De Motte v. City of Valparaiso

• Decision Date: 26 June 1903
• Citation: 161 Ind. 319,67 N.E. 985
• Parties: DE MOTTE et al. v. CITY OF VALPARAISO et al.
• Court: Indiana Supreme Court

161 Ind. 319

67 N.E. 985

DE MOTTE et al.

v.CITY OF VALPARAISO et al.^*

Supreme Court of Indiana.

June 26, 1903.

Appeal from Circuit Court, Porter County; W. C. McMahan, Judge.

Suit by Mark L. De Motte and others against the city of Valparaiso and others. From a judgment for defendants entered on overruling a demurrer to the answer, plaintiffs appeal. Transferred from Appellate Court under Act March 12, 1901, § 10, cl. 2 (Acts 1901, pp. 565, 567, codified as Burns' Rev. St. 1901, § 1337j). Affirmed.

Grant Crumpacker, William Daly, and N. L. Agnew, for appellants. H. H. Loring, for appellees.

DOWLING, J.

The appellants, who are described as residents and taxpayers of the city of Valparaiso, brought this suit to enjoin a threatened sale and transfer by said city of a right to purchase a system of waterworks owned by a private company, and constructed and used in the streets, alleys, and public grounds of said city, reserved to and held by said city in and under a contract between said city and George P. Smith and others, made February 16, 1885. The part of said contract which is material here is as follows: “At any time after the expiration of fifteen years from the completion of said waterworks the city shall have the right to purchase the same by giving the owners thereof one year's notice in writing, and in case of purchase the city shall pay a reasonable value for the same which shall be ascertained by three disinterested hydraulic engineers, one to be chosen by the city, one by the owners of the waterworks, and the third selected by the two thus chosen.” The works were completed December 31, 1885, and afterwards, Smith and his associates sold and transferred the same, with all rights, franchises, and privileges created by the said ordinance, to the Valparaiso City Waterworks, which has ever since owned and operated them. The city has a population of more than 5,000 inhabitants, and less than 7,000, and is organized under the general laws of this state for the incorporation of cities. It is indebted beyond 2 per centum of the valuation of its taxable property; its indebtedness being about $95,000, and the appraised value of its taxable property for the year 1902 being $2,300,000. Its current revenues of late years have been insufficient to pay its general expenses and the interest on its debts. It is averred in the answer, among other things, that the said waterworks had never been owned by said city, and had never been dedicated to any public use. A demurrer to the answer was overruled, and this decision is assigned for error.

The question presented is whether the city has the power to sell and transfer its right to purchase said waterworks, so reserved in the ordinance. It is contended by counsel for appellees that such reserved right is held in...