City of Toledo v. Northwestern Ohio Natural Gas Co.

6 Ohio N.P. 531
CourtLicking County Court of Common Pleas
DecidedJuly 1, 1898
StatusPublished

This text of 6 Ohio N.P. 531 (City of Toledo v. Northwestern Ohio Natural Gas Co.) is published on Counsel Stack Legal Research, covering Licking County Court of Common Pleas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Toledo v. Northwestern Ohio Natural Gas Co., 6 Ohio N.P. 531 (Ohio Super. Ct. 1898).

Opinion

Lemmon, J.

This action was brought by the city solicitor in behalf of the oity of Toledo against the Northwestern Ohio Natural Gas Co. to seek, by the process of injunction, in this court, to ocmpell the defendant tc obey the ordinance of the city passed August 4, 1890, and which ordinance the plaintiff claimed was binding on the defendant. A preliminary injunction was granted upon the filing of th9 petition, giving the relief prayed for until the further hearing of the oase, and subsequently, the plaintiff came into court and asked for an ad■ditional order, having amended his petition, and, in this amended petition,prays for a mandatory injunction requiring the defendant to furnish gas to all citizens of Toledo who may demand the same, át and for the rate fixed by the ordinance of the common council, August 4, 1890. The plaintiff claims thht this ordinance is binding upen the defendant and all the citizens of Toledo, in pursuance of a statute which was passed in March, 1889.

An answer has been hied in the case, and the plaintiff has filed a reply to the answer; but, for the present, we will content ourselves with an examination cf the petition alone, and cf the claim that is made under it for relief.

The history of the connection of the Northwestern Ohio Natural Gas Co. with the piping of gas through the streets of the city and furnish[532]*532ing it to the citizens of Toledo, is a matter so well known that no reference need be made to it here, and the ordinance and ordinances which were passed and accepted by the Northwestern Ohio Natural Gas Co. have been so frequently discussed and so many times before the public in print, that I need not state anything in that regard.

The following propositions appear to us to disoiose sufficiently the opinion to which the court has arrived.

1. Before the passage cf the act pf March, 1889, now section 2478, Reivsed Statutes, the city council of Toledo possessed no right to regulate the price of natural gas1 — or, to speak more accurately, the legislature had not before that time conferred upon city councils the power to regulate the price, etc., of natural gas — and hence the ordinance of September 6, 1886, when accepted by the Natural Gas Companies, including the provision which secures the right to further regulate the furnishing of gas upon such terms as the oommon council and the gas companies might thereafter determine, became a contract between the city of Toledo and the gas companies, binding upon the parties until revoked or terminated by them.

This case must be distinguished from those where the contract was made with a gas company at a time when the statute empowering common councils to regulate the price of gas was in force: in this case it cannot be said that the contract made, was in violation of law, or of the expressed polioy of the state.

2. The ordinance of the common council of Toledo,passed September 6, 1886, before the common council had the power to regulate the price of gas otherwise than by contract, having been accepted by the natural gas companies before the passage of the act of March, 1889, now section 2478, Revised Statutes, which authorized common councils to regulate from time to time the price of natural gas as well as manufactured gas, by ordinance — and the gas companies having expended large suras of money in pursuance of such contract in purchasing gas lands and wells and in laying pipes to bring such gas to Toledo before the passage of the act of March, 1889, that statute cannot be held to change the contract relation between the city of Toledo and the gas companies, established by their agreement and binding upon the parties thereto at and before the passage of the aot of March, 1889. To construe the statute as applying to and governing the parties to this contract as subordinating the contract and altering the contract rights of the parties, would be holding the statute invalid under the constitution of the United States and the constitution of the state of Ohio, because of its impairing (when so construed) the obligation of contracts.

3. The contract so made (section 8 of the ordinance) provided that “The right to further regulate the furnishing of natural gas to consumers shall be subject to such terms and conditions as the common council and the gas companies may hereafter determine upon.” The meaning of the above words is made more clear by those immediately following: “This ordinance and all rights herein granted shall be subject to any general ordinance or ordinances which may hereafter be adopted by the common council, regulating the mode and manner of laying, relaying and repairing the mains and pipes, conductors, connections and drips and the conducting of gas through the streets, lanes, alleys, squares, docks and lands of said city not inconsistent with the provisions of this ordinance.” While thus particularly mentioning what the oommon council might by general ordinance thereafter do, specifying what the common council might thereafter regulate in the exercise of its control of the streets, lanes, alleys, squares and docks, it would have been an easy matter to have added, if the parties then in negotiation had so intended, the words “and to fix and adjust a schedule of the price to be charged consumers” etc.

4. In this connection we may as well notice section 9 of the ordinance [533]*533granting franchise to the Toledo Natural Gas Co. which contains the express requirement that the Toledo Natural Gas Co. shall furnish gas to all persons requiring it in the city so far as the company may be able, without preference or favoritism, on equal terms and at reasonable prices.

This express provision we regard as but declaratory of the common law which inheres in all contracts without express statement — 'and hence the Northwestern Ohio Natural Gas Co. has the same measure of right and is bound to the same duties and to the same extent as the Toledo Natural Gas Co., those matters being implied though not expressed in. their contract. Neither company could lawfully make and enforce a scale of prices that should be unequal, unreasonable or extortionate, though the oommon council should unite with the gas companies in approving such schedule.

Chief Justice Waite, in Munn v. Illinois, 94 U. S., 113, on this subject, says:

“When, therefore, one devotes his property to a use in which the public has an interest, he in effect grants ■to the public an interest in that use and must submit to be controlled by ■the public fcr the common good to the extent of the interest he has thus created. He may withdraw his grant ■by discontinuing the use; but so long as he maintains the use he must submit to the control.”

✓Numerous authorities are cited by the court in support of this proposition, from Lord Hale down to the present time, in which the right to regulate wharfage, ferriage, dravage, hacks, carriages, stages, railway companies, steam boat companies, warehouse men, gas companies, bakers, millers, inn-keepers, etc. etc., has been asserted continuously as the right of the sovereign, or of the public through its constituted authorities, with the view of seouring equality be tween patrons and protection from unreasonable exorbitant as well as unequal charges. These principles cf elementary justice have accompanied our forefathers in their rugged and honest lives in their development from age to age,and have been amplified in their application to improved methods of motion and new species of property/*"

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Related

Munn v. Illinois
94 U.S. 113 (Supreme Court, 1877)

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Bluebook (online)
6 Ohio N.P. 531, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-toledo-v-northwestern-ohio-natural-gas-co-ohctcompllickin-1898.