Capitol Cable, Inc. v. City of Topeka
| Decision Date | 08 April 1972 |
| Docket Number | No. 46409,46409 |
| Citation | 209 Kan. 152,495 P.2d 885 |
| Parties | CAPITOL CABLE, INC., Appellee, v. CITY OF TOPEKA, Kansas, a Municipal Corporation, et al., Appellants. |
| Court | Kansas Supreme Court |
Syllabus by the Court
1. The record is examined in a declaratory judgment action and the 'Topeka Cable Television Systems Franchise Ordinance' enabling the City governing body to issue a franchise for CATV is determined to be valid and properly adopted under its Home Rule authority; but the franchising ordinance which the governing body of the City purported to adopt pursuant to the enabling ordinance is determined to be void because it is permeated with arbitrary and unreasonable action and exceeds the authority of the enabling ordinance.
2. Senate Bill No. 499 entitled 'AN ACT authorizing cities to grant franchises to those engaged in operating or providing cable television service within cities' was enacted by the 1972 session of the legislature and signed by the Governor on March 17, 1972. This enactment supersedes Community Antenna TV of Wichita, Inc. v. City of Wichita, 205 Kan. 537, 471 P.2d 360, 41 A.L.R.3d 374.
3. Since July 1, 1961, under Article 12, Section 5, of the Kansas Constitution, the cities Kansas have had Home Rule powers. Under Home Rule authority the cities are 'empowered to determine their local affairs and government,' and the cities 'shall exercise such determination by ordinance,' subject only to state statutes of statewide concern applicable uniformly to all cities. (Art. 12, § 5(b), Kansas Constitution.) The Constitution also provides that the powers and authority granted to cities under the Home Rule Amendment 'shall be liberally construed for the purpose of giving to cities the largest measure of self-government.' (Art. 12, § 5(d), Kansas Constitution.)
4. Prior to the enactment of Senate Bill No. 499 by the 1972 session of the legislature, a city had power to regulate the CATV business by the adoption of an enabling ordinance under the Home Rule Amendment to the Kansas Constitution (Art. 12, § 5, Kansas Constitution).
5. The nature of the CATV business is to be resolved as a question of law. In view of recent developments the CATV business is held to be a private business affected with such a public interest as to require reasonable regulation by a city.
6. The City of Topeka has authority to enact ordinance No. 12959, providing for the issuance of a nonexclusive franchise or permit for cable television systems in accordance with provisions set forth in the ordinance. Under such ordinance the City governing body has discretion, but it is under no positive duty to grant a franchise; hence, mandamus asserted by an unsuccessful applicant for a franchise to compel the granting of a franchise to it will not lie.
7. The power of the governing body of a city to grant or refuse to grant a franchise is essentially legislative in nature requiring the exercise of judgment and discretion, and courts may not inquire into motives which prompt a municipality's legislative body to enact an ordinance which is valid on its face.
8. The CATV business is regulated by the Federal Communications Commission, but the area of franchising and local regulation is left open to local authority.
9. Where a franchising ordinance is adopted purporting to issue a franchise to the highest bidder, the action of the governing body of the City is permeated with arbitrary and unreasonable action and the franchising ordinance must be set aside as void.
Robert A. McClure, of Colmery, McClure, Funk & Hannah, Topeka, argued the cause, and Gerald J. Letourneau, Topeka, and Dan E. Turner, City Atty., were with him on the brief for appellants.
Leland Spurgeon, of Hiatt & Spurgeon, Chartered, Topeka, argued the cause, and Eugene W. Hiatt and Kenneth F. Crockett, Topeka, were with him on the brief for appellee.
This is a declaratory judgment action to determine the validity of a CATV enabling ordinance known as the 'Topeka Cable Television Systems Franchise Ordinance,' and a franchising ordinance issued pursuant thereto under the Home Rule Amendment of the Kansas Constitution.
The action was originally commenced by Capitol Cable, Inc. (plaintiff-appellee) for mandamus and damages. After pretrial and before the case case was ultimately submitted to the trial court, it was converted to a declaratory judgment action challenging the validity of the enabling cable television ordinance. (See K.S.A. 60-1701.)
The trial court rendered its decision in this action upon due consideration of appellants' motion for summary judgment. (K.S.A. 60-256.) It concluded the 'Topeka Cable Television Systems Franchise Ordinance' (ordinance No. 12959) was void and unenforceable. As a consequence ordinance No. 12986 granting a franchise to Cablecom-General of Topeka pursuant to the enabling ordinance was declared invalid.
The material facts are not in dispute.
Ordinance No. 12959 of the City of Topeka known as the 'Topeka Cable Television Systems Franchise Ordinance' was enacted on July 7, 1970. It provides, in essence, for the issuance of a nonexclusive franchise or permit for cable television systems by the governing body of the City of Topeka. It provides that an award of franchise is to be made on the basis of applications. In connection with the ordinance instructions were prepared and distributed to those wishing to make application for a franchise. The details required in the application are similar to those specified in the ordinance and need not be set forth.
Pursuant to the provisions of ordinance No. 12959, nine applicants made application for a franchise. All nine were certified to the City Commission by the City Clerk, and on August 4, 1970, the applicants were given an opportunity to present their applications orally. On August 5, 1970, the City Commission awarded a franchise to Cablecom-General of Topeka, one of the nine applicants. The other eight, including Capital Cable, Inc., the plaintiff herein, were denied franchises. As a result the plaintiff brought this action originally as a mandamus action to compel the City of Topeka to issue a franchise to it under the ordinance. In essence, the plaintiff's original petition admitted the validity of ordinance No. 12959, but subsequent developments, prior to submission of the case, raised an issue concerning the constitutional validity of the ordinance.
Thereafter ordinance No. 12986 granting Cablecom-General of Topeka a franchise was enacted on August 25, 1970. It authorized Cablecom-General to construct, operate and maintain a community antenna television system within the City of Topeka. As a result of the plaintiff's action herein the City was enjoined from publishing the ordinance until final determination of the litigation.
Provisions of the enabling ordinance (No. 12959) are summarized as follows:
Among the definitions at the beginning of the ordinance it defines 'CATV System' and 'Franchise' as follows:
It then provides:
(a) No person shall use the streets or other public ways of the City to install or operate a CATV system, or provide CATV service in the City without a franchise.
(b) A franchise is to be granted on the basis of the applications made to the City in writing to be accompanied by a $250 non-refundable application fee. The application should contain the following information:
(1) The name, address and form of business organization.
(2) A description of the CATV system proposed to be installed or operated; the proposed location of components of such CATV system, the manner in which the applicant proposes to install or operate the same; the extent to which existing or future poles or other facilities of public utilities will be used for such system; the personnel and qualifications of the working organization proposed for the City; a map specifically showing and delineating the proposed service area within which the applicant proposes to provide CATV service.
(3) A copy of each agreement the applicant has with any other person or firms relating to the proposed franchise, including public utilities.
(4) A copy of the CATV service agreement proposed for use by the applicant with its subscribers.
(5) A statement describing the applicant, its officers and directors, partners or major stockholders, indicating business experience, including experience and performance in the CATV system and service field showing any interest in other franchise, the dates of such; a separate listing showing all city employees or officers or appointees that have any interest, direct or indirect, in the applicant; and the application filed with the City shall be accompanied by a bid bond acceptable to the City for $10,000, to be returned if applicant is not awarded a franchise.
(6) A detailed statement showing the estimated cost of the system which applicant proposes to install, the amount of working capital necessary to operate the system during the first five-year period of the franchise. A projection of revenue and expenses for the first five years' operation is to be included.
(7) A declaration that the application is true and complete and that no person not shown in the application has any interest in the application for franchise.
(8) A statement setting forth those signals which the applicant would bring into the City, and in...
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