Phoenix Ry. Co. of Arizona v. Lount

• Citation: 21 Ariz. 289,187 P. 933
• Decision Date: 25 February 1920
• Docket Number: Civil 1703
• Parties: PHOENIX RAILWAY COMPANY OF ARIZONA, a Corporation, Appellant, v. WILLIAM B. LOUNT and HATTIE L. MOSHER, Appellees
• Court: Supreme Court of Arizona

187 P. 933

21 Ariz. 289

PHOENIX RAILWAY COMPANY OF ARIZONA, a Corporation, Appellant, v. WILLIAM B. LOUNT and HATTIE L. MOSHER, Appellees

Civil No. 1703

Supreme Court of Arizona

February 25, 1920

APPEAL from a judgment of the Superior Court of the County pf Maricopa. F. H. Lyman, Judge. Remanded, with directions to dismiss.

Messrs Chalmers, Stahl, Fennemore & Longan (Mr. W. E. Ryan on the Brief), for Appellant.

Mr. J B. Woodward and Miss Alice M. Birdsall, for Appellees.

OPINION

ROSS, J.

In July, 1892, the city of Phoenix granted to J. O. Dunbar a franchise to enter upon its streets for the purpose of constructing, operating and maintaining an electric railway. This franchise was thereafter assigned to the appellant which, in due course, accepted the terms and conditions thereof and entered upon their performance by laying tracks upon certain streets and operating cars thereon for public service. The service was first established on Washington Street, a main thoroughfare extending easterly and westerly through the city. Thereafter, in 1895, the appellant constructed a line, herein called the Brill line, beginning at the juction' of Washington Street, running thence north along First Street to Pierce Street and along Pierce easterly to Tenth Street, thence north along Tenth Street to McDowell Road; and established and maintained service thereon continuously until August 17, 1916. On the last-mentioned date it ceased to operate its cars on that portion of the Brill line on First and Pierce Streets, and later took up the track thereon.

The appellees, who were the plaintiffs below, brought mandamus to compel the defendant railway company to continue to operate its cars over the Brill line on First and Pierce Streets.

The appellant set forth in its answer as a defense certain orders of the Corporation Commission directing it to change the routes of certain of its lines, among others the Brill line. The last order, dated July 11, 1916, also authorized the abandonment of a portion of Brill line. These defenses were held bad upon demurrer to the answer, and were stricken upon motion from the amended answer.

The court heard evidence upon the issues left, and entered judgment that a peremptory writ of mandamus be directed against appellant.

The controversy involves the power of the Corporation Commission to make the orders relied upon by the appellant as justification of its action in making the changes; it being contended by appellant that the commission had such power and that therefore its orders were null and void. We will consider the case upon the two main propositions submitted by appellees. They are: First. That the Constitution and laws of the state have not changed or affected the power of municipalities to grant public utilities the use and occupancy of streets and to prescribe the regulation of such use and occupancy. Second. That the franchise in this case constituted a contract between the appellant and the city of Phoenix, "the terms of which could only be abrogated by mutual consent, and that appellant could not abandon a portion of its system without first obtaining consent of the sovereign power granting it the right to operate, in this instance, the municipal authorities of the city of Phoenix."

The decision of the questions involves a search into article 15 of the Constitution, entitled "The Corporation Commission," and chapter 11, title 9, Civil Code, entitled "Public Service Corporations and Corporation Commission," for the intention as therein expressed of the law-making bodies. The Corporation Commission is a constitutional body. By that instrument it was created, and certain powers over public utilities specifically conferred upon it, such as prescribing their classifications, just and reasonable rates and charges, and rules and regulations governing them in discharging their business with the public, etc. Section 3, art. 15. In section 6 of the same article it is provided: The law-making power may enlarge the power and extend the duties of the Corporation Commission, and may prescribe rules and regulations to govern proceedings instituted by and before it. . . ."

Paragraph 2278 of the Public Service Corporation Act defines the terms used in said act and, among others, defines public service corporations and confers jurisdiction thereof on the Corporation Commission in the following language:

" . . . (z) The term 'public service corporation' when used in this chapter, includes every common carrier, pipe-line corporation, telegraph corporation, water corporation, and warehouseman, as these terms are defined in this section, and each thereof is hereby declared to be a public service corporation and to be subject to the jurisdiction, control, and regulation of the commission and to the provisions of this chapter."

There is so much of the Public Service Corporation Act that it is not possible to set it forth here, but some of the provisions bearing more or less directly upon the question involved we will quote.

Subdivision (b), par. 2289:

Every public service corporation shall furnish, provide, and maintain such service, instrumentalities, equipment and facilities as shall promote the safety, health, comfort and convenience of its patrons, employees and the public, and as shall be in all respects adequate, efficient, just and reasonable."

Paragraph 2312:

"Whenever the commission, after a hearing had upon its own motion or upon complaint, shall find that additions, extensions, repairs or improvements to, or changes in, the existing plant, equipment, apparatus, facilities or other physical property of any public service corporation . . . ought reasonably to be made, . . . the commission shall make and serve an order directing that such additions, extentions, repairs, improvements or changes be made . . . in the manner and within the time specified in said order."

Paragraph 2306:

Every public service corporation shall obey and comply with each and every requirement of every order, decision, direction, rule or regulation made or prescribed by the commission in the matters herein specified, or any other matter in any way relating to or affecting its business as a public service corporation, and shall do everything necessary or proper in order to secure compliance with and observance of every such order, decision, direction, rule or regulation by all of its officers, agents and employees."

Paragraph 2307:

"The commission is hereby vested with power and jurisdiction to supervise and regulate every public service corporation in the state and to do all the things, whether herein specifically designated or in addition thereto, which are necessary and convenient in the exercise of such power and jurisdiction."

In addition to the powers and duties of the Corporation Commission as indicated in the above excerpts, many others are conferred on that body by chapter 11, title 9. They may order hearings, either on their own motion, or upon petition by interested parties. They may enforce the production of documentary evidence, attendance of witnesses, may make decisions and orders, and prescribe penalties for their disobedience. The power of the Corporation Commission to require this very appellant to double-track its Washington Street line has been recognized and enforced by the highest court of the land. Phoenix Ry. Co. v. Geary, 239 U.S. 277, 60 L.Ed. 287, 36 S.Ct. 45 (see also, Rose's U.S. Notes).

Viewing the above provisions of the statute and the Constitution as the only law upon the subject, it would seem that no other conclusion could be drawn than that the Corporation Commission was vested with the power to make the order of July 11, 1916, and that such order was ample authority for the abandonment of that portion of the Brill line of which complaint is made by the appellees.

But appellees cite us to other provisions of the Constitution and the statute which they contend control the proposition. They refer to that provision of the Constitution found in section 3, article 15, as follows:

" . . . Provided, that incorporated cities and towns may be authorized by law to exercise supervision over public service corporations doing business therein, including the regulation of rates and charges to be made and collected by such corporations. . . ."

It will be observed this is an exception to the general grant of power and control of the Corporation Commission over public service corporations, and that it may be exercised by the municipalities of the state only when authorized by law. If the legislature has enacted laws conferring power of supervision over public service corporations upon the municipalities of this state, it would follow that the Corporation Commission is deprived of the power and can no longer exercise it. The case of Yuma Gas, Light & Water Co. v. City of Yuma, 20 Ariz. 153, 178 P. 26 involved the question as to whether the city authorities could fix and regulate the price of the electric light company's product, or whether that was one of the functions of the Corporation Commission, and we there announced that the legislature had not by any enactment enabled the city to perform that function. The case of the State v. Tucson Gas, Electric Light & Power Co., 15 Ariz. 294, 138 P. 781, involved the question as to whether the rate-fixing power of a public utility was in the Corporation Commission or could be exercised by the legislature. The ruling in that case was that, so far as rate fixing was concerned, the Corporation Commission possessed the paramount power, but that the legislature could, under the proviso in section 3 of article 15 of the Constitution, by proper legislation confer the jurisdiction of rate fixing upon the municipal authorities...