City of Raleigh v. Norfolk S. Ry. Co., 31

• Court: North Carolina Supreme Court
• Writing for the Court: BRANCH; Barnhill; PARKER
• Citation: City of Raleigh v. Norfolk S. Ry. Co., 168 S.E.2d 389, 275 N.C. 454 (N.C. 1969)
• Decision Date: 11 July 1969
• Docket Number: No. 31,31
• Parties: CITY OF RALEIGH, v. NORFOLK SOUTHERN RAILWAY COMPANY.

Page 389

168 S.E.2d 389

275 N.C. 454

CITY OF RALEIGH, v. NORFOLK SOUTHERN RAILWAY COMPANY.

No. 31.

Supreme Court of North Carolina.

July 11, 1969.

Donald L. Smith, Raleigh, for plaintiff City of Raleigh.

R. N. Simms, Jr., Raleigh, for defendant Ry. Co.

Joyner, Moore & Howison, Raleigh, for Southern Ry. Co., Maupin, Taylor & Ellis, Raleigh, for Seaboard Coast Line R., Co., amici curiae.

BRANCH, Justice.

The decision of the Court of Appeals is based on the principles set forth in City of Winston-Salem v. Southern Ry., 248 N.C. 637, 105 S.E.2d 37.

The majority view in this country recognizes that an ordinance in the interest of public safety, convenience or welfare which requires a railroad to construct or reconstruct, at its expense, passageways over or under streets and highways, without regard to which was first in existence, is a reasonable exercise of the police power. Atchison, T. & S.F. Ry. v. Public Utilities Commission, 346 U.S. 346, 74 S.Ct. 92, 98 L.Ed. 51; Erie R.R. v. Board of Public Utilities Commissioners, 254 U.S. 394, 41 S.Ct. 169, 65 L.Ed. 322; Chicago, Mil. & St. P. Ry. v. Minneapolis, 232 U.S. 430, 34 S.Ct. 400, 58 L.Ed. 671. See also Atlantic Coast Line R.R. v. Goldsboro, 155 N.C. 356, 71 S.E. 514, aff'd, 232 U.S. 548, 34 S.Ct. 364, 58 L.Ed. 721.

The rationale of these cases is that the public has a superior right to the safe and unimpeded use of streets and highways and since the railroad has obstructed such use, the cost to the railroad is Damnum absque injuria. Missouri Pac. Ry. v. Omaha, 235 U.S. 121, 35 S.Ct. 82, 59 L.Ed. 157.

In the case of City of Winston-Salem v. Southern Ry., supra, the city's charter provided that the city could require any railroad company, at its own expense, to construct, maintain and repair crossings at grade, over or under its streets. The governing body of the city enacted an ordinance requiring the defendant railroad to rebuild at its Entire expense an existing trestle over a city street in order to accommodate increased traffic which would be caused by a proposed city thoroughfare. The city sought a writ of mandamus to enforce the ordinance. The defendant railroad challenged both the ordinance and the charter provision under which it was enacted as being arbitrary, unreasonable and unconstitutional. The defendant railroad introduced evidence of special facts which tended to show that railroads were in a losing competitive fight with other modes of transportation and could no longer effectively pass on costs of improvement and building to the public by rate increases; that benefit from overpass or underpass construction or improvement accrued to their strongest competitors, motor transports; that the municipality received large amounts for street improvement from gasoline taxes and ad valorem taxes on motor vehicles; that there was a strong legislative trend towards relieving railroads from payment of costs for overpass and underpass construction.

The trial court granted mandamus. The Supreme Court reversed the trial court, holding that the ordinance and the charter provisions were unconstitutional as applied to the facts of the case, in that it was an unreasonable exercise of the police power, depriving the defendant of its constitutional right of due process. The Court in so deciding said:

(T)he police power is subject to all the constitutional limitations which protect basic property rights, and therefore must be exercised at all times in subordination to Federal and State constitutional limitations and guarantees. Clinard v. Winston-Salem, 217 N.C. 119, 6 S.E.2d 867, 126 A.L.R. 634; Brewer v. Valk, supra, 204 N.C. 186, 167 S.E. 638; Clinton v. Oil Co., 193 N.C. 432, 137 S.E. 183, 55 A.L.R. 252; State v. Whitlock, 149 N.C. 542, 63 S.E. 123; State v. Williams, 146 N.C. 618, 61 S.E. 61, 17 L.R.A.,N.S., 299.

* * * (W)hat was at one time regarded as an improper exercise of the police power may now, because of changed conditions, be recognized as a legitimate exercise of that power. Elizabeth City v. Aydlett, 201 N.C. 602, 161 S.E. 78; Miller v. Board of Public Works, supra (195 Cal. 477, 234 P. 381, 38 A.L.R. 1479); 11 Am.Jur., Constitutional Law, Sec. 253. Similarly, a police regulation or measure, although valid when promulgated, may become unreasonable and confiscatory in operation as a result of later events or changed conditions. Nashville C. & St. L.R. Co. v. Walters, supra (294 U.S. 405, 55 S.Ct. 486, 79 L.Ed. 949).

Upon consideration of these special facts and all the surrounding circumstances of the case, we conclude that the ordinance of the City of Winston-Salem requiring the defendant railway company to pay the Entire expense of rebuilding the trestle amounts to an unreasonable exercise of the police power, amounting to an invasion of the company's property rights in violation of the constitutional guarantee provided by the 'law of the land' or 'due process' section of the Constitution of North Carolina. Article I, Section 17. (Emphasis ours.)

See Nashville, C. & St. L. Ry. v. Walters, 294 U.S. 405, 55 S.Ct. 486, 79 L.Ed. 949.

The case of Winston-Salem v. Southern Ry., supra, applies well-recognized constitutional principles and, without overruling the majority view, reaches its conclusions by factual distinctions based principally on absence of the elements of public safety and danger to the public. It is important to note that in that case the Court concluded that the ordinance requiring the defendant to pay 'the Entire expense of rebuilding the trestle amounts to an unreasonable exercise of the police power, amounting to an invasion of the company's property rights in violation of the constitutional guarantee provided by the 'law of the land' or 'due process' section of the Constitution of North Carolina, Article I, Section 17.' (Emphasis ours.)

Our courts are thus confronted with the enigma of what portion of the costs may be allocated to the railroad by the city without constituting the exercise of its police power unreasonable and arbitrary. Clearly, the proper forum for relief is the legislative. The Legislature has enacted statutes authorizing the Highway Commission to allocate the costs in eliminating or safeguarding grade crossings, underpasses, or overpasses, where any road or street forming a part of the State Highway System is concerned (N.C.Gen.Stat. § 136--20(b)) and has further authorized the Utilities Commission to require the raising or lowering of any tracks or roadways at any grade crossing in a road or street not forming a link in or part of the State Highway System (N.C.Gen.Stat. § 62--223) and to allocate the costs thereof. The statutory formula for allocation of the costs provides 'that the cost of construction of such underpass or overpass or the installation of such safety device shall be allocated between the railroad company and the Commission in the same ratio as the net benefits received by such railroad company from the project bear to the net benefits accruing to the public using the highway, and in no case shall the net benefits to any railroad company or companies be deemed to be more than ten per cent (10%) of the total benefits resulting from the project.' N.C.Gen.Stat. § 136--20(b).

This legislative trend is further indicated by the Federal Highways Act of 1958, 23 U.S.C. § 130 (1964), under which railroads are required to pay for overpasses or underpasses where federal money goes into the projects only in proportion to the benefits received, and in no case are the railroads required to pay in excess of ten per cent of the cost incurred.

At least one jurisdiction has recognized legislative enactments as creating state policy limiting the municipality's general police power. City of Memphis v. Southern Ry., 167 Tenn. 181, 67 S.W.2d 552.

Whether the same formula and limitations should apply where municipal streets are concerned is a matter for the Legislature. We do not consider it to be the province of the courts to allocate the cost between the municipality and the railroad. Where the municipality, pursuant to its police power, seeks to compel a railroad to reconstruct a trestle at its full or partial expense, the allocation of the cost is a part of its legislative function. When an ordinance exercising the municipal police power is properly before the court so as to prevent a justiciable controversy, it is the province of the court to determine whether the police power has been exercised within constitutional limits. State v. Whitaker, 228 N.C. 352, 45 S.E.2d 860. In making this decision the allocation of the cost is a special factor to be considered by the court in determining the validity of the exercise of the police power.

The lack of guidelines or standards for the allocation of costs in cases of this nature creates an uncertain and uncharted area in the exercise of municipal police power. This unsatisfactory condition does not, however, warrant the court's intrusion into the legislative area in violation of Article I, Section 8, of the North Carolina Constitution.

We turn to the determinative question of whether a justiciable controversy is here presented.

The police power vests in the individual states, and in the exercise thereof the legislature may enact laws, within constitutional limits, to protect or promote the health, morals, order, safety, and general welfare of society. State v. Ballance, 229 N.C. 764, 51 S.E.2d 731, 7 A.L.R.2d 407; State v. Whitaker, supra. The General Assembly may delegate to a municipality, as an agency of the State, authority to enact ordinances in the exercise of the police power. State v. Scoggin, 236 N.C. 1, 72 S.E.2d 97. However, the municipality has only such powers as are delegated to it, and such powers are, of course, subject to the same constitutional limitations as are police powers exercised directly by the State. Winston-Salem v. Southern Ry., supra. In reviewing the exercise of the police power, it is the sole duty of the court to...