Postal Telegraph-Cable Co. v. City of Mobile

• Decision Date: 11 March 1909
• Docket Number: 269.
• Citation: 179 F. 955
• Parties: POSTAL TELEGRAPH-CABLE CO. v. CITY OF MOBILE.
• Court: U.S. District Court — Southern District of Alabama

179 F. 955

POSTAL TELEGRAPH-CABLE CO. v. CITY OF MOBILE.

No. 269.

United States Circuit Court, S.D. Alabama.

March 11, 1909

Fitts &amp Leigh, for complainant.

B. B Boone, for defendant.

TOULMIN District Judge.

The allegations of complainant's bill are as follows:

First. The complainant, the Postal Telegraph-Cable Company, is a corporation, incorporated under the laws of the state of Delaware, and that it has accepted the provisions of the act of Congress approved July 24, 1866 (chapter 230, 14 Stat 221), and the amendments and supplements thereto, and is operating under the terms of said act and in accordance with its provisions.

That by virtue thereof its poles and wires have been at all times, and are now, used for the transmission of telegraph messages for the United States government and the various departments thereof at prices fixed from time to time by the Postmaster General of the United States in accordance with the terms of said act of Congress. And that the highways upon which said poles and wires are constructed and operated are post roads and post routes within the meaning of said act of Congress, and the other acts of Congress defining post roads and post routes.

Second. That the city of Mobile is a municipal corporation, vested with certain delegated powers; the same being the corporate name of a municipality in the Southern division of the Southern district of the state of Alabama.

Third. That the said complainant is engaged in business as a public service corporation in sending messages by wire throughout the United States, and, by means of connection with cable lines, to all portions of the world. That as such public service telegraph corporation the said complainant maintains an office in the city of Mobile for the purpose of receiving and transmitting messages from the citizens of the city of Mobile and vicinity to the outside world, and for the purpose of receiving and delivering messages from the outside world to the citizens of the city of Mobile and vicinity. That the wires of the complainant telegraph company diverging from the city of Mobile and from the state of Alabama connect with other wires in other states, and telegraph messages are transmitted thereon into and through other states of the United States, and to all of the principal towns and cities therein; and connection is also had with cables under and across the Atlantic Ocean. And the company is engaged in sending and transmitting messages to all of the states of the United States and receiving and delivering messages from all of the states of the United States, and is engaged in interstate commerce.

Fourth. That the mayor and general council of the city of Mobile, which is the governing body of said city, by an ordinance approved on the 31st day of December, 1908, commonly called the 'license ordinance,' has exacted, and does exact, of and from each telegraph company doing business in the city of Mobile in the year 1909 an annual license or privilege tax in the sum of $1,000. That the said ordinance in question is unreasonable, unjust, and excessive, and is illegal and void, because it is designed and intended to provide revenue by this form of taxation for the general expenses of the city of Mobile, and that no other object than this exists or has at any time existed for the exaction of the large sum of money imposed by the ordinance. That the city of Mobile is under no expense whatever in connection with issuing the license required to be taken out by the said ordinance, and has not been at any time heretofore, nor will it be during the year 1909 put to any expense or charge whatever in connection with inspecting and regulating the poles, wires, or business of this complainant. That this privilege tax or license fee imposed by the said ordinance complained about is not based on the cost and expense to the city incident to any inspection and supervision and regulation of the complainant's lines and business within the said city; but that it is imposed notwithstanding it is more than 20 times the amount that could possibly be incidental to any such inspection, supervision, and regulation, together with all reasonable measures and precautions that might possibly and could be required to be taken by the said city of Mobile for the safety of its citizens and the public.

That the license or privilege charge by the said ordinance is grossly excessive, and that, if every town or city in the state of Alabama in which the complainant company maintains an office should pass similar ordinances, the total amount exacted from the complainant company would exceed $25,000 per annum; and if the same kind of ordinances, providing for excessive privilege taxes for the towns and cities in all the other states of the United States in which the complainant company maintains offices, were adopted, that company could not possibly pay the aggregate amount of such privilege taxes, but would immediately become insolvent by reason of the fact that the expense of operation, including such privilege or license taxes, would be far in excess of the gross receipts of the complainant company from the whole country at large.

Fifth. The complainant company is a corporation engaged in legitimate business. That it is engaged in interstate commerce by transmitting telegraphic communications among the several states of this Union. That this is a lawful business and that the said complainant company pays just and lawful taxes upon the assessed value of its property to the state of Alabama, to the county of Mobile, and to the city of Mobile, and that it is in arrears with respect to none of these taxes. That the license tax complained of is in addition to all of the other taxes levied by the state of Alabama, the county of Mobile, and the city of Mobile, and is in this respect unfair, unjust, and unequal and in direct violation of law. Complainant further shows unto your honors that while the said license tax purports to be levied only upon business destined from the Mobile office to points within Alabama, and upon business originating within the state of Alabama and subject to delivery at the Mobile office, that as a matter of fact, in addition to being excessive and confiscatory, it is violative of the guaranteed constitutional right which inures to and in favor of this company to maintain an office in the city of Mobile for the purpose of engaging in the business for which it was chartered, and is violative of the right of the complainant company to carry on interstate commerce unhampered and unimpeded. That the right thus involved is a valuable right, worth to complainant many thousand dollars-- worth certainly in excess of $2,100. That, if the defendant municipal corporation is allowed to exact the said excessive license fee, it is destructive, and will be...