Shaw v. City of Asheville, 126

• Decision Date: 20 January 1967
• Docket Number: No. 126,126
• Parties: Alan SHAW, as a Taxpayer and Voter in and of the City of Asheville, North Carolina, on behalf of himself and all other Taxpayers and Citizens of said City who may desire to join in this Action v. The CITY OF ASHEVILLE, a Municipal Corporation, The Honorable Earl Eller,Mayor of said City, William F. Algary, Robert P. Crouch, J. Walter McRary,Clarence E. Morgan, Frank Mulvaney, and Theodore B. Sumner, Members of the CityCouncil of saidCity, J. Weldon Weir, City Manager of said City, and Asheville Cablevision, Inc., a North Carolina Corporation.
• Court: North Carolina Supreme Court

Page 139

152 S.E.2d 139

269 N.C. 90

Alan SHAW, as a Taxpayer and Voter in and of the City of Asheville, North Carolina, on behalf of himself and all other Taxpayers and Citizens of said City who may desire to join in this Action v. The CITY OF ASHEVILLE, a Municipal Corporation, The Honorable Earl Eller,Mayor of said City, William F. Algary Robert P. Crouch, J. Walter McRary,Clarence E. Morgan, Frank Mulvaney, and Theodore B. Sumner, Members of the CityCouncil of saidCity, J. Weldon Weir, City Manager of said City, and Asheville Cablevision, Inc., a North Carolina Corporation.

No. 126.

Supreme Court of North Carolina.

Jan. 20, 1967.

Parker, McGuire & Baley by Frank M. Parker and Richard A. Wood, Jr., Asheville, for plaintiff appellant.

O. E. Starnes, Jr., Vanwinkle, Walton, Buck & Wall, by Herbert L. Hyde, Asheville, for City of Asheville.

G. Edison Hill, Asheville, for Asheville Cablevision, Inc.

Kennedy, Covington, Lobdell & Hickman, by Charles V. Tompkins, Jr., Charlotte, amicus curiae.

LAKE, Justice.

The plaintiff is stipulated by the parties and found by the superior court to be a citizen and taxpayer of the city. As such, he was authorized to maintain this action on behalf of himself and all others similarly situated. In Wishart v. City of Lumberton, 254 N.C. 94, 118 S.E.2d 35, suit was instituted by a citizen and taxpayer of the defendant city to enjoin it from using a city owned park as a parking lot for motor vehicles. This Court held that a demurrer to the complaint was properly overruled, saying, through Rodman, J., 'If the governing authorities were preparing to put public property to an unauthorized use, citizens and taxpayers had the right to seek equitable relief.' Similarly, in Merrimon v. South Paving and Const. Company, 142 N.C. 539, 55 S.E. 366, 8 L.R.A.,N.S., 574, though holding that the complaint was demurrable for failure to state a cause of action, the Court, through Connor, J., said, 'That a citizen, in his own behalf and that of all other taxpayers, may maintain a suit in the nature of a bill in equity to enjoin the governing body of a municipal corporation from transcending their lawful powers or violating their legal duties in any mode which will injuriously affect the taxpayers--such as making an unauthorized appropriation of the corporate funds, or an illegal or wrongful disposition of the corporate property, etc.--is well settled.' See also 52 Am.Jur., Taxpayers' Actions, §§ 4, 14, 17 and 28, where the right of the taxpayer to sue for equitable relief is likened to that of a stockholder in a private corporation to sue in equity for a wrong done or about to be done to the corporation.

The present action is distinguishable from Angell v. City of Raleigh, 267 N.C. 387, 148 S.E.2d 233, in which, at the time the taxpayer instituted his action, the city had adopted an ordinance providing for the issuance of 'licenses' for the operation within the city of community antenna television systems, but had not issued or contracted to issue a license thereunder. This Court held that, in such situation, the plaintiff taxpayer was not authorized to maintain a suit for declaratory judgment to test the validity of the ordinance. In the present case, it is stipulated that the city of Asheville has made an agreement with Cablevision and the suit is brought to enjoin the performance of that specific agreement.

The agreement here in question, among other things, purports to grant to Cablevision the right to lay cables under the streets, sidewalks and other public ways of the city of Asheville, and to erect poles and lines of cable therein for the purpose of carrying on thereby a business for private profit. Such action will, of necessity, require substantial expenditures to repair and restore the pavements or other surfaces of such public ways. The agreement provides that such expenses will be borne by Cablevision. If, however, the purported grant of rights to Cablevision is, as the plaintiff contends, unlawful and void, the undertakings by Cablevision in the agreement would be without consideration and unenforceable. Elizabeth City v. Banks, 150 N.C. 407, 64 S.E. 189, 22 L.R.A.,N.S., 925. Part or all of the expense of such repair to the streets and other public ways may fall upon the taxpayers of the city. This, without more, is sufficient to give to the plaintiff the right to institute and maintain this action to determine the validity of the agreement and to enjoin the performance thereof if it be unlawful. We are, therefore, brought to the question of the validity of the agreement between the city and Cablevision.

The plaintiff assigns as error the inclusion in the judgment of the above quoted paragraphs 4, 5 and 6 under the caption 'FINDINGS OF FACT.' He contends that since this matter was submitted to the superior court upon an agreed statement of facts, the court had no authority to find additional facts. It is unnecessary for us to determine the validity of this contention for the reason that paragraphs 4 and 5 are, in reality, conclusions of law reviewable by us (see Woodard v. Mordecai, 234 N.C. 463, 67 S.E.2d 639) and the finding, in paragraph 6 that the construction and maintenance of the proposed system will not 'unreasonably interfere' with streets and other public ways, is not material to the determination of the validity of the agreement if, as the plaintiff contends, the proposed use of the streets is one beyond the authority of the city to grant. In such case, the degree to which the unlawful use of the streets will impair their use by the plaintiff and others so situated is not material. The reasonableness or unreasonableness of such interference is of importance only where the municipality has been granted authority to permit the use of its streets for the kind of operation proposed. See Clayton v. Liggett & Myers Tobacco Co., 225 N.C. 563, 35 S.E.2d 691.

It is well established that a municipal corporation of this State 'has only such powers as are granted to it by the General Assembly in its specific charter or by the general laws of the state applicable to all municipal corporations, and the powers granted in the charter will be construed together with those given under the general statutes.' Riddle v. Ledbetter, 216 N.C. 491, 5 S.E.2d 542. 'Any fair, reasonable doubt concerning the existence of the power is resolved against the corporation.' Elizabeth City v. Banks, supra.

The fact that this agreement is denominated by the parties a 'Lease-License Agreement' is not controlling. Its nature, not its title, determines the power of the city to enter into it. Paragraph 1 purports to grant to Cablevision, its successors or assigns, 'the right to erect, install, construct, reconstruct, replace, remove, repair, maintain and operate in or upon, under, above, across and from the streets * * * and other public ways * * * in the City of Asheville, all equipment, facilities, appurtenances and apparatus of any nature, for the purpose of receiving, amplifying, transmitting and distributing * * * television, radio, electrical and electronic energy, pictures, sounds, signals, impulses and communications, * * * of every nature and description * * *.' Obviously, this is not a right possessed by inhabitants and citizens of Asheville in general. In any event, that is made clear by paragraph 3 of the agreement which provides expressly that the right so 'to use and occupy said streets * * * shall be exclusive.'

In Black's Law Dictionary we find: 'FRANCHISE. A special privilege conferred by government on individual or corporation, and which does not belong to citizens of country generally of common right.' In Ballentine's Law Dictionary, it is said '(I)t is the privilege of doing that which does not belong to the citizens of the country generally by common right which constitutes the distinguishing feature of a franchise.' See also 23 Am.Jur., Franchises, § 2; 37 C.J.S. Franchises § 1.

In Elizabeth City v. Banks, supra, it is said, 'A franchise is property, intangible, it is true, but none the less property, a vested right protected by the Constitution, while a license is a mere personal privilege, and, except in rare instances and under peculiar conditions, revocable.' To the same effect, see 23 Am.Jur., Franchises, § 3.

In New Orleans Gas-Light Co. v. Louisiana Light etc. Co., 115...