City of Macon v. Southern Bell Tel. & Tel. Co.

• Citation: 89 Ga.App. 252,79 S.E.2d 265
• Decision Date: 10 November 1953
• Docket Number: No. 34798,No. 2,34798,2
• Court: United States Court of Appeals (Georgia)
• Parties: CITY OF MACON v. SOUTHERN BELL TEL. & TEL. CO

Page 265

79 S.E.2d 265

89 Ga.App. 252

CITY OF MACON v. SOUTHERN BELL TEL. & TEL. CO.

No. 34798.

Court of Appeals of Georgia, Division No. 2.

Nov. 10, 1953.

Rehearing Denied Nov. 25, 1953.

Syllabus by the Court.

1. A grant, whether by State statute or under contract, to a telephone company to use the streets of a municipality for the purpose of laying underground cables with which to carry on its telephone service in such city, does not confer upon the company an indefeasible right to any specific street or portion of a street in the city, but only confers upon the company the right to use generally any of the streets in the city for such purpose.

2. The operation by the City of Macon of the city hospital is a governmental function although charges are exacted from some of the persons receiving treatment, where it does not appear that the city owns and operates this hospital primarily as a profit-making enterprise.

3. The requirement of uncompensated obedience to a regulation enacted for the protection and promotion of the general welfare, good health, and lives of the public, under the police power of the State, is not a taking or damaging, without just compensation, of private property or of property affected with a public interest.

4. A telephone company cannot collect damages on account of being compelled to render obedience to a public regulation designed to secure the common welfare and protect the health and lives of the people.

5. It is not within the power of a municipality in any franchise it may grant to a public utility to divest itself of or curtail or limit its police power, the exercise of which is required for the public safety and welfare; and all personal or property rights are held subject to the police power of the State and the subdivisions thereof.

6. A grant to a telephone company of the right to use the streets of a municipality for the construction of its telephone lines and to lay cables underneath the surface thereof, is to be enjoyed by the company in subordination and subject to any lawful exercise of the police power belonging to the State or to its municipalities or counties.

7. Where the City of Macon, in increasing and enlarging the facilities of a hospital owned and operated by the city, finds it necessary to close a portion of a street in order to build thereon additional hospital facilities, and there are laid beneath the surface of such street at this point cables belonging to the telephone company, the act of the city in closing this street at this location, and requiring the telephone company to remove these cables to another location provided by the city, is an exercise by the city of the police power delegated to it by the State, for the promotion and protection of the general welfare, health, and lives of the people, and such at of the city does not amount to a forfeiture, repeal, or nullification in any manner of the franchise granted to the telephone company to use the streets of the City of Macon for the purpose of laying underground cables.

8. Under the circumstances narrated above, the act of the city in requiring the telephone company to remove such cables to another location in the city, without paying to the company the cost thereof, does not amount to a taking or damaging of the property of the telephone company without just compensation being paid therefor, in violation of the Federal and State Constitutions.

Southern Bell Telephone and Telegraph Company filed in the Superior Court of Bibb County its petition against the City of Macon, seeking a declaratory judgment relative to the liability of the municipality for damages or compensation growing out of the removal by the telephone company of its subterranean cables and conduits from beneath New Street in said City to a new location, such removal being necessitated by the closing of New Street by the City of Macon, which was pursuant to legislative authority, and done in order for the city to enlarge and add to the municipally owned, operated, and maintained hospital. The case was submitted to Judge A. M. Anderson of said superior court for his determination of the law and the facts without the intervention of a jury. It appeared that, due to the growth of the city, the increasing of hospital facilities was required for the public welfare, and that the most feasible manner in which the city could do so was by adding to the existing hospital building, currently being operated by the city, and lying in a block (city block No. 73) bounded on one side by said New Street, and that, in order to effect this, New Street would have to be closed to travel and the hospital buildings extended over New Street and onto the adjoining block No. 74.

It further appeared that the plaintiff public utility company or its predecessor utility company had been engaged in serving the City of Macon and its people since before the dawn of the present century, and that numerous contracts had from time to time been entered into between it and said municipality. Beginning in the year 1895, said city had enacted several ordinances prescribing the manner and method for the telephone company to install and lay underground conduits in said city for the telephone wires. It was necessary to use these underground conduits in order to properly and successfully maintain efficient and adequate telephone service to said city and the public, including the people of said city. In 1915 an ordinance was passed, which provided the manner of making excavations in the city streets and made it unlawful for any excavation to be made in any street without first obtaining a permit from the city engineer; and that ordinance provided for certain rules and regulations to be observed by the person or company making the excavation and also for an indemnity bond to be forthcoming. While this ordinance does not specifically refer to underground cables and conduits, it has been regarded as referring to excavations for the installation thereof. In 1946, the telephone company procured a permit from the engineer for an excavation in New Street, including that portion thereof involved in this proceeding, and thereupon installed the underground conduit in which it placed the wires and cables, the cost for the removal of which the telephone company is seeking a declaratory judgment pursuant to the provisions of the Act of 1945, Ga.L.1945, pp. 137, 139. Pursuant to express charter authority granted, said city owns and operates the Macon Hospital, which has heretofore been located in said square or block No. 73 in Macon, Georgia. Around 1951, the mayor and council of said city determined that the hospital facilities of the present hospital were inadequate to serve the needs of the city's increased population, and an expert was obtained to advise the city as to the most feasible and economical means of providing the needed hospital facilities. This expert surveyed the facilities extant and reported to the mayor and council his opinion that the facilities required could be most efficiently and economically provided by the construction of additional buildings adjacent to those then existing and so that all present facilities could be utilized. The city council adopted the recommendations of the engineer, and employed architects to design the additions to be made. The present hospital plant is in the square bounded by New, Pine, Spring, and Hemlock streets. It was determined that the best means of providing the additional facilities would be for the city to close that portion of New Street lying between Pine and Hemlock Streets, to extend the buildings across New Street into the adjoining square, and acquire additional land in the next square (74). The city then held a bond election and was authorized to float general obligation bonds. The people voted in favor of these bonds and the bonds have been sold. Since then additional money has been raised by the issuance of revenue certificates, so that the city now has some $4,000,000 which it proposes to use with Federal and State grants to construct the additional hospital buildings and facilities.

Beginning in 1951, the phone company called attention to the fact that it had underground cables and conduits in the portion of New Street involved. In the fall of 1952, a conference was had between the city and the company, in which the problem was outlined. The company engineers stated their unwillingness to extend the cables through the basement of the new building to be located in New Street, upon the basis that it would be impracticable. Following this conference, representatives of the city advised the phone company to remove and relocate its facilities. The company called on the city to pay the cost of same, and the city passed a resolution denying the claim of the phone company for compensation for the cost of the removal and relocation of the cables, directed the company to remove and relocate same from New Street at its own expense, and offered other locations in the city streets for such relocation.

At the 1953 session of the General Assembly, the city obtained a grant or title to the portion of said street involved, and authority to close, vacate, and abandon the same. The city has since exercised its rights under the statute and, by ordinance, closed the street in question and dedicated it to such hospital purposes.

This suit was brought by the company in the form of a declaratory-judgment proceeding to determine its rights, if any, to compensation. The trial court ruled that the company was entitled to be paid the cost of removal and relocation of its conduit and cable. The company contended that Code § 104-205 created a contract with the State, which the city was undertaking to abrogate, and that the company has a franchise right in New Street which the city's action was destroying. The petition also attacked the right of the city to close the street on the ground that it was doing so for a...