Lackey v. Fayetteville Water Co.

• Decision Date: 23 July 1906
• Citation: 96 S.W. 622
• Parties: LACKEY et al. v. FAYETTEVILLE WATER CO. et al.
• Court: Arkansas Supreme Court

96 S.W. 622

LACKEY et al. v. FAYETTEVILLE WATER CO. et al.

Supreme Court of Arkansas.

July 23, 1906.

Appeal from Washington Chancery Court; Jas. A. Rice, Special Chancellor.

Suit by J. S. Lackey and others against the Fayetteville Water Company and another. From a decree in favor of defendants, complainants appeal. Affirmed.

J. S. Lackey and 18 other taxpayers of the city of Fayetteville brought this suit in their own behalf and on behalf of all other taxpayers in the city to enjoin the appellee and the city from enforcing Ordinance No. 135 of the city of Fayetteville, alleging among other things:

"That the passage of said ordinance was procured by undue influence of the said water company in that J. H. McIlroy, the president thereof, unduly influenced J. H. Atha, a member of the counsel to vote therefor by making him believe that the legal effect of the instrument prepared would be to only require the city to pay at the stated periods at which it could purchase, the actual value of its physical property, if it desired to purchase and induced him to believe that the pressure was greater than required under the old ordinance, when in fact the city could not purchase at such prices, and when said pressure was in effect, less than required under the old ordinance. That he induced W. W. Chapman to vote therefor by making him believe that under the new ordinance the pressure would be guarantied at the university greater under the new ordinance than was required by the old ordinance. That he induced C. W. Phillips, a member of the council, to vote for said ordinance by inducing him to believe that the opposition to it on the part of many citizens was on account of revenge, and that he induced each and every member of the council who voted for it to believe that under this ordinance which they passed the water company guarantied to the city a greater pressure and the power to raise water to a greater elevation at the university than was required of the company under the old ordinance. That it is not true that under the new ordinance a greater pressure was guarantied at the university than under the old. By the terms of this new ordinance, a stream was required to be raised 65 feet at some point south of the university on Dickson street to be selected by the council, while in fact the highest point on Dickson street south of the university was 56 feet lower than the lowest point of the basement of the university building which fact was unknown to the members of the council and the required pressure would only require the water to be raised 9 feet above the lowest point of the foundation of the building. That the said J. H. McIlroy, president of the water company devoted the most of his time from the time the ordinance was introduced before the council in August until the final passage of Ordinance 137 on the 9th day of November in preparing the ordinance so as to protect the interests of the water company, and in persuading the individual members of the council to vote for it. That each and every one of the members of the council who voted for said ordinance was induced to believe that the legal effect of the said Ordinance No. 135 was that the city could purchase at the expiration of the periods named, the water plant by paying simply for the physical property a fair and reasonable value and had it not been that they so believed none of the said members would have voted for the same. That none of said councilmen were lawyers or versed in matters of this character, that the president of the water company with the aid of his counsel wrote out the report of the chairman of the committee having in charge the consideration of said ordinance and wrote out all of the amendments that he and his counsel prepared, and shaped the language of each and every one of said amendments. That the said chairman, W. W. Chapman, received the same from the hands of the president of the water company on Friday the 23d day of October, 1903. That he received at the same time, said Ordinance 135 which had been prepared by the water company and his counsel. That on Monday night, October 26th, said W. W. Chapman and C. W. Phillips signed the report so prepared by the president of the water company and his counsel the other members of the committee refusing to sign the same. That through the influence of the president of the water company and his representations aforesaid and divers other representations, a majority of the council believing the same, were induced to vote for said ordinance and to pass the same by putting it upon its third reading the same night it was introduced, that the same had never been submitted to Hon. R. J. Wilson, attorney for the city, and he had no opportunity to examine into the report or the ordinance so amended, and that no citizen outside of the council had any knowledge or information that there would be no attempt to pass this ordinance at this time, and no one had an opportunity to point out and call attention to the council to the objectionable features of the ordinance so passed.

That the ordinance passed is void for the following reasons:

"First. Because it was procured by the undue influence aforesaid, and was passed without the members of the council voting therefor understanding the legal effect thereof, and the same is a fraud on the rights of plaintiff and other taxpayers.

"Second. Said ordinance is void for the reason that it seeks to fasten upon the city a bonded indebtedness as the only means by which it can be relieved of this ordinance when the city has no legal right to issue or create a bonded indebtedness.

"Third. Said ordinance is void because it seeks to make the city liable for interest-bearing indebtedness.

"Fourth. Said ordinance is void because it is unreasonable in this: (a) It is an attempt to grant to the water company an exclusive franchise for an unreasonable length of time, to wit, 20 years. (b) It seeks to bind the city for the payment of hydrant rental at a fixed price for an unreasonable length of time. (c) It gives no assurance to the city to furnish a necessary or sufficient amount of water for domestic and manufacturing purposes and fire protection. (d) It gives no assurance of any definite pressure in case of fire. (e) The city council had prior to the passage of this act granted to an electric light company a 25-year franchise by which it had agreed to pay certain sums annually and after having paid said sums there is not sufficient revenue from the taxation of all said city property to the constitutional limit of 5 mills to pay the amount that is contracted for under this ordinance for hydrant rental, and if all of the revenue of the city should be used for that purpose there would be an annual deficit during the continuance of this franchise. (f) It makes an arrangement for the payment of 5 cents per thousand gallons for water for sewers when the city is absolutely deprived of means to pay for same. (g) It provides no penalty whatever for a failure on the part of the water company to comply with any of its undertakings. (h) By section 19 of said ordinance it is attempted to provide a special rate of 10 cents per thousand gallons to manufacturing industries that use an average of 10,000 gallons per day and that use hydrant exclusively, which in effect is oppressive, aimed at subdivision of a class and by its terms is exclusive of 2 or 3 industries within the city limits. (i) It is unreasonable in that it approximates a minimum rate to water consumers. (j) It is unreasonable in that the rates so fixed are exorbitant. (k) It is unreasonable in that it makes it impossible for the city under its terms to require the water company to make any future extensions.

"Fifth. Said ordinance is void because it is contrary to the Constitution, the laws, and policy of the state. (a) It attempts to bind the city to pay a bonded indebtedness when under the Constitution and laws of the state it has no power to issue bonds. (b) It attempts to bind the city to pay interest on indebtedness when the Constitution and laws of the state forbid the same. (c) It attempts to fix the hydrant rental for a long and unreasonable length of time which hydrant rentals amount to more than the amount derived from the legal assessment of all the property within the city limits. (d) It attempts to delegate the legislative functions of the council to a board of arbitration for the purpose of determining the terms and conditions upon which the charter may be continued. (e) It imposes conditions for future extensions which are unreasonable and cannot be complied with in order to obtain the same. (f) It imposes the condition of allowing the water company to mortgage its property for an additional sum of $1,250 for each hydrant that might be added under order of the council, the effect of which would be to prevent the council ordering fire hydrants where they are necessary and is contrary to public policy. (g) It creates a monopoly contrary to public policy. (h) And in divers other respects it is contrary to the Constitution and statute laws of the state.

"Sixth. Said ordinance is void for uncertainty in the following and other respects: (a) The various terms employed in sections 7, 17, and 21 leave it indefinite and uncertain as to what pressure is required from the water company. (b) It is impossible to determine from the language of section 7 whether the `altitude * * * shall have the capacity' for supplying a population of 15,000, whether the reservoir, the mains, the plant or what it is that shall have a capacity. (c) It is impossible to determine from section 14 how much water is to be consumed by each consumer, and how it is to be ascertained, what the surplus is, for which the consumer shall be charged regular meter rate heretofore established. (d) That section 17 is uncertain in that it fails to show what is necessary to call for the opening or closing of the valves; that it is not made the...