Seattle Elec. Co. v. Seattle, R. & S. Ry. Co.

• Decision Date: 06 February 1911
• Docket Number: 1,855.
• Citation: 185 F. 365
• Parties: SEATTLE ELECTRIC CO. v. SEATTLE, R. & S. RY. CO. [1]
• Court: U.S. Court of Appeals — Ninth Circuit

185 F. 365

SEATTLE ELECTRIC CO. v. SEATTLE, R. & S. RY. CO. ^[1]

No. 1,855.

United States Court of Appeals, Ninth Circuit.

February 6, 1911

James B. Howe, for appellant.

Will H Thompson and Morris B. Sachs, for appellee.

Before GILBERT, ROSS, and MORROW, Circuit Judges.

MORROW Circuit Judge.

The appellee, a corporation organized and doing business under the laws of the state of Washington, operating a street railway on Rainier avenue and other streets in Seattle, under a franchise granted its predecessors in interest by the city of Seattle, by ordinances including, among others, ordinance No. 15,919, dated May 6, 1907, was the complainant in the court below in a bill in equity for the purpose of obtaining an interlocutory decree and perpetual injunction restraining the appellant, also a corporation of the state of Washington and also operating a street railway system in the city of Seattle, from constructing a street railway upon Rainier avenue under a franchise granted it by the city of Seattle by ordinance No. 22,933, dated January 10, 1910.

The conflicting claims and alleged rights of the two corporations to occupy and operate two double street railways along Rainier avenue between certain designated points is set forth in detail in the bill of complaint. It will not be necessary to enter into a recital of these allegations. For the present purpose it will be sufficient to state that the bill of complaint alleges that the complainant has been, for many years, operating a line of electric railway along certain streets in the city of Seattle, including Rainier avenue under a franchise granted by the city of Seattle, and including also the right to operate its line of railway over certain rights of way acquired by complainant in or adjacent to Rainier avenue; that the city of Seattle has since making the grant to complainant under ordinance No. 15,919, dated May 6 1907, granted to the defendant, under ordinance No. 22,933, dated January 10, 1910, the right and privilege to build, construct, and operate an electric railway with double tracks along Rainier avenue between points now occupied by the complainant under its franchise, and the board of public works of the city of Seattle has issued a permit to the defendant to construct a railway.

It is alleged that, if defendant is permitted under and in accordance with ordinance No. 22,933 to proceed with and carry to completion the construction of the railway contemplated by and mentioned in said ordinance, such railway would interfere with the operation of complainant's railway on Rainier avenue under the franchise and over its acquired rights of way; the property of the complainant would be greatly and irreparably damaged; that the operation of the complainant's railway would be greatly hampered, obstructed, and rendered inefficient; that the earnings thereof would be greatly reduced, and the cost of operating thereof would be greatly increased; that the franchise granted by the city of Seattle would become greatly less in value; that the cost of maintaining and operating said complainant's railway line would be greatly increased; that the value of complainant's franchise would be greatly and materially decreased, and all the securities of the complainant and all bondholders and security holders whose bonds and securities were liens and incumbrances upon the complainant's railway and franchise would be greatly reduced in value, and the security thereof almost destroyed; that none of such injuries and damages to the complainant's railway and to the securities could be determined and measured or compensated in money; and the complainant and the owners of the securities would be without any adequate legal remedy whatever, and were wholly dependent upon the interposition of equity.

It is further alleged that ordinance No. 22,933 was granted by the city of Seattle to the defendant in violation of the terms of the franchise owned and used by the complainant; and that the ordinance was obtained by the defendant in fraud of the rights of the complainant and granted illegally and without right by the city of Seattle, and by the terms of the ordinance the property, rights, and privileges enjoyed by the complainant would be taken from it without due process of law and in contravention of the Constitution and laws of the United States, and that said alleged ordinance was without authority of law, and was null and void, and without force and effect. The allegations of the bill were supported by affidavits at the hearing.

Upon the filing of the complaint, an emergency appearing, an order for the defendant to show cause was issued, accompanied by a temporary restraining order. Upon the order to show cause a hearing was had upon the allegations of the complaint and upon affidavits in support of and in opposition thereto. Thereupon the court issued an interlocutory order or decree restraining and enjoining the defendant until the further order of the court and during the pendency of the action from proceeding with the construction work of a railway in any part of Rainier avenue between Jackson and Edmunds streets, in the city of Seattle.

From the interlocutory decree the defendant appealed on the ground that it was improvidently granted; that the case is not within the jurisdiction of a court of equity; and that the Circuit Court, as a court of the United States, has no jurisdiction of the suit.

The appellee in this court has moved to dismiss the appeal on the ground that the jurisdiction of the Circuit Court was not invoked on the ground of the diverse citizenship of the parties, and, the sole question being the construction of the Constitution of the United States, this court is without jurisdiction to hear the appeal. This was the law under the act of March 3, 1891 (chapter 517, 26 Stat. 826 (U.S. Comp. St. 1901, p. 488)), as originally enacted, and it was so held in the cases cited by the appellee; but the law has been amended for the express purpose of giving the Circuit Court of Appeals appellate jurisdiction in such cases.

Section 7 of the act of April 14, 1906 (34 Stat. 116 (U.S. Comp. St. Supp. 1909, p. 220)), provides:

'That where, upon a hearing in a District or in a Circuit Court, or by a judge thereof in vacation, an injunction shall be granted or continued, or a receiver appointed by an interlocutory order or decree, in any cause an appeal may be taken from such interlocutory order or decree granting or continuing such injunction, or appointing such receiver, to the Circuit Court of Appeals.'

The words 'in any cause' in this section were an amendment to the original section, act of March 3, 1891 (26 Stat. 826, 828), as amended by the act of February 18, 1895 (28 Stat. 666), and by the act of June 6, 1900 (31 Stat. 660 (U.S. Comp. St. 1901, p. 550)), and was substituted in the act in place of the provision 'in a cause in which an appeal from a final decree may be taken under the provisions visions of this act to the Circuit Court of Appeals. ' The purpose of Congress in substituting the words 'in any cause' for the provisions referred to in the act of March 3, 1891, as amended, was to confer upon the Circuit Court of Appeals jurisdiction to hear appeals from interlocutory orders or decrees granting or continuing injunctions or appointing receivers where constitutional questions were involved. Without this provision there was no appeal from an order or decree of a District or Circuit Court, or judge thereof, granting or continuing an injunction or appointing a receiver if a constitutional question was alleged in the bill of complaint. The only hearing in a case involving the construction or application of the Constitution of the United States was in the Supreme Court upon an appeal from final decree; and this delay for the entry of a final decree was deemed to be a matter of great hardship in such cases, hence the statute was amended giving the Circuit Court of Appeals jurisdiction 'in any cause' to hear appeals from interlocutory decrees granting or continuing injunctions or appointing receivers whether a constitutional question was involved or not. Cong. Record, 59th Cong., 1st Sess. vol. 40, pt. 2, p. 1723; volume 40, pt. 5, pp. 4856, 4857.

The motion to dismiss the appeal is therefore denied.

This court having jurisdiction on appeal from an interlocutory order to determine a constitutional question, it follows that the court has jurisdiction to determine whether the Circuit Court had or had not jurisdiction of the case by reason of the presence or absence of such constitutional question. City of Louisville v. Cumberland Tel. & Tel. Co., 155 F. 725, 728, 84 C.C.A. 151.

The allegation of the bill of complaint upon which a constitutional question is based is the following:

'That said alleged ordinance No. 22,933 was granted by the city of Seattle to the said the Seattle Electric Company, defendant herein, in violation of the terms and conditions of the franchise now owned and used by the complainant company evidenced by ordinance No. 15,919, and that said alleged ordinance No. 22,933 was obtained by said the Seattle Electric Company in fraud of the rights of complainant, and granted illegally without right by the city of Seattle, and by the terms of said alleged ordinance the property, rights, and privileges enjoyed by this complainant will be taken from it without due process of law and in contravention of the Constitution and laws of the United States, and that said alleged ordinance is without authority in law and is null and void and of no force and effect.'

Is this allegation sufficient to invoke the jurisdiction of the Circuit Court on the ground that the case is one arising under the laws or the Constitution of the United States? The...