Lincoln Street Railway Company v. City of Lincoln

• Citation: 84 N.W. 802,61 Neb. 109
• Decision Date: 04 January 1901
• Docket Number: 10,609
• Parties: LINCOLN STREET RAILWAY COMPANY ET AL. v. CITY OF LINCOLN ET AL
• Court: Nebraska Supreme Court

84 N.W. 802

61 Neb. 109

LINCOLN STREET RAILWAY COMPANY ET AL. v. CITY OF LINCOLN ET AL

No. 10,609

Supreme Court of Nebraska

January 4, 1901

ERROR from the district court for Lancaster county. Tried below before HOLMES, J. Reversed.

REVERSED AND REMANDED.

William B. Hornblower, John H. Ames and James Byrne, for plaintiff in error:

Sections 76 and 77 of the act of 1887 violate section 7, article 9, of the constitution. State v. Wheeler, 33 Neb. 563.

The right granted by the city to the railway company to use the streets was a contract. The act of 1887 impaired the obligation of such contract, and is inimical to the federal constitution. Chicago v. Sheldon, 9 Wall. [U. S.] 50; Coast L. R. Co. v. Mayor, 30 F. 646; Milhan v. Sharp, 27 N.Y. 611; Mayor v. Second Avenue R Co., 32 N.Y. 261; People v. O'Brien, 111 N.Y. 1, 40; Brooklyn Central R. Co. v. Brooklyn City R Co., 32 Barb. [N. Y.], 358, 364; Appeal of North Beach & M. R. Co., 32 Cal. 499.

The right conferred by the city upon a railway company to occupy the streets is a grant whose terms, once having been complied with, can not be altered, either by the city or the legislature. Coast L. R. Co. v. Mayor, supra.

The power reserved in section 1 of the article of the state constitution, entitled "Miscellaneous Corporations," does not authorize an act of the legislature impairing the obligation of contracts. There is a limitation to reserved powers. Sinking-Fund Cases, 99 U.S. 700, 720; Shields v. Ohio, 95 U.S. 319, 324; Commonwealth v. Essex Co., 13 Gray [Mass.], 239; City of Detroit v. Detroit & Howell Plank Road Co., 43 Mich. 140.

Even if the reserved power existed in the case at bar, it could be exercised only for the amendment or repeal of the general incorporation laws. Trust Co. v. Citizens S. R. Co., 82 F. 1; Braceville Coal Co. v. People, 35 N.E. [Ill.], 62; Foxworthy v. City of Hastings, 23 Neb. 772; Touzalin v. City of Omaha, 25 Neb. 817, 825.

A law or ordinance requiring a street railway company to pave streets is not an exercise of police power. The limit of the exercise of police power in such case must be regulated with reference to the comfort, safety and welfare of society. Cooley, Constitutional Limitations [6th ed.], 710; Horback v. City of Omaha, 54 Neb. 83.

Harwood, Ames & Ames, also for plaintiff.

Charles O. Whedon and Joseph R. Webster, contra.

The franchise conferred upon the plaintiff in error was obtained by virtue of the general incorporation law, which was subject to amendment at any time. Constitution, art. Miscellaneous Corporations.

Corporate franchises in the American states emanate from the government. What was granted by the city of Lincoln to the plaintiff in error was a mere license. Chicago C. R. Co. v. People, 73 Ill. 541.

There was no contract between the city and the plaintiff in error. The company's franchise was subject to such conditions as the legislature might impose for the public good. Sioux City S. R. Co. v. Sioux City, 138 U.S. S., 98.

The administrative powers of the city over the streets was conferred upon it for public purposes. It is an unalienable right, which the municipality can not bargain away. State v. St. Paul C. R. Co., 81 N.W. [Minn.], 200.

E. C. Strode, N. C. Abbott and D. J. Flaherty, also for defendants.

OPINION

HOLCOMB, J.

The Lincoln Street Railway Company and the New York Security & Trust Company, mortgagee of its property in trust, by proceedings in error to obtain a review of the trial had in the district court, pray a reversal of the judgment therein rendered in favor of the city of Lincoln, plaintiff in the court below, for the sum of $ 108,526.58, principal and interest, and $ 2,915.60, penalties, for taxes or obligations in the nature of special assessments levied by the city of Lincoln on the property of the street railway company, plaintiff in error, as well as certain assessments levied against other street railway companies operating street railway lines in the city, which were, after the assessments, and before proceedings for a recovery thereof were instituted, consolidated with, and merged into, the company against which this action is brought. A recovery is sought for the cost of paving that part of the paved streets occupied by the street railways, including, in most instances, the cost of grading, and is based upon many different assessments in different paving districts and against the several companies operating various lines of railway, and covering a period of several years from and including the years 1888 to 1895. The amount found due is adjudged to be a first lien on all the lines of the defendant company situated in and near the city of Lincoln now or at any time during the existence of the tax liens mentioned in the petition owned by the defendant company, or of which it became possessed by the several agreements of consolidation; also, other lines in and near the city, constructed before or during the pendency of the action, which became the property of the defendant by purchase or otherwise, including its franchise, track, ties, road-bed, right of way, side-tracks, appurtenances, buildings, real estate, etc., belonging to the defendant company, all as one property. It is further adjudged that the defendant trust company's mortgage or trust deed is subject to the lien of the plaintiff city for the amount of the tax liens so as aforesaid found to be due. The decree is adjudged to draw interest at the rate of twelve per centum per annum, and the property ordered sold if the sums found due were not paid within a short time therein stated. The correctness of the judgment is challenged by the plaintiffs in error upon several distinct and different grounds, but primarily for the reasons, as alleged, the enforcement of the claim of the city is violative of different provisions of the federal and state constitutions, in that it impairs the obligation of a contract, and the legislation authorizing the assessments contravenes different sections of the fundamental law of the state. The particular objections interposed, and which appear necessary to a rightful determination, will be considered in the further discussion of the case.

The authority for making the several assessments against the defendant and constituent companies afterwards consolidated with it is founded in the provisions contained in sections 76 and 77 of chapter 11 of the Laws of 1887, entitled "An act to incorporate cities of the first class having less than sixty thousand inhabitants, and regulating their duties, powers, and government."

Section 76: "All street railway companies now existing or hereafter created, in any city governed by this act or that shall hereafter be organized thereunder, shall be required to pave or repave between and to one foot beyond their outer rails, or in case said railway use more than one track in any street, they shall pave between and to one foot beyond their outer rails where such company owns at their own cost. Whenever any street shall be ordered paved or repaved by the mayor and city council of such city, such paving or repaving shall be done at the same time, and shall be of the same material and character as the paving or repaving of the street upon which said railway track is located, unless other material be specially ordered by the board of public works. Such street railway companies shall be required to keep that portion of the street required by them to be paved in repair, using for said purpose the same material as the streets upon which the track is laid at the point of repair, or such other material as the board of public works may require and order upon streets in cities governed by this act. * * * The track of all railway companies, when located upon the streets or avenues of the city, shall be kept in repair and safe in all respects for the use of the traveling public, and such companies shall be liable for all damages resulting by reason of neglect to keep such tracks in repair, or for obstructing the streets or avenues of such city."

Section 77: "In the event of the refusal or neglect of such street railway companies to pave, repave, or repair when so directed by the mayor and council, upon the paving or repaving of any street upon which their track is laid, the mayor and council shall have power to pave, repave, or repair the same and the cost and expense of such paving, repaving, or repairing may be collected by levy and sale of any real or personal property of said street railway company, the same as special taxes are collected. Special taxes for the purpose of paying the cost of any such paving, repaving, macadamizing, or repairing of any such street railway may be levied upon the track, including the ties, iron, road-bed and right of way, side tracks, and appurtenances, including buildings, and real estate belonging to any such company or person, and used for the purpose of such street railway business, all as one property, or upon such part of such tracks, appurtenances, and property as may be within the district paved, repaved, macadamized, or repaired, or any part thereof, and shall be a lien upon the property upon which levied from the time of the levy until satisfied. No mortgage, conveyance, pledge, transfer, or incumbrance of any such property of any such company, * * * created or suffered by any such company or party, after the time when any street or part thereof, upon which any such street railway shall have been laid, shall have been ordered paved, repaved, macadamized, or repaired, shall be made or suffered, except subject to the actual or prospective lien of such special taxes, whether actually levied or not, if such levy be in contemplation. * * * The railroad track, or any other property upon which such special taxes shall be...