In this action the plaintiff questions the validity of an act of the Legislature of 1925 which authorizes the surrender of a municipal franchise in exchange for a revocable permit and requiring certificates of convenience and necessity and providing for the determination and issuance thereof. The act has been approved by the Governor and is now part of the law of this state unless it violates some provision of the Constitution.
The act is as follows:
"House Bill No. 4. Revocable Permit Act.
"An act relating to the business of furnishing power, light, heat, gas, electricity, or water in cities and towns; authorizing the surrender of municipal franchises in exchange for revocable permits; requiring certificates of convenience and necessity and providing for the determination and issuance thereof; and repealing acts in conflict herewith.
"Be It Enacted by the People of the State of Oklahoma:
"Corporations — Franchises — Surrender.
"Section. 1. Any person, firm, association, or corporation, now or hereafter engaged in the business of furnishing power, light, heat, gas, electricity, or water as a public utility in any city or town in this state under a municipal franchise now in existence or hereafter granted, may at any time before the expiration of such franchise, but not thereafter, file with the clerk of the municipal corporation which granted such franchise and with the Corporation Commission of the state of Oklahoma a written declaration and agreement, executed in the manner required for the execution of conveyances of real estate, that it surrenders such municipal franchise for the purposes herein provided;
and, in consideration, the utility surrendering the same shall, by operation of law, receive in lieu of such surrendered franchise, a permit from the state revocable only in the manner hereinafter provided, granting to such utility the right, until such permit shall be so revoked, to conduct the same business in such municipality and enjoy the use of the streets, alleys, and public grounds, or ways, in the municipality for that purpose and upon the terms and conditions of said surrendered franchise except as to its period of duration, subject to the lawful police regulation and control of such municipal"
Municipal Corporations — Receipts.
"Section 2. Nothing in this act shall be so construed as to limit the right of any municipal corporation to include in any franchise hereafter granted by it such requirement as it shall see fit that the grantee of such franchise pay to the municipal corporation a portion of the receipts of such grantee from business conducted under such franchise, or pay to such municipal corporation any other sum or sums of money; or such reservation of right in the municipality to purchase the property of the grantee used in the conduct of business under such franchise. Every such right to share receipts or to receive payments of moneys or to purchase created by any franchise or other contract present or future, shall continue to exist to the full extent defined by such franchise or contract; and no existing right of any municipal corporation under the laws of the state of Oklahoma shall be effected (sic) hereby except as herein expressly provided.
"Corporation Commission — Permit — Certificate.
"Section 3. Upon the surrender of any municipal franchise, as provided in the first section hereof, it shall be the duty of the Corporation Commission to issue to such utility a certificate to the effect that from the date of the filing of such written declaration and agreement, it is the holder of such permit, and such certificate shall be conclusive of that fact.
"Permit — Amendments — Revocation.
"Section 4. Any permit granted under the provisions of this act may be altered, amended, annulled, revoked, or repealed by enactment of the Legislature of Oklahoma whenever in its opinion such permit may be injurious to the citizens of this state; in such manner, however, that no injustice shall be done to the holder of such permit.
"Corporations — Franchises — Permits.
"Section 5. No person, firm, association, or corporation except the municipality shall commence the business of furnishing power, heat, light, gas, electricity or water as a public utility, or commence the construction of a plant, works, or system therefor, or apply for or be granted a municipal franchise therefor, in any city or town of this state so long as there is in existence a valid franchise or permit authorizing any other person, firm, association, or corporation, to conduct in such city or town a business similar to that proposed, until the Corporation Commission of Oklahoma shall issue a certificate of public convenience and necessity therefor, as hereinafter provided. But no such certificate shall be required in cases where no such valid franchise or permit exists.
"Corporation Commission — Jurisdiction — Certificates.
"Section 6. The Corporation Commission is hereby given jurisdiction to determine whether public convenience will be served by such proposed new public utility business and whether public necessity exists therefor and to issue such certificate of public convenience and necessity upon hearing after a written petition therefor shall be filed. The Corporation Commission shall have power to promulgate such rules and regulations not in conflict herewith, as it shall see fit, for the purpose of making this act effectual, and before hearing any such petition shall fix a date therefor and shall require that notice of such hearing be given by delivering a copy to the chief executive officer and the clerk of all cities and towns effected (sic) by the proposal and to the managing officer of any person, firm, association or corporation conducting or holding a valid franchise or permit to conduct a similar business in the same locality or any portion thereof. In addition, the Corporation Commission shall require that such notice be published at the expense of the petitioner for at least two weeks in some newspaper or newspapers of general circulation in the cities or town effected (sic) by such petition. Upon the hearing of such petition, any person interested may appear, and file objections thereto, and offer evidence in support thereof, and the Commission may summon such other witnesses, and require the production of such other evidence as it may deem proper and shall have all powers incident and necessary to a full and complete investigation of such petition and the objections thereto. Upon the hearing of such application, if the Commission shall find that the petition should be granted, it shall issue under the seal of the Commission its certificate of public convenience and necessity, and in so doing the Commission may fix the time within which the construction of such utility shall be commenced and completed. Should the Commission find that the certificate should be refused, it shall so order. Any party to the proceedings feeling himself aggrieved by the order of the Commission in issuing or refusing such certificate, may appeal to the Supreme Court of the state of Oklahoma, as provided in other cases of appeal
from orders of the Corporation Commission.
"Repealing Clause.
"Section 7. All acts and parts of acts in conflict herewith are hereby repealed."
"Approved March 19, 1925."
The parties hold the same position in this court as they did in the district court of Okmulgee county, and will be referred to hereafter as plaintiff and defendant.
On July 20, 1905, the incorporated town of Okmulgee, Indian Territory, granted a municipal franchise to L.S. Skelton, his heirs and assigns, authorizing him and his heirs and assigns to use the streets or avenues, alleys and public places of said town for the purposes of laying pipe lines, mains, and other appliances through which to convey gas and furnish the same to the inhabitants of said town. On October 24, 1912, said franchise was assigned to the Okmulgee Gas Company, and on July 7, 1925, while engaged in the business of furnishing natural gas as a public utility under said municipal franchise, the Okmulgee Gas Company made and executed its written declaration and agreement surrendering said municipal franchise for the purposes provided in House Bill No. 4, above set out, and received in lieu thereof a revocable permit as provided in said act.
On the 24th day of November, 1925, the city of Okmulgee, Okla., filed a petition in the district court of Okmulgee county, Okla., for the purpose of enjoining the Okmulgee Gas Company from using the streets and alleys of said municipality, alleging that the franchise granted to L.S. Skelton and his heirs and assigns on July 20, 1905, expired August 7, 1925, and that the revocable permit under which the utility was then operating was invalid, because chapter 102 of the Laws of 1925, above set out as House Bill No. 4, was unconstitutional. The defendant filed its answer, alleging compliance with the terms of said act. The case was tried on an agreed statement of facts, and on April 25, 1927, a decree was granted denying plaintiff the relief sought, and dismissing the petition with prejudice. From this judgment the city of Okmulgee has appealed. The question presented is the constitutionality of the Revocable Permit Law.
Plaintiff contends that the law is unconstitutional and void, and that it is repugnant to sections 5a and 5b, and section 7 of art. 18, of the Constitution of Oklahoma; and also section 32 of art. 2, and section 51 of art. 5, of the Constitution. The defendant claims that the act under consideration is not violative of, or repugnant to any of the provisions of the Constitution.
Ordinance 105, which, under the agreed statement of facts, was the ordinance granting the franchise to L.S. Skelton, his heirs and assigns, the franchise which defendant claims to have surrendered and taken in lien thereof a revocable permit under House Bill No. 4, was passed and approved and ordered published by the duly elected officers of the incorporated town of Okmulgee, Indian Territory, on July 20, 1905, and published in the Chieftain August 8, 1905, and by section 2 of said ordinance, the said franchise was limited to the term of 20 years, and if House Bill No. 4 is unconstitutional, then the franchise involved in this action expired on August 8, 1925.
As said in City of Pawhuska v. Pawhuska Oil Gas Co.,64 Okla. 214, 166 P. 1058, at page 221 of the opinion:
"It is well settled that the courts are not concerned with the policy of the law, and it is our duty to interpret the constitutional and legislative enactments as we find them."
The object of construction, applied to a Constitution, is to give effect to the intent of its framers, and of the people in adopting it. This intent is to be found in the instrument itself; and, when the text of a constitutional provision is not ambiguous, the courts in giving construction thereto are not at liberty to search for its meaning beyond the instrument.
To get at the thought or meaning expressed in a statute, a contract, or a Constitution, the first resort in all cases is to the natural signification in the order of grammatical arrangement in which the framers of the instrument have placed them. If the words convey definite meaning, which involves no absurdity nor any contradiction of other parts of the instrument, then that meaning, apparent on the face of the instrument, must be accepted, and neither the courts nor the Legislature have the right to add to it or take from it. Shaw, State Auditor. v. Grumbine, 137 Okla. 95, 278 P. 311.
It is not to be presumed that a provision was inserted in the Constitution or statute without reason, or that a result was intended inconsistent with the judgment of men of common sense, guided by reason. Mitchell v. Lowden, 288 Ill. 327, 123 N.E. 566.
Our Constitutional Convention evidently intended, as far as possible, to reserve in the people of the state, and of the several subdivisions thereof, the right to propose legislation as well as provide for referring acts of legislation to a vote of the people, as
the general trend of the several provisions relating to the legislative branch of the government so indicates. Section 1 of art. 5 provides that:
"The legislative authority of the state shall be vested in a Legislature, consisting of a Senate and a House of Representatives; but the people reserve to themselves the power to propose laws and amendments to the Constitution and to enact or reject the same at the polls independent of the Legislature, and also reserve power at their own option to approve or reject at the polls any act of the Legislature."
Section 4a of art. 18 provides that:
"The powers of initiative and referendum, reserved by this Constitution to the people of the state and respective counties and districts therein, are hereby reserved to the people of every municipal corporation now existing or which shall hereafter be created within this state, with reference to all legislative authority which it may exercise, and amendments to charters for its own government in accordance with the provisions of this Constitution."
Section 10 of art. 9 provides that:
"No law shall be passed by the Legislature granting the right to construct and operate a street railroad within any city, town, or village, or upon any public highway, with-out first acquiring the consent of the local authorities having control of the street or highway proposed to be occupied by such street railroad."
It also appears that the framers of the Constitution and the people in adopting the same, as far as possible, intended to provide for local self-government or home rule.
"The people are above the Constitution, subject to it and all its parts while it is in force, but possessed of the undoubted right to change, alter or amend it at their own will in any of the regular ways provided by the Constitution or laws." Hockett v. State Licensing Board, 91 Ohio St. 176, 110 N.E. 485.
The power to make changes in the organic law is one belonging peculiarly to the people. Ellingham v. Dye, 178 Ind. 336, 99 N.E. 1.
The principle of the initiative and referendum may be inserted in a state Constitution. State v. Brantley, 113 Miss. 786, 74 So. 662.
"A Constitution is legislation direct from the people acting in their sovereign capacity, while a statute is legislation from their representatives subject to limitations prescribed by the superior authority." Ellingham v. Dye, supra.
"A Constitution is a Magna Charta of the people's rights, the fundamental law of the land, intended, not for short periods of time, but for all time." Henry v. State, 88 Miss. 843, 39 So. 856.
In order to give effect to the intent of the framers of the Constitution and the people in adopting it, we feel that a brief consideration of the historical conditions as they existed at that time is proper. The framers of the Constitution had for their consideration and guidance the Constitutions of 45 states of the Union, and also the construction of the Constitutions of those states by the courts of last resort of said states. Some of the delegates were from the Indian Territory, governed locally by one code of laws, and some from Oklahoma Territory, governed by another code, and each territory without a Constitution, and the Indian Territory without a Legislature, and each territory being limited in its local self-government by the Congress of the United States.
The municipalities in Oklahoma Territory had the power to grant charters for a period not exceeding 21 years, and the municipalities in Indian Territory, under Mansfield Digest, chapter 29, sec. 775 (Ind. T. Ann. St. 1899, section 525), had the right, through its mayor and council, to contract with any person or company to construct and operate water systems and furnish gas to such cities and to construct street railroads, for a period of time to be agreed upon in the franchise.
On October 19, 1904, the Court of Appeals of Indian Territory in the case of Incorporated Town of Tahlequah v. Guinn, 82 S.W. Rep. 886, held that a contract giving a water company the exclusive privilege of supplying water for streets and public places in the town for 60 years was valid.
At that time, there was in force in some of the states laws granting exclusive privileges and exclusive franchises, others granting perpetual franchise with the right reserved in the legislative branch of the government to alter, amend, annul, revoke, or repeal any charter of corporations or franchises subject to being altered, amended, revoked, or repealed, where, in its opinion, it might be injurious to the citizens of the state, in such manner, however, that no injustice be done the incorporators; and still others with authority to grant limited franchises for a certain number of years fixed by the statute of those states.
The National Association of Editors at Guthrie in June, 1905, secured a strong resolution favorable to joint statehood. About July 1, 1905, when the press of the state was announcing in big headlines the Oklahoma
Statehood Convention to be held July 12, 1905, Mr. J.A. Norman, a Cherokee citizen, who for some time had labored for separate statehood for the Indian Territory, issued a call for an election to be held August 7, 1905, at which time seven delegates from each of the 27 recording districts in the Indian Territory were to be elected, for the purpose of convening at Muskogee August 21, 1905, and writing a Constitution for a state to be formed of the territory embraced by the Five Civilized Tribes. This call recited the facts that the federal government would complete the allotting of Indians by the close of the fiscal year; that tribal governments would close March 4, 1906; and that the people of the Indian Territory were sorely displeased with the "bureaucratic" government from Washington, D.C. W.C. Rogers, Chief of the Cherokees; Green McCurtain, Chief of the Choctaws, and J.A. Norman signed and published this call. A short time thereafter, a new call was prepared and signed by four of the Chiefs and Governors, and by Mr. George Scott, as secretary, asking the people of the different incorporated towns and communities to elect on August 7, 1905, delegates to the Muskogee convention. The principal difference between this call and the first one was the manner of selecting delegates. This convention was organized and known as the Sequoyah Convention, and after adopting a Constitution, memorialized Congress for admission into the Union as a state, reciting briefly the manner in which 32 states had been added to the original thirteen. The Congress of the United States refused to approve the action of the Sequoyah Convention, but shortly thereafter passed the Enabling Act, under which Oklahoma Territory and Indian Territory were permitted to draft our Constitution.
From the historical events and conditions existing about the time the framers of the Constitution assembled and prepared and submitted to the people for their ratification the Constitution, they had in mind the reservation of power in our Constitution by the people to themselves. They also had in mind that the surest way of securing franchises satisfactory to the people was for the people to vote such franchises, so they provided by section 5a of art. 18, supra, that:
"No municipal corporation shall ever grant, extend or renew a franchise, without the approval of the majority of the qualified electors residing within its corporate limits, who shall vote thereon at a general or special election; and the legislative body of any such corporation may submit any such matter for approval or disapproval, to such electors at any general municipal election, or call a special election for such purpose at any time after 30 days notice; and no franchise shall be granted, extended or renewed for longer term than 25 years."
Also by section 5b, supra, that:
"Whenever a petition signed by a number of qualified electors of any municipal corporation equal to 25 per centum of the total number of votes cast at the next preceding general municipal election, demanding that a franchise be granted, extended, or renewed, shall be filed with the chief executive officer of said corporation, the chief executive officer shall, within 10 days thereafter, call a special election, at which he shall submit the question of whether or not such franchise shall be granted, extended or renewed, and if, at said election, a majority of the said electors voting thereon shall vote for the grant, extension, or renewal of such franchise, the same shall be granted by the proper authorities at the next succeeding regular meeting of the legislative body of the city."
And by section 7 of art. 18, that:
"No grant, extension, or renewal of any franchise or other use of the streets, alleys, or other public grounds or ways of any municipality, shall divest the state, or any of its subordinate sub-divisions, of their control and regulation of such use and enjoyment.
"Nor shall the power to regulate the charges for public services be surrendered: and no exclusive franchise shall ever be granted."
Further, by section 2 of art. 18, that:
"Every municipal corporation now existing within this state shall continue with all of its present rights and powers until otherwise provided by law, and shall always have the additional rights and powers conferred by this Constitution."
Then, to prevent any exclusive franchise or privilege ever being granted in this state, the framers incorporated in the Constitution section 51 of art. 5, which reads:
"The Legislature shall pass no law, granting to any association, corporation, or individual, any exclusive rights, privileges, or immunities within this state."
The Constitution with the foregoing provisions incorporated therein was adopted and the state of Oklahoma erected.
Presently the Supreme Court was called upon to construe many of these provisions. Among the cases coming before this court were: Mayor and Councilmen of City of Pawhuska v. Pawhuska Oil Gas Co. et al., 28 Okla. 563, 115 P. 353, in which this court held that section 5a, art. 18, of the Constitution, providing that no franchise shall be granted for a longer period than 25 years, is self-executing; and section 5b, art.
18, of the Constitution, providing that after a franchise has been voted to be granted by a majority of the qualified electors voting thereon, the same shall be granted by the proper authorities at the next regular meeting of the legislative body of the municipality, imposes upon the mayor and councilmen a mandatory ministerial duty. Also, the case of State ex rel. Caldwell v. Hooker, County Judge, 22 Okla. 712,98 P. 964, where it is said:
"In cases where a provision is self-executing, legislation may still be desirable, by way of providing a more specific and convenient remedy and facilitating the carrying into effect or execution of the rights secured, making every step definite, and safeguarding the same so as to prevent abuses. Such legislation, however, must be in harmony with the spirit of the Constitution, and its object to further the exercise of constitutional right and make it more available, and such laws must not curtail the rights reserved, or exceed the limitations specified."
On the same subject we have Overholser v. Oklahoma Interurban Trac. Co., 29 Okla. 571, 119 P. 127, where it is held that:
"(Section 5a, art. 18, of the Constitution) applies to an original franchise or to a renewal or extension of the period for which a grant has been made, and does not apply to a mere extension or enlargement of the facilities which the franchise holder employs in exercising a power previously granted."
In the case of Noble State Bank v. Haskell et al.,22 Okla. 48, 97 P. 590, at page 79 of the opinion, it is held that section 51, art. 5, supra, "is, in effect, that every association or corporation, and any individual, may have any right that any other of the same class may have."
Section 5b, art. 18, provides that:
"Whenever a petition signed by a number of qualified electors of any municipal corporation equal to 25 per centum of the total number of votes cast at the next preceding general municipal election, demanding that a franchise be granted, extended, or renewed, shall be filed with the chief executive officer of said corporation, the chief executive officer shall, within ten days thereafter, call a special election, at which he shall submit the question of whether or not such franchise shall be granted, extended, or renewed, and if, at said election, a majority of the said electors voting thereon shall vote for the grant, extension, or renewal of such franchise, the same shall be granted by the proper authorities at the next succeeding regular meeting of the legislative body of the city."
As said before, this section has been held to be mandatory. City of Pawhuska v. Pawhuska Oil Gas Co., supra. This section does not say "any city" or town in which there is not now in existence a valid franchise or valid permit authorizing any other person, firm, association, or corporation to conduct in such city or town a business similar to that proposed, until the Corporation Commission shall issue a certificate of public convenience and necessity therefor, but it very clearly says, and just as certainly means, that whenever a petition is signed by the requisite number of qualified electors of "any city," whether there is in existence a valid franchise or valid permit or a dozen or more valid franchises or valid permits, it is the duty of the chief executive officer to call, and he shall, within ten days thereafter, call a special election, at which he shall submit the question of whether or not such franchise shall be granted, extended or renewed, and if, at said election, a majority of the said electors voting thereon shall vote for the grant, extension, or renewal of such franchise, the same shall be granted by the proper authorities at the next succeeding regular meeting of the legislative body of the city. The vote of a majority of the said electors voting thereon determines the question of whether or not a franchise shall be granted. If a majority of the said electors voting thereon shall vote for the grant, extension, or renewal of such franchise, the same shall be granted by the proper authorities at the next succeeding regular meeting of the legislative body of the city; and if a majority of the qualified electors voting thereon at said election do not vote favorable to the grant, extension, or renewal, that is the end of the issue until another petition is presented in a lawful manner, and the Corporation Commission of Oklahoma has nothing whatever to do with the granting, extension, or renewal of a franchise in a municipal corporation, such power being reserved in our Constitution by the people to themselves.
Section 2, art. 18, supra, provides that municipal corporations "shall always have the additional rights and powers conferred by this Constitution." This right and power being given the qualified electors of a municipal corporation, by the Constitution, it cannot be taken away by the Legislature.
In the case of Perrysburg v. Ridgway, 140 N.E. 595, the Supreme Court of Ohio said:
"Express delegations of political power are made through constitutional provisions and are necessarily exclusive delegations of power unless it be expressly provided otherwise. * * *
" 'They (the people) have, therefore, the most undoubted right to delegate just as much, or just as little, of this political power with which they are invested as they see proper, and to such agents or departments of government as they see fit to designate. To the Constitution we must look for the manner and extent of this delegation; and from that instrument alone must every department of government derive its authority to exercise any portion of political power.' "
We have been unable to find any Constitution with provisions similar to sections 5a and 5b, supra.
The Supreme Court of the state of Iowa, in 1902, under Code of 1873, par. 473, held that:
"When the right to operate water works should be granted to a private corporation, the grant should not be made to inure for more than 25 years, an ordinance purporting to grant a private corporation the exclusive privilege for 25 years, and an equal right thereafter, of supplying the city with water, was invalid as to the attempted extension of the grant for a greater period than 25 years." Cedar Rapids Water Co. v. City of Cedar Rapids, 91 N.W. Rep. 1081.
In that case the court held:
"Grants of franchises in perpetuity or for unreasonably long periods of time are generally regarded as against public policy, and, if ever valid, the authority therefor must be found in the Constitution or statutes of the state. Richmond Co. Gaslight Co. v. Town of Middletown, 59 N.Y. 228; City of Brenham v. Brenham Water Co., 67 Tex. 542, 4 S.W. 143; Long v. City of Duluth, 49 Minn. 280. 51 N.W. 913, 32 Am. St. Rep. 547; Thrift v. Elizabeth City, 122 N.C. 31, 30 S.E. 349, 44 L. R. A. 427. And it doubtless was with this principle in view that the Legislature expressly denied to a city government power to grant a franchise of this nature for any terms exceeding 25 years. That enactment enters into and controls every grant made thereunder, and courts have no alternative but to recognize its authority."
In Smith v. City of Osceola et al. (Iowa) 159 N.W. 648, the Supreme Court of that state held that:
"Under Code, section 775, empowering a city to authorize and regulate the use of its streets for telephone lines, and section 776, providing that no 'franchise' shall be granted by a city for such use of its streets unless the electors vote therefor, and that the party applying for the 'franchise' shall pay the expenses of the election, 'franchise' is used in its limited and technical sense of a privilege conferred by grant from the government and vested in an individual, so that a general ordinance, under which any one may so use the street, if the electors approve thereof, is not contemplated, but one granting the privilege to the individual applicant."
In the case of City Water Co. Chillicothe v. Chillicothe, Mo., 207 Fed. 503, the United States, Circuit Court of Appeals, Eighth Circuit, said:
"Where a city ordinance, entering into a contract with and granting a franchise to a water company, specifies a definite term for its duration, the rights of the company and the obligation of the city under its contract terminate on the expiration of such term, and cannot be enlarged by implication."
In the case of Des Moines Water Co. v. City of Des Moines et al., 206 Fed. Rep. 657, that court said:
"A grant to a water company by a city ordinance of a franchise to operate water-works for a definitely fixed term, accepted and acted on by the company, terminates at the end of that term by force of the terms of the instrument of grant, and cannot be enlarged by implication."
In the case of City of Owensboro v. Cumberland Telephone
Telegraph Co., 57 L.Ed. 1389, the Supreme Court of the United States says:
"The grant by municipal ordinance to an incorporated telephone company, its successors and assigns, of the right to occupy the city streets and alleys with its poles and wires for the necessary conduct of a public telephone business, is a grant of a property right in perpetuity, unless limited in duration by the grant itself, or as consequence of some limitation imposed by the general law of the state or by the corporate powers of the city making the grant."
In the case of Postal Telegraph-Cable Co. v. Ingraham et al., 228 Fed. 392, the court says:
"A permit granted by the mayor and aldermen of a city for the erection of telegraph poles and wires in a street, and duly made use of, though granted without any legal consideration being paid therefor and in general terms without any limit is not revocable at will, but constituted a franchise which is assignable, and could not be terminated or substantially modified, except for good cause. See Owensboro v. Cumberland Telephone Telegraph Co., 230 U.S. 58, 33 Sup. Ct. 988, 57 L. Ed. 1389."
In the case of Farmers' Telephone Co. of Quimby v. Town of Washta et al. (Iowa Telephone Co., Intervener), 133 N.W. 365, the court says:
"It is to be conceded that cases may be found, and they are cited by counsel, in
which statutes, more or less similar to our own, have been shorn of their apparent effect, and construed as giving cities and towns no more than a power of supervision or regulation. The thought which seems to have influenced these holdings, and is pressed upon our attention in appellant's brief, is that, where the state — the repository of the sovereign power — has by general statute given telephone and other similar corporations the right to occupy the public highways with their poles and wires, it cannot be presumed that the Legislature intended to confer upon cities and towns the right or power to exclude them from their corporate limits.
"We do not regard the reasoning by which this conclusion is reached as convincing or persuasive. It is a safe rule to assume that the Legislature means what it clearly says. The state may and does delegate certain of its powers to municipal corporations, and if, in its judgment, such corporations can best or most effectually control, improve, and protect the streets within their limits, and statutes to that effect are duly enacted, we know of no restriction in the Constitution or in principles of public policy which should impel the courts to construe away their obvious meaning. It was entirely competent for the Legislature to restrict the scope of the right or privilege which had been conferred by Code section 2158, and this we think it did by the provisions of the later statute."
In the case of Stites v. Norton, (Ky.) 101 S.W. 1189, 13 L. R. A. (N. S.) 474, that court says:
"A constitutional provision requiring the sale of public franchises to the highest bidder does not prevent a municipal corporation from excluding one already enjoying a similar franchise from competition for the right to string electric light wires along the public streets, in order to prevent a monopoly of the business, where other sections of the Constitution show an intention to prevent monopoly and afford opportunity for competition in all things necessary to the welfare of the public."
In the body of the opinion, at page 475, 13 L. R. A. (N. S.) we find this language:
"The Constitution of the state imposes upon legislative bodies the duty to protect the citizens against monopolies, trusts, and unlawful combinations. No more important obligations are imposed upon a legislative body than that of shielding the citizen against extortion in matters of public necessities; no higher duty than that of opening the doors to the fullest competition in such matters. The following are some of the sections showing that the framers of the Constitution had in mind the great importance of preventing monopolies and affording opportunities for competition in all things which are necessary for the welfare and happiness of the people. Section 3 of the Bill of Rights prohibits exclusive privileges; section 190 provides that no corporation can have the benefit of future legislation unless it accepts the provisions of the Constitution; section 195 prohibits corporations from conducting their business so as to infringe upon the equal rights of individuals; section 198 prohibits trusts and combines, and directs the Legislature to take steps to crush them; section 199 compels telegraph companies to receive and transmit each other's messages; section 201 prohibits railroads, telegraph and telephone companies, or other common carriers, from consolidating with or acquiring parallel and competing lines; sections 213, 214, and 215 contain stringent provisions to prevent discrimination; to prevent the making of exclusive or preferential contracts; to compel common carriers to receive, handle, ship, and switch all freight without discrimination, and to handle each other's cars. All the provisions of the Constitution on the same subject should be construed together, to the end that the purpose and intention of the provisions might be ascertained and carried into effect. Thus construing the Constitution, it is evident that it was the duty of the city council to take the necessary steps to relieve the people of the city from paying exorbitant prices for electricity for lighting purposes by establishing a competing plant, and fixing the maximum price at which it could sell electricity. This duty was of equal dignity, and as binding upon it as that of selling the franchise to the highest and best bidder; and it had the right, in our opinion, to so frame the ordinance as to accomplish the purpose of obtaining a competing plant."
We quote at length from some of the foregoing cases for the reason that they are from states having either constitutional or statutory provisions similar to the constitutional provisions involved in this action, and show a tendency the same as the framers of our Constitution had in mind, that in order to promote business we must have competition in all lines of business, including public utilities, and therefore provided for the qualified electors in cities and towns voting as many competitive franchises as they deem necessary to secure just competition. In 1925, when the Legislature enacted House Bill No. 4, the members seem to have had in mind the regulation and supervision of public utilities and the stifling of competition by granting perpetual franchises and prohibiting municipal corporations from granting competing franchises, until the Corporation Commission, after a
public hearing, had issued a certificate, of public convenience and necessity.
In 1907, at the time our Constitution was being framed, the Legislature of the state of Wisconsin appears to have arrived at the same conclusion as that reached by the Legislature of Oklahoma in 1925, but in 1906-07, the framers of our Constitution held a strong conviction against monopolies and perpetuities and favored encouraging just competition, as shown by clauses, paragraphs, and sections of our organic law. The Revocable Permit Act, commonly known as House Bill No. 4, is patterned after an act of the Legislature of the state of Wisconsin, known as the Indeterminate Permit Act. The first case we find construing the Indeterminate Permit Law of Wisconsin, is the case of State ex rel. Kenosha Gas Electric Co. v. Kenosha Electric Ry. Co., decided by the Supreme Court of Wisconsin on January 10, 1911, and reported in 129 N.W. 600, wherein that court says:
"Where an indeterminate permit has been acquired under the Law of 1907, chapter 499, referred to as amended by Laws 1909, c. 180, within the scope thereof, the municipality is under disability to grant any conflicting franchise privilege, except in case of public necessity and convenience, the fact in that regard to be found as matter of fact and certified by the railroad rate commission prior to making such conflicting grant."
At page 603, we find this language:
"The public utility law, in form, in unmistakable terms disabled the city of Kenosha from making such a grant as that in question after respondent's indeterminate permit took effect. It provides that:
"'No license, permit or franchise shall be granted any person, copartnership, or corporation to own, operate, manage or control any plant or equipment for the production, transmission, delivery or furnishing of heat, light, water or power in any municipality where there is an operation under an indeterminate permit as provided in this act a public utility engaged in similar service without first securing from the commission a declaration after a public hearing of all parties interested, that public convenience and necessity require such second public utility.'
"That is plain. The purpose of it is obvious. The intent was to give the holder of an indeterminate permit, within the scope thereof, a monopoly, so long as the convenience and necessities of the public should be reasonably satisfied, yet to secure to the public the benefit of the monopoly in excess of a fair return upon the investment, under proper administration, by insuring to the consumers the best practicable service at the lowest practicable cost, and to that end prohibit, conditionally, the granting of just such franchises as the one challenged in this case in the circumstances under which the ordinance of June 7, 1909, was passed."
This question is next discussed by the Wisconsin Supreme Court in the case of City of La Crosse v. La Crosse Gas
Electric Co., 130 N.W. 530, which is discussed extensively in the brief of the defendant in error. We next find this law considered by the Supreme Court of Wisconsin in the case of Calumet Service Co. v. City of Chilton, 135 N.W. 131, where the court says:
"A privilege within the scope of No. 14, whether a license, permit, or technically a franchise, is the latter in the statutory sense. * * *
"An indeterminate permit is a perpetual exclusive privilege within the scope of the grant, subject to the Code of conditions and limitations. * * *
"An indeterminate permit duly received for an old privilege is of the same scope as the latter as to the privilege feature, freed from all considerations, limitations, reservations, and control incident prescribed by the municipality as a state agency, including the right of repeal, if any reserved, but subject to the conditions and limitations of the public utility law. * * *
"The purpose of the law was to give the holder of an indeterminate permit as in Nos. 22 and 23, as regards the conditions existing at the time of its origin, and a qualified monolopy within the scope of the privilege, subject to the conditions and limitations of the public utility law, — the term 'monopoly' not being used in its common-law sense, except as to exclusiveness, but being characterized by purpose to promote public welfare, by a return consideration and by not being of common right, instead of being otherwise but for the grant and being for private gain."
It is the contention of the defendant that sections 5a and 5b of art. 18 of the Constitution were intended only to limit municipal corporations in granting franchises and limiting the period of time for which they might grant the same, for the reason that the same appear under the title of "Municipal Corporations," and that the limitation of 25 years for which a franchise might be granted, renewed, or extended applied only to franchises granted by the municipality, and that under section 47 of art. 9 the Legislature shall have power to alter, amend, annul, revoke, or repeal any charter of incorporation or franchise, and that under
this section the Legislature might alter or amend a charter so as to eliminate the 25-year limit fixed by section 5a of art. 18 of the Constitution. However, under the reasoning of the defendant that the limitation of section 5a of art. 18, supra, did not apply to franchises that might be granted by the Legislature to operate in a municipality, for the reason that the same was under the title of "Municipal Corporations," it could be argued with equal force that the power granted the Legislature to alter, amend, annul, revoke, or repeal a franchise does not apply to franchises granted by a municipality for the reason that section 47 of art. 9 appears under the title of "Corporation Commission — Public Service and Private Corporations," and also that the restrictions of section 7, art. 18, did not apply to any franchise except such as might be granted by a municipality, because it likewise comes under the title of "Municipal Corporations."
All of the authorities that we have been able to find hold that where a franchise is not limited in its existence to a fixed and definite period of years, then the same is a perpetual franchise, and if we should hold that section 5a of art. 18 was intended by the framers of the Constitution to limit only the powers of municipalities in granting franchises, and that the Legislature had the power to grant a franchise, or provide for the surrendering of a limited franchise granted by a municipal corporation and accept in lieu thereof a revocable permit without limit as to time of existence, in other words, a perpetual franchise, and thus extricate House Bill No. 4 from the control of section 5a of art. 18, supra, then it would run into the teeth of section 32 of art. 2 of the Constitution, which provides that:
"Perpetuities and monopolies are contrary to the genius of a free government, and shall, never be allowed."
It is also contended that House Bill No. 4 is not repugnant to the Constitution for the reason that by section 4 thereof, "any permit granted under the provisions of this act may be altered, amended, annulled, revoked, or repealed by enactment of the Legislature of Oklahoma whenever in its opinion such permit may be injurious to the citizens of this state; in such manner, however, that no injustice shall be done to the holder of such permit."
It will be noted that the act does not give the Legislature power to grant, extend, or renew, but specifically limits the power of the Legislature to alter, amend, annul, revoke, or repeal such permit, when in its opinion such permit may be injurious to the citizens of this state, and then in such manner that no injustice shall be done to the holder of such permit. This section is very similar to the provisions of section 47 of art. 9, but there is a material difference in the language employed in sections 5a and 5b of art. 18, and the language employed in section 47 of art. 9, and of section 4 of House Bill No. 4. By sections 5a and 5b of art. 18, supra, it is provided how a charter may be granted, extended, or renewed, and limits the period for which it may be granted and the period to which it may be extended or renewed to 25 years. Under House Bill No. 4, the revocable permit is simply a perpetual franchise which may be altered, amended, annulled, or revoked by the Legislature of Oklahoma only whenever in its opinion such franchise may be injurious to the citizens of the state.
Further, the municipality is deprived by House Bill No. 4 of renewing or extending a franchise, and the qualified electors of a municipality equal to 25 per centum of the total number of votes cast at the next preceding general municipal election are deprived of their right of demanding that a franchise be granted, extended, or renewed, and the qualified electors, by a majority vote thereof, are deprived of the right of expressing their opinion as to whether or not the franchise should be granted, extended, or renewed, and if a majority should vote in favor thereof, the proper authorities of the municipality cannot perform the ministerial duty which this court has held was enjoined upon them by the Constitution. House Bill No. 4 also provides that:
"Any party to the proceedings feeling himself aggrieved by the order of the Commission in issuing or refusing such certificate, may appeal to the Supreme Court of the state of Oklahoma, as provided in other cases of appeal from orders of the Corporation Commission." Section 6.
Section 32 of article 9, relative to appeals from the Corporation Commission in other cases, is:
"In no case of appeal from the Commission shall any new or additional evidence be introduced in the Supreme Court; but the chairman of the Commission, under the seal of the Commission, shall certify to the Supreme Court all of the facts upon which the action appealed from was based and which may be essential for the proper decision of the appeal, together with such of the evidence introduced before, or considered
by, the Commission as may be selected, specified and required to be certified, by any party in interest, as well as such other evidence, so introduced or considered as the Commission may deem proper to certify. The Commission shall, whenever an appeal is taken therefrom, file with the record of the case, and as a part thereof, a written statement of the reasons upon which the action appealed from was based, and such statement shall be read and considered by the Supreme Court, upon disposing of the appeal. The Supreme Court shall have jurisdiction, on such appeal, to consider and determine the reasonableness and justness of the action of the Commission appealed from, as well as any other matter arising under such appeal; Provided, however, that the action of the Commission appealed from shall be regarded as prima facie just, reasonable, and correct; but the court may, when it deems necessary, in the interest of justice, remand to the Commission any case pending on appeal, and require the same to be further investigated by the Commission, and reported upon to the court (together with a certificate of such additional evidence as may be tendered before the Commission by any party in interest) before the appeal is finally decided."
Next, does House Bill No. 4 violate section 51 of article 5 of the Constitution? Section 51 of article 5 is, in effect, that every association or corporation, and any individual, may have any right that any other of the same class may have. Noble State Bank v. Haskell et al., supra.
A corporation now or hereafter engaged in the business of furnishing power, light, heat, gas, electricity, or water as a public utility in any city or town, under a franchise which it secured from a city by a petition signed by a number of qualified electors of said city equal to 25 per centum of the total number of votes cast at the next preceding general municipal election, demanding that a franchise be granted, which was filed with the chief executive officer of said city, and the chief executive officer of said city in obedience to the demand of said petition called a special election within ten days after the petition was filed with him, at which election he submitted the question of whether or not such franchise shall be granted, and at said election a majority of the said electors of the city voted for the grant of such franchise, and the same was granted by the proper authorities at the next succeeding regular meeting of the legislative body of the city. This franchise is not operated by the holder as the qualified electors of the city feel it should be, or the qualified electors feel it would be for the best interest of the city to grant a competing association, corporation, or individual a franchise to engage in the same or a similar business, and the constitutional number of qualified electors of the city prepare a petition in writing and circulate the same and secure the signatures of the requisite number of qualified electors residing in the city and present the same to the chief executive officer of the city, demanding that he file the same and demanding that he call an election thereon within ten days, as commanded by the Constitution. The chief executive officer replies to the electors that he would be pleased to comply with their demands, but section 5 of chapter 102, Session Acts of 1925, being House Bill No. 4, provides, that no person, firm, association, or corporation, except the municipality, shall commence the business of furnishing power, heat, light, gas, electricity or water as a public utility, or commence the construction of a plant, works, or system therefor, or apply for or be granted a municipal franchise therefor, in any city or town of this state so long as there is in existence a valid franchise or permit authorizing any other person, firm, association, or corporation to conduct in such city or town a business similar to that proposed, until the Corporation Commission of Oklahoma shall issue a certificate of public convenience and necessity therefor, after a petition has been filed with the Corporation Commission, and notice given and a hearing held and an appeal granted any person aggrieved, as more fully appears in section 6 of House Bill No. 4; that there is existing in the city petitioned to grant a franchise a valid franchise, and the individual requesting a franchise has not complied with section 6 of House Bill No. 4, and therefore, as the chief executive officer of the city, he must refuse to file the petition demanding that an election be called and must refuse to call an election for the same reason, and for the reasons only that House Bill No. 4 prohibits the applying for or the granting of a franchise by a municipal corporation in any city or town of this state so long as there is in existence a valid franchise or permit authorizing any person, firm, association, or corporotion to conduct in such city or town a business similar to that proposed. Which must control the action of the chief executive officer of the city, section 5b of article 18 of the Constitution, or sections 5 and 6 of House Bill No. 4? We think the only answer to this question is that, section 5b of the Constitution
and House Bill No. 4 being in conflict, section 5b of the Constitution must prevail.
Also, does the individual applying for the second franchise have any right that any other of the same class may have when he is denied a vote by the electors of the city on the question of whether or not such franchise should be granted? We must hold that denying him the right to file his petition signed by the requisite number of etectors for the purpose of having the question of whether or not he shall be granted a franchise denies him a right which the corporation that secured the first franchise had.
We feel it is too clear to need further discussion that House Bill No. 4 burdens section 5b of art. 18 of the Constitution, which makes it mandatory upon the authorities of a municipality to a special election within 10 days after the chief executive officer of the municipality has been petitioned by a number of qualified electors of the municipality equal to 25 per centum of the total number of votes cast at the next preceding general municipal election demanding that a franchise be granted, extended, or renewed, at which election the chief executive of the municipality shall submit the question of whether or not such franchise shall be granted, extended, or renewed, and if at said election a majority of said electors voting thereon shall vote for the grant, extension, or renewal of such franchise, the same shall be granted by the proper authorities at the next succeeding regular meeting of the legislative body of said city.
It seems so clear to us that the terms of House Bill No. 4, being the act under consideration, violate sections 5a and 5b of art. 18, and section 32, art. 2, of the Constitution, that it is useless to further pursue this discussion. If a legislative enactment is repugnant to, violates, or burdens our Constitution, it is the duty of this court to so say and strike down such legislation.
If our Constitution lives, then our rights to life, liberty, and property are sure; its words give a firm foundation upon which the Legislature and the people may build our laws and rest secure. So we hold that in cases where a provision of the Constitution is self-executing, legislation may be desirable by way of providing a more specific and convenient remedy, and facilitating the carrying into effect or execution of the rights secured, making every step definite, and safeguarding, the same so as to prevent abuse. Such legislation, however, must be in harmony with the spirit of the Constitution, and its object to further the exercise of constitutional right, and make it more available, and such laws must not curtail the rights reserved or extend the limitation specified.
The limitation specified in the Constitution for a municipal charter granted by a municipality is 25 years, and this may be extended not exceeding 25 years, as provided for in the Constitution, and any act of the Legislature that violates section 5a is repugnant to the Constitution and must fall. Any act of the Legislature which attempts to burden section 5b, which guarantees to the people the power therein reserved by them to vote a municipal charter or to re-new or extend one, is likewise repugnant to the Constitution and void. Any act of the Legislature which provides for issuing a license revocable permit, indeterminate permit, or other instrument in the nature of a franchise, which is not limited as to its time of existence, violates section 32 of art. 2 of our Constitution.
We therefore hold that House Bill No. 4, approved March 19, 1925, and known as chapter 102 of the Session Laws of 1925, is repugnant to the Constitution, and is therefore void.
The only questions before this court for consideration have to do with the granting, extension, or renewal of franchises granted by municipal corporations and the surrender of such franchises and, receiving in lieu thereof a revocable permit; therefore a number of the cases cited and argued by counsel for defendant have no bearing upon the case at bar. They deal with the reservation to the state of the controlling power, in the way of taxation, as to franchises and grants from municipalities of a public nature and the right of the state, or any of its subordinate subdivisions, of their control or regulation of such use and enjoyment and the power to regulate charges for public service.
For the reasons herein stated, we are of the opinion, and hold, that the findings and judgment of the district court of Okmulgee county were erroneous, and should be, and the same hereby are, in all things vacated, annulled, and set aside, and this cause reversed and remanded to the district court of Okmulgee county, Okla., to set aside the judgment heretofore entered in said court in this cause and to grant the plaintiff a new trial, and to further proceed the same as though House Bill No. 4 had never been
passed by the Legislature and approved by the Governor, and to take such further proceedings in this action as may be consistent with this opinion.
MASON, C. J., LESTER, V. C. J., and CLARK, RILEY, HEFNER, CULLISON, and ANDREWS, JJ., concur.