Texas-Louisiana Power Co. v. City of Farmersville

• Decision Date: 30 December 1933
• Docket Number: No. 1509-1721-6440.,1509-1721-6440.
• Citation: 67 S.W.2d 235
• Parties: TEXAS-LOUISIANA POWER CO. et al. v. CITY OF FARMERSVILLE.
• Court: Texas Supreme Court

67 S.W.2d 235

TEXAS-LOUISIANA POWER CO. et al. v. CITY OF FARMERSVILLE.

No. 1509-1721-6440.

Commission of Appeals of Texas, Sections A and B.

December 30, 1933.

Error to Court of Civil Appeals of Fifth Supreme Judicial District.

Suit by the City of Farmersville against the Texas-Louisiana Power Company and others. Judgment for defendants was set aside by the Court of Civil Appeals and rendered in favor of plaintiff [55 S.W.(2d) 195], and defendants bring error.

Judgment of Court of Civil Appeals reversed, and judgment of trial court affirmed.

W. R. & W. P. Abernathy, of McKinney, Bennett L. Smith, of Fort Worth, and Black & Graves, of Austin, for plaintiffs in error.

Touchstone, Wight, Gormley & Price and J. W. Gormley, all of Dallas, for defendant in error.

SHARP, Judge.

This suit involves a dispute between the city of Farmersville, a municipal corporation, organized under the general laws of Texas, and the Texas-Louisiana Power Company, with respect to rates to be charged consumers by virtue of certain ordinances passed by the city of Farmersville. For the sake of brevity, we will refer to the city of Farmersville as the city and the Texas-Louisiana Power Company as the power company. It appears that on May 5, 1930, the city adopted two ordinances, Nos. 122 and 123, which had for their object the regulation of public utilities and the fixing of rates to be charged consumers. These ordinances were enacted by virtue of article 1119, Revised Civil Statutes 1925, as it then existed. The Forty-Second Legislature amended the article by an act approved May 26, 1931 (see Session Acts, c. 226, p. 380, Vernon's Ann. Civ. St. art. 1119), whereby the amended act authorizes cities and towns of over 500 population instead of over 2,000, as originally provided, to regulate and prescribe rates to be charged by public utilities; and further providing that no rates should be fixed that would yield more than 10 per cent. per annum, in lieu of the former provision of not less than 10 per cent. per annum, on the actual costs of the physical properties, equipment, and betterments.

After the amendatory act became effective, the city, on September 1, 1931, adopted Ordinances Nos. 126 and 127, which are in all material respects the same as Ordinances Nos. 122 and 123, in which rates for its own observance were prescribed, as well as for the observance of the power company, being the same, in effect, voluntarily charged by the power company. The power company, refusing to abide by the schedule of rates prescribed by the ordinances, promulgated, and insists upon maintaining, the schedule of rates much lower than that fixed by the ordinances.

The case was tried without a jury on the city's amended petition. The trial court sustained a special exception to the amended petition setting up the rate and regulatory ordinances adopted in September, 1931, by virtue of the amended article, on the ground that the amendment was unconstitutional because of the defect in its caption, and, after hearing the evidence, rendered judgment in favor of the power company. An appeal was made to the Court of Civil Appeals at Dallas, and the judgment of the trial court was set aside and judgment rendered in favor of the city, upholding the validity of article 1119 as amended, and sustained the rates fixed by the ordinance. 55 S.W.(2d) 195. A writ of error brings the cause here.

The first question presented is that the Court of Civil Appeals erred in not holding unconstitutional and void the entire amendment to article 1119 adopted by the Forty-Second Legislature, 1931 (Session Acts, pp. 380 and 381 [Vernon's Ann. Civ. St. art. 1119]). The court, having correctly held that the second sentence of said act was not supported by the caption of the bill, erred in failing to hold that this rendered void the entire act.

The effect of the original article 1119 was to authorize cities and towns having a population of more than 2,000 to regulate rates to be charged by public utilities to consumers, and that no rate should be prescribed which would yield less than 10 per cent. per annum net on the actual costs of the physical properties, equipment, and betterments. In 1931 the Forty-Second Legislature undertook to amend article 1119 in two respects, as will hereafter appear. The vital parts of the act read as follows:

"An act to amend Article 1119 of the Revised Civil Statutes of 1925, so as to change the population of towns coming within its scope from two thousand (2,000) to five hundred (500); and declaring an emergency.

"Section 1. That Article 1119 of the Revised Civil Statutes of 1925, be amended so as to hereafter read as follows:

"Article 1119. The governing body of all cities and towns in this State of over five hundred (500) population, incorporated under the General Laws thereof, shall have the power to regulate, by ordinance, the rates and compensation to be charged by all water, gas, telephone companies, light and sewer companies, corporations or persons using the streets and public grounds of said city or town, and engaged in furnishing water, gas, light or sewerage service to the public, and also to prescribe rules and regulations under which such commodities shall be furnished, and service rendered, and to fix penalties to enforce such charges, rules and regulations. The governing body shall not prescribe any rate or compensation which will yield more than ten (10%) per cent per annum net on the actual costs of the physical properties, equipment and betterments."

It plainly appears that the amendment had two objects in view, first, to substitute cities or towns having over 500 in population for cities and towns having more than 2,000 in population as in the original act; and, second, to change the minimum rate of 10 per cent. on actual costs of the physical properties, etc., to a maximum rate of 10 per cent. calculated on the same basis. The caption of the amended act refers only to the first object stated, and makes no reference whatever to the second object. All laws passed by the Legislature of this state originate in bills upon which must appear a caption or title. Section 35 of article 3 of the Constitution of this state provides: "No bill * * * shall contain more than one subject, which shall be expressed in its title." The object of this provision of the Constitution is to compel the caption to contain the subjects embraced within the bill. This prevents the caption concealing the true purpose of the statute and avoids deception in its adoption. Section 36 of article 3 of the Constitution reads: "No law shall be revived or amended by reference to its title; but in such case the act revived, or the section or sections amended, shall be re-enacted and published at length."

The amended act cannot be sustained on the ground that, if that part of the act which prescribes that no rate shall be fixed "which will yield more than ten per cent per annum net on the actual costs of physical properties," etc., should not be upheld because not contained in the caption, the remaining part of the law should be sustained by reason of that part of section 35 of article 3 of the Constitution which reads as follows: "But if any subject shall be embraced in an act, which shall not be expressed in the title, such act shall be void only as to so much thereof, as shall not be so expressed."

The primary rule which governs in the construction of statutes is to ascertain the intention of the Legislature as expressed in the law. This intention should be derived from reading the entire act. The Legislature, in the original article 1119, authorized cities and towns of more than 2,000 population to fix rates to be charged consumers by public utilities upon a basis of not less than 10 per cent. net of the costs of physical properties, etc. The amended article undertook to change the rule and give cities of more than 500 population power to change rates to be charged by public utilities but made the basis of compensation of not more than 10 per cent. per annum based upon the costs of physical properties, etc. Whatever power the cities of this class possessed to fix rates was conferred by this statute. Both acts specified a limitations upon the grant of power, but the limitations are different in character. In the original act it was required that the rates prescribed should yield not less than 10 per cent. on the value of the property of the public utility; while under the amended act it is required that the rates prescribed should yield not more than 10 per cent. on such value. The Legislature granted an important power to the public officers of those cities coming under the terms of the law. The grant was a limited, and not an unlimited, one. The character of the limitation was clearly stated in the second sentence of the act. The Court of Civil Appeals correctly held that the caption is insufficient to sustain the second sentence of the act, wherein the Legislature undertook to state the limitations under which the rate-making power should be exercised. The caption is plain and specific in terms, and makes no reference to any change in the existing law, except a change based on population alone. The second sentence is wholly unsupported by the caption. The Court of Civil Appeals holds that the second sentence of the amended act may be eliminated and the second sentence of the original act substituted therefor, and, as thus rearranged, the law is valid. Both the original and amendatory acts are embraced within one paragraph consisting of two sentences. It clearly shows that it was the intention of the Legislature to amend the original law in the manner and terms stated in the amended act. It is stated in plain language upon what conditions cities or towns of more than 500 are authorized to fix rates. The field is limited as expressed in the statute, and courts are not authorized to reshape the statute by changing the limits definitely expressed in the...