Little Falls Fibre Co. v. Henry Ford & Son, Inc.

• Decision Date: 31 December 1928
• Citation: 164 N.E. 558,249 N.Y. 495
• Parties: LITTLE FALLS FIBRE CO. et al. v. HENRY FORD & SON, Inc.
• Court: New York Court of Appeals Court of Appeals

249 N.Y. 495

164 N.E. 558

LITTLE FALLS FIBRE CO. et al.

v.HENRY FORD & SON, Inc.

Court of Appeals of New York.

Dec. 31, 1928.

Action by the Little Falls Fibre Company and others against Henry Ford & Son, Inc. From a judgment of the Appellate Division (223 App. Div. 559, 229 N. Y. S. 445), which modified and affirmed a judgment of the Special Term for plaintiffs (127 Misc. Rep. 834, 217 N. Y. S. 534; 129 Misc. Rep. 544, 221 N. Y. S. 671), defendant appeals.

Affirmed.

See, also, 126 Misc. Rep. 126, 212 N. Y. S. 630.Appeal from Supreme Court, Appellate Division, Third Department.

Charles E. Nichols, Jr., and Robert E. Whalen, both of Albany, for appellant.

George E. O'Connor and Thomas O'Connor, both of Waterford, for respondents.

POUND, J.

The Federal Water Power Act (Act June 10, 1920, c. 285, 41 Stat. 1063; U. S. Code, tit. 16, § 797, subd. (d); 16 USCA § 797, subd. (d) created the Federal Power Commission, which is empowered, with limitations not applicable to this case, ‘to issue licenses to citizens of the United States, or to any association of such citizens, or to any corporation organized under the laws of the United States or any state thereof, or to any state, or municipality for the purpose of constructing, operating, and maintaining dams, water conduits, reservoirs, power houses, transmission lines, or other project works necessary or convenient for the development and improvement of navigation, and for the development, transmission, and utilization of power across, along, from or in any of the navigable waters of the United States, or upon any part of the public lands and reservations of the United States (including the territories), or for the purpose of utilizing the surplus water or water power from any government dam, except as herein provided.’

The defendant applied to the Federal Water Power Commission for permission ‘to install flashboards on the Troy dam in connection with our power house.’ The Troy dam is a federal wing dam in the Hudson river at Troy, constructed to regulate navigation under an act of Congress. Defendant has a power house at Green Island, using power developed at the dam. It desired to raise the level of the dam in order to develop more power. The Commission thereupon issued to it a water power license. The terms of the license are unnecessarily broad, and are operative practically, so far as this litigation is concerned, only as applied to the maintenance of the flashboards. The flashboards were erected by defendant with the result that the water from down stream backed up, so as to reduce the head at plaintiffs' manufacturing plants upstream. Plaintiffs are riparian owners, who claim to be entitled to the flow of the stream as against this defendant, unobstructed by the flashboards. Clinton v. Myers, 46 N. Y. 511, 516,7 Am. Rep. 373;U. S. v. Rio Grande Dam & Irrigation Co., 174 U. S. 690, 702, 19 S. Ct. 770, 43 L. Ed. 1136. Their rights must yield to the power of Congress to regulate commerce (Const. U. S. art, 1, § 8, cl. 3), but not to individuals. Sage v. Mayor, 154 N. Y. 61, 47 N. E. 1096,38 L. R. A. 606, 61 Am. St. Rep. 592. They brought this action for an injunction and damages. They have succeeded in obtaining a judgment enjoining the defendant from maintaining the flashboards and awarding damages. The question is whether they must submit to the authority of the Federal Water Power Commission as asserted by the defendant under its license.

The construction of dams in the Hudson river without the consent of the federal government is prohibited.

‘It shall not be lawful to construct or commence the construction of any bridge, dam, dike, or causeway over or in any port, roadstead, haven, harbor, canal, navigable river, or other navigable water of the United States until the consent of Congress to the building of such structures shall have been obtained and until the plans for the same shall have been submitted to and approved by the Chief of Engineers and by the Secretary of War: Provided, that such structures may be built under authority of the Legislature of a state across rivers and other waterways the navigable portions of which lie wholly within the limits of a single state, provided the location and plans thereof are submitted to and approved by the Chief of Engineers and by the Secretary of War before construction is commenced.’ U. S. Code, tit. 33, § 401 (33 USCA § 401).

Since the enactment of chapter 425, Acts of Congress [249 N.Y. 500]1899, ‘the creation of any obstruction not affirmatively authorized by Congress, to the navigable capacity of any of the waters of the United States is * * * prohibited,’ even though the waterway is within the limits of a single state. U. S. Code, tit. 33, § 403 (33 USCA § 403); U. S. v. Rio Grande Dam & Irrigation Co., supra, pages 708, 709 of 174 U. S. (19 S. Ct. 770), Economy Light & Power Co. v. U. S., 256 U. S. 113, 123, 41 S. Ct. 409, 65 L. Ed. 847. It has been held that these sections do not imply that the ‘affirmative authorization’ of the building of a dam under such a permit is given by Congress with the same effect as though Congress had undertaken the enterprise itself. They merely place a condition upon the exercise of such right. The right to construct the dam unst be established independently of the federal permit. International Bridge Co. v. New York, 254 U. S. 126, 132, 41 S. Ct. 56, 65 L. Ed. 176.

The sections above quoted are negative. The provisions of the Federal Water Power Act are affirmative. They purport to permit and regulate the granting of licenses for power purposes. Defendant claims to have obtained from the Commission more than a permit to place an obstruction in a navigable stream; more than a permit which purports to give the defendant no right to build the structure and merely sanctions the exercise of rights obtained elsewhere. The Commission has made a finding, without taking evidence to support it, in substance in the language of the Water Power Act (U. S. Code, tit. 16, § 797, subd. (d); 16 USCA § 797, subd. (d), ‘that the contemplated improvement is desirable and justified in the public interest for the purpose of improving and developing the Hudson river for the use and benefit of interstate commerce.’ It has also made regulationspursuant to Federal Water Power Act, § 18 (U. S. Code, tit. 16, § 811; 16 USCA § 811) to govern the maintenance of the flashboards ‘in the interests of navigation.’

Although the act provides (section 10(c); U. S. Code, tit. 16, § 803, subd. (c): ‘Each licensee hereunder shall be liable for all damages occasioned to the property of others by the construction, maintenance, or operation of the project works or of the works appurtenant or accessory thereto, constructed under the license, and in no event shall the United States be liable therefor’-defendant contends that this section is inapplicable; that plaintiffs have suffered no damages because there has been no taking of private property but merely a regulation of the flow of the river by the federal government in aid of navigation, for which the plaintiffs could have no compensation against the United States, and therefore none against its licensee. Private property may not be taken for public use without compensation (U. S. v. Cress, 243 U. S. 316, 37 S. Ct. 380, 61 L. Ed. 746), but the flow of the stream of a navigable river is in no sense private property and there is no room for judicial review, at the instance of the private owner of the banks of a stream whose lands are not flooded, of a determination of Congress that such flow is needed for the purposes of navigation. U. S. v. Chandler-Dunbar Water Power Co., 229 U. S. 53, 33 S. Ct. 667, 57 L. Ed. 1063;New Jersey v. Sargent, 269 U. S. 328, 337, 46 S. Ct. 122, 70 L. Ed. 289. Defendant asserts that its license is the equivalent of such a determination of Congress and is not subject to judicial review.

The first question is as to the effect of a federal permit to place an obstruction in a navigable stream for the private business purposes of the licensee upon the rights of upstream owners to the free flow of the stream. The jurisdiction of the Federal Power Commission to issue a license for the use of the waters of the Hudson river for power purposes and the effect of such a license are to be determined by the courts. When some right asserted under a license becomes the subject of actual controversy, excess of jurisdiction is a necessary ground for judicial review to maintain the supremacy of law and keep administrative boards to the exercise of their delegated powers. Matter of Quinby v. Public Service Commission, 223 N. Y. 244, 119 N. E. 433, 3 A. L. R. 685;New Jersey v. Sargent, supra, 269 U. S. at page 339 (46 S. Ct. 122). The finding of the Commission that the project work is in aid of navigation is not conclusive on the courts, in the absence of evidence to support it, even though the license is in form within the delegated powers of the Federal Water Power Commission. People ex rel. New York & Queens Gas Co. v. McCall, 245 U. S. 345, 348, 38 S. Ct. 122, 62 L. Ed. 337.

It may be assumed, although we do not attempt to decide, that Congress may, in connection with its limited enumerated express or implied powers, provide for the development of water power in aid of or as incidental to such powers (Const. U. S. art. 1, § 8, cl. 18), and that it may not, within the scope of the Constitution, go into the business of power development as an independent proposition. The extent of the authority of Congress to enact laws to carry into execution its enumerated powers need not be considered at this time. Doubtless it is very broad. McCulloch v. Maryland, 4 Wheat. 316, 4 L. Ed. 579;Legal Tender Case, 110 U. S. 421, 4 S. Ct. 122, 28 L. Ed. 204; New Jersey v. Sargent, supra. How far Congress may delegate its powers to regulate navigation in this connection remains an open question. We will assume, although we do not so decide, that the ...