State ex Inf. McKittrick v. Ark.-Mo. Power Co.

• Decision Date: 02 May 1936
• Docket Number: No. 34464.,34464.
• Parties: STATE OF MISSOURI upon the information of ROY McKITTRICK, Attorney General, at the relation of THE CITY OF CAMPBELL, Relator, v. ARKANSAS-MISSOURI POWER COMPANY, a Corporation.
• Court: Missouri Supreme Court

93 S.W.2d 887

STATE OF MISSOURI upon the information of ROY McKITTRICK, Attorney General, at the relation of THE CITY OF CAMPBELL, Relator, v. ARKANSAS-MISSOURI POWER COMPANY, a Corporation.

No. 34464.

Supreme Court of Missouri.

Court en Banc, May 2, 1936.

Quo Warranto.

OUSTER GRANTED (upon conditions). JURISDICTION RETAINED.

Roy McKittrick, Attorney General, Covell R. Hewitt, Assistant Attorney General, C.D. Bray, Jones, Hocker, Gladney & Jones and Vincent L. Boisaubin for relator, City of Campbell.

(1) This court has original jurisdiction in quo warranto proceedings instituted at the information of the Attorney General to test the right and authority of a corporation to use the streets of a municipality for an electrical distribution system after the expiration of its franchise. Const. of Mo., Art. VI, Sec. 3; Sec. 1618, R.S. 1929; State ex rel. v. Lawrence, 38 Mo. 535; State ex inf. McAllister, Atty. Genl. ex rel. Manion v. Albany Drainage Dist., 290 Mo. 33; State ex inf. Hadley v. Standard Oil Co., 218 Mo. 1; State ex inf. Shartel, Atty. Genl. ex rel. City of Sikeston v. Mo. Utilities Co., 331 Mo. 337, 53 S.W. (2d) 394; State ex inf. McKittrick, Atty. Genl. ex rel. City of Lebanon v. Mo. Standard Tel. Co., 85 S.W. (2d) 613. (2) Under the statutes and decisions an electrical company has power to supply a town with electricity and to sell electricity to its citizens and to use the streets and alleys of the town for such purposes, only with the consent of the municipal authorities. Consent of the municipality is a condition precedent to the right to operate therein. Sec. 4962, R.S. 1929; State ex inf. Shartel, Atty. Genl. ex rel. City of Sikeston v. Mo. Utilities Co., 331 Mo. 337, 53 S.W. (2d) 394; State ex inf. McKittrick, Atty. Genl. ex rel. City of Lebanon v. Mo. Standard Tel. Co., 85 S.W. (2d) 613. (3) Under the statutes and decisions a municipality may grant a franchise to maintain and operate an electric light plant and to use the streets of the city in connection therewith for a period of twenty years or less. In granting such a franchise the municipality acts as the agent of the State, and it may grant or refuse the franchise or limit the term of its operation, and it may refuse to renew or extend the franchise. Without the consent of the municipality no right exists to operate a private electric light plant therein; and without such consent no right to so operate the plant exists after the termination of the franchise. Sec. 7683, R.S. 1929; State ex inf. Shartel, Atty. Genl. ex rel. City of Sikeston v. Mo. Utilities Co., 331 Mo. 337, 53 S.W. (2d) 394; State ex inf. McKittrick, Atty. Genl. ex rel. City of Lebanon v. Mo. Standard Tel. Co., 85 S.W. (2d) 613.

A.Z. Patterson and D.C. Chastain for respondent.

(1) To oust the defendant from the city of Campbell under the facts hereinbefore stated would deprive it of its property without due process of law. Sec. 1, Fourteenth Amendment, U.S. Const.; Sec. 30, Art. II, Mo. Const.; Ky. Utilities Co. v. Board of Commrs., 254 Ky. 527, 71 S.W. (2d) 1024; City & County of Denver v. New York Trust Co., 187 Fed. 890; Columbus Gas & Fuel Co. v. Pub. Utilities Comm., 292 U.S. 398; Smyth v. Ames, 169 U.S. 466. (2) The city of Campbell and the State of Missouri are estopped to deny the defendant's right to operate. State ex rel. Shartel v. Mo. Utilities, 331 Mo. 337, 53 S.W. (2d) 392; City of Mountain View v. Farmers Tel. Exchange Co., 294 Mo. 623, 243 S.W. 153; St. Joseph v. Railroad Co., 268 Mo. 47, 186 S.W. 1080. (3) If this ouster is granted, the State of Missouri enforces its laws in a manner wholly contradictory. In fixing rates of the utility, it allows annual depreciation on the basis of continuous operation, but nevertheless it compels cessation of operation at the end of a municipal franchise period. In re St. Joseph Water Co., 14 Mo. R.S.C. 193; In re Kansas City Gas Co., 14 Mo. P.S.C. 312; In re Kansas City Elec. Lt. Co., 5 Mo. P.S.C. 20; Ky. Utilities Co. v. Board of Commrs. of Paris, 254 Ky. 527, 71 S.W. (2d) 1024; United Rys. & Elec. Co. of Baltimore v. West, 280 U.S. 234, 50 Sup. Ct. 123, 74 L. Ed. 390; Denver v. New York Trust Co., 187 Fed. 890; Columbus Gas & Fuel Co. v. Public Utilities Comm., 292 U.S. 398, 54 Sup. Ct. 763, 78 L. Ed. 1327; Pond on Public Utilities, sec. 460, Supp. secs. 462, 474; 51 C.J., p. 26, sec. 55; Smyth v. Ames, 169 U.S. 546; State ex rel. St. Louis v. Pub. Serv. Comm., 326 Mo. 751, 34 S.W. (2d) 507. (4) This court has discretion in granting an ouster and the facts justify the refusal of the writ. State ex rel. McKittrick v. Mo. Standard Tel. Co., 85 S.W. (2d) 613.

TIPTON, J.

On May 17, 1935, the Attorney General of the State of Missouri at the relation of the city of Campbell, Missouri, filed an original proceeding in this court in the nature of quo warranto against the Arkansas-Missouri Power Company, as respondent, praying that this court make an order directing the respondent to forthwith remove its poles, wires and other equipment from the streets and alleys of the relator, and to discontinue further sales of electric current to the inhabitants of that city.

So that the issue decided in this case may correctly be understood, we deem it advisable to summarize the pleadings.

The information alleges that the relator is a city in Missouri of the fourth class; that on January 5, 1915, it granted to Ben F. Eicholtz and assigns a franchise to erect and maintain an electric light plant and distribution system in that city for a term of twenty years from that date; that Eicholtz accepted and operated under the franchise until July 14, 1924, when with knowledge, consent and acquiescence of the relator, he transferred this franchise to the respondent who has since operated under the franchise rights; that on May 12, 1925, the relator and respondent entered into a contract to light relator's streets; that this contract was for a period of ten (10) years from that date; that on October 2, 1934, the relator notified the respondent that the franchise would not be renewed upon its expiration on January 5, 1935; that on January 1, 1935, the board of aldermen of the relator passed another resolution, referring to that of October 2, 1934, and further to the effect that the street lighting contract expiring May 12, 1935, would not be renewed; and also that the respondent should remove its poles, wires and equipment from relator's streets, except such as was necessary to carry out the contract expiring May 12, 1935, and that upon the expiration of that contract the remainder of the poles, wires and equipment must be removed; that the respondent was duly notified of this resolution; that upon the expiration of the franchise and contract the respondent has refused to remove its equipment and vacate the streets and alleys of the relator; that on February 15, and March 1, 1935, the respondent publicly announced in a newspaper that it intended to continue to serve the inhabitants of relator; that occupancy of the streets and alleys are without permission of relator and without lawful warrant of authority and that the prayer was for a judgment of ouster.

Respondent's return to order to show cause and answer to relator's information was filed June 3, 1935. This court sustained the relator's motion to strike out certain parts of respondent's return, leaving the return and answer as follows:

"Now comes Arkansas-Missouri Power Company, defendant in the above entitled cause, and for return to the order to show cause issued by this Honorable Court and in answer to the information filed by the Attorney General of the State of Missouri herein, said Defendant shows:

"1. Defendant admits that the City of Campbell is a city of the fourth class; admits that Arkansas-Missouri Power Company is a corporation organized under the laws of the State of Arkansas, with principal place of business in the City of Blytheville, State of Arkansas, and that it is licensed to do and is doing business in the State of Missouri as a foreign corporation.

"2. Defendant, further answering, denies that it has continuously since the 5th day of January, 1935, or the 12th day of May, 1935, maintained its electrical equipment in the streets and alleys and public places of the City of Campbell, and denies that it has continued to furnish and serve the inhabitants of the City of Campbell with electrical current, without warrant of authority, and denies that it has assumed, usurped, and is unlawfully exercising the rights and privileges of maintaining its electrical equipment in the City of Campbell.

"3. Defendant, further answering, states that it and its predecessor have maintained and operated an electrical system in the City of Campbell since the year 1915, with all necessary fixtures and facilities to furnish said City and its inhabitants with electric light, heat and power.

"4. Defendant, further answering, states that on the 14th day of July, 1924, it acquired from one Ben F. Eicholtz, by purchase, all the right, title and interest of the said Ben F. Eicholtz in and to an electrical plant and system, then engaged in and operated for the purpose of supplying the City of Campbell and inhabitants thereof with electrical service, including certain municipal franchise theretofore on the 5th day of January, 1915, granted by the said City to the said Eicholtz.

"8. Further answering, defendant states that this information in the nature of quo warranto was not instituted by any lawful or proper action of the relator City, but was in reality instituted upon the application of a private party, that is upon the application of Fairbanks, Morse & Company, a corporation of the State of Illinois.

"That this suit is not a proceeding in defense of the prerogative rights of the State by the constitutional writ of quo warranto, but is a proceeding whereby a private party seeks to secure advantages, which it should undertake by civil action. That leave of Court was not first had...