Hatch v. Consumers' Co., Ltd.

• Decision Date: 09 November 1909
• Citation: 104 P. 670,17 Idaho 204
• Parties: ALBERT L. HATCH, Plaintiff, v. CONSUMERS COMPANY, LTD., a Corporation, Defendant
• Court: Idaho Supreme Court

104 P. 670

17 Idaho 204

ALBERT L. HATCH, Plaintiff, v. CONSUMERS COMPANY, LTD., a Corporation, Defendant

Supreme Court of Idaho

November 9, 1909

WATER COMPANY-PUBLIC SERVICE CORPORATION-SUBJECT OF PUBLIC REGULATION-SERVICE CONNECTION SUPPLYING CONSUMER-REASONABLE RULES AND REGULATIONS-LAYING MAINS ON UNGRADED STREET-EXTENSION OF CITY BOUNDARY-IMPLIED CONTRACT OF CORPORATION-CONFISCATION OF PROPERTY.

1. Under the franchise granted by the city of Coeur d'Alene to the Consumers Company to occupy the streets and alleys of the city for the purpose of supplying the city and inhabitants thereof with fresh water, the right and authority to dig in the streets and alleys and lay pipes therein for supplying consumers with water is conferred upon the company alone, and no such right is conferred upon the individual or consumer, and the consumer acquires no right to lay pipes or acquire property in the streets and alleys, but, on the contrary, the duty to do so and the rights acquired thereby belong to the water company. It is consequently the duty of the water company to supply and lay the laterals from its main to the line of a consumer's property abutting on such street, and such laterals are the property of the water company. Bothwell v. Consumers Co., 13 Idaho 568, 92 P. 533 and Pocatello Water Co. v. Standley, 7 Idaho 155, 61 P. 518 followed and approved.

2. Under the statute of this state, sec. 2839, Rev. Codes, and the general rule of law applicable in such cases, a water company may make and enforce such reasonable rules and regulations as are in harmony with law and consonant with justice for the conduct of its business, the protection and preservation of its property, and the collection of its water rentals, and in so doing may require the consumer to pay reasonable water rentals in advance, or in default thereof shut off the water supply, or may require a month's rent to be paid at the end of the month, or in default thereof shut off the water until such time as the rent due is paid.

3. A water company cannot enforce a rule requiring a consumer to pay an old or disputed bill for water furnished him at some previous time, or some other and independent use, or at some other place or residence, or for a separate or distinct transaction from that for which he is claiming and demanding a water supply, as a condition precedent to supplying him with water, where he tenders payment of the established water rate in advance for the service he is demanding.

4. In such cases the parties are not upon equal grounds. The consumer's necessities for water for business, health comfort, and life are such as to put him at a decided disadvantage and deprive him of the right to contest an unjust claim; and it would, therefore, be unjust, unsafe, and contrary to public policy to invest a public service corporation with power to become both judge and jury in the determination of claims and demands it holds against the consumer.

5. An ordinance of the city of Coeur d'Alene, passed and approved in the month of April, 1904, including the Krotzer addition to Coeur d'Alene City within the corporate limits thereof, was not void on account of an intervening strip of land 2,663 ft. in length by 2.8 ft. wide at one end and 67 ft. wide at the other. Sec. 9 of the act of February 9, 1899, as appears at page 109 of the 1899 Sess. Laws, which was in force at the time of the adoption of the foregoing ordinance, provided that land or territory laid off or subdivided as provided by statute "shall be regarded and treated as contiguous to such city or town, notwithstanding any stream or embankment or any strip or parcel of land not more than 200 feet in width may be or lie between such land or territory and the corporate limits of such city or town."

6. In a case where the city authorities have by ordinance extended the city limits so as to include an addition or tract of land and the inhabitants thereof, and all parties affected thereby have acquiesced in the action of the city authorities and have transacted their business upon the theory that such territory was included within the city limits, a public service corporation will not be allowed to question the validity of such action of the city council in a collateral attack after the lapse of five years.

7. Under the terms of a franchise ordinance, wherein it is provided that the company receiving the franchise shall not be re- quired to extend its water mains along any ungraded street or alley, no question as to the construction of such provision can arise in a case where the company has in fact extended its main along such ungraded street. After so doing the company cannot refuse to supply consumers along such street on the theory that it was not compelled to build along such street in the first place.

8. A corporation receiving a franchise from a municipality in this state authorizing it to supply the inhabitants with water, by accepting such franchise and attempting to operate thereunder, enters into an implied contract to serve all the inhabitants of such municipality without distinction or discrimination, upon such persons paying it the established rates and complying with the reasonable rules and regulations of such company.

9. To compel a public service corporation to live up to the law of its existence and to discharge the duties for which it was organized and for which it received its franchise, can in no case amount to a confiscation of its property, or taking its property without due process of law, even though such requirement necessitates the corporation using a part or all of its property or investing its money in order to meet its duties and obligations.

10. There can be no element of confiscation or taking property without due process of law in a case where a writ of mandate is issued to compel a water company to put in laterals and service connections from its main to the property line of an abutting owner at an expense of $8.50, where he tenders the monthly water rate of $1.50 in advance. In such case, the rental rate constitutes a fair and reasonable income and revenue on the sum invested, and compulsory service in such case contains no element of confiscation.

11. A public service corporation organized for the purpose of supplying the inhabitants of a municipality with water is not justified in assuming that the people it is to serve are dishonest, and that they will demand and pay for a month's water supply merely for the purpose of entailing upon the company the expense of putting in laterals and service connections, and that they will thereafter refuse to take water and thereby discommode themselves and depreciate their own property, and the courts will not base decisions upon such an assumption.

(Syllabus by the court.)

Original action praying for a writ of mandate. Writ granted.

Writ issued. Costs of this action taxed against the defendant.

Reed & Boughton, for Plaintiff.

Any attempt upon the part of the defendant to require plaintiff or any other consumer to enter into a contract such as proposed by defendant, which would be a lien upon plaintiff's property for all time, would be unreasonable. (Wheeler v. Northern Colo. Irr. Co., 10 Colo. 582, 3 Am. St. 603, 17 P. 487; Rockland Water Co. v. Adams, 84 Me. 472, 30 Am. St. 368, 24 A. 840; State v. Butte City Water Co., 18 Mont. 199, 56 Am. St. 574, 44 P. 966, 32 L. R. A. 697.)

A regulation that in case a consumer is in default his supply will be cut off is reasonable and may be enforced. But such a regulation cannot be made the instrument by which the water company can become the judge in its own case, or shut off water to enforce payment of a disputed bill; nor by its means can payment be enforced which it is not the duty of the consumer to make. (1 Farnham on Waters, 877, and cases there cited.) The account is with the premises and not with the consumer, so that water cannot be refused to an applicant because he is in arrears for water furnished him elsewhere. (1 Farnham on Waters, p. 880; Dayton v. Quigley, 29 N.J. Eq. 77.)

There is also a line of authorities which hold that gas companies may refuse to supply gas when the consumer is in arrears for gas furnished; but these authorities all seem to be based upon a statute giving the gas company the right to refuse to furnish gas while any rates remain unpaid. But it is held that even where there is a statute on the subject, that the right does not exist where there is an honest dispute as to the amount due. (20 Cyc. 1161, and cases there cited.)

The consumer could not legally be required to pay for a portion of the company's system, and neither could the company legally require an unreasonable payment in advance in order to secure water for domestic purposes. (Pocatello Water Co. v. Standley, 7 Idaho 155, 61 P. 518; Bothwell v. Consumers Co., 13 Idaho 568, 92 P. 533.)

Robert H. Elder, and Gray & Knight, for Defendant.

A water company may make and enforce all reasonable rules and regulations which shall insure to it a fair return on the money invested, and also providing for the proper security to it of the payment of the rates fixed and amounts charged, as well as for the safety and preservation and conservation of its several instrumentalities. (Tacoma Hotel Co. v. Tacoma Light & Water Co., 3 Wash. 316, 28 Am. St. 35, 28 P. 516, 14 L. R. A. 669; Shepard v. Gaslight Co., 6 Wis. 539, 70 Am. Dec. 479; Harbison v. Knoxville Water Co. (Tenn. Ch.), 53 S.W. 993; Williams v. Mutual Gas Co., 52 Mich. 499, 50 Am. Rep. 266, 18 N.W. 236; Miller v. WilkesBarre Gas Co., 206 Pa. 254, 55 A. 974; Cedar Rapids Gaslight Co. v. City of Cedar Rapids (Iowa), 120 N.W. 966; Watauga Water Co. v. Wolf, 99 Tenn. 429, 63 Am. St. 841, 41 S.W. 1060; Poole v. Paris Mt. Water Co., 81...