Kaukauna Elec. Light Co. v. City of Kaukauna

• Decision Date: 11 March 1902
• Citation: 89 N.W. 542,114 Wis. 327
• Parties: KAUKAUNA ELECTRIC LIGHT CO. v. CITY OF KAUKAUNA.
• Court: Wisconsin Supreme Court

114 Wis. 327

89 N.W. 542

KAUKAUNA ELECTRIC LIGHT CO.

v.CITY OF KAUKAUNA.

Supreme Court of Wisconsin.

March 11, 1902.

Appeal from circuit court, Outagamie county; John Goodland, Judge.

Action by the Kaukauna Electric Light Company against the city of Kaukauna. There was a judgment in favor of defendant for affirmative relief, and plaintiff appeals. Reversed.

Plaintiff operates an electric light plant at the city of Kaukauna, occupying the streets with its poles, under a franchise in the form of an ordinance of the city adopted September 5, 1889, which gives it a right to use the streets for the purpose of furnishing both arc and incandescent lights. By the second section the company contracts to furnish the city incandescent electric lights of certain sizes at certain prices; also to furnish certain lights for bridges, fire department, and council room free of charge. Other sections of the ordinance provide that the company shall give a $5,000 bond, conditioned “to indemnify and save harmless the city of Kaukauna of and from all damages which may in any way arise or grow out of the exercise by said grantee of the privileges herein granted,” and further conditioned “for the faithful compliance by said grantee with all of the terms and provisions of the ordinance, and said bond shall be renewed at any time and as often as the common council of said city may require.” It was also provided that after 10 years from the passage of the ordinance, “if the city deems it necessary, the said grantee shall be required to lay its wires under ground, including those already put up, at the rate of not less than two or more than four blocks per year until all wires are under ground.” The acceptance of the ordinance was declared to constitute a contract binding with equal force upon both parties thereto. This ordinance was duly accepted and a bond filed. On August 4, 1897, a supplemental contract was made, by which the company agreed to furnish, at a price specified, such arc lights as the city might demand, except that they should not be located more than 600 feet from existing lamps; such arc lamps to displace such incandescent lamps as the city should direct. Otherwise the former contract remained in full force, with the later contract as a supplement. On March 7, 1899, the city enacted an ordinance requiring certain painting of all poles in the city, expressly including those of this plaintiff, imposing a penalty or fine of $5 for every 24 hours of disobedience after 30 days' notice. That notice was given about August 1, 1899. On July 11, 1899, a resolution was adopted, and communicated to the plaintiff, requiring additional incandescent lamps to be located at five or six specified places. On August 1, 1899, a resolution was adopted, and communicated to the plaintiff, requiring the company to give a new bond, in the sum of five thousand dollars, “to indemnify the city from all loss or damage by reason of the privileges granted them under their franchise.” On the same day a resolution was adopted to notify the company that the city would exercise its right under the franchise to require the company to bury four blocks (not designated) of their wires after the 10 years should have expired, viz., September 5, 1899. On October 3, 1899, an ordinance was duly adopted, and notified to the plaintiff, reciting the provision of the franchise, and declaring the sense of the council that the burying of a portion of plaintiff's wires was necessary for the best interests and welfare of the city, and ordering the plaintiff to place under ground their wires on two specified blocks, and to commence such work within 30 days after the passage of the resolution, and to prosecute it with due diligence until its completion. The company made no attempt at compliance with any of the ordinances and resolutions of 1899 above recited, and on November 7th the council adopted a resolution reciting the failure to comply with said several ordinances and resolutions, and resolving that the city thereby declared said franchise and contract forfeited and broken; that it would no longer accept or pay for lights furnished by the company; and that the company be, and it thereby was, ordered to remove from the public streets all poles, wires, and other fixtures. The same day was appropriated $100 as payment in full to the company of all that was due it for light up to the date of that resolution, which money was tendered to it, and was brought into court and deposited at the time of answering. Plaintiff continued to run the pre-existing street lamps, but the city cut off all lamps within its control in the public buildings and on bridges, and neither received nor used any light or power from the plaintiff, after November 7th, voluntarily. Thereafter, at monthly intervals, the company presented its bills, which were not passed upon by the council, and within the time limited by the charter the company took appeals to the circuit court, until a large number of such appeals were pending, upon bills of about $260 a month, which were afterwards consolidated into this one suit, making a total of $4,222.08. The defendant interposed as answer a denial of compliance by the company with its contract, alleging all of the breaches of ordinances and resolutions above recited. It counterclaimed the same breaches to its damage $5,000, and by a second counterclaim it set up the same breaches of duty; also that the city had no other means of lighting its streets, and could not practically supply another method; that the plaintiff was engaged in commercial lighting as well as street lighting, and used its poles and wires for that purpose, whereby the city was continually subject to liability, for which it had no adequate indemnity, in the form of a bond or otherwise; that the damage to the city from such breaches of contract by the plaintiff was great and irreparable, but difficult, if not impossible, of ascertainment; that a multiplicity of suits arose from the continued claim of the plaintiff to continue furnishing lights under the ordinance, alleging that, if the whole contract had not been effectively rescinded, the city was ready to comply on its part with all of its contract, provided the plaintiff should first perform the conditions of its franchise and contract; and prayed judgment dismissing the complaint, enjoining the commencement of any more suits or filing of any more claims before the council; also that the plaintiff be perpetually restrained from committing any breach of either of its two contracts; that it be compelled to place and maintain the additional lights demanded, and such others as might be demanded, by the defendant; and that by mandatory injunction it be compelled to bury its wires, as specified in the recited resolutions, and be compelled to furnish the defendant a bond in compliance with its contract; also that the same acts be enforced by decree of specific performance. The court found the facts substantially as above, and on October 30, 1901, rendered judgment that the two contracts of September 5, 1889, and August 4, 1897, be specifically enforced, by requiring the plaintiff, within four months from the service of notice of entry of the judgment, to deposit with the city clerk a bond in the penal sum of $5,000, conditioned as required by the contract; that within like four months, adjudged to be a reasonable time, the plaintiff lay or place under ground its wires in the blocks specified in the ordinance; and that, upon affidavit filed with the clerk of court showing compliance therewith, judgment be entered in favor of the plaintiff and against the city for the contract amount of the service sued for, $4,222.08; and further providing that, in case of failure to comply within four months with the mandatory portion of such judgment, the plaintiff take nothing by the action, and its complaint be dismissed; judgment without costs to either party. From that judgment the plaintiff appeals.Humphrey Pierce (D. S. Rose, of counsel), for appellant.

Lyman E. Barnes, for respondent.

DODGE, J. (after stating the facts).

The ordinance or contract serving as the basis of the rights of the respective parties in this case is one of a character now become very common in this state, where the city acts in a twofold capacity: First, as a governmental body exercising delegated power of the state, it confers, and limits with conditions, the privilege or franchise to use the public streets, under authority of section 1780b, Rev. St. 1898. State v. Superior Ct. of Milwaukee Co., 105 Wis. 651, 673, 81 N. W. 1046, 48 L. R. A. 819;State v. Portage City Water Co., 107 Wis. 441, 445, 83 N. W. 697. It is true that no such authority had been delegated when, in 1889, this ordinance was enacted, and it was perhaps originally void. This want of authority with reference to electric lighting companies was, however, supplied by chapter 192 of the Laws of 1893, which probably may be considered as ratifying the original ordinance. In addition to this function as an agent of the state, however, the city, in the same instrument or ordinance, exercises its function as a business corporation, with power to purchase, contract for, and pay for electric lights for public purposes, and to specify the conditions of such contracting,--a power arising under its own charter. In the argument in this case, as in the ordinance itself, these two functions are greatly confused, and it is not always easy to separate those provisions which pertain to the one portion or the other of the instrument. In the formulation of such a document, reciprocal duties are usually imposed both upon the grantee of the franchise and upon the city. Some of these duties or conditions clearly relate exclusively to the subject of the franchise. Others with equal clearness may apply only to the contractual and commercial duty of supplying lights to the city, to be paid for when so supplied. Other...