an annual charge under an ordinance for the transaction of business in the police jurisdiction of said city during the years 1932 to 1936, both inclusive, for an amount equal to 1 per cent. of the gross receipts of defendant from business done in the police jurisdiction of the city for the years preceding those above named, to wit, 1931 to 1935, inclusive. For those years appellant was doing business in the city limits, and had two large customers, coal mines, in the police jurisdiction, from whom it collected an amount of approximately twice as much income as it did from its operations within the city, and paid the city 2 per cent. of the gross receipts from business done within the city, which is approximately equal to the amount here sued for of 1 per cent. of the gross receipts in the police jurisdiction.

The authority for the claim is an ordinance pursuant to an act of the Legislature approved September 6, 1927 (page 674), fixing a license for business done in the police jurisdiction at one-half the amount charged for like business done within the city; and fixing a license fee of 2 per cent. of the gross receipts from the business of operating an electric light or power business within the city. So that it results that the city claims 1 per cent. of the amount of gross receipts of such business in the police jurisdiction, having charged and collected 2 per cent. of the amount of gross receipts of such business done in the city.

Appellant claims, among other contentions, that the act of September 6 1927, has no application here because of its proviso, that it shall not repeal or modify section 2162, Code, which fixes a limit of 2 per cent. of the gross receipts in the municipality which a city may charge a public utility. It is also claimed that section 2162, Code, does not authorize a city to charge a license in excess of that, regardless of the amount of its business in the police jurisdiction.

When that section is considered in connection with section 2173, Code, appellant would have stronger argument for the contention than now exists by virtue of section 24a of the Revenue Act of 1927, approved July 22, 1927 (page 166), which makes an enactment changing the law as declared in section 2162, Code, in respect to the matter on which appellant relies to support its argument. Section 24a, supra, does not refer to section 2162, Code, but repeals schedule 89, section 361 of the Revenue Act of 1919 (Gen.Acts 1919, p. 282). Section 2162 refers to that provision of that act for its authority. So that section 24a of the Revenue Act of 1927 clearly repeals by necessary implication, if not by express language, section 2162, Code.

The act of September 1927, supra, by referring to section 2162, Code, did not have the effect of re-enacting a law which had been repealed, and the substance of which was changed as then re-enacted. But we think that its purpose was to save unaffected the law as thus modified and enacted in the general Revenue Act of 1927 (page 166). As thus modified, it cannot be construed as prohibiting a license on the business of a public utility in the police jurisdiction, which will exceed the limit of 2 per cent. on gross receipts from business conducted in the city, when otherwise authorized by law. So that the proviso in the act of September, 1927, does not serve to exclude the license charge here sought to be collected, but authorizes it by its terms, if otherwise legal, when considered in the light of section 24a of the Revenue Act of 1927. It serves to fix a maximum of one-half the amount charged as a license for a like business done within the corporate limits.

But the Legislature is without authority to extend to cities the right to make a license charge for conducting a business outside of its corporate limits for the general revenue of the city. White v. Decatur, 225 Ala. 646, 144 So. 873, 86 A.L.R. 914; Standard Chemical & Oil Co. v. Troy, 201 Ala. 89, 77 So. 383, 384, L.R.A.1918C, 522. But it may confer on cities the right to enact a license on such business located and conducted in their police jurisdiction as a reasonable and proper exercise of their right and duty to supervise them in that territory. Van Hook v. City of Selma, 70 Ala. 361, 45 Am.Rep. 85; 3 McQuillan on Municipal Corporations section 952. Mr. Dillon says, as quoted in the Troy Case, supra, that the police power which exists in that respect includes "the suppression of nuisances, the preservation of the public health, the prevention of fires, the regulation of trades and occupations and of the use and storage of dangerous articles, the establishment and control of markets, the suppression of disorderly conduct and breaches of the peace and other similar matters." No effort is made to limit such power by precise words.

Here appellant is conducting the same sort of business in general terms in the city limits, and without them, but in the limits of its police jurisdiction.

The agreed facts here assert that appellant during the years in question conducted in the city and police jurisdiction an electric public utility business "not harmful, hazardous, hurtful to public morals, productive of disorder, or injurious to the public. Neither the police, fire or other municipal authorities of plaintiff city have ever rendered or been called upon to render any service in connection with said business of defendant and plaintiff city has never incurred nor been subjected to any expense in connection with such business. The city of Carbon Hill during said period has rendered police protection and supervision beyond its corporate limits, and within its police jurisdiction, such police jurisdiction and supervision consisting of making arrests for violations of State laws and municipal ordinances, preventing breaches of the peace and maintaining law and order, such protection and supervision being rendered by its regular police officers, who performed the same services within the city limits. The cost to the city of issuing license to defendant for the years mentioned has been nominal."

It is also agreed that the appellant during those years made returns of receipts in the city, but not for business done within its police jurisdiction, and that the city accepted payment for doing a public utility business on that basis, and made no demand for payment on account of receipts in its police jurisdiction or for reports concerning same. It does not allege whether the city had notice of such service or not. But that may be fairly inferred on account on the conspicuous nature of the business as ordinarily conducted.

The right here in question can be used only as a means of regulation and not as a source of revenue. It may be "therefore, in such sum as may be reasonably necessary to promote these objects, in the district where the ordinance imposing it is designed to operate" in the exercise of the police power, but not for revenue. Van Hook v. City of Selma, supra; 3 McQuillan on Municipal Corporations § 1095(995). The amount, as a general rule, cannot be more than is "reasonably necessary to cover the cost of granting the license and of exercising proper police regulation." 3 McQuillan on Municipal Corporations section 1102(1002).

In this connection, the following is taken from Van Hook v. City of Selma, supra:

"Where police regulation alone is the object of a license, there is a conflict among the authorities, as to the rule governing the amount that may be charged for such license. The nature of the occupation, trade or profession, authorized to be licensed, has, of necessity, much to do with it. In the case of such as are useful and beneficial to the

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