Blue Ridge Telephone Co. v. City of Blue Ridge

288 S.E.2d 705, 161 Ga. App. 452, 1982 Ga. App. LEXIS 1912
Court of Appeals of Georgia·Decided March 2, 1982·No. 62557, 62558·Published·Cited by 6 cases

Opinion

McMurray, Presiding Judge.

This appeal arises from the trial court’s order on opposing motions for summary judgment. The action initially was a complaint for declaratory relief, as well as for a money judgment.

The complaint filed by the City of Blue Ridge alleges it is a *453 municipal corporation organized and operating under the laws of this state and that in ,1959 its city council passed an ordinance which purported to grant to defendant Blue Ridge Telephone Company, a Georgia corporation, a franchise to operate a telephone system, within the City of Blue Ridge and to use the public streets, rights-of-way, alleys and other public property for its telephone lines, and equipment until May 15,1996. The ordinance in question provided for no franchise fee to be paid to the plaintiff city and none has, in fact, been paid. Plaintiff alleges that the ordinance granting the franchise in question is ultra vires and void being inconsistent with the charter of the plaintiff City of Blue Ridge as enacted in Georgia Laws 1935, pp. 928, 954, Section 54 which provides that no such franchise shall be granted for a term of “more than twenty years, nor without compensation to said city . . . which compensation shall be one per cent of the annual gross income received from or on account of said franchise.”

The relief sought by the plaintiff City of Blue Ridge was a money judgment equal to 1% of the annual gross income received by defendant Blue Ridge Telephone Company from or on account of the purported franchise for the years 1960 through 1980. The plaintiff presented alternative grounds for the grant of the money judgment in that the defendant had knowledge of the limitations on the powers of the City of Blue Ridge in participating in an act beyond those limitations at its peril and also sought in quantum meruit the reasonable value of the use made of the property of the plaintiff city by the defendant. Plaintiff also sought declarations of the rights and obligations of plaintiff and defendant in regard to the 1959 ordinance purporting to grant the defendant the franchise and its previous and present use of city property by defendant in carrying out its business.

Plaintiff submitted its motion for summary judgment as to the legality of the 1959 ordinance purporting to grant the franchise and as to the liability of defendant to compensate the plaintiff for the use of the city property. Defendant filed its motion for summary judgment as to all issues.

After discovery the trial court entered an order whereby it held that the 1959 ordinance was ultra vires as contrary to the plaintiff’s city charter but held that the 20 year and 1 % restrictions of the City of Blue Ridge charter, § 54 were repealed by Code Ann. § 69-310 (e) (Ga. L. 1962, pp. 140,141; later amended by Ga. L. 1973, pp. 778,779; 1976, pp. 188,189; 1979, pp. 645, 646). The.trial court held that this repeal of these restrictions in conjunction with the acquiescence of the plaintiff in the operation of the telephone company in the City of Blue Ridge on terms which were within the plaintiff’s power to grant it a franchise from 1962 until the instant suit was filed, subjected *454 plaintiff City of Blue Ridge to the rules of estoppel for such period of time so that the plaintiff is estopped to challenge the validity of the subject franchise or contractual relationship as it existed between the parities from 1962 until the instant suit was filed, but since the franchise at the time it was granted was ultra vires and void, which fact was within the imputed knowledge of both parties, the city is not estopped from challenging the validity of the franchise prospectively so that as of the filing of this suit there is no franchise nor contractual relationship between the parties. In all other matters plaintiff’s motion for summary judgment was denied, and summary judgment in favor of defendant was granted as to the issue of money damages but denied as to all other matters. Both parties appeal. Held:

1. Defendant contends that the franchise is granted by Code § 104-205, not by the municipal ordinance, and the 1959 city ordinance is merely a consent as contemplated by the language of the statute. This statute provides that a telephone company chartered under the laws of this or another state shall have the right to construct, maintain and operate telephone lines, “over the public highways of this State, with the approval of the county or municipal authorities in charge of such highways.” (Emphasis supplied.)

The distinction which the defendant seeks to draw between an approval under the provisions of Code § 104-205 and the grant of franchise under the city charter of plaintiff is not well taken. The franchise is “[a] special privilege conferred by government on individual or corporation, and which does not belong to citizens of country generally of common right.” Black’s Law Dictionary, Fourth Edition. The approval contemplated under Code § 104-205 is the same. It is also the conferring of a special privilege allowing the use of the public streets and rights-of-way which does not otherwise belong to individual citizens. We acknowledge the dicta contained in the City of Macon v. Southern Bell Tel. &c. Co., 89 Ga. App. 252, 266 (79 SE2d 265), stating that a telephone company by virtue of the provisions of Code § 104-205 holds a right to use the streets of a municipality by virtue of a franchise from the state. That dicta was unnecessary to the opinion in that case, was unsupported by any citation of Georgia law and we believe incorrect. Nor does § 24 of the city charter of the City of Blue Ridge dealing with powers as to streets, etc., prevail over the provisions of § 54. Section 24 provides that the city shall have the power to regulate or prohibit the use of the streets for telephone poles and other uses and also to compel the telephone company having previously erected poles and wires in said city to remove them to any responsible location designated by the Mayor and Councilmen. We find no conflict between § 24 and § 54 of the charter. Section 54 involves the granting of franchises while § 24, *455 insofar as it specifically relates to telephone companies, is involved with the regulation of the telephone companies who have presumably been granted franchises under the provisions of § 54. See Simmons v. City of Clarkesville, 234 Ga. 530, 531 (216 SE2d 826); Sutton v. City of Cordele, 230 Ga. 681, 682 (3) (198 SE2d 856); Horkan v. City of Moultrie, 136 Ga. 561 (71 SE 785); Town of Decatur v. DeKalb County, 130 Ga. 483 (61 SE 23).

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Blue Ridge Telephone Co. v. City of Blue Ridge, 288 S.E.2d 705, 161 Ga. App. 452, 1982 Ga. App. LEXIS 1912 (Ga. Ct. App. 1982).

288 S.E.2d 705 (Blue Ridge Telephone Co. v. City of Blue Ridge) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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