Houston Lighting & Power Co. v. Fleming

• Decision Date: 27 April 1939
• Docket Number: No. 10853.,10853.
• Citation: 128 S.W.2d 487
• Parties: HOUSTON LIGHTING & POWER CO. v. FLEMING et al.
• Court: Texas Court of Appeals

128 S.W.2d 487

HOUSTON LIGHTING & POWER CO. v. FLEMING et al.

No. 10853.

Court of Civil Appeals of Texas. Galveston.

April 27, 1939.

Rehearing Denied May 25, 1939.

COPYRIGHT MATERIAL OMITTED

Appeal from District Court, Harris County; Ben F. Wilson, Judge.

Suit by the Houston Lighting & Power Company against H. T. Fleming and others to enjoin the enforcement of an ordinance of the City of West University Place. From a judgment denying the relief sought, plaintiff appeals.

Reversed and rendered.

W. P. Hamblen, Baker, Botts, Andrews & Wharton, and F. G. Coates, all of Houston, for appellant.

Robt. L. Sonfield, C. A. Leddy, and Fulbright, Crooker & Freeman, all of Houston, for appellees.

A. J. Lamonte, of Houston, for appellees on rehearing.

Sewall Myer, City Atty., and Vernon Coe and Will Sears, Asst. City Attys., all of Houston, for City of Houston, amicus curiæ.

GRAVES, Justice.

Appellant, an electric utility company, brought this suit to enjoin the City of West University Place and its officials from enforcing its newly-adopted ordinance No. 129 of January 4 of 1938, copy of which is appended hereto as Exhibit A, requiring all telegraph, telephone, electric, and gas companies furnishing their respective services in the City to pay four per cent of their annual gross-receipts from business done therein, as a "street-rental", and conditioning their future right to use the streets at all for such purpose upon compliance with such ordinance. This appeal is from a judgment of the 61st District Court denying the relief sought, entered after a trial on the merits before the court without a jury, upon evidence from both sides, pursuant to an express holding that the ordinance was valid and constitutional in all respects.

Appellant began furnishing its electric service to the area now comprising the appellee-City of West University Place on January 1 of 1921, prior to its incorporation under the general law of the State in 1925, pursuant to R.S.Title 28; from 1925 to 1930 appellant furnished its electric service in such city without an ordinance consenting to its occupancy of the streets for that purpose, during which period the City's population increased from 260 to over 1300 people; at the time of this trial a further increase had occurred up to between 3500 and 4500 people; thereafter, on May 29 of 1930, the City, by an ordinance which was duly accepted by the appellant, granted it a franchise for such use for its service of its then-existing and future streets for a period of 50 years, copy of which franchise is appended hereto as Exhibit B.

As its terms declare, this consent-franchise, while imposing other conditions the appellant accepted, did not provide, nor did it accept, a charge for the use and occupancy of such streets; on the contrary, the undisputed evidence shows (indeed, the parties so agree) that the service continued under that franchise with no such claim ever having been made until the enactment and attempted enforcement in 1938 of stated ordinance No. 129, so forming the subject matter of this injunction-suit.

This court, upon a consideration of the controversy in the light of the record and the briefs of the parties, including that of the amici curiae, concludes that the judgment of the learned trial court was erroneous, must be reversed, and the cause rendered in appellant's favor, mainly upon these considerations:

(1) The appellant's right to the use and occupancy of these streets for that purpose was predicated upon a general statute of the State applying uniformly to all corporations rendering gas or electric service, which declared its general and state-wide policy with reference to such use and occupancy of streets in such cities and towns so created, to-wit, R.S. Article 1436; the right given thereby is plainly and directly granted by the State, and became complete on the giving of the City's consent thereto, which as indicated supra, occurred in this instance, that being the sole statutory condition-precedent to the investment of the utility with the granted right; Galveston & W. Ry. Co. v. City of Galveston, 90 Tex. 398, 39 S.W. 96, 36 L.R.A. 33; Denison & S. R. Co. v. S. L. S. W. Ry. Co., 96 Tex. 233, 72 S.W. 161, 201; Russell v. Sebastian, 233 U.S. 195, 34 S.Ct. 517, 58 L.Ed. 912, Ann.Cas.1914C, 1282; Fort Worth Gas Co. v. Latex Oil & Gas Co., Tex.Civ.App., 299 S.W. 705, writ refused, 118 Tex. 674.

(2) This City, having thus been incorporated under the general law and never having attained a greater population than 4500, was accordingly in its relations with such a utility as appellant, amenable to and governed by this general law of the State, as declared in cited R.S. Article 1436; this record fails anywhere to show any abrogation, repeal, or impairment by the Legislature of the right to so use and occupy these streets for the time stipulated between the parties; on the contrary, there is no contention by the appellees that any such abrogation, abatement, or modification did ensue, they, on the other hand, claiming that the power to so undermine the preexisting franchise by adopting Ordinance 129 is to be implied from R.S. Articles 1015 (23) and 1016, as well as from the provision of the Bill of Rights, Article 1, section 17, of the Texas Constitution, Vernon's Ann. St., prohibiting irrevocable or uncontrollable grants of special privileges or immunities.

(3) This cited Constitutional prohibition, in this court's opinion, cuts just the other way; that is, instead of withdrawing from Constitutional protection the stated franchise-rights that so became complete on the City's acceptance under R.S. Article 1436, it secures and safeguards them unimpaired by expressly reserving them to the control of the Legislature itself alone; furthermore, in no exact nor legal sense could the right so granted appellant under that general statute, applicable alike to all corporations furnishing such service who met its requirements, be termed a special privilege or immunity; rather, in the plain circumstances, it was just a privilege or franchise granted direct by the State, through the Legislature by means of that general enactment, to any such corporation as satisfactorily met its terms and furnished the Utilities for the public benefit its terms dealt with; Mayor, etc., of City of Houston v. Houston City St. Ry. Co., 83 Tex. 548, 19 S.W. 127, 29 Am.St.Rep. 679; Galveston & W. Ry. Co. v. City of Galveston, 90 Tex. 398, 413-414, 39 S.W. 96, 36 L.R.A. 33; Denison & S. R. Co. v. St. Louis S. W. R. Co., 96 Tex. 233, 242, 72 S.W. 161, 201; 19 Tex.Jur., pp. 877-878.

(4) Thus appellant's occupancy of these streets, under the express statutory authority vouchsafed by validly outstanding R.S. Article 1436, confirmed by the appellee-City's express written consent subsequently given by franchise, constituted a contract that remains protected against impairment by the very provision of our Constitution the appellees invoke in their own behalf; in other words, Ordinance 129—in the absence of any nod from the Legislature itself withdrawing any of the privileges it had theretofore granted under R.S. Article 1436—comes into direct conflict with the general law of the State, which it may not be permitted to do; it thereby unconstitutionally impairs the contract-obligation appellant had already entered into the discharge of, by increasing the burdens of and impairing the benefits to the appellant under it; in short, it amounts to an attempted repeal, by necessary implication, of the City's prior, unexpired franchise-contract to accept such electric service for 50 years, inclusive of the easements, rights of ingress and egress, and of user that went to appellant under it, without further charge or claim. Russell v. Sebastian, 233 U.S. 195, 34 S.Ct. 517, 58 L.Ed. 912, Ann.Cas.1914C, 1282; City of Louisville v. Cumberland Tel. & Tel. Co., 224 U.S. 649, 32 S.Ct. 572, 56 L.Ed. 934; Rio Grande R. Co. v. City of Brownsville, 45 Tex. 88; City of Tulsa v. S. W. Bell Tel. Co., 10 Cir., 75 F.2d 343; City of Fort Worth v. S. W. Bell Tel. Co., 5 Cir., 80 F.2d 972; Mayor, etc., of City of Houston v. Houston City St. Ry. Co., 83 Tex. 548, 19 S.W. 127, 29 Am.St.Rep. 679; Texarkana Gas & Electric Co. v. Texarkana, 58 Tex.Civ.App. 109, 123 S.W. 213; City of Vernon v. Montgomery, Tex.Civ.App., 265 S.W. 188, writ refused; Corpus Christi Gas Co. v. Corpus Christi, Tex.Civ.App., 283 S.W. 281, writ refused; Northern Texas Utilities Co. v. Community Natural Gas Co., Tex.Civ.App., 297 S.W. 904, writ refused; 12 Am.Jur. p. 19, sec. 397; Columbia Ry., Gas & Elec. Co. v. South Carolina, 261 U.S. 236, 43 S.Ct. 306, 67 L.Ed. 629; Carondelet Canal & Nav. Co. v. Louisiana, 233 U.S. 362, 34 S.Ct. 627, 58 L.Ed. 1001; McCracken v. Hayward, 43 U.S. 608, 2 How. 608, 11 L.Ed. 397; Cooley, Const.Lim., 8th Ed., p. 582; Boise Artesian Hot & Cold Water Co. v. Boise City, 230 U.S. 84, 33 S.Ct. 997, 57 L.Ed. 1400; Travelers' Ins. Co. v. Marshall, 124 Tex. 45, 76 S.W.2d 1007, 96 A.L.R. 802; 39 Tex.Jur., p. 624.

(5) It is further thought the State's entire public policy as to the use and occupancy of streets by electric corporations is thus found in R.S. Article 1436—that is, to simply grant the right for such use, together with the necessary easements and rights of way, in any city incorporated by general law, if and when that city so consents by ordinance, franchise, or otherwise; if such policy of the State had further been to authorize such cities to raise revenue from that prescribed use, like that termed "street-rental" in Ordinance 129, and that without any additional quid pro quo, it seems wellnigh obvious that the power to prohibit such use, except by the payment of further compensation, would have been expressly given somewhere in that statute, as it has been given to "Home Rule" cities by section 12 of R.S. Article 1175. Texas & Pacific R. Co. v. City of El Paso, 126 Tex. 86, 85 S.W.2d 245; City of Owensboro v. Cumberland Tel....