Georgia Power Co. v. Okefenokee Rural Elec. Membership Corp.

• Decision Date: 08 September 1961
• Docket Number: No. 21283,21283
• Citation: 121 S.E.2d 777,217 Ga. 219
• Parties: GEORGIA POWER COMPANY v. OKEFENOKEE RURAL ELECTRIC MEMBERSHIP CORPORATION.
• Court: Georgia Supreme Court

Page 777

121 S.E.2d 777

217 Ga. 219

GEORGIA POWER COMPANY v. OKEFENOKEE RURAL ELECTRIC MEMBERSHIP CORPORATION.

No. 21283.

Supreme Court of Georgia.

Sept. 8, 1961.

Rehearing Denied Sept. 25, 1961.

Syllabus by the Court.

1. The Georgia Power Company under its contract with the City of Folkston, having the right to supply the city with electric energy for street lighting purposes, has such special interest that it can maintain an action attacking the validity of a contract between the city and the Okefenokee Rural Electric Membership Corporation for the supplying of electric energy by the latter for street lighting in an area annexed to the city in 1951.

2. The City of Folkston at the time it entered into a contract with the Okefenokee Rural Electric Membership Corporation was being served by the Georgia Power Company with electric energy for street lighting purposes. It was, therefore, under the provisions of the act of 1937 (Ga.L.1937, pp. 646-659), ineligible to become a member of the Okefenokee Rural Electric Membership Corporation.

3. The evidence does not show that the plaintiff was guilty of laches.

4. The court erred in denying the plaintiff's prayer for an interlocutory injunction.

Troutman, Sams, Schroder & Lockerman, Tench C. Coxe, Atlanta, Bennett, Pedrick & Bennett, Larry E. Pedrick, E. Konta Bennett, Waycross, or plaintiff in error.

J. Robert Smith, Nahunta, Arnall, Golden & Gregory, Cleburne E. Gregory, Jr., Atlanta, for defendant in error.

ALMAND, Justice.

The case under review is one wherein the Georgia Power Company (hereinafter referred to as 'power company'), a public utility under the jurisdiction of the Georgia Public Service Commission, sought to enjoin the defendant Okefenokee Rural Electric Membership Corporation (hereinafter after referred to as 'co-op.'), in furnishing electric energy to the City of Folkston (hereinafter referred to as the 'city'), for street lighting purposes in an area which was annexed to the city in 1951. After a hearing on the power company's petition for an interlocutory injunction the court upon consideration of pleadings, demurrers, answers and evidence denied the power company's prayer for an interlocutory injunction. The exception is to that order.

The record discloses that the power company was granted a franchise by the city to use and occupy its streets for the purpose of supplying electric energy to the city and its inhabitants in 1957. In February 1960, the city and the power company entered into a contract whereby the power company agreed to furnish to the city and the city agreed to receive electric energy for street lighting purposes for a period of five years with terms and rates as provided by the agreement. In 1951, pursuant to Ga.L.1951, p. 2046, a rural area was annexed to the city. At that time the co-op. had electric lines and was servicing customers in the annexed area. The record does not show that the power company was serving customers in this area in 1951. In July 1960, the city informed the power company and the co-op. of its desire to install additional street lighting. The power company notified the co-op. that they could not lawfully furnish electric energy to the city because the city was not was not eligible to become a member of the co-op. On September 13, 1960, the city granted a franchise to the co-op. to occupy a certain street and highway in that portion of the area annexed in 1951, for the purpose of installing and operating a street lighting system in the annexed area. On the same date the city and the co-op. entered into a contract whereby the co-op. agreed for a period of 10 years to construct, maintain, operate and furnish all the electric energy necessary for street lighting purposes in the annexed area, and the city agreed to pay according to a rate schedule.

Whether the court abused its discretion in refusing to grant an interlocutory injunction is dependent upon the answer to the following questions. (1) Does the power company have sufficient interest to maintain this action? (2) Does the contract of September 13, 1960, between the city and the co-op. violate the provisions of the act of 1937, (Ga.L.1937, pp. 644-659), as amended by the act of 1960 (Ga.L.1960, pp. 5, 6, Code, § 34A-101 et seq.)? (3) Did the evidence authorize a finding that the power company was guilty of laches?

If an answer adverse to the power company is made to any one of these questions, then the order of the trial court must be affirmed. We will dispose of the questions in their order.

1. Does the power company have such an interest in the alleged contract between the city and the co-op. to give it the right to challenge the lawful power of the co-op. to enter into the street lighting contract? We are of the opinion that it does have such right. At the time (September 1960) the city and the co-op. entered into the contract, the power company had a contract with the city whereby it was furnishing electric energy to the city for street lighting and other municipal purposes with the right to furnish additional street lighting which in 1960, included the area annexed in 1951. It was alleged that if the co-op. was permitted to install street lights in the annexed area and furnish electric energy for such street lights it would result in special injury and damage to the power company. The right of the co-op. to comtract to render electric service to the city was challenged as being violative of Sections 3 and 10 of the act of 1937 (Ga.L.1937, p. 644; Code Ann. §§ 34A-103, 34A-111), in that in September 1960, the city, being at that time a customer of the power company, was ineligible to become a member of the co-op.

As we construe the allegations of the petition, the power company does not challenge the right of the city to grant a franchise to the co-op. for the use of the streets in the annexed area, but asserts that the co-op. under its statutory and corporate powers does not have the legal right to accept the city, or serve it, as a member of the co-op. Its contention is that if the co-op. is allowed to serve the city in the annexed area, its acts will be ultra vires or not in the scope of its authorized statutory powers. As a general rule the State alone will be heard to complain of a corporation for not conforming to the terms of its charter, or, in all events, the Attorney-General, either as a plaintiff or defendant, must be a party to the suit. But there is an exception to this rule where the immediate interest involved and sought to be protected, is not that of the general public but the special and peculiar interest of the complaining party. Macon & Birmingham R. Co. v. Gibson, 85 Ga. 1(6), 11 S.E. 442. It was there said (85 Ga. at page 23, 11 S.E. at page 446), 'It is a mistake to suppose that corporations are created alone for their own benefit, or that their privileges are more sacred than their duties. We see not why a local and special duty may not be enforced at the instance and by the suit of the local and special body of citizens recognized in the charter as immediately interested in some of its provisions.' In Leverett v. Middle Georgia & Atlantic Ry. Co., 96 Ga. 385, 392, 24 S.E. 154, 156, where a group of citizens sought to enjoin a railroad from violating the terms of its charter this court said, 'Those persons who have invested money upon the faith of this contract between the railroad company and the state are entitled to have that contract performed. They are entitled to have the railway company comply with the terms of its charter in this respect, not because of any public inconvenience which might necessarily result from its breach, but because in their own [e]states they suffer a special particular damage, in which the public in no manner participate. The threatened injury, if permitted, would...