Colorado Central Power Co. v. City of Englewood

• Decision Date: 14 May 1937
• Docket Number: No. 1486.,1486.
• Citation: 89 F.2d 233
• Parties: COLORADO CENTRAL POWER CO. et al. v. CITY OF ENGLEWOOD.
• Court: U.S. Court of Appeals — Tenth Circuit

89 F.2d 233 (1937)

COLORADO CENTRAL POWER CO. et al. v. CITY OF ENGLEWOOD.

No. 1486.

Circuit Court of Appeals, Tenth Circuit.

April 7, 1937.

Rehearing Denied May 14, 1937.

Archibald A. Lee, of Denver, Colo. (Miles & O'Brien, of Baltimore, Md., on the brief), for appellants.

Clyde C. Dawson, Jr., of Denver, Colo. (H. H. Davies, of Englewood, Colo., and Pershing, Nye, Bosworth & Dick, of Denver, Colo., on the brief), for appellee.

Before LEWIS, PHILLIPS, and BRATTON, Circuit Judges.

BRATTON, Circuit Judge.

This proceeding in condemnation, filed in the state court and removed to the federal court, was instituted by the City of Englewood, a municipality of the second class in Colorado, against Colorado Central Power Company, a public utility engaged in the transmission, distribution, and vending of electric energy within the city and elsewhere in Arapahoe county, to acquire the light and power system of the company for use and operation as a municipal system. The trustees in a deed of trust were joined as defendants. It was alleged in the petition that the city granted a franchise to Arapahoe Electric Light & Power Company and its assigns in October, 1920, authorizing the construction and operation of a light system; that it was for a period of twenty-five years and expressly reserved to the city the right to purchase or condemn the plant or system of the grantee within the city at its actual value, excluding any sum for franchise or right of way through the streets, alleys, and other public places, with the provision that such right should not be exercised at any time within twenty years from the date of the franchise except at intervals of ten and fifteen years; that chapter 153, Laws of 1899, now being the 67th and 70th subdivisions of section 8987, Compiled Laws of 1921, was in force at the time the franchise was granted; and that Colorado Central Power Company acquired the franchise through mesne conveyances and was operating under its terms.

The company filed an amended answer which interposed legal defenses and equitable issues. The equitable issues were that the petition described and sought to condemn property and transmission lines outside the city exceeding $75,000 in value; that such property was not necessary, used, or useful in serving the city or its residents; that the attorneys for the city and the mayor were not authorized to include such property in the proceeding, the resolution of the city council authorizing the institution of the proceeding being expressly limited to property within the city; that such property outside the city was already devoted to a public use; that the city was endeavoring to exercise rights and privileges as a public utility by acquiring the transmission lines for the transmission and sale of electric energy outside the limits of the city without first having obtained a certificate of convenience and necessity from the Public Utilities Commission of the state; that such interference with the operation of the plant and system of the company would constitute the taking of private property without due process of law in violation of the Fourteenth Amendment; that the entire distribution system and property had a value of $400,000; that the city did not have and could not obtain the money with which to pay for such property; and that the prosecution of the proceeding would subject the company to unreasonable expense without necessity, and would deprive it of property without compensation in violation of the due process clauses in the Federal and State Constitutions. Each paragraph tendering equitable issues concluded with a prayer that further action on the law side of the docket be suspended until the equitable issues were heard; and that upon such hearing the city be permanently enjoined from proceeding at law with the condemnation.

The court struck out the equitable defenses, and the appeal is from that action.

The effect of the order was the denial of a temporary injunction. It, therefore, was appealable under section 274b of the Judicial Code (28 U.S.C.A. § 398); and the measure for determining the correctness of the action is whether the company could have maintained a bill in equity upon the same allegations. Enelow v. New York Life Ins. Co., 293 U.S. 379, 55 S.Ct. 310, 79 L.Ed. 440; Township of Delaware v. Central-Penn. Nat. Bank (C.C.A.) 79 F. (2d) 255.

A city of the second class in Colorado is vested with power of eminent domain for the acquisition of private property necessary for the construction and operation of water, gas or light works; and the power is not confined to property situated within the city limits. Property outside the city may be taken for such public use if it is needed. Public Service Co. v. City of Loveland, 79 Colo. 216, 245 P. 493. Whether the contemplated use is public is a judicial question. Article 2, section 15, Colorado Constitution. If it is public, the necessity or expediency of devoting the property to it is a question for the determination of the city, and when subject to inquiry it must be determined by a board of commissioners appointed by the court. If that determination is not made arbitrarily, or...