The Western Paving And Supply Co. v. The Citizens' Street Railroad Co.

• Decision Date: 10 January 1891
• Docket Number: 15,640
• Citation: 26 N.E. 188,128 Ind. 525
• Parties: The Western Paving and Supply Company v. The Citizens' Street Railroad Company
• Court: Indiana Supreme Court

26 N.E. 188

128 Ind. 525

The Western Paving and Supply Company v. The Citizens' Street Railroad Company

No. 15,640

Supreme Court of Indiana

January 10, 1891

Reported at: 128 Ind. 525 at 540.

From the Marion Circuit Court.

Judgment affirmed.

A. C Harris and L. Cox, for appellant.

H. C Allen, F. Winter and J. B. Elam, for appellee.

Coffey, J. Elliott, J., took no part in the consideration of this case.

OPINION

Coffey, J.

This case was under consideration by the late Judge Mitchell, prior to his death, and, while so considering it, he prepared the following statement, which we adopt:

"On the 18th day of January, 1864, the common council of the city of Indianapolis passed an ordinance authorizing the Citizens' Street Railway Company, which had been duly organized under the general laws for the incorporation of street railways, to use the streets of the city for the purpose of constructing and operating thereon a street railway. Among other things it was provided, in the ordinance, that the company should boulder that part of the street it might thereafter occupy lying between the rails of its track, and also that it should pave, boulder, or otherwise improve and keep in repair two feet on the outside of each rail, so as at all times to correspond with the street outside. Pursuant to the above ordinance the street railway system was in part constructed. Subsequently, in the month of April, 1878, the common council and board of aldermen amended so much of the ordinance of 1864 as imposed upon the company the duty of bouldering the part of the street between the rails of its track, and paving, or otherwise improving, as the street might be, a space outside the tracks on either side, and instead thereof provided that 'the said company shall keep the tracks and two feet on the outside of each rail, together with all bridges, and the crossings of all gutters, at all times, in good repair to the satisfaction of the common council.' The company was required to signify its acceptance of the amendment within thirty days, and it is averred that the ordinance, as amended, was duly accepted.

"It appears that afterwards, in April, 1884, an ordinance was duly adopted in which it was provided that when any street upon which there existed a line of railway, was improved from curb to curb, the improvement should be made under contract, as required by law, and that the street railway company should be liable to the contractor for its proportion of the total cost; the proportion to be determined by the city civil engineer according to the method prescribed in the ordinance.

"Nothing appears to indicate that the company accepted or consented to the provisions of this last ordinance.

"Subsequently, in 1888, the property and franchises of the corporation hereinbefore named, were transferred to the Citizens' Street Railroad Company, a new corporation then recently organized. The new company presented to the common council an ordinance known as the ordinance of April 23, 1888, which was duly adopted, and which is of the tenor following:

'Be it ordained by the common council and board of aldermen of the city of Indianapolis, that the sale and transfer heretofore made by the Citizens' Street Railway Company of Indianapolis, Indiana, of all its property, rights, franchises and privileges in the city of Indianapolis to the Citizens' Street Railroad Company of the city of Indianapolis, its successors and assigns, subject to all the duties, conditions and obligations heretofore imposed and now resting on said railway company, be, and the same is hereby ratified and approved; and all said rights, privileges and franchises heretofore possessed by said old corporation are granted to and confirmed in said new corporation, its successors and assigns, subject to the same duties and obligations as vested in said old corporation.'

"In 1889 an ordinance was duly passed for the regrading of two squares of Pennsylvania street with asphalt. The contract was duly let to the Western Paving and Supply Company, and the work was done and accepted by the city, the amount estimated as the proportion to be paid by the company, according to the provisions of the ordinance of 1884, being $ 3,716.28. The railway company denied its liability, whereupon the contractor instituted this suit to recover the amount."

The central position which the street railway company plants itself upon is, that the ordinance passed by the common council of the city of Indianapolis in 1864, and the amendment thereto adopted in 1878, both of which were duly accepted by its predecessor, had the force and effect of a contract which could not be altered or impaired without its consent; that the old company had never consented to nor accepted the ordinance of 1884 which sought to impose upon it more extended obligations, and that by the ordinance of April 23d, 1888, the new company became subject to the same duties and obligations that had theretofore been imposed upon the old, no greater and no less, and it was not bound by the ordinance passed in 1884, by which the obligation of paying a proportionate share of the cost of street improvements was sought to be imposed upon the old company.

The vital question to be decided by this court is this: Does the amendatory ordinance of April, 1878, providing that the Citizens' Street Railway Company should keep the space between its tracks and two feet on the outside of each rail, together with all bridges and crossings of gutters at all times in good repair, to the satisfaction of the common council and board of aldermen, and to cause the space between its tracks and two feet on the outside of each rail to conform to the grade of the street on which the same is laid, amount to a contract, based upon a sufficient consideration, the legal effect of which was to release the company from the performance of duties imposed by the ordinance of 1864, to which the appellee succeeded by its purchase from that company?

Many of the questions governing the rights existing between street railway companies and the cities in which they operate their roads, under charters granted by such cities, seem to be too well settled to admit of longer controversy, while many other questions remain in doubt and uncertainty.

It is settled that a charter granted by the common council to a street railway company to construct and operate a street railway within the corporate limits of a city, constitutes a contract between such railway company and the city. Chicago v. Sheldon, 76 U.S. 50, 9 Wall. 50, 19 L.Ed. 594; Coast-Line Railroad Co. v. Mayor, etc., 30 F. 646; State, ex rel., v. Corrigan, etc., Street R. W. Co., 85 Mo. 263; District of Columbia v. Washington, etc., R. R. Co., 4 Am. and Eng. R. R. Cases, 161; Farrar v. City of St. Louis, 80 Mo. 379; New Orleans Gas Co. v. Louisiana Light Co., 115 U.S. 650, 29 L.Ed. 516, 6 S.Ct. 252; Greenwood v. Freight Co., 105 U.S. 13, 26 L.Ed. 961; New Jersey v. Yard, 95 U.S. 104, 24 L.Ed. 352.

It is also settled that such charter is to be strictly construed against the railway company, and that it has no doubtful rights under such charter, for where there are doubts they are construed against the grantee and in favor of the city. Citizens' R. W. Co. v. Jones, 34 F. 579; Mayor, etc., v. Ohio, etc., R. R. Co., 26 Pa. 355; Birmingham, etc., R. W. Co. v. Birmingham, etc., R. W. Co., 79 Ala. 465; West Philadelphia, etc., R. W. Co. v. City of Philadelphia, 10 Phila. 70.

It seems to be settled that a street railway company is bound to keep in repair that portion of the street used by it, even in the absence of a stipulation in its charter requiring it to do so, but the question as to whether it is compelled to improve the street, as ordered by the city, in the absence of a contract to that effect, seems to be in some doubt. It is undoubtedly true that the authorities upon this question are conflicting.

Judge Elliott, in his valuable work on Roads and Streets, after a careful examination of the authorities upon the subject, at page 594, says: "As much as can be safely affirmed in the present state of the decided cases is that the private corporation is bound to repair but is not bound to improve. It is bound to restore but is not bound to change. * * It would not, as we interpret the rule sustained by the weight of authority, be compelled to make the new pavement, but it would be its duty, in making repairs after the new pavement was laid, to make them to correspond to the new pavement."

The conclusion reached by Judge Elliott, as stated above, is fully warranted by the authorities cited in support of the text.

By section 5 of the original charter granted to the Citizens' Street Railway Company and accepted by it, that company contracted with the city of Indianapolis to boulder the streets between the rails, and to pave or otherwise improve the street for a given space outside its rails. If this section was still in force the case would, we think, be free from difficulty. But if the amendment of 1878 was a valid and binding ordinance, and was accepted by the company, section 5 of the original charter does not now exist, being merged in the amended section. It is to be inferred from the amendment above referred to, that the company under the original charter had constructed, in the city, two systems of railway, one south of the union railway tracks and one north, which were wholly disconnected. The city was desirous of having these two systems connected, and of limiting the fare to be charged for the transportation of passengers to any part of the city to five cents; and, also that the company should construct, within a given time, certain additional lines of railway named in the ordinance. It is recited in the...