City of Seattle v. Pacific States Lumber Co., 23367.

• Decision Date: 05 February 1932
• Docket Number: 23367.
• Citation: 7 P.2d 967,166 Wash. 517
• Court: Washington Supreme Court
• Parties: CITY OF SEATTLE v. PACIFIC STATES LUMBER CO.

7 P.2d 967

166 Wash. 517

CITY OF SEATTLE v. PACIFIC STATES LUMBER CO.

No. 23367.

Supreme Court of Washington

February 5, 1932

Department 1.

Appeal from Superior Court, Kittitas County; Arthur McGuire, Judge.

Action by the City of Seattle against the Pacific States Lumber Company. From judgment for defendant, plaintiff appeals.

Affirmed.

A. C Van Soelen, J. Ambler Newton, and Glen E. Wilson, all of Seattle, for appellant.

Preston Thorgrimson & Turner, of Seattle, and Hayden, Langhorne &amp Metzger, of Tacoma, for respondent.

HERMAN J.

The city of Seattle, plaintiff, sued the Pacific States Lumber Company, a corporation, alleging that defendant is wrongfully removing timber from lands owned by plaintiff; that plaintiff has been damaged thereby in the sum of $500,000; that the conduct of defendant in its logging operations constitutes a public and private nuisance, which is continuously recurring. Plaintiff prayed for judgment for its damages in the sum of $500,000; that said damages be trebled in accordance with section 939, Rem. Comp. Stat.; and for a decree of court ejecting defendant from the lands of plaintiff and abating the nuisance being committed by defendant. The cause was tried to the court without a jury, and resulted in judgment for defendant. From this judgment plaintiff appeals.

Appellant has made seven assignments of error, and has discussed its claim of error under four headings, or claims. The first of these claims is that the standing timber is a part of the water utility; the second is that an ultra vires contract is not subject to ratification or estoppel. We will discuss these two claims first.

In considering the assertion that the standing timber is a part of the water utility, we will review briefly the history of the organization, acquisition, and operation of the Seattle municipal waterworks system, as disclosed by the testimony in the case. A fair summary of the facts established by the evidence follows:

Appellant was authorized by the state of Washington to acquire and operate a municipal waterworks plant, and did acquire and does operate such a plant and system of the value of more than $20,000,000. Cedar Lake is part of appellant's waterworks system, and is used as a catch basin and impounding reservoir for the storage of water.

In 1895 appellant decided to make Cedar river the source of its water supply. This decision appellant manifested by the passage by the council of Ordinance No. 3990, which was approved by the voters. That ordinance provided, among other things, for headworks on Cedar river, for the use of Swan Lake (now Lake Youngs) for reservoir purposes, and for a pipe line. It estimated the cost of the construction and acquisition of lands, rights, and privileges necessary therefor at one and a quarter million dollars. It provided that the cost was payable only in warrants upon a fund then created, known as the Cedar river water supply fund of Seattle, out of which payment should be made for any real estate rights, easements, or privileges necessary; that 75 per cent. of the gross revenues of the system was set apart into that fund, and the fund pledged to the retirement of warrants, principal and interest. The plant was constructed and all of the one and a quarter million dollars, except about $75,000, was spent for that purpose. The amount so expended was all spent for construction purposes, the right of way for a pipe line, and for the purchase of reservoir sites in the city, save and except the comparatively small sum of $15,000, which was the cost of the land purchased for intake purposes.

In 1900 appellant decided to extend the system to Cedar Lake and its watershed and Cedar river above the intake. This decision was manifested by Ordinance No. 5803, passed by the council and approved by the electors, which provided that the unexpended portion of the estimated cost of one and a quarter million dollars provided by Ordinance No. 3990, heretofore referred to, might be used for the extension of the system. At the time this latter ordinance extending the system was arrived at, it would have cost over $5,000,000 to have acquired the timber standing upon the lands in the Cedar river and Cedar Lake watersheds above the intake.

Appellant acquired no land or timber in connection with the Cedar river project, except the land at the intake, until 1899. From 1899 to 1911 the city acquired several thousand acres of land. In most of these acquisitions the city procured the land only, the timber being either reserved to, or deeded by the city to, the original owner. In such instances the transactions were so arranged that the owner of the timber was privileged to remove the timber in later years, with the right to construct logging railroads and logging roads over the lands so acquired by the city, such right of way also extending to other lands then owned by the city or thereafter to be acquired by it. The arrangements for future logging operations provided they should be conducted in such a way as to avoid pollution of the water supply, and to that end be under supervision of and regulation by the city authorities. It was specially provided that this logging privilege was confined to timber then standing, and excluded the right to log any new growth of timber.

Pursuant to the provisions of an amended city charter, Ordinance No. 7708 was passed by the city council and approved by the electors, authorizing the construction of a municipal hydroelectric plant, near the foot of Cedar Lake, at an estimated cost of $590,000, to be paid for in general bonds. The project was completed in November, 1904. A part of the system was the erection of a crib dam at the lower end of the lake. The city removed and used, for building the dam, the power house, and other structures, timber it had acquired near the dam site.

In September, 1910, it was decided to enlarge the hydroelectric plant. This decision took the form of Ordinance No. 25009, passed by the city council and approved by popular vote. The new plan involved raising the waters of the lake. At that election the electors voted that the lands to be submerged, in accordance with the plan to enlarge the hydroelectric plant, should be cleared of timber. To accomplish that purpose, and for that purpose only, the city began for the first time to acquire timber standing on lands which it had previously procured, and also additional land and timber to be affected by the raising of the lake level.

In 1911 the city council passed, and the electors confirmed, Ordinance No. 27499, authorizing the acquisition of lands, properties, rights, and privileges within and near the watershed at Cedar river necessary to be had in order to protect the existing water supply system from pollution, and authorizing the issuance of general bonds. Thereupon the city commenced acquiring additional lands in the watershed. Ordinance No. 27499 estimated the cost of such acquisitions at $1,000,000, and authorized the issuance of general bonds to that amount.

The watershed comprises about 90,000 acres of land, of which about 50,000 acres are tributary to Cedar Lake and known as the upper watershed, and 40,000 acres are tributary to Cedar river below the lake and known as the lower watershed. The United States government owned approximately 24,000 acres of the upper area of the watershed. Appellant acquired approximately 60,000 acres of the watershed, acquiring the land only for the largest part of its holdings. To have secured all the timber in the watershed, or any considerable portion thereof, would have imposed a prohibitive cost, and would have resulted in the imposition upon water users of prohibitive rates.

In the course of its acquisition of land without timber, the city purchased a quantity of land from Weaver and associates, the grantors reserving the timber with the right to log it. A considerable part of this timber was to be affected by the raising of the lake level. An arrangement was made with Weaver whereby the city should procure the timber for $75,000, payable in bonds issued under Ordinance No. 27499, heretofore referred to as having been passed by the city council and ratified by the electors in 1911. Ordinances were passed to that effect. Appellant's bond attorneys in New York City questioned the validity of the issuance of the $75,000 to procure timber, for the reason that it was not made to appear that the acquisition was for the benefit of the water system. Thereupon the city repealed those ordinances and enacted ordinances in their place, one of which (No. 32473) contained a recital that it was necessary to acquire the Weaver timber to protect the existing water supply system from pollution. The purchase was then concluded. The only reason for the recital aforesaid was to obviate the objection raised by the New York attorneys, and it was not made for the purpose of indicating an actual change of policy on the part of the city in respect to the watershed and timber thereon. Some of the Weaver timber was on land to be submerged, and some was on higher land; but the entire holding was purchased as a matter of necessity in order for the city to acquire the timber which it needed and which was to be cleared under the mandate of the electors.

During the same period, the city was granted by Congress the right to purchase the government land and timber in the watershed, paying for the timber the value to be fixed thereon by appraisal. This acquisition involved so large a sum of money that it could not be accomplished without financially overburdening the system and producing higher water rates to consumers. So later the city relinquished that right to the government.

About this same time, the city let a contract to a company, not the...