City of Duluth v. Duluth Tel. Co.

• Decision Date: 29 November 1901
• Parties: CITY OF DULUTH v. DULUTH TEL. CO.
• Court: Minnesota Supreme Court

84 Minn. 486

87 N.W. 1127

CITY OF DULUTH

v.DULUTH TEL. CO.

Supreme Court of Minnesota.

Nov. 29, 1901.

Appeal from district court, St. Louis county; Wm. A. Cant, Judge.

Action by the city of Duluth against the Duluth Telephone Company. Judgment for defendant, and the city appeals. Affirmed.

Syllabus by the Court

The Duluth Telephone Company was organized under title 1, c. 34, Gen. St. 1878, before section 28, c. 34, Gen. St. 1866, was amended by chapter 73, Gen. Laws 1881. By a special act approved March 7, 1881, the exclusive right was conferred upon the company to erect its poles and wires upon the streets of the city for the period of 10 years, which right was extended for the further period of 10 years by a special act approved April 13, 1889. Commencing in 1882 under the authority of both the general and special acts, the company constructed its telephone system within the city, and has since maintained and continued to extend the same therein. The time granted under the special acts having expired, on November 29, 1898, under the provisions of chapter 74, Gen. Laws 1893, the common council offered to sell a franchise to construct a telephone system within the city upon certain conditions; and, defendant having refused to submit a bid, the franchise was granted to another company, which thereupon constructed a telephone system, which it has since maintained and operated. On February 13, 1900, the city council passed a resolution requiring defendant on or before April 1, 1900, to remove its poles and wires from the streets, avenues, and alleys of the city. Upon defendant's refusal to comply with the order, the city commenced an action to enjoin defendant from further extending its system, and to compel the removal of the poles and wires already erected. Held:

1. That section 28, Gen. St. 1866, as amended by chapter 73, Gen. Laws 1881 (section 2641, Gen. St. 1894), authorized defendant to enter upon the streets and alleys of the city and erect its poles and wires therein, subject only to the police power of the city to control and regulate the same.

2. The company having established its plant in reliance upon the provisions of the general law (section 2641, Gen. St. 1894), such action on its part constituted an acceptance of the right or privilege thus granted, and its occupancy of the streets thus acquired, including the right to extend its system within the city as occasion might require, became fixed, in the nature of vested rights, which cannot be revoked by the city, except within the exercise of its police power. Northwestern Tel. Exch. Co. v. City of Minneapolis, 83 N. W. 527,86 N. W. 69, 81 Minn. 140,53 L. R. A. 175. Oscar Mitchell, for appellant.

Billson, Congdon & Dickinson, for respondent.

LEWIS, J.

The plaintiff municipality was organized under a special act of the legislature approved March 2, 1887. The defendant company was organized under title 1, c. 34, Gen. St. 1878, and its corporate existence began February 15, 1881. By a special act approved March 7, 1881, the exclusive right was conferred upon the municipality, as it then existed, to erect and maintain telephone poles and wires upon and over its streets, avenues, and alleys for a period of 10 years; and by the special act of the legislature approved April 13, 1889, this privilege was extended until the 8th of March, 1899. Commencing in 1882, and continuing down to the present year, the defendant company has, in the customary manner, established its plant, erected its poles, and strung wires thereon, to the extent of some 50 miles, in the streets, avenues, and alleys of the city of Duluth. The charter of 1887, through the common council, conferred upon the city the power ‘to prevent the encumbering of streets, sidewalks, alleys, lanes, public grounds or wharves with * * * posts * * * or any other materials or substances whatsoever,’ and ‘to remove and abate a nuisance, obstruction or encroachment upon the streets, alleys, public grounds and highways of the city.’ By chapter 74 of the General Laws of 1893, title 1, c. 34, Gen. St. 1866, was amended in part as follows: ‘But no corporation formed under this title shall have any right to construct, maintain or operate upon or within any street, alley or other highway of any city or village, * * * any improvement of whatsoever kind or nature without first obtaining a franchise therefor from such village or city, according to the terms of its charter, and without first making just compensation therefor as herein provided.’ There was also a further amendment to the effect that such corporation should be subject to any conditions imposed from time to time by the village or city, which might, at the end of every five years from and after the granting of a franchise for the construction of any improvement whatsoever, have a right, under certain conditions, to purchase the same. After the expiration of the 20-years grant under the special acts of 1881 and 1889, the company continued to occupy the streets and to extend its system. After the amendment of 1893 went into effect the defendant company continued erecting its poles and stringing wires thereon in the streets, avenues, and alleys to the extent of several thousand feet. On November 29, 1898, the common council of Duluth passed an ordinance providing for the sale by the city of franchise for the establishment and operation of a telephone exchange system, which contained elaborate provisions with reference to bids and their acceptance. The defendant company did not submit a bid in accordance with the ordinance, and thereafter, on March 11, 1899, the city granted a franchise to another company, which was accepted by it, and a telephone plant constructed in conformity to the requirements of the ordinance. Subsequently, on February 13, 1900, the council adopted a resolution requiring defendant on or before the 1st of April, 1900, to remove its poles and wires from the streets, avenues, alleys, and public grounds of the city of Duluth, and to cease using the same for the purpose of carrying on its telephone business. A copy of this resolution was served upon the defendant company, which refused to comply therewith, whereupon this action was commenced by the city to enjoin the defendant company from further extending its system, and to compel the removal of that part already erected. The defendant justified its action in an answer which set forth the laws under which it claimed to be authorized, and alleged that its possession of the streets, avenues, alleys, and public grounds of the city was in the ordinary and usual manner, and without interference with the safety or convenience of ordinary public travel. The court found as facts that the defendant company constructed its plant and occupied the streets and alleys of the city in reliance upon the special acts above mentioned, and also upon the general law embodied in section 28, c. 34, Gen. St. 1886, as amended by chapter 73 of the General Laws of...