Northwestern Bell Telephone Company v. Wentz

• Decision Date: 26 May 1960
• Docket Number: No. 7856.,7856.
• Citation: 103 N.W.2d 245
• Parties: NORTHWESTERN BELL TELEPHONE COMPANY, an Iowa corporation. Plaintiff and Respondent, v. A. W. WENTZ, State Highway Commissioner, State of North Dakota, Defendant and Appellant.
• Court: North Dakota Supreme Court

103 N.W.2d 245

NORTHWESTERN BELL TELEPHONE COMPANY, an Iowa corporation. Plaintiff and Respondent, v. A. W. WENTZ, State Highway Commissioner, State of North Dakota, Defendant and Appellant.

No. 7856.

Supreme Court of North Dakota.

March 4, 1960.

On Rehearing May 26, 1960.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Cox, Pearce & Engebretson, Bismarck, for plaintiff and respondent.

Leslie R. Burgum, Atty. Gen., and Francis Breidenbach, Asst. Atty. Gen., for defendant and appellant.

TEIGEN, Judge.

This is a declaratory judgment action brought by the respondent (plaintiff), Northwestern Bell Telephone Company, an Iowa corporation, against the appellant (defendant), A. W. Wentz, as Highway Commissioner for the State of North Dakota, to determine the constitutionality of the relocation of utility facilities law, being Chapter 195 of the Session Laws of 1957 (Section 24-0141 of the 1957 Supplement to the NDRC of 1943), providing that utilities shall be reimbursed out of State Highway funds for costs of changing, removing or relocating utility facilities in connection with interstate and defense highway projects when determined and ordered by the State Highway Commissioner.

The facts were stipulated and may be summarized as follows:

1. The plaintiff is a foreign corporation licensed and qualified to carry on business in North Dakota. It is a privately owned public utility company as defined in the relocation of utility facilities law and engaged in furnishing telephone service in North Dakota.

2. The defendant is the duly appointed, qualified and acting State Highway Commissioner for North Dakota.

3. U. S. Highway No. 94, hereinafter referred to as Interstate Highway No. 94, is in process of construction and is a part of the North Dakota highway system and is a federally aided highway included in the National System of Interstate and Defense Highways and that portions of present U. S. Highway No. 10 and portions of rural highways are a part of Interstate Highway No. 94.

4. Between the years 1904 and 1950 plaintiff, by virtue of statutory authority and permission of proper governmental officials, placed telephone utility facilities along and across portions of the right of way of present U. S. Highway No. 10 and certain rural roads now a part of Interstate Highway No. 94 at many locations between a point about two miles east of Valley City and about one mile west of Jamestown, as shown by an exhibit agreed to be a true and correct representation.

5. The defendant and his predecessor in office ordered plaintiff to remove and relocate its telephone utility facilities on the right of way for said Interstate Highway No. 94 between the points shown on said exhibit.

6. That the relocating of the said telephone utility facilities in accordance with said orders was commenced and completed by plaintiff after the relocation of the utility facility's law became effective.

7. The defendant and his predecessor determined the utility facilities relocation was necessitated by the construction and location of said Interstate Highway No. 94.

8. Plaintiff delivered to defendant an itemized statement and billing of its non-betterment cost and requested payment in accordance with the provisions of said law.

9. If plaintiff is entitled to reimbursement under said law, all conditions precedent on plaintiff's part have been performed.

10. Defendant rejected statement and billing on ground that the defendant "had been advised that a payment of this claim would be in violation of the North Dakota Constitution" by Attorney General's opinion.

11. Defendant refused and still refuses to ascertain and determine the non-betterment costs.

12. That there are sufficient State Highway funds appropriated and available for the purpose, if the law is constitutional.

The respondent utility in its complaint prayed that the court declare and adjudge that such relocation of utility facilities law is valid as applied to the facts herein and that plaintiff is entitled to be reimbursed by defendant out of State Highway funds for the non-betterment costs of relocating its utility facilities on the right of way of Interstate Highway No. 94 between the points specified.

The appellant, State Highway Commissioner, in his answer and by way of affirmative defenses alleges:

1. That the respondent was ordered to remove its utility facilities by the appellant pursuant to the police powers of the state and not by the authority purportedly given in the relocation of utility facilities law.

2. That respondent at no time had any property right in having its utility lines located upon public highway right of way and had merely a temporary privilege of maintaining its facilities upon such right of way at the sufferance of the public officials, which privilege was granted without consideration having been paid by respondent.

3. That the respondent by complying with appellant's order has suffered no legal injury.

4. That the cost of removal of the utility's facilities from public highway right of way is not an expense of construction, reconstruction or maintenance of public roads.

5. That respondent is not a highway user entitled to any greater privilege than other highway users.

6. That plaintiff's claim for reimbursement for removing its facilities from public highway right of way is based solely on Section 24-0141 of the 1957 Supplement to NDRC of 1943 which is null and void and unconstitutional because:

a. It would permit the state to loan money, give its credit to or make donations to or in aid of the respondent, a private corporation, who is not one of the poor, in violation of Section 185 of the North Dakota Constitution.

b. It would permit a diversion of highway funds to a non-highway purpose in violation of Article 56 of the Amendments to the North Dakota Constitution.

c. It would confer upon the respondent a special privilege in violation of Sections 11, 20, 70 and Subsection 20 of Section 69 of the North Dakota Constitution.

d. It would abridge the police powers of the state in violation of Section 134 of the Constitution.

On the facts and the issues thus framed the matter was submitted to the district court. The district court concluded in favor of the validity of Section 24-0141 of the 1957 Supplement to NDRC of 1943 in the particulars as framed by the pleadings and the stipulation of facts and entered judgment adjudging the statute to be valid and constitutional, that the respondent is entitled to be reimbursed by the appellant out of State Highway funds for its non-betterment costs in relocating its utility facilities as described in the action and that the amount of reimbursement is to be determined in the manner provided by the said statute. The appellant has appealed from the whole of the judgment and demands a trial de novo in this court of all of the issues of fact and law.

The appellant's specifications of error present the single issue of law, to wit, the constitutionality of Chapter 195 of the Session Laws of 1957, Section 24-0141, 1957 Supplement to the NDRC of 1943.

The statute thus questioned reads as follows:

"§ 1.) Whenever the state highway commissioner shall determine and order that any utility facility which now is, or hereafter may be, located in, over, along, or under the national system of interstate and defense highways, or urban extension thereof, qualifying for federal aid should be changed, removed or relocated to accommodate the construction of a project on the national system of interstate and defense highways, including extensions thereof within urban areas, the utility owning or operating such facility shall change, relocate or remove the same in accordance with the order of the state highway commissioner; provided that the costs of the change, relocation or removal, including the costs of installing such facilities in a new location, shall be ascertained and paid by the state out of state highway funds as part of the cost of such federally aided project, unless such payment would violate a legal contract between the utility and the state.

"§ 2.) The term `utility' shall include all cooperatively, municipally, publicly or privately owned utilities, for supplying water, sewer, light, gas, power, telegraph, telephone, transit, pipe line, or like service to the public or any part thereof.

"§ 3.) `Cost of change, relocation or removal' shall include the entire cost incurred by such utility properly attributable to such change, relocation or removal after deducting therefrom any increase in the value of the new facility and any salvage value derived from the old facility.

"§ 4.) Nothing herein contained shall be construed to affect in any way the right of any utility to receive just compensation for the expense of changing, removing or relocating its facilities located in a private right of way.

"§ 5.) This Act is and shall be construed to be cumulative, independent legislation and complete in itself. All Acts heretofore enacted are repealed insofar as they are inconsistent with the provisions of this Act."

The above quoted statute was enacted by the North Dakota legislature to implement a provision of Section 111 of the Federal Aid Highway Act of 1956, 70 Stat. 383, 23 U.S.C., 1952 Edition, Supp. IV, Title 23, Section 162, which provided as follows:

"§ 162. Relocation of utility facilities—(a) Availability of funds for reimbursement to States.

"Subject to the conditions contained in this section, whenever a State shall pay for the cost of relocation of utility facilities necessitated by the construction of a project on the Federal-aid primary or secondary systems or on the Interstate System, including extensions thereof within urban areas, Federal funds may be used to reimburse the State for such cost in the same proportion as Federal funds are expended on the project: Provided, That Federal funds shall not be apportioned to the States under this section when the payment to the utility

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