Twin City Power Co. v. Savannah River Elec. Co.

• Decision Date: 26 November 1930
• Docket Number: 13033.
• Parties: TWIN CITY POWER CO. v. SAVANNAH RIVER ELECTRIC CO.
• Court: South Carolina Supreme Court

161 S.E. 750

163 S.C. 438

TWIN CITY POWER CO. v. SAVANNAH RIVER ELECTRIC CO.

No. 13033.

Supreme Court of South Carolina

November 26, 1930

Appeal from Common Pleas Circuit Court of McCormick County; W. H Townsend, Judge.

Action by the Twin City Power Company against the Savannah River Electric Company. From an order sustaining demurrer to the complaint, both plaintiff and defendant appeal.

Reversed on each appeal.

The order of the circuit judge, directed to be reported, is as follows:

Order.

This matter comes before me on return to an order to show cause made by me while on the eleventh circuit, at the instance of the plaintiff why it should not be granted a temporary injunction against the defendant pendente lite.

The plaintiff seeks the injunction, as in S.C. R. R. Co. v C. & A. R. R. Co., 13 Rich. Eq. 339, 353, 356, for the protection of a franchise to develop a water power at the downstream end of Price's Island in the Savannah River about twenty-five miles above Augusta, Ga., granted it by this State, and to its subsidiary corporation, of which it owns all the stock, by the State of Georgia, together with riparian lands acquired by them in both States for the purpose of building and operating a single water power plant for the generation of electricity, and its sale to the public.

The subject matter of the action is plaintiff's right to use, without interference by defendant, the waters and lands, including a power site and basin for reservoir, on the Savannah River in McCormick County, which it owns, is developing and intends to develop and use as a single public utility under the laws of this State.

The defendant has served notice of its intention to take such lands, rights and franchise from the plaintiff under the exercise of the power of eminent domain in accordance with the Civil Code of South Carolina, 1922. The immediate issue in the action is whether the lands, rights and franchise of the plaintiff can be so taken by one situated as the defendant.

As to the right to an injunction in such case, it was said by Chancellor Dunkin in Bird v. W. & M. R. R. Co., 8 Rich Eq. 55, 64 Am. Dec. 739: "It might be suggested that public improvements may be sometimes greatly retarded by this summary interference on the part of the Court. But if the right of property in the plaintiff be conceded or established, and the license or warrant of the defendant to encroach upon it is deemed doubtful by a judicial magistrate, the defendant should withhold his hand until the right be established." And as said in S. A. L. Ry. v. A. C. L. R. R. Co., 88 S.C. 478, 71 S.E. 39, a "temporary injunction should be granted when it appears prima facie that such injunction is necessary to preserve the right asserted by the plaintiff."

The defendant by way of return to the order to show cause, first demurred (1) on the ground that there is a defect of parties in that D. J. Halpin, as Trustee, the holder of a mortgage over the lands and property in question, is not joined as plaintiff or defendant, though claiming to be privy in interest with the plaintiff.

To this plaintiff replies that this action is to enjoin a threatened trespass or tort by defendant, the injury from which is severable as to plaintiff, and that no adjudication is sought upon the rights of the mortgagee.

The mortgagee has an equitable interest in the subject matter of the action, on which he holds the mortgage, and should be heard on the right of defendant to force a compulsory sale under the power of eminent domain, the proceeds of which sale would be primarily applicable toward the payment of the mortgage debt, and necessarily affect or destroy its security. Ex Parte Johnson, 147 S.C. 260, 145 S.E. 113; Old Colony Trust Co. v. Atlanta Ry. Co. (C. C.) 100 F. 799; Water Power Co. v. Electric Co., 43 S.C. 166, 20 S.E. 1002; Niles-Bement-Pond Co. v. Iron Moulders Union, 254 U.S. 80, 41 S.Ct. 41, 65 L.Ed. 145; Comm. Trust Co. v. Smith, 266 U.S. 152, 45 S.Ct. 26, 69 L.Ed. 219.

I conclude that the mortgagee is a necessary party to a complete determination of the controversy; and that under Code Civil Proc. 1922, § 365, the Court must cause him to be brought in as a party, and leave is hereby given the plaintiff to amend his complaint within thirty days after notice of the filing of this order so as to make said mortgagee a party defendant.

The defendant further demurred (2) on the ground that it fails to state a valid cause of action against the defendant for an injunction, as the plaintiff has a full and adequate remedy at law.

This ground of demurrer is overruled under the authority of Columbia Water Power Co. v. Nunamaker, 73 S.C. 550, 554, 53 S.E. 996, and Riley v. Union Station, 67 S.C. 92, 45 S.E. 149.

The defendant then moved to strike from the complaint as irrelevant paragraphs 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58 and 59. This motion is refused, as I deem the allegations of these paragraphs relevant to the issue whether the land, rights and franchise of the plaintiff can be taken by one so situated as the defendant under the exercise of the power of eminent domain.

The complaint and supporting affidavits disclose the fact that the lands, water rights and franchise, sought to be condemned by defendant, together with the rights and lands owned by it, through its subsidiary corporation in Georgia, constitute prima facie, a single public utility unit, now in process of creation and development under the franchise granted concurrently by the States of South Carolina and Georgia. The questions whether or not plaintiff has forfeited such franchise granted to it by this State, and whether or not its lands, water rights and other property have ceased to be dedicated to a public use, cannot be determined in this action in the absence of the State of South Carolina, who is a necessary and indispensable party to the determination of those questions. State ex rel. City Council of Spartanburg v. Spartanburg, Clifton & Glendale R. R. Co., 51 S.C. 129, 28 S.E. 145; Code Civil Proc., Sec., 777; Columbia Water Power Co. v. Columbia Electric St. Ry. L. & P. Co., 43 S.C. 154, 165-167, 20 S.E. 1002.

The jurisdiction of the Federal Water Power Commission to issue a license for the use of the waters of the Savannah River for power purposes, and the effect of a failure to obtain such license from them, are at least questionable, and are not now necessary for determination on this motion. Little Falls Fibre Co. v. Henry Ford & Son, Inc., 249 N.Y. 495, 164 N.E. 558.

Hence, I conclude that the lands and property rights of the plaintiff sought to be condemned are necessary parts of an existing public utility, which would be destroyed by the proposed exercise of the power of eminent domain to take them from the plaintiff. Such exercise of the power is not to be implied from the general powers granted the defendant in its charter. 2 Nichols on Eminent Domain, § 352; 2 Lewis on Eminent Domain, § § 418, 419, 433, 440, 442; Marsh Mining Co. v. Inland Mining Co., 30 Idaho, 1, 165 P. 1128; Rutland Ry. Co. v. Clarendon Power Co., 86 Vt. 45, 83 A. 332, 44 L. R. A. (N. S.) 1204; State ex rel. Mason County Power Co. v. Supr. St. of Mason County, 99 Wash. 496, 169 P. 994; State ex rel. Cascade Pub. Serv. Co. v. Supr. Ct. Pierce Co., 53 Wash. 321, 101 P. 1094; Pittsburgh Junction R. Co.'s Appeal, 122 Pa. 511, 529, 6 A. 564, 9 Am. St. Rep. 128.

The plaintiff's right to its property is established prima facie; and the defendant's right to take it under the proposed proceeding in eminent domain is at least doubtful.

It is, therefore, ordered and adjudged: That upon the plaintiff entering into bond or written undertaking with a surety to be approved by the Clerk of Court for McCormick County, to the effect that the plaintiff will pay to the defendant such damages, not exceeding the sum of One Thousand Dollars, as he may sustain by reason of this injunction, if the Court shall finally decide that the plaintiff was not entitled thereto, the defendant be enjoined and restrained pending the hearing and determination of this action upon its merits, from in anywise interfering with the property, lands, rights, easements, water power, or other properties of the plaintiff mentioned and referred to in the complaint, and from proceeding with the condemnation proceedings attempted to be instituted under the notice, Exhibit A, attached to the complaint; provided, the plaintiff do within thirty days after the date of this order amend his complaint so as to make Daniel J. Halpin as Trustee, a party defendant by service of summons either personally within this State, or after order for publication of summons under section 392 of the Code of Civil Procedure.

And in case the plaintiff shall fail to bring in said Trustee as a party to this action within the time above limited that the complaint be dismissed.

E. H. Callaway, of Augusta, Ga., T. B. Greneker, of Edgefield, and D. W. Robinson, of Columbia, for plaintiff.

Grier, Park & McDonald, of Greenwood, J. Wm. Thurmond, of Edgefield, and Hull, Barrett & Willingham, of Augusta, Ga., for defendant.

COTHRAN J.

This action was commenced on April 24, 1929, by the Twin City Power Company, a corporation under a charter issued by the secretary of state of South Carolina in 1900, against the Savannah River Electric Company, a corporation under a charter granted by a special act of the General Assembly of South Carolina, 35 St. at Large, p. 887, in 1927, for the purpose of enjoining the prosecution of a condemnation proceeding instituted by the Savannah River Electric Company in March, 1929, by which it proposed to condemn certain property of the Twin City Power Company...