Town of Holyoke v. Smith

• Decision Date: 04 April 1924
• Docket Number: 10728.
• Citation: 75 Colo. 286,226 P. 158
• Parties: TOWN OF HOLYOKE v. SMITH et al.
• Court: Colorado Supreme Court

226 P. 158

75 Colo. 286

TOWN OF HOLYOKE v. SMITH et al.

No. 10728.

Supreme Court of Colorado, En Banc.

April 4, 1924

Rehearing Stricken May 5, 1924.

Error to District Court, Phillips County; L. C. Stephenson, Judge.

Action by the town of Holyoke, a municipal corporation, against F M. Smith and Myron H. Smith, a copartnership, doing business under firm name and style of F. M. Smith & Son. Judgment for defendants and plaintiff brings error.

Affirmed.

Campbell and Denison, JJ., dissenting.

Gillette & Clark, of Denver, for plaintiff in error.

T. E Munson, of Sterling, and Allen & Webster and L. H. Drath, all of Denver, for defendants in error.

TELLER C.J.

The plaintiff in error is a municipal corporation owning and operating an electric light and power plant, and the defendants in error, doing business in the town, were among its customers.

The town council established a schedule of rates for electric current, and the State Board of Public Utilities established a higher rate. The town brought suit to recover the higher rate, which the defendants had refused to pay.

The trial court held that if the law gave to the Public Utilities Commission the right to fix rates for municipally owned utilities, such as the one in question, it was unconstitutional, the Legislature being prohibited by section 35 of article 5 of the Constitution from delegating the power. Accordingly judgment was entered for the amount fixed locally. The plaintiff brings error.

The question then is: Does the act under consideration (chapter 127, Laws of 1913), if it gives the commission the power claimed for it, contravene the provision of the Constitution above mentioned. The provision reads as follows:

'The General Assembly shall not delegate to any special commission, private corporation or association, any power to make, supervise or interfere with any municipal improvement, money, property or effects, whether held in trust or otherwise, or to levy taxes or perform any municipal function whatever.'

In considering the question thus raised we are to take a broad view of the subject, and ascertain, if possible, the purpose for which this limitation on the power of the Legislature was imposed.

In Denver v. Telegraph Co., 67 Colo. 225, 184 P. 604, this court quoted from Cooley's Constitutional Limitations as follows:

"Narrow and technical reasoning is misplaced when it is brought to bear upon an instrument framed by the people themselves, for themselves, and designed as a chart upon which every man, learned and unlearned, may be able to trace the leading principles of government. The Constitution is to be construed as a frame of government or fundamental law,' and not as a mere statute.'

To ascertain the meaning of this provision we may consider its historical background, the conditions existing when it was adopted, and what were the mischiefs against which it was intended to guard. Schwartz v. People, 46 Colo. 239, 104 P. 92; People v. Harding, 53 Mich. 48, 18 N.W. 555, 51 Am.St.Rep. 95.

First, as to the kind of government, and the conditions under which we were living when the Constitution was adopted. The certral idea of government in this country was and is that in local matters municipalities should be self-governing. Prior to the time we are considering, Judge Cooley had said, 'Local government is a matter of absolute right, and the state cannot take it away.' People v. Hurlbut, 24 Mich. 44, 9 Am.Rep. 103. He also said, speaking of state Constitutions: 'Local self-government having always been a part of the English and American systems, we shall look for its recognition in any such instrument, and even if not expressly recognized, it is still to be understood that all these instruments are framed with its present existence and anticipated continuance in view.' Cooley's Constitutional Limitations (7th Ed.) p. 65.

The right of self-government in cities and towns is coeval with the history of the Anglo-Saxon race. It was confirmed by Magna Charta to cities and boroughs.

As is well known, in New England there were many towns which existed for years without statutory authority, and they were regarded as municipal, or quasi municipal, without any formal act of incorporation. Hill v. Boston, 122 Mass. 344, 23 Am.Rep. 332.

In Cooley's Constitutional Limitations (7th Ed.) page 261, it is said that one of the vital ideas in the American form of government is 'that local affairs shall be managed by local authorities, and general affairs only by the central authorities. These statements by Judge Cooley have been many times quoted with approval by eminent courts, and it may be confidently asserted that the question now before us might properly have been raised, had there been no constitutional provision like that under consideration.

In State v. Barker, 116 Iowa 96, 89 N.W. 204, 57 L.R.A. 244, 93 Am.St.Rep. 222, the court points out the distinction frequently recognized between the governmental and the proprietary powers of a city, stating that as to the former the power of the Legislature in unlimited, but that the latter are entitled to constitutional protection. The court said that these private and proprietary rights of municipalities are a part of the rights retained by the people when the Constitution was adopted, and that----

'Written constitutions should be construed with reference to and in the light of well-recognized and fundamental principles lying back of all constitutions, and constituting the very warp and woof of these fabrics. A law may be within the inhibition of the constitution as well by implication as by expression.'

In State v. Denny, 118 Ind. 382, 21 N.E. 252, 4 L.R.A. 79, the court held that the right of the people to govern themselves as to matters purely local, through the medium of the local municipal government and officers chosen by themselves, was not surrendered upon the adoption of the Constitution, but was still vested in them, and cannot be taken away by the Legislature. It was therefore held that an act providing for boards of public works to have control over the streets, alleys, etc., of cities was unconstitutional.

That the right of local self-government was reserved by the people in the making of the Constitution was distinctly stated in Rathbone v. Wirth, 150 N.Y. 459, 45 N.E. 15, 34 L.R.A. 408, where the court said that such right is a cardinal principle in our form of government:

'A right which inheres in a republican government and with reference to which our Constitution was framed. The habit of local self-government is something which we took over, or rather, continued from the English system of government. * * * The principle is one which it takes but little reflection to convince the mind of being fundamental in our governmental system and as contributing strength to the national life, in its educational and formative effect upon the citizen.'

In McQuillan on Municipal Corporations, § 246, it is said:

'It is thus obvious that the Constitution must be considered in the light of the local and state government existing at the time of its adoption. That the principle of local self-government constituted a prominent feature in both the federal and state government is a fact that cannot be denied. * * * The right of local self-government, as an undoubted right of the people, is regarded as an inseparable incident to our republican form of government, and, therefore, * * * all our Constitutions assume its continuance.'

It is to be noted also that the people have approved the principle of local government by the adoption of the amendment of 1912 to article 20 of the Constitution, now appearing as section 6 of that article, by which the right of home rule was extended to every town or city of the state having 2,000 inhabitants. Any town within that class may free itself from the jurisdiction of any commission, special or otherwise, having power to interfere in local affairs. This right being thus a part of our political system, we should look for constitutional protection of it, if there were reasons to apprehend that it might otherwise be interfered with.

It is common knowledge that for years prior to the adoption of the state Constitution of Colorado the Legislatures of several states had repeatedly, by statutes, regulated the internal affairs of cities in those states, and that there had been great opposition to such legislation.

In the very year that our Constitution was adopted, a commission, including very eminent men, was appointed in New York to devise a plan for the government of cities, and they reported that one of the causes of misgovernment in the cities was the assumption by the Legislature of the control of local affairs.

The right of the Legislature thus to interfere in municipal affairs, even though there was no constitutional provision against it, had been several times before the courts of several of the states. People v. Hurlbut, 24 Mich. 55, 9 Am.Rep. 103; People ex rel. Board of Park Com'rs v. Common Council of Detroit, 28 Mich. 228, 15 Am.Rep. 202; People ex rel. Atty. Gen. v. Common Council of Detroit, 29 Mich. 108; People ex rel. Wood v. Draper, 15 N.Y. 532; People ex rel. Bolton v. Albertson, 55 N.Y. 50; People v. Lynch, 51 Cal. 15, 21 Am.Rep. 677; and Philadelphia v. Fox, 64 Pa. 169.

Unquestionably these facts were had in mind when this provision was framed, and the people in adopting it intended to guard against the evils to which attention had been called by these cases.

It remains only to determine whether or not the people, by the language used, effected their purpose so far as the instant case is concerned. If they have done so, it is our duty so to declare. In Allor v. Wayne County Auditor, 43 Mich. 76, 4 N.W. 492, it is said:

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