Sorensen v. Chimney Rock Public Power Dist.

• Decision Date: 28 June 1940
• Docket Number: 30793.
• Parties: SORENSEN v. CHIMNEY ROCK PUBLIC POWER DIST.
• Court: Nebraska Supreme Court

293 N.W. 121

138 Neb. 350

SORENSEN v. CHIMNEY ROCK PUBLIC POWER DIST.

No. 30793.

Supreme Court of Nebraska.

June 28, 1940

Syllabus by the Court.

1. Transactions set forth in opinion held within the powers of the defendant corporation, and not ultra vires.

2. A public power district is liable for the reasonable value of electrical equipment which it purchases and retains, provided such district was clothed with power to purchase such property, notwithstanding the fact that the contract is unenforceable because the power was irregularly exercised.

Appeal from District Court, Morrill County; Irwin Judge.

Action by A. V. Sorensen, doing business as the Midwest Electric Supply Company, against the Chimney Rock Public Power District, to recover a balance allegedly due for merchandise and electrical equipment alleged to have been sold and delivered by plaintiff to defendant. From a judgment in favor of the defendant, the plaintiff appeals.

Judgment reversed, and cause remanded with directions to enter judgment as prayed.

Davis & Stubbs and James N. Ackerman, all of Lincoln, for appellant.

C. A Sorensen, of Lincoln, for appellee.

Heard before ROSE, EBERLY, PAINE, CARTER, MESSMORE, and JOHNSEN JJ.

EBERLY, Justice.

This, an action at law, was commenced by plaintiff, A. V. Sorensen, doing business as the Midwest Electric Supply Company, to recover of defendant, Chimney Rock Public Power District, the sum of $2,950.62, with interest, as a balance due for a quantity of merchandise and electrical equipment alleged to have been sold at wholesale and delivered by plaintiff to defendant, and by defendant accepted, received and retained. This claim is set forth in plaintiff's petition in seventeen distinct and separate causes of action, in each of which it is alleged that on a date therein named plaintiff sold and delivered to defendant merchandise and electrical equipment therein specified, of the fair and reasonable value therein set forth, which defendant accepted and received, and since retains. Further, it is alleged that no part of the total amount due upon the seventeen causes of action has been paid, except the sum of $720 in cash, and $478.71 by return of merchandise. Plaintiff alleges that after deducting said total payments, including value of merchandise returned, there remains due to plaintiff from defendant the sum of $2,950.62.

In its answer defendant denies generally the allegations of the petition, and specially denied that the property in controversy was ever " ordered, requested, purchased, received or accepted" by it, and that the purchase of no part thereof was ever authorized by its board of directors, or within the scope of the actual or apparent authority of any officer or employee of the corporation to make; that the alleged purchase of such property, set forth in plaintiff's petition, was beyond and in excess of the corporate powers of defendant and ultra vires. To this answer plaintiff filed its general denial. There was a trial to the court, a jury having been waived, and judgment was entered for defendant. Plaintiff appeals.

Plaintiff is a wholesale dealer in electrical equipment, and defendant is a rural power district, which is incorporated and doing business under the provisions of chapter 86, Laws 1933, as amended by chapter 152, Laws 1937 (Comp.St.Supp.1937, sec. 70-701 et seq.). A " public power district" is defined in this act as: " 1. ‘ Public power district', * * * means a district organized under this Act either as originally organized or as the same may from time to time be altered or extended." Comp. St.Supp.1937, sec. 70-701. " A district may be created as hereinafter provided in this Act and when so created shall be a public corporation and political subdivision of this state, and may sue or be sued in its corporate name." Comp.St.Supp.1937, sec. 70-702.

Its functions and powers are thus, in part, defined by the terms of its constating act, viz.: It " shall have the following powers and shall be entitled to own, have, or exercise the following rights, privileges and franchises, subject to the limitations, if any, of the petition for its creation and all amendments thereto: (1) Such a district shall have all the usual powers of a corporation for public purposes and may purchase, hold, sell, and lease personal property and real estate reasonably necessary for the conduct of its business. (2) Such a district may own, construct, reconstruct, purchase, lease, or otherwise acquire, improve, extend, manage, use, or operate any electric light and power plants, lines and systems, either within or beyond, or partly within and partly beyond the boundaries of the district, and may engage in or transact business or enter into any kind of contract or arrangement with any person, firm, corporation, * * * or with any body politic or corporate, for any of the purposes above mentioned or for or incident to the exercise of any one or more of the foregoing powers, or for the generation, distribution, transmission, sale, or purchase of electrical energy for lighting, power, heating and any and every other useful purpose whatsoever, and for any and every service involving, employing or in any manner pertaining to the use of electrical energy, by whatever means generated or distributed, or for the financing or payment of the cost and expense incident to the acquisition or operation of any such power plant or system, or incident to any obligation or indebtedness entered into or incurred by the district." Comp.St.Supp. 1937, sec. 70-706.

In this connection, the articles of defendant corporation expressly provide that it " will receive its principal income from the sale of electrical energy."

The defendant is largely engaged in rural electrification. A careful reading of the record and the evidence contained in the bill of exceptions discloses that, eliminating the formalities of pleading, defendant's real contention is that the various items of merchandise, for the furnishing of which appellant seeks to recover, constitute wiring supplies and equipment suitable for wiring farm premises and for connecting up the wiring and electrical equipment on such premises with the electric light and power distribution system of appellee district. It is also appellee's claim that at its own expense it only constructed its transmission line to each of its farmer customers to and including the meter, and all wiring and equipment beyond the meter, necessary to hook up the transmission line with the farmer, with exception of some cases of a light, was to be installed and paid for by the latter. There is no real contest, as disclosed by the testimony, as to the quantity, quality, and reasonable value of the property in suit, and as to the suitability and absolute necessity thereof for the intended use in connection with hooking up defendant's system with its customers.

A careful examination of the petition for the formation of defendant district discloses that its terms in no manner materially restrict the powers delegated to it by the terms of the quoted statute.

The terms of the statute are broad and inclusive. Not only is defendant empowered to construct, acquire, improve, use and operate (electrical) lines and systems, but it is expressly authorized to enter into any contract incident to the exercise of the enumerated powers and expressly for the transmission or sale of electrical energy. To connect up defendant's system with its customers is not only a...