Davenport v. Kleinschmidt

• Decision Date: 18 January 1889
• Parties: DAVENPORT et al. v. KLEINSCHMIDT et al.
• Court: Montana Supreme Court

8 Mont. 467

DAVENPORT et al.

v.KLEINSCHMIDT et al.

Supreme Court of the Territory of Montana.

January 18, 1889.

Appeal from district court, Lewis and Clarke county.

Action by William Davenport and others, citizens and tax-payers of Helena, Mont., against T. H. Kleinschmidt and others, mayor and aldermen of said city, and E. F. Woolston. Judgment for plaintiffs. Defendants appeal. For additional facts in the case, and for the opinion on the former appeal, see 13 Pac. Rep. 249.

Carter & Clayberg, for appellants.

Wade, Toole & Wallace, for respondents.

LIDDELL, J.

The plaintiffs in this suit are citizens and tax-payers of the city of Helena, and instituted the present action, in 1886, against the defendants, mayor and aldermen of the city aforesaid, and against one E. F. Woolston. It appears that on the 22d of November of that year the city council, by an ordinance, granted to the defendant Woolston the franchise of laying mains and water-pipes through the streets, and supplying water to the inhabitants, of said city, as well as furnishing the corporation with water for fire and sewerage purposes for a period of 20 years at a stipulated payment of $1,250 per month. The plaintiffs, alleging the contract to be illegal, at the time of filing their suit applied for and obtained an injunction restraining the city council from entering into the contract, or paying out any money in accordance therewith. The defendants (except Woolston) appeared and moved to dissolve the injunction upon various grounds to be noticed hereafter, and, when the motion was decided against them, appealed the case to this court, where it was tried in January, 1887. The opinion of the court, found on page 502, 6 Mont., and 13 Pac. Rep. 249, affirms the decision of the court below, and, the defendants having filed their answer, the case was again decided in favor of the plaintiffs upon their motion for judgment and the pleadings, and from this judgment the present appeal is prosecuted.

Before we can intelligently understand the present issues in the case, it will be necessary to consider the opinion referred to, and find from it what issues were presented, and what points therein decided. The complaint alleges the illegality of the ordinance entering into the contract: First, because it creates a monopoly; second, because it increases the indebtedness and liability of the corporation beyond $20,000, which is the amount limited by sections 17 and 37 of the charter of the city; third, because it involved an expenditure of over $100, and was not advertised in accordance with the provisions of the city charter; fourth, that the ordinance is in violation of the act of congress passed the 10th of July, 1886. Those grounds in the motion to dissolve, and which were insisted upon, were that the bill was without equity, and that the writ was improvidently issued.

In the outset of the opinion, the organ of the court, Justice McLEARY, while expressing the opinion that Woolston was not a party to the record by reason of the failure to summon him, nevertheless held that the parties before the court were sufficient to the complete determination of the controversy and the issues involved.

From a careful reading of that opinion we find that the following issues were determined in that controversy, brought about by the motion to dissolve:

First. The court held that the plaintiff had the right to enjoin the council from the execution of and expenditure of the city's revenues, upon an illegal contract.

Second. The court held that the defendant Woolston was not a party to the proceedings, never having been summoned, and was not a necessary party.

Third. The court declines to express any opinion as to the divisibility of the franchise and contract.

Fourth. That part of the ordinance which gave to Woolston the exclusive right and power of selling water to the city of Helena for a period of 20 years, at a fixed rate, is a monopoly.

Fifth. That under the charter of the city no authority existed for the erection of monopolies.

Sixth. The ordinance granting the exclusive right and power to furnish the city water for a period of 20 years, at a fixed rate, was not for a reasonable period, under the circumstances, and the contract was one beyond the power of the council to enter into.

Seventh. The contract proposed was one forbidden by section 17 of the city charter, as amended by the act of 1883, p. 19, which limits the city indebtedness for any purpose whatever to $20,000.

Eighth. That the indebtedness of the city at that time already exceeded the limit fixed by the charter, $20,000.

Ninth. No further debts could be incurred without aid from the legislature of the territory.

Tenth. That, whether the contract was considered in the nature of a debt or liability, it is prohibited by section 37 of the city charter, which provides that the aggregate amount of bonds, and all indebtedness and liability of the city for any and all purposes whatever, shall not exceed the sum of $20,000.

Eleventh. For this reason it is beyond the authority of the council to make it, or carry it out in any particular.

Twelfth. The court also holds that the contract is void because it involved an expenditure of over $100, and was not advertised before letting, as is required by the city charter, page 15.

Thirteenth. The contract does not create an indebtedness which falls within the act of congress of the 10th of July, 1886.

Fourteenth. The injunction was neither improvidently nor imprudently issued.

After this decision the defendants filed an answer admitting the assessed value of property in the city to be $5,000,000, as stated in the complaint, and that the bonded indebtedness is also as stated in the complaint, to-wit, $19,000; but they deny any floating indebtedness at all on the part of the city. They deny any contract, or intention to contract, between Woolston and the city, but that the tenor and effect of the ordinance is to authorize and empower Woolston to lay pipes and mains, and to furnish the inhabitants of the city with water, and to procure from him such water as is needed for city purposes; and to pay for which the ordinance makes appropriation.

Without enumerating further the denials and allegations of new matter, we may say, generally, that the answer puts at issue all the points presented in the complaint, and passed upon in the opinion of the supreme court heretofore referred to. In passing upon the motion for judgment on the pleadings, the court, while sustaining it, modified the injunction in so far as it restrained Woolston from erecting his system of water-works under the franchise, but made the writ perpetual as to the council, and prohibited them from carrying out the ordinance wherein it gives the exclusive right and power to Woolston to furnish the city with water for fire and sewerage purposes for the period of 20 years. From this judgment it is plain that the question of the divisibility of the ordinance has been recognized by the judge a quo, and from the oral arguments and brief we understand the point to be conceded by counsel from both sides, and that it is...