Carothers v. Philadelphia Co.

12 A. 314, 118 Pa. 468, 1888 Pa. LEXIS 411

Opinion

Opinion,

Mb.. Justice Williams :

The plaintiff in the court below is the owner of a tract of land. The defendant is a corporation claiming the right of eminent domain and seeking by virtue thereof to enter upon the plaintiff’s land and lay under the soil, pipes for the transportation of natural gas from its wells in Westmoreland county to its customers in and about the city of Pittsburgh. The plaintiff denies that the defendant possesses this right for the purpose for which it is sought to exercise it, and asks the court to restrain its exercise; alleging that the production, transportation, and supply of natural gas is not among the objects which the company has power to enter upon, either under the provisions of the act of 1871, which created it, or those of 1885, which provided for the incorporation and organization of natural ga.s companies.

The decision of this case makes it necessary, therefore, to ascertain what powers were conferred upon this company by the act of incorporation, and to what extent they have been enlarged or diminished by the act of 1885. The act of March 22, 1871, incorporated the Empire Contract Company with power to change its name by the action of its stockholders, and then clothed it with “ all the rights, powers, privileges, franchises, and immunities ” which had been given to the Pennsylvania Company by an act approved on April 7, 1870. Under this authority the Empire Contract Company was organized, began business, changed its name several times, and on March 11,1884, was sold by the sheriff of Dauphin county on a judgment obtained by the commonwealth for unpaid taxes. The purchasers then proceeded in May, 1884, to reorganize the company under the name of the Philadelphia Company, in accordance with the act of 1878, and filed an acceptance of the provisions of the 16th article of the constitution as required by that act.

Upon its reorganization the Philadelphia Company possessed all the powers conferred directly by the act of incorporation, and all those possessed by the Pennsylvania Company under the act of April 7,1870. Among the latter were the following:—

1. To act as a contractor or builder, and as such to build, construct, maintain or manage for others—

2. To act as principal, and as such to build, construct, maintain or manage for itself—

3. To act as a purchaser, and as such to buy, maintain, or manage in its own name or otherwise “any work or works public or private which may tend or be designed to improve, increase, facilitate, or develop ” either of the following objects, viz.: (1) trade; (2) travel; (3) transportation and conveyance of (a) freight; (i) live stock; (e) passengers ; (d~) any other traffic, by land or water from or to any part of the United States or territories thereof. It was also invested with power to “ enter upon and occupy the lands of individuals or companies on making payment therefor or giving security according to law.”

Soon after its organization the Philadelphia Company turned its attention towards the production and supply of natural gas as a fuel, and in July, 1884, began its operations in the Murraysville field. These were conducted on a large scale, and the master finds that, prior to the taking of the testimony before him, the company had thirteen lines of gas pipes conveying gas to custoihers, were supplying about eleven thousand factories and dwellings with fuel equivalent to ten thousand tons of coal per day, and had an actual cash investment in the business of over eight millions of dollars.

If the company has the right to engage in this business under its act of incorporation, it has the right of eminent domain under the same act. If the act of incorporation does not authorize it, then, as to this business, it is a private association, and without the power to enter upon the plaintiff’s lands. The master and the court below held that the company was authorized to enter in its corporate character upon this business, and rested their conclusion upon the proposition that gas is freight, and that conducting it through pipes from the wells to the consumers is the transportation of freight. But a transportation company provides simply the means for transportation of freight for customers at certain prices. This company produces a commodity which it takes to market and sells. The gas is produced at the wells. It is wanted at the mills and dwellings of the city. The pipe-lines laid by this company serve to convey the gas from its wells to its own customers, to whom it is sold and delivered. The transportation is incidental to the production and supply of the gas. The situation is precisely the same as in the case of illuminating gas, which is manufactured, stored, and conveyed by pipes to the places of consumption. The business is that of making and supplying gas for light. The transportation to the customer is incidental. The same is also true of water companies. They produce, store, and supply to customers, water. Transportation by means of pipes is the means of delivery, and is a mere incident of the business. The business of the Philadelphia company is, in our opinion, that of a fuel-gas company, viz.: the production and distribution of natural gas ; and the transportation of the gas is the necessary means of delivery to its customers and nothing more. Had it the power to engage in this business in 1884 ? It will be seen by our analysis of the grant in the act of incorporation that the company had the power to build, etc., any work, public or private, which “ may tend or be designed to improve, increase, facilitate, or develop trade.”

In the preamble to the act of 1885 the legislature declares that natural gas has become a “ prime necessity for use as a fuel and. otherwise in the development of trade.” It thus applies to this business the very words employed in the act of incorporation to describe the powers of this company. It is, moreover, part of the current history of the commonwealth that the discovery and use of natural gas has facilitated and cheapened and increased the production of manufactured articles of all descriptions, where heat is employed in the generation of steam or in the processes of manufacture. By cheapening and increasing production trade has been stimulated, facilitated, and developed wherever the natural gas has been made available as a fuel. We conclude, therefore, that the works by which the gas is produced from the earth, transported to the factories and dwellings of Pittsburgh, and then delivered to customers, are works that “ tend and are designed to improve, increase, facilitate, and develop trade,” and are therefore within the powers granted to this company. If so, the Philadelphia Company is rightfully engaged as a corporation in this business by virtue of its own charter.

The act of 1885 declares the transportation and supply of natural gas to be a public use, and, the days of special charters having gone by, provides by general law for “ the incorporation and regulation of natural gas companies; ” but does not diminish the powers of any corporation in existence by virtue of a special charter. This company having the right to engage in this business had by express words the right of eminent domain and could enter upon lands without the aid of the act of 1885. But it is objected that the act of incorporation did not provide the machinery by which the value of property taken or injured could be ascertained and a judgment obtained therefor; and for that reason it is urged that the grant of eminent domain cannot be sustained. The grant is in these words: “ The company hereby created shall also have power to enter upon and occupy the lands of individuals or companies on making payment therefor, or giving security according to law, for the purpose of erecting,” etc.

The proceedings to secure the adjustment of the damages were to be “ according to law.” Had the company built a railroad under this provision the general laws regulating the assessment of damages against railroad companies would have provided the mode of procedure. That they would have been applicable is very clear from the words of the act of 1849. This act provides that “ whenever a special act of the general assembly shall hereafter be passed, authorizing the incorporation •of a railroad company,” the manner of its organization, its powers, privileges, and obligations shall be as therein set forth, and damages for its entry upon lands shall be assessed in the manner pointed out. It furnished a system of procedure to be followed in all cases arising after its passage not specially provided for, and would have been applicable to this company if its undertaking had been to build a railroad. But the Philadelphia Company did not build a railroad. It entered upon the business of producing and supplying natural gas. The general laws regulating the exercise of the right of eminent domain and assessing damages therefor, did not contemplate an entry of this description and their provisions were not adapted to the assessment of the damages done by it.

It may be, therefore, as the plaintiff in error insists, that the landowner had no remedy under the act of incorporation except an action at law. If so, the act of 1885 has supplied what was lacking and given a general system for the assessment of damages applicable to all natural gas companies. In the tenth section, after the declaration that the transportation and supply of natural gas for public consumption is a public use, the legislature declares that “ any and all corporations that is or are now, or shall hereafter be, engaged in such business shall have the right of eminent domain for the laying of pipelines for the transportation and distribution of natural gas.” Then follow provisions regulating the exercise of the right and the proceedings for the assessment of the damages done thereby. These provisions are not limited in their application to corporations created under the act, but are general and apply to all “ corporations that is or are now ” engaged in the business, as well as to those that “shall hereafter be engaged” in it. Thus corporations then supplying gas and those to be so engaged by virtue of incorporation under the act are treated in the same manner.

This is in harmony with the circumstances that gave rise to the legislation of 1885, as well as with the general character of its provisions. The business of producing and supplying natural gas had assumed important proportions prior to 1885. Several companies, organized under the general laws providing for the incorporation of illuminating gas companies, were engaged in the business. This court had recently held that such charters conferred no authority to transport or to deal in natural gas as a fuel. The precise point in controversy was the authority of a company so organized to exercise the right of eminent domain. In view of this state of things the legislature, in 1885, declared that the production and distribution of natural gas had become, and then was, a matter of “ prime necessity; ” that the business was so important as to justify declaring it “ a public use ; ” and that it had become essential that corporations for this purpose “ should be provided for by general law.” It then conferred by apt words the right of eminent domain on all corporations then engaged or thereafter to be engaged in the business, and prescribed the manner in which the assessment of damages should be made and the amount thereof finally adjusted. Whatever the situation of the plaintiff may have been under the act of incorporation, he now has an ample remedy for the recovery of his damages under the general system provided by the act of 1885.

This conclusion renders it unnecessary to enter at any length upon a discussion of the constitutional question raised over the title to the act of 1871. If it should be conceded, as the plaintiff in error contends, that the title does not sufficiently indicate a purpose to confer the right of eminent domain, or that it is misleading so far as this subject is concerned, such concession could not affect the decision of this case. Its only result would be to render so much of the act as the title gave no notice of, unconstitutional. This was distinctly ruled in the Union Pass. Railway Co.’s App.; 81* Pa. 91, and in the Allegheny Co. Home’s App., 77 Pa. 77. The balance of the act would be unaffected. The corporation would remain with the general powers with which it was endowed; and as it was actually engaged in the transportation of natural gas when the act of 1885 became a law, it would acquire under its provisions both the right of eminent domain and the system for adjusting the damages done by its exercise.

But, speaking for myself, I would hold the title to the act of 1871 to be neither insufficient nor misleading. It is in these words: “An act to incorporate the Empire Contract Company and define the powers thereof.” All persons interested in knowing what contracts the- company may make, or what powers it possesses, have notice from the title that both these subjects are covered by the act which follows. This is a sufficient compliance with the constitutional provision. It is only necessary the title should fairly give notice of the subject of the act, so as reasonably to lead to an inquiry into its body: Allegheny Co. Home’s Case, 77 Pa. 77; Craig v. Church, 88 Pa. 42; Loewi v. Haedrich, 8 W. N. 70. It is not necessary that the title should be a complete index of its contents: Com. v. Green, 58 Pa. 226.

Our conclusions on the whole case may be summarized as follows:—

The special law incorporating the defendant company, while it may be improvident in some of its provisions, is nevertheless valid.

The grant of power therein is sufficiently comprehensive to authorize the company to engage in the production, distribution, and supply of natural gas as a fuel.

It possessed the right of eminent domain under the provisions of its charter.

If this is doubtful it acquired it under the act of 1885 beyond doubt.

The general system for the assessment of damages provided by the act of 1885 is applicable to companies engaged in the transportation of natural gas at and before its passage as well as to those organized for that purpose under its provisions.

Another and a graver question is suggested by this discussion, but it is not involved in this case. . The policy of the state is to commit the development and prosecution of different enterprises to different classes of corporations. One furnishes a city with water, another with light, and a third with heat. One carries packages, another transmits messages, and so on through the numerous manufacturing, mining, commercial, and financial agencies which the business of this age brings into its service. The question which we have is not whether a single corporation organized under an “ omnibus charter ” like that of the Philadelphia Company may be permitted to gather up into one corporate hand all the powers and franchises of the commonwealth, but whether this company may do this particular business in which it has embarked its capital. We hold that it may; that the powers granted by the act of incorporation authorized it to engage in this business and to become a natural gas company. The other subject is referred to only that we may in the language of the old pleaders “ exclude the conclusion ” that it is in the least degree involved in or affected by the decision of this case.

The appeal is dismissed at the costs of the appellant.