City of Owensboro v. Cumberland Telephone Telegraph Company, No. 244

CourtUnited States Supreme Court
Writing for the CourtLurton
Citation230 U.S. 58,33 S.Ct. 988,57 L.Ed. 1389
PartiesCITY OF OWENSBORO, Appt., v. CUMBERLAND TELEPHONE & TELEGRAPH COMPANY
Docket NumberNo. 244
Decision Date16 June 1913

230 U.S. 58
33 S.Ct. 988
57 L.Ed. 1389
CITY OF OWENSBORO, Appt.,

v.

CUMBERLAND TELEPHONE & TELEGRAPH COMPANY.

No. 244.
Argued April 22, 1913.
Decided June 16, 1913.

Page 59

This case involves the nature and duration of the right of the telephone company to maintain its poles and wires upon the streets of the city of Owensboro. The ordinance under which it, or its predecessors in right, title, and property, have maintained a telephone system in the city of Owensboro, was passed on December 4, 1889. Inasmuch as it contains several provisions which require consideration, it is set out in full in the margin.

Council Proceedings Dec. 4th, 1889.

Minute Book 'F,' Page 157.

The following ordinance, after being twice read, was enacted by the following vote, to wit.: Ayes, Mes. Borer, Brotherton, Vargeson, Cullon, Higdon, Decker, Noes, None. Viz.:

Be it ordained by the Mayor and Common Council of Owensboro, Ky.:

That the Cumberland Telephone Company, its successors and assigns, is authorized and hereby granted the right to erect and maintain upon the public streets and alleys of said city any number of telephone poles of proper size, straight and shaved, smooth, set plumb and set erect, and any number of wires thereon with the right to connect such wires with the building when telephone stations are established, provided that such poles shall be located and kept so as not to interfere with the travel upon said streets or alleys or the substantial use thereof by the inhabitants of said city.

Sec. 2. That the said Cumberland Telephone Company shall erect only one line of poles on a street, except for the length of one block upon the street upon which the exchange building may be located, and where the wires of said company enter such exchange building the said company shall have the right to erect and maintain its poles on both sides of such street, and the lowest wire of said telephone company shall not be less than twenty-five feet from the ground, except where such wires enter the exchange building or telephone stations.

Nothing in this ordinance contained shall be construed as an exclusive right to said company to erect and maintain said poles upon the streets and alleys of said city, and no obstruction shall be placed by said company to the erection and maintenance of poles by any other person or company. Such company shall enjoy such rights in common with all other persons or companies to whom said city may see proper to extend the same right.

Sec. 3. The said telephone company shall repair all streets and alleys it may enter upon and use for the purpose herein provided, which by the acts of said company or persons in its employ shall have become injured or damaged or been made unsafe.

All proper precautions and safeguards shall be used to prevent such use from becoming either injurious or annoying to the inhabitants of said city, and should any damage or injury result to any person or property by reason of the erection and maintenance of such poles, or the failure to keep the streets and alleys in repair as herein required, and said city shall be held liable by reason thereof, such company shall pay all damages and costs resulting therefrom to the parties injured, or to the city, if paid by her.

Page 60

The grantee under that ordinance at once proceeded to erect its plant and to place its poles and wires upon the streets, and it and its successors and assigns have ever since maintained and operated a telephone system. The city

Page 61

has used the company's poles for the maintenance of its fire alarm service, and has had the benefit of a free public telephone service for municipal purposes.

In January, 1909, the city council passed an ordinance requiring the telephone company to remove from its streets and alleys all of the poles and wires 'within a reasonable time after the passage of the ordinance,' and, upon failure to so remove, the mayor was directed to have them removed. This was, however, subject to a provision 'that said company shall have the right to purchase from the said city a franchise authorizing it to maintain said poles and wires and use same as provided under the laws of the state, upon proper conditions, to be prescribed by an ordinance, to be passed upon request of said company to the common council of said city.'

This bill was filed for the purpose of enjoining the enforcement of this ordinance, the contention being that it was an impairment of the company's contractual property rights in the streets, and, as such, in contravention of the contract and due-process clauses of the Constitution of the United States. Upon a final hearing the court below sustained the bill, and permanently enjoined the enforcement of the repealing ordinance.

Page 62

Messrs. R. S. Todd and George W. Jolly for appellant.

[Argument of Counsel from pages 62-64 intentionally omitted]

Page 64

Messrs. William L. Granbury, Clarence M. Finn, and Hunt Chipley for appellee.

Statement by Mr. Justice Lurton:

Mr. Justice Lurton, after making the foregoing statement, delivered the opinion of the court:

1. That the right conferred by the ordinance involved is something more than a mere license is plain. A license has been generally defined as a mere personal privilege to do acts upon the land of the licensor, of a temporary character, and revocable at the will of the latter unless, according to some authorities, in the meantime expenditures contemplated by the licensor when the license was given

Page 65

have been made. See Greenwood Lake & P. J. R. Co. v. New York & G. L. R. Co. 134 N. Y. 435, 440, 31 N. E. 874; Southampton v. Jessup, 162 N. Y. 122, 126, 56 N. E. 538.

That the grant in the present case was not a mere license is evident from the fact that it was upon its face neither personal nor for a temporary purpose. The right conferred came from the state through delegated power to the city. The grantee was clothed with the franchise to be a corporation and to conduct a public business, which required the use of the streets, that it might have access to the people it was to serve. Its charges were subject to regulation by law, and it was subject to all of the police power of the city.

That an ordinance granting the right to place and maintain upon the streets of a city poles and wires of such a company is the granting of a property right has been too many times decided by this court to need more than a reference to some of the later cases: Detroit v. Detroit Citizens' Street R. Co. 184 U. S. 368, 395, 46 L. Ed. 592, 610, 22 Sup. Ct. Rep. 410; Louisville v. Cumberland Teleph. & Teleg. Co. 224 U. S. 649, 661, 56 L. ed. 934, 939, 32 Sup. Ct. Rep. 572; Boise Artesian Hot & Cold Water Co. v. Boise City, opinion just handed down. [230 U. S. 84, 57 L. ed. ——, 33 Sup. Ct. Rep. 997.] As a property right it was assignable, taxable, and alienable. Generally it is an asset of great value to such utility companies, and a principal basis for credit.

2. The grant by ordinance to an incorporated telephone company, its successors and assigns, of the right to occupy the streets and alleys of a city with its poles and wires for the necessary conduct of a public telephone business, is a grant of a property right in perpetuity, unless limited in duration by the grant itself, or as a consequence of some limitation imposed by the general law of the state, or by the corporate powers of the city making the grant. Detroit v. Detroit Citizens' Street R. Co. 184 U. S. 368, 395, 49 L. ed. 592, 610, 22 Sup. Ct. Rep. 410; Louisville v. Cumberland Teleph. & Teleg. Co. 224 U. S. 649, 661, 56 L. ed. 934, 939, 32 Sup. Ct. Rep. 572; People v. O'Brien, 111 N. Y. 1, 42, 2 L.R.A. 255, 7 Am. St. Rep. 684, 18 N. E. 692; People ex rel. Woodhaven Gaslight Co. v. Deehan, 153 N. Y. 528, 47 N. E. 787: Mobile v. Louisville & N.

Page 66

R. Co. 84 Ala. 115, 5 Am. St. Rep. 342, 4 So. 106; Arcata v. Arcata & M. River R. Co. 92 Cal. 639, 28 Pac. 676; State, Hudson Teleph. Co. Prosecutor, v. Jersey City, 49 N. J. L. 303, 60 Am. Rep. 619, 8 Atl. 123; Dill. Mum. Corp. 5th ed. § 1265; Nebraska Teleph. Co. v. Fremont, 72 Neb. 25, 29, 99 N. W. 811; Plattsmouth v. Nebraska Teleph. Co. 80 Neb. 460, 466, 14 L.R.A.(N.S.) 654, 127 Am. St. Rep. 779, 114 N. W. 588. If there be authority to make the grant, and it contains no limitation or qualification as to duration, the plainest principles of justice and right demand that it shall not be cut down, in the absence of some controlling principle of public policy. This conclusion finds support from a consideration of the public and permanent character of the business such companies conduct, and the large investment which is generally contemplated. If the grant be accepted and the contemplated expenditure made, the right cannot be destroyed by legislative enactment, or city ordinance based upon legislative power, without violating the prohibitions placed in the Constitution for the protection of property rights. To quote from a most weighty writer upon municipal corporations, in approving of the decision in People v. O'Brien, 111 N. Y. 1, 42, 2 L.R.A. 255, 7 Am. St. Rep. 684, 18 N. E. 692,—a decision accepted and approved by this court in Detroit v. Detroit Citizens' Street R. Co. 184 U. S. 368, 395, 46 L. ed. 592, 610, 22 Sup. Ct. Rep. 410—'The grant to the railway company may or may not have been improvident on the part of the municipality, but having been made, and the rights of innocent investors and of third parties as creditors and otherwise having intervened, it would have been a denial of justice to have refused to give effect to the franchise according to its tenor and import, when fairly construed, particularly when the construction adopted by the court was in accord with the general understanding. In the absence of language expressly limiting the estate or right of the company, we think the court correctly held, under the legislation and facts, that the right...

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128 practice notes
  • City of Jamestown v. Pennsylvania Gas Co., No. 106.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • June 28, 1924
    ...R. A. 1918E, 865; Old Colony Trust Co. v. Omaha, 230 U. S. 100, 117, 33 S. Ct. 967, 57 L. Ed. 1410; Owensboro v. Cumberland Telephone Co., 230 U. S. 58, 73, 33 S. Ct. 988, 57 L. Ed. 1389; Grand Trunk Western Ry. Co. v. South Bend, 227 U. S. 544, 556, 33 S. Ct. 303, 57 L. Ed. 633, 44 L. R. A......
  • State ex Inf. McKittrick v. Mo. Utilities Co., No. 34073.
    • United States
    • United States State Supreme Court of Missouri
    • September 8, 1936
    ...118 Iowa, 234; Scott County Road Co. v. Hines, 215 U.S. 336; Turnpike Co. v. Illinois, 96 U.S. 63; Owensborough v. Cumberland Tel. Co., 230 U.S. 58; Postal Tel.-Cable Co. v. Ingraham, 228 Fed. 392; Smith v. Osceola, 178 Iowa, 200; Grand Rapids Bridge Co. v. Prange, 35 Mich. 400; State v. No......
  • State ex Inf. Shartel v. Mo. Utilities Co., No. 31441.
    • United States
    • United States State Supreme Court of Missouri
    • October 5, 1932
    ...When the term is fixed the rights of the grantee will cease at the expiration of the term, 26 C.J. 1040; Owensboro v. Cumberland Tel. Co., 230 U.S. 58, 33 S. Ct. 988, 57 L. Ed. 1389; Detroit United Ry. Co. v. Detroit, 229 U.S. 39; Postal Tel. Cable Co. v. Ingraham, 228 Fed. 392; People v. L......
  • State Ex Rel. Daniel v. Brd. River Power Co, No. 12698.
    • United States
    • United States State Supreme Court of South Carolina
    • July 9, 1929
    ...New York Elec. Co. v. Empire City Subway Co., 235 U. S. 179, 35 S. Ct. 72, 59 L. Ed. 184; Owensboro v. Cumberland Tel. & Tel. Co., 230 U. S. 58, 33 S. Ct. 988, 57 L. Ed. 1389; City R. Co. v. Citizens' St. Ry. Co., 166 U. S. 557, 17 S. Ct. 653, 41 L. Ed. 1114; Detroit v. Detroit Citizens' St......
  • Request a trial to view additional results
128 cases
  • City of Jamestown v. Pennsylvania Gas Co., No. 106.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • June 28, 1924
    ...R. A. 1918E, 865; Old Colony Trust Co. v. Omaha, 230 U. S. 100, 117, 33 S. Ct. 967, 57 L. Ed. 1410; Owensboro v. Cumberland Telephone Co., 230 U. S. 58, 73, 33 S. Ct. 988, 57 L. Ed. 1389; Grand Trunk Western Ry. Co. v. South Bend, 227 U. S. 544, 556, 33 S. Ct. 303, 57 L. Ed. 633, 44 L. R. A......
  • State ex Inf. McKittrick v. Mo. Utilities Co., No. 34073.
    • United States
    • United States State Supreme Court of Missouri
    • September 8, 1936
    ...118 Iowa, 234; Scott County Road Co. v. Hines, 215 U.S. 336; Turnpike Co. v. Illinois, 96 U.S. 63; Owensborough v. Cumberland Tel. Co., 230 U.S. 58; Postal Tel.-Cable Co. v. Ingraham, 228 Fed. 392; Smith v. Osceola, 178 Iowa, 200; Grand Rapids Bridge Co. v. Prange, 35 Mich. 400; State v. No......
  • State ex Inf. Shartel v. Mo. Utilities Co., No. 31441.
    • United States
    • United States State Supreme Court of Missouri
    • October 5, 1932
    ...When the term is fixed the rights of the grantee will cease at the expiration of the term, 26 C.J. 1040; Owensboro v. Cumberland Tel. Co., 230 U.S. 58, 33 S. Ct. 988, 57 L. Ed. 1389; Detroit United Ry. Co. v. Detroit, 229 U.S. 39; Postal Tel. Cable Co. v. Ingraham, 228 Fed. 392; People v. L......
  • State Ex Rel. Daniel v. Brd. River Power Co, No. 12698.
    • United States
    • United States State Supreme Court of South Carolina
    • July 9, 1929
    ...New York Elec. Co. v. Empire City Subway Co., 235 U. S. 179, 35 S. Ct. 72, 59 L. Ed. 184; Owensboro v. Cumberland Tel. & Tel. Co., 230 U. S. 58, 33 S. Ct. 988, 57 L. Ed. 1389; City R. Co. v. Citizens' St. Ry. Co., 166 U. S. 557, 17 S. Ct. 653, 41 L. Ed. 1114; Detroit v. Detroit Citizens' St......
  • Request a trial to view additional results

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