City of Tampa v. Tampa Waterworks Co.

• Decision Date: 28 April 1903
• Citation: 34 So. 631,45 Fla. 600
• Parties: CITY OF TAMPA v. TAMPA WATERWORKS CO.
• Court: Florida Supreme Court

34 So. 631

45 Fla. 600

CITY OF TAMPA v. TAMPA WATERWORKS CO.

Florida Supreme Court

April 28, 1903

In Banc. Appeal from Circuit Court, Hillsborough County; Joseph B. Wall, Judge.

Bill by the Tampa Waterworks Company against the city of Tampa. Decree for complainant, and defendant appeals. Reversed.

Syllabus by the Court

SYLLABUS

1. Companies deriving their authority from the Legislature, and invested with the franchise of supplying municipalities and their inhabitants with water through the instrumentality of pipes and mains laid in the public streets, are, when exercising such functions, performing services of a public nature, within the meaning of section 30, art. 16, Const 1885, and their business is affected with a public interest so as to subject them to regulation by requiring them to charge reasonable rates, and such regulation does not violate the 'due process' clause of the federal Constitution.

2. The provisions of chapter 5070, p. 240, Acts 1901, approved May 31, 1901, are sufficient to authorize municipalities in this state to pass ordinances fixing reasonable rates to be charged for water supplied by a water company to the municipality and its inhabitants.

3. Every charter granted by the Legislature to the persons and corporations mentioned in section 30, article 16, Const 1885, and every contract made with them by the Legislature or by a municipality under its authority, are granted, made, and accepted subject to and in contemplation of the possibility of the subsequent exercise of the power which by that section is declared to be vested in the Legislature. The section mentioned not only becomes a part of every such charter or contract, as much so as if written therein, but by implication it denies the authority of the Legislature to estop itself by contract, or to authorize a municipality to so bind it, not to exercise the power thereby recognized whenever in its wisdom it shall think necessary to do so.

4. Section 30, art. 16, Const. 1885, reserves to the Legislature the power to regulate by its own act, or through the instrumentality of a municipality, the rates to be charged by a water company supplying such municipality and its inhabitants with water, so as to require such company to charge reasonable rates only for water supplied, and the exercise of this power does not deprive such company of its property without due process of law, nor does it impair the obligation of a contract between it and the city for higher rates, where such company was created and such contract was made subsequent to the adoption of the Constitution of 1885.

5. Section 30, art. 16, Const. 1885, is applicable not only to persons and corporations engaged as common carriers in transporting persons and property, but also to persons and corporations performing other services of a public nature.

6. To the extent that section 30, art. 16, Const. 1885, affirms and declares full power in the Legislature to do the things therein declared, and to the extent that it by implication deprives the Legislature of the power to barter away that power, and to the extent that it becomes a part of every contract made since the adoption of the Constitution, by the Legislature or by a municipality under its authority, with the persons and corporations therein mentioned, it is self-executing, and needs no legislation to enforce it.

7. Where the matter presented for adjudication in a second suit arose after the termination of a former suit between the same parties, and was in no manner involved in such former suit the judgment therein is no bar to the second.

COUNSEL

John P. Wall and Macfarlane & Glen, for appellant.

P. O. Knight and Sparkman & Carter, for appellee.

From the pleadings it appears that on September 20, 1887, the city of Tampa entered into a contract with W. A. Jeter and A. E Boardman and their associates, constituting the Tampa Waterworks Company, for supplying the city and its inhabitants with water. By this contract the water company agreed to erect waterworks and to supply the city for public purposes in the manner therein stated for a period of 30 years, and the city agreed to pay $4,950 per annum, in equal semiannual payments, for certain hydrant rentals, and, if payments were not promptly made, vouchers bearing 7 per cent. interest were to be issued therefor. The water company agreed to supply water for certain public purposes in payment of city taxes and licenses for the first 10 years, and for water used for fountains the city was to pay at the rate of not more than 25 cents per 100 cubic feet. The city agreed to levy an irrepealable tax sufficient to meet the annual payments, and, if it should be authorized to levy a special tax, it obligated to do so annually, and to keep the proceeds as a separate fund to be devoted to the payment of hydrant rentals. It further agreed to pass such ordinances as would protect the property of the water company, and enforce such penalties and fines upon any person injuring the property as would, when divided between it and the water company, reimburse the latter for repairs made necessary by such injury, provided the damages should not exceed the fine limited by charter. The city further gave the water company the exclusive right to streets, and forbade the laying of pipes through the streets by others for the sale of water during the continuance of the contract, and the water company was accorded the privilege of laying a water pipe through the streets and alleys, and crossing all streams in the city, under certain restrictions therein declared. It was further agreed that the contract should continue in force for 30 years from the time the waterworks were completed and ready for duty, and that at any time after the expiration of 10 years from the completion of the waterworks the city should have the right to purchase the waterworks, together with all appurtenances thereunto belonging, at the value thereof to be agreed upon by the parties, by giving the waterworks company notice of the intention to purchase one year in advance. It was further stipulated that, if the parties could not agree at to the price to be paid for the waterworks and appurtenances, the price should be determined by arbitration in the manner therein provided. It was further agreed that, should the city not wish to purchase at the expiration of 30 years, the contract should be renewed for not less than 5 years, after which the franchise granted the water company should cease and be reopened for competition, at the option of the city. It was further agreed 'that the owners of the said waterworks may charge and collect quarterly in advance, for water furnished private consumers, prices not to exceed the following maximum rates and rules,' followed by a list of maximum prices for purposes specified, with certain regulations of the use of water by private consumers, with a clause that 'for all uses not herein specified the price shall be within the discretion of the waterworks company.' It was further agreed that, as the city grew or should for any reason desire more hydrants, the water company should erect them, and that the city should pay, in addition to the $4,950 previously stated, $45 per annum for each additional hydrant under the conditions before stated, and that when the number of hydrants rented by the city should reach 200 the prices for all should be reduced to $40 per hydrant per annum. There are other provisions in the contract not necessary to be set out.

On September 29, 1887, the city passed an ordinance, No. 7 which set out in section 2 the contract of September 20, 1887, and ordained that Jeter and Boardman, and their associates, successors, and assigns, should have the exclusive right and privilege of constructing, maintaining, and operating waterworks for public and private supply of water within the city for a term of 30 years, together with the right to lay pipes and erect hydrants, fountains, and such other structures and appurtenances in any and all of the streets and other public ways in the city as might be required for the distribution of water, and to make all necessary repairs, upon the conditions mentioned in the contract set forth in section 2. The ordinance prescribed certain regulations for the laying of pipes, and other matters not necessary to be specifically mentioned, and obligated the city to locate upon the map of the mains at least 110 fire hydrants for its use, and required the water company, in accordance with the contract, to extend the water mains when directed so to do by the city, and on such extensions to place additional hydrants. Section 6 is as follows: 'It is provided and ordained that the owners of said waterworks may charge and collect quarterly, for water furnished private consumers, prices not exceeding the price named in section 2 of this ordinance.' No prices were named in section 2, but the contract containing the provisions as to prices was as stated made a part of that section. Section 7 is as follows: 'As provided in section 2 of this ordinance, the city of Tampa shall levy and collect no municipal tax against the waterworks, upon its stock or earnings, or upon material entering into their construction or operation, during a period of ten years from the passage of this ordinance.' Section 8 required the water company by or before January 1, 1888, to commence work upon said waterworks after having filed a written acceptance of the ordinance with the city clerk, and to complete the waterworks and have them in operation by January 1, 1889, and provided for forfeiture of the privileges granted upon noncompliance with such requirements. Section 11 provided for the levy and collection annually of a tax of five mills to be applied exclusively to the...