State v. Laclede Gas-Light Co.

• Decision Date: 15 December 1890
• Citation: 14 S.W. 974,102 Mo. 472
• Parties: STATE ex rel. CITY OF ST. LOUIS v. LACLEDE GAS-LIGHT CO.
• Court: Missouri Supreme Court

14 S.W. 974

102 Mo. 472

STATE ex rel. CITY OF ST. LOUIS v. LACLEDE GAS-LIGHT CO.

Supreme Court of Missouri.

December 15, 1890.

GAS COMPANIES — CHARTER — REGULATION OF PRICE.

1. An ordinance granting to a gas company, its successors and assigns, the right of supplying gas to the city and to private consumers for a stated period, is not void because the time extends beyond the limit of the company's chartered existence, the ordinance providing that it might transfer all of its rights, privileges, property, and franchises conferred by the ordinance to any organized gas company of the state, which should within 20 days after the transfer file its written acceptance of the ordinance and give bond to perform all the agreements required of the original company.

2. The ordinance providing that the price of gas to consumers shall not exceed $1.25 per each 100 cubic feet or the net price $1.18¾ for gas paid for within five days after presentation of the bill, the company is exempt from regulation by the city of the price of gas after the acceptance of the ordinance by the company.

3. The L. Gas-Light Company was organized by special charter granted March 2, 1857, which authorized it to lay its pipes and vend gas in a certain portion of the city of St. L., and exempted it from Rev. St. Mo. 1855, c. 34, art. 1, § 7,

providing that the charter of every corporation thereafter created should be subject to alteration by the legislature. In 1868, the charter was amended so as to extend the rights, privileges, and franchises of the company throughout the entire corporate limits of the city. Held, that the right to make and vend gas carried with it the right to fix the price, and that it was not subject to regulation by state or city.

4. The regulation of the price of gas by the state, or by municipalities created by it, is not the exercise of a police power which cannot be abridged by contract.

BARCLAY J., dissenting.

Petition for mandamus by the state ex rel. the city of St. Louis against the Laclede Gas-Light Company commanding the respondent to observe and obey the terms of ordinance 15,482, which reads as follows: "Section 1. For a period of five years from and after the passage of this ordinance, the price of illuminating gas in the city of St. Louis to consumers shall not exceed ninety cents per one thousand cubic feet on all bills paid within five days after presentation, and ninety-five cents per one thousand cubic feet on all bills paid after the expiration of five days from presentation; and for said period of five years in said city the price of gas sold to consumers to be used for fuel and power purposes shall not exceed forty-five cents per one thousand cubic feet on all bills paid within five days after presentation, and fifty cents per one thousand cubic feet on all bills paid after the expiration of five days from presentation. Sec. 2. Any corporation, president, agent, or officer thereof, and any person who shall charge, collect, or receive for gas furnished on and after the passage of this ordinance any sum in excess of the rates fixed by this ordinance shall be deemed guilty of a misdemeanor, and on conviction shall be fined not less than two hundred and fifty dollars for each offense, and every such case shall constitute a separate offense. Sec. 3. The city of St. Louis reserves the right to amend, alter, or repeal this ordinance at any time." In obedience to the alternative writ, the respondent filed its return, to the following effect: (1) That the respondent corporation exists under a special charter granted to it by the state of Missouri by an act approved March 2, 1857,¹ as amended by an act approved March 26, 1868.² By the provisions of section 1 of the act of 1857, the respondent has power to contract and to be contracted with without condition or limitation. By the provisions of section 5 of said act of 1857, the respondent has power, throughout a certain portion of the corporate limits of the city of St. Louis, to lay its pipes and fixtures, and to make and vend gas, with no condition or limitation as to price to be charged therefor, and to have and exercise all other powers necessary to execute and carry out the privileges and powers granted to respondent by the act. By the provisions of section 7 of the act of 1857, any interference with the respondent, in the exercise of the privileges granted to it by that act, subjects the offender to a liability to the respondent of $1,000. By the provisions of section 8 of said act of 1857, the respondent and its charter are expressly exempted from the operation of sections 6 and 7 of article 1 of the act entitled" An act concerning corporations," approved November 23, 1855. Said section 6 is as follows: "If any corporation created by the legislature shall not organize and commence the transaction of its business within one year from the date of its incorporation, its corporate powers shall cease." Rev. St. Mo. 1855, c. 34, art. 1. Said section 7 is as follows: "The charter of every corporation that shall hereafter be created by the legislature shall be subject to alteration, suspension, and repeal in the discretion of the legislature." Id. By the first section of the said act approved March 26, 1868, the rights, privileges, and franchises granted to respondent in a portion of the city of St. Louis by section 5 of the act of 1857 were extended throughout the entire corporate limits of the city. The return alleges that the said acts, constituting its charter, were accepted by the respondent; and, in substance, alleges that the respondent from and after the passage of said acts, and until the present time, has, at large expense, constructed its buildings, machinery, appliances, and fixtures for manufacturing gas; has laid its pipes and mains in and along the streets of the city of St. Louis, and connected them with business places and residences, and has been and now is distributing and vending gas under the sanction and authority of its said special charter, to the city of St. Louis and to its citizens; that its mains or pipes, so used for distributing and vending gas, aggregate about 135 miles in length; that it is now vending gas to over 18,000 different consumers, located throughout the city of St. Louis; that its special charter is a contract between it and the state of Missouri; that its obligations cannot be impaired; and that, because said ordinance No. 15,482 does impair the obligation of its said contract with the state, it is inoperative so far as respondent is concerned. (2) The respondent, for further and second cause why it does not obey or observe the provisions of ordinance No. 15,482, alleges, in substance, as follows, that is to say: That prior to January 1, 1890, there was a corporation known as the "St. Louis Gas-Light Company," organized and existing under and by virtue of a special charter evidenced by an act of the general assembly of Missouri entitled "An act to incorporate the St. Louis Gas-Light Company," approved February 4, 1837, (see Laws Mo. 1836-37, p. 173,) and also an act entitled "An act to amend the charter of the St. Louis Gas-Light Company," approved February 11, 1839, (see Laws Mo. 1838-39, p. 242,) and also an act entitled "An act amendatory and supplementary of an act to incorporate the St. Louis Gas-Light Company," approved February 28, 1845, (see Laws Mo. 1844-45, p. 150.) Reference is made in the return to said several acts for a full and complete statement of all the rights, powers, and privileges of said St. Louis Gas-Light Company. By reference to said acts, (as well as to the averments of the return,) it will be found that said St. Louis Gas-Light Company had an exclusive franchise to make and vend gas within the corporate limits of the city of St. Louis, and to establish and lay down in the streets of said city, all pipe, fixtures, and appliances necessary for that purpose. The return avers that under and by virtue of said acts the said St. Louis Gas-Light Company had the right and power to charge for gas, which it might make and vend, such price as it might agree upon with consumers, not exceeding $10 per thousand cubic feet. Section 7 of said act of February 4, 1837, found in Laws Mo. 1836-37, at page 175, confers such right. Section 13 of the act entitled "An act to amend the charter of the St. Louis Gas-Light Company," approved February 11, 1839, above referred to, is as follows: "Sec. 13. The corporation of the city of St. Louis, and the board of directors of the St. Louis Gas-Light Company, may contract for and make regulations relating to the lighting of said city with gas in such manner as may be agreed upon; and they may make generally such contracts in relation to the business of the company as may be beneficial to them and the public * * *." See page 244, Laws Mo. 1838-39.

The return further alleges that by the terms and stipulations of a contract of date February 28, 1873, (known generally as the "tripartite agreement,") executed by and between the city of St. Louis, the Laclede Gas-Light Company, and the St. Louis Gas-Light Company, which was in full force on the 30th day of January, 1886, and a valid, binding obligation of the said city, the said St. Louis Gas-Light Company had the exclusive right, throughout a large part of the city of St. Louis, to sell gas to the said city and to any and all other persons, at and for any price and sum it might agree upon with its consumers, not exceeding $3.25 per thousand cubic feet; that by virtue of said contract, the St. Louis Gas-Light Company had also a vested right to furnish public lighting, and to charge and collect therefor from the city of St. Louis the sum of $37.50 per year for each and every public gas-lamp erected throughout the territory aforesaid, for lighting the streets and public places of said city; that said rights were in existence on January 30, 1886, and were, by the terms of said tripartite agreement, to continue in favor...