City and County of San Francisco v. United Railroads of San Francisco

• Decision Date: 02 October 1911
• Docket Number: 1,922.
• Citation: City and County of San Francisco v. United Railroads of San Francisco, 190 F. 507 (9th Cir. 1911)
• Parties: CITY AND COUNTY OF SAN FRANCISCO et al. v. UNITED RAILROADS OF SAN FRANCISCO.
• Court: U.S. Court of Appeals — Ninth Circuit

190 F. 507

CITY AND COUNTY OF SAN FRANCISCO et al. v. UNITED RAILROADS OF SAN FRANCISCO.

No. 1,922.

United States Court of Appeals, Ninth Circuit.

October 2, 1911

The appeal in this case is taken from an order of the Circuit Court granting a temporary injunction restraining the appellants, pending the suit or until the further order of the court, from building, constructing, or operating a street railroad in San Francisco over and along 'Market street from East street to Geary street, a distance of seven blocks,' and 'over and along Point Lobos avenue from Thirty-Third avenue, the point of intersection of Cliff avenue with Point Lobos avenue, a distance of nine blocks ' The bill of complaint filed by the appellee sets forth several franchises granted by the city and county of San Francisco to various street railroad corporations, all of which franchises are alleged to have been assigned to the appellee. It alleges that these franchises were granted upon the condition that no more than two corporations should be granted the right to use any of the streets covered thereby for more than five consecutive blocks. It alleges certain proceedings taken by the appellants with a view to the construction of a municipal railroad beginning at the ferry and extending up Market street to Geary and out Geary to the ocean, with a branch to the City Park. These proceedings are alleged to be the action of the city resulting from the vote on two distinct propositions which had been submitted to the voters of the city; proposition No. 1 covering the Market Street Railway from the ferry to Geary street, proposition No. 2 covering the street railway from the intersection of Geary and Kearney to the ocean, with its branch to the park. The bill alleges that this railroad is about to be constructed along the said streets which are covered by the complainant's franchises and its roads. It alleges that unless the city is restrained, the construction of its road will cause irreparable damage to the appellee, that the value of its property will thereby be depreciated, also the value of its securities and bonds. Other facts are set forth showing the threatened injury to the appellee's property. There is no diversity of citizenship between the parties to the suit, and the jurisdiction of the Circuit Court was invoked on the ground that a federal question was involved, in that the construction of the road under the ordinances adopted by the city would result in impairing the obligation of the appellee's contracts, and taking the property of the appellee without due process of law, in violation of the fifth and fourteenth amendments to the Constitution of the United States; that the franchises granted to the appellee's predecessors in interest 'were so granted and accepted upon the express condition and provision that it should be lawful for the board of supervisors of the city and county of San Francisco to grant to one other corporation than to the grantee, and to no more the right to use the street or streets named therein for a distance of five blocks and no more, and that said grant was made upon the terms and conditions specified in section 499 of the Civil Code as said section existed in the Civil Code at the date of the passing and the adoption of said order, to wit, in the year 1879, which said section of the Civil Code is in the terms and figures following, to wit: '499. Two corporations may be permitted to use the same streets, each paying an equal portion for the construction of the track; but in no case must two railroad corporations occupy and use the same street or track for a distance of more than five blocks.' ' The bill alleges that the road which the appellants are proceeding to construct will, when constructed, cover the same streets with the appellee's street railway, a distance of seven blocks on Market street and a distance of nine blocks on Point Lobos avenue. It is not alleged that the appellee had a franchise for the exclusive use of any of the streets of San Francisco, or that the appellants were unauthorized to grant franchises to others over the same streets, or to build a municipal railway in the city of San Francisco. The illegality of the proposed action of the city is alleged to consist in the fact that on Market street the road which the city proposes to build will occupy the same street with the appellee's road for a distance of two blocks, and on Point Lobos avenue for a distance of four blocks in excess of the distance which was permissible under section 499 of the Civil Code.

Percy V. Long, City Atty., Thomas E. Haven, and John T. Nourse, Asst. City Attys., for appellants.

Wm. M. Abbott, Joseph D. Redding, and Tirey L. Ford, for appellee.

Before GILBERT and MORROW, Circuit Judges, and HANFORD, District judge.

GILBERT Circuit Judge (after stating the facts as above).

The question arises whether there is jurisdiction on the ground that the bill presents a federal question. As sustaining the jurisdiction, the appellee relies on the allegation that section 499 of the Civil Code entered into and became a part of its contract, and that the ordinances adopted by the city with a view to the construction of a municipal railroad and its acts in carrying out those ordinances would result in an impairment of the appellee's contract as expressed in its franchises. Referring to those franchises, which are made exhibits to the bill, it will be seen that in the franchise for a street railway on Market street it is provided in section 5, as follows:

'It shall be lawful for the board of supervisors of the city and county of San Francisco to grant to one other corporation and no more the right to use either of the aforesaid streets for a distance of five blocks and no more, upon the terms and conditions specified in the 499th section of the Civil Code of this state. This section shall apply to persons and companies, as well as corporations.' In the franchise under which the appellee operates its road on Point Lobos avenue, no reference is made to section 499, but it is provided that the rights and privileges therein granted shall be held and enjoyed by the grantee, 'upon such terms, conditions and restrictions as are now or may be hereafter imposed by the laws of the state of California relative to street railroads in the cities and towns therein, or are or shall be hereafter imposed by orders of the board of supervisors, and a strict compliance with said laws and orders is hereby required. ' So long as section 499 remained in force, these provisions of the contract added nothing to its obligations. They would have force only in case of the material amendment or repeal of the statute. But the statute has not been repealed. It is still in force, and not substantially amended. At the time of the adoption of the ordinances which are here complained of, the statute read as follows:

'Two or more lines of street railway, operated under different managements, may by lease or contract, use the same street or tracks upon such terms as may have been agreed upon between the companies operating such railways; and two lines of street railway operated under different managements may be permitted to use the same street or tracks for a distance of five blocks without such lease or contract, upon payment of an equal portion for the construction of the tracks and appurtenances used by such railways jointly; but in no case shall a company owning or operating one line of street railway be permitted to condemn the right to occupy and use the same street or tracks for a distance of more than five blocks consecutively.'

The inquiry is whether on the facts alleged in the bill there has been state action impairing the obligation of the contract.

A state may act through a municipal corporation to which it has delegated powers of legislation, but, where the ordinance of such a corporation is relied upon as...