Green Bay & Mississippi Canal Compact v. Kaukauna Water Power Co.

87 N.W. 864, 112 Wis. 323, 1901 Wisc. LEXIS 94

• Court: Wisconsin Supreme Court
• Decided: December 17, 1901
• Status: Published

Opinion

The following opinion was filed November 5, 1901:

Bardeen, J.

We cannot resist the conclusion that this case has been swamped by a multitude of contentions, On the one side we are told that this is either -a case in the nature of “ trespass for mesne profits,” “ assumpsit for use and occupation,” “assumpsit for money had and received,” or “ trespass on the case for diversion of water.” On the other we are informed that the complaint does not state a cause 'of action; that it does not state'a case in which the tort can be waived and a recovery permitted on implied contract; that it does not state a case for mesne profits, or one for use and occupation, but is one for diversion of water from a flowing stream; and that the facts do not make out a case in which a recovery can be permitted. These questions are most learnedly discussed in briefs covering nearly 200 pages, and the positions assumed are fortified by authorities from the Year Books down to the present time. The importance of the case and the novelty of the questions assumed to be involved are a sufficient excuse for the fertile research of counsel, and for their great industry in presenting every possible phase of the litigation. But with it all we are persuaded that the actual issue involved is comparatively simple and must be determined according to well-recognized legal principles.

First, What is the cause of action stated? Unquestionably, one in tort. The plaintiff is alleged to be the owner of the hydraulic power furnished by the fall in the Fox river at a dam in the city of Kaukauna. The defendant wrongfully entered into possession of, and wrongfully took and appropriated to its own’ use, one half of such power, being about 1,500 horse power, of the annual value of $5 per horse power. The complaint contains a “plain and conpise statement of the facts constituting the cause of action,” as prescribed by sec. 2646, Stats. 1898. By apt alie-gation it charges that the acts of defendant were wrongful, thus recognizing the rule that a cause of action must be so stated that the court may determine its character,— whether ex contractu or ex delicto. Joseph Dessert L. Co. v. Wadleigh, 103 Wis. 318. The requirements of the statute and of the rules of practice having been complied with, we need not give the complaint baptism, or christen it, as under the old practice. It is enough when the facts are stated, and so stated that the character of the action can be gathered therefrom. We agree with defendant’s counsel that the cause of action is in tort, and bears some resemblance to the ancient action of trespass on the case.

Passing this point, we come to the claim that the complaint fails to state a cause of action. It is said that.the “ complaint fails to state a complete cause of action ex delicto, in that it does not allege that the plaintiff has suffered any direct or consequential damage by reason of the wrongful acts of thp defendant.” Also, it being alleged that the water had been wrongfully taken from the flowing stream, the inference is that as fast as the water was withdrawn it was instantly replaced by the natural flow of the river, “ and plaintiff therefore was not deprived of any valuable use which it could or might make of the water power which it owned.” We met a contention very similar to the first in its legal results in the recent case of Luessen v. Oshkosh E. L. & P. Co. 109 Wis. 94. There, as here, it was argued that there was no allegation of direct pecuniary injury, and hence no cause of action was stated. Here as there, we hold that, when the facts are stated from which the law raises the inference of damages, they are necessarily implied, and no direct allegation of the conclusion is necessary. Waiving for the instant the question of whether one may have such a property right in water as entitles him to damages for its conversion, we will test the complaint by the rule stated. It alleges that the plaintiff was the owner of a certain water power. The law implies that it was entitled to its free and unobstructed use. The defendant wrongfully entered, and wrongfully appropriated to its own use one half of said power, or about 1,500 horse power of the same, which was of the annual rental value of $5 per horse power, “ to the damage of this plaintiff as herein set forth.” Conceding the right of property to exist, what inference or implication does the law draw from those facts ? Using an illustration used on the argument: Suppose plaintiff’s horse was running in its pasture, and the defendant wrongfully entered, and took the horse, and used it for a. season, the value' of such use being fifty cents per day, would any one contend that the plaintiff must allege that it was deprived of the use of the horse so that it was unable to plow its corn field, or market its potatoes, in order to state a “ complete cause of action ex delieto ” ? "When the facts are stated from which loss or injury may be implied,, the law draws that implication, and formal allegation of injury is not necessary.

Since the determination of the litigation between the parties to this action as shown by the opinion of the United States supreme court (Green Bay & M. C. Co. v. Patten P. Co. 172 U. S. 58), this court cannot, nor will it permit the defendant to, question the rights of the plaintiff with reference to the water power in question as there determined. That decision settled those rights to be absolute ownership, subject only to the rights of the government in aid of navigation. As we understand it, subject to those rights the plaintiff might do as it pleased with the entire body of water stored in the pond. It might allow it to run to waste, or rent it to its tenants, or divert it to its own use. We know of no limitation upon that right save that before mentioned. We cannot, if we would, surround it by new or different limitations. As it was adjudicated, so must it stand. According to the defendant’s contention, that right was a mere abstraction; a mental conception without reality or substance; “a barren right” of no property value; a mere right to have the surplus water not needed for navigation .flow over the dam, of no value to plaintiff unless it had facilities for using it as it passed, — ■ a most specious contention, finding some support in loose expressions and random remarks found in some of the cases. In support of their position they say:

“ The law is well settled, both in England and in this country, that no action to recover substantial damages can be maintained for the diversion of water unless the party complaining alleges and proves that some existing mill has been injured, and the use made less valuable, by reason of the diversion.”

They refer us to the cases of Williams v. Morland, 2 Barn. & C. 910, and Mason v. Hill, 3 Barn. & Adol. 304, and 5 Barn. & Adol. 1, as establishing the rule in England. The first case was an action by a downstream landowner against his neighbor on the stream above, who had built a dam and thereby prevented the water from running in its usual course, in its usual calm and smooth manner, and thereby the water ran in a different channel, and with great violence, and injured the banks and premises of the plaintiff. The jury found the banks were not injured. Bayley, J., says:

“ Flowing water is originally publici juris. So soon as it is appropriated by an individual, his right is coextensive ■with the beneficial use to which he appropriates it. Subject to that right, all the rest of the water remains publioi juris. The party who obtains the right to the exclusive enjoyment of the water does so in derogation of the primitive right of the public. How, if this be the true character of the right to water, a party complaining of the breach of such right ought to show that he is prevented from having water which he has acquired a right to use for some beneficial purpose. Here the declaration states a right to the use of this water at all times; but still, if the plaintiff had as much water as could be necessary for his purpose, the defendant would have been guilty of no wrong by preventing additional water from coming to the plaintiff’s premises.”

Another judge said:

“ The mere obstruction of the water which had been used to flow through his lands does not give any right of action. In order to entitle him to recover, he should show the loss of some benefit, or the deterioration of the value of his premises.”

Mason v. Hill was a similar action, except that the water diverted by the upriver owner was not returned to the original channel, but was suffered to pass away on a level below the plaintiff’s works. The opinion by Denman, C. J., contains an interesting discussion of the question involved, and holds that the lower owner, having shown actual damage, was entitled to judgment.

It requires but a casual glance at the cases to disclose that the questions discussed and decided, are in no way parallel with the ones here involved. The plaintiff here is not seeking to recover damages for water merely diverted from its premises, or damages for water thrown on its premises in such a manner as to injure them. It is seeking to recover the market value of water which it had legally impounded, and wh'ich was unlawfully taken by defendant. But it is said the plaintiff had no mill. It had no means of using the water. It has suffered no substantial damage. It had but a “ barren right ” of no property value unless it had facilities for using the water, and hence cannot maintain this action. Ve do not consider this an action merely for diverting water, wfithin the principle of the cases cited by defendant. It is rather a.n action for taking water which had legally been gathered in a pond, and capable of producing potential energy. True, the plaintiff did not thereby secure a property interest in any particular particle of water. Water is a movable and wandering thing, and when it runs out of my pond into another man’s I have no right to reclaim it. But when I have built a dam, and created a reservoir, kept full by the natural flow of the stream, I have created for myself a property right to use the stored water, just as valuable and just as substantial in point of law as would be the right to use my horse. It may be subject to some limitations not surrounding other species of property, but they are not material to the questions here involved. To say that because I have no mill, or no facilities to use the energy so stored up, I am not injured when some one comes along and wrongfully appropriates it to his use, would be a solecism in the law without parallel. As well might the defendant say, when sued for the use of the horse in the case supposed: “You were not using the horse. You had no work for him to do. He was running idle in the pasture. You have lost nothing; hence I should not be required to pay.”

A similar suggestion was thus disposed of in the Luessen Case, 109 Wis. 94:

“If one deprives another person of anything of value, the loss to the latter in’a legal sense is not lessened at all by the circumstance, if it exists, that he intended never to enjoy it, or to bestow it as a gratuity upon another.”

One of the counsel likened the defendant’s alleged trespass in taking the water to the tapping of a wire charged with electricity, and diverting therefrom a given quantity of electric current or power. Defendant’s counsel answer: “ There is no likeness between the two. The wire is only charged with electricity by the expenditure of force or power which costs money, and the electrical current in that sense is private property to at least the value to the owner of what it has cost to produce it. The current of water, on the other hand, is furnished by nature without cost, is pub-lid jwris, and is not property until appropriated and used.” Counsel for plaintiff aptly reply that electricity is publioi juris until impounded on a wire. The natural flow of a river is in some sense publiai juris, but, when impounded, and a head raised by a dam by one having authority to dam, and having incurred the expense of building and maintaining the dam, the fall of the water due to the dam. is not puibliei juris any more than the impounded electric current, and herein lies the distinction. The water itself may belong to the public in a sense, but the force — the energy — produced by it when stored in bulk no more belongs to the public than the banks and dam surrounding it. The storing costs money, and within the line of defendant’s argument the force so impounded becomes property in the owner. '

The major contention of defendant rests upon the question of whether plaintiff’s right to the water is to be considered a thing of value, and, if so, what is the proper measure of damages. That plaintiff’s right is of value follows as necessary corollary from the decisions of this court and of the United States supreme court. Green Bay & M. C. Co. v. Kaukauna W. P. Co. 70 Wis. 635; Kaukauna W. P. Co. v. Green Bay & M. C. Co. 142 U. S. 254; Green Bay & M. C. Co. v. Patten P. Co. 172 U. S. 58. That value rests upon the right of plaintiff to the free and constant use of the water in the pond, subject only to the rights of navigation. It makes no difference, so far as we can see, whether it is called “ the right to use the surplus water created by the dam,” or by some other name. Under the reservation in its deed to the United States, as we understand it, it had the right to use all the water created by the dam not required for purposes of navigation, “ with the rights of protection and preservation appurtenant thereto.” As to the effect of this reservation we need only refer to the language of Mr. Justice Shieas in this litigation. 172 U. S. 80.

From an}»' point of view, the judgment of the court below was erroneous. The title to the thing in question was clearly established. Under any theory of the case, plaintiff was' entitled to at least nominal damages. Testimony was offered showing that defendant had rented to tenants.914 horse power at ah annual rent averaging $5 per horse power. It is suggested that, if the other theory of recovery is denied, plaintiff was entitled to recover the money so received. That, however, would be' contrary to the theory of the complaint. Eo doubt plaintiff might have brought the action for money had and received, waiving the tort; but that is not this action. The complaint alleges a tortious taking and conversion of impounded water of a certain market value. This is inconsistent with a claim to have ■defendant disgorge money it had received. The complaint, being in tort, cannot be changed to one on implied contract for the mere convenience of assessing damages.

As we have already seen, it was no answer for defendant to say that plaintiff was not in a position to use the water if it had not taken it. The question now is, What damages does the law imply from the situation presented? The defendant seeks to apply the rule applied in many cases for the mere diversion of the water of a running stream. Kensit v. G. E. R. Co. 23 Ch. Div. 566, is one of a class of cases confidently relied on to support this view. But the facts in that and kindred cases are so entirely different from the case at bar that they furnish little aid in in the solution of the question before us. As we view it, there is a vast difference, in point of legal consequences, between the case of where an upriver owner diverts the water in a flowing stream, and the one where a stranger without right taps the dam and takes the water from another’s mill pond. The cases above referred to hold that the owner from whose land water has been wrongfully diverted may recover general damages,— that is, such as the law implies from the violation of a legal right, — and such special damages as he is able to show. See Blanchard v. Baker, 8 Me. 253; Ulbricht v. Eufaula W. Co. 86 Ala. 587; Webb v. Portland Mfg. Co. 3 Sumn. 189; Bliss v. Rice, 17 Pick. 23. Many of the cases are somewhat misleading on the question of damages for the reason that the real point in controversy was the vindication of the actor’s right, and little or no attention was given to the amount of the recovery, the latter being treated as of secondary importance. The cases bearing upon the point at issue are not numerous. Bliss v. Rice, 17 Pick. 23, was a ca"se where the plaintiff and defendant were tenants in common of a mill on one side of a river and of the milldam and water power. They occupied the mill by agreement alternately, each for several days at a time, in proportion to his interest. The. defend ant owned the land on the opposite side of the river, and cut a channel from the pond above the dam, on his own land, and used a portion of the water to drive machinery. In a suit to enjoin the defendant from diverting the water from the pond, tie court held that during the time each was entitled to use the mill he was entitled to use all the water stored in the pond, and gave plaintiff judgment for §24 per year for the unlawful use of the water by defendant, and required him to close his channel during the time plaintiff was entitled to use the mill. The court directly recognized the right of property in water and the liability for damages when that right had be/nn invaded.

De Camp v. Bullard, 159 N. Y. 450, was a case where the court was called upon to determine the measure of damages for the use ¡of a stream by trespassers for floating logs. In the discussion the court uses the following language:

“ The defendant insists that the measure of damages is not what the privilege of trespassing was worth to the trespassers, but what the plaintiff actually lost through interference with his business,'loss of rent, and the like. As there was no proof of actual loss of this character, they further insist that the plaintiff is entitled to nominal damages only This position would put a premium on trespassing, because it makes the position of the trespasser more favorable than that of'the one lawfully contracting. If a man’s house is vacant, with no prospect of a tenant, and no intention on his part of occupying it himself, and a trespasser occupies it, he must pay, as damages for the trespass, the value of the use and occupation; for this would be the duty of the tenant contracting upon a quantum, meruit for the use, by consent, of that which the trespasser uses without consent. In cases of involuntary trespass the damages are restricted as much as possible; but, when the trespass is deliberate, intentional, and continuous, they include at least the value of the use of the premises for the period that the owner is kept out of possession.”

A verdict for $500 for the use of the steam was sustained.

Powers v. Hibbard, 114 Mich. 533, is said to be a suit “to restrain the wrongful diversion of water for' power, and an accounting.” The defendants were entitled to use 105 horse power, but at times used from 150 to 175 horse power. A recovery for $7,000 damages was sustained, but the case is barren of any discussion of the basis upon which damages were allowed. Neither does it appear that the plaintiff had mills, or lost rents or sales. As near as we can determine, the recovery was allowed on the basis of value of the use in excess of the grant. These cases indicate that the value of the use of water is sometimes regarded as the proper measure of damages where it has been wrongfully taken and used. No rule of law of which we are aware, and no case that has been found, goes to the extent of declaring that impounded water is of no value unless the owner has a mill built and ready for use. Water, when so stored, is capable of producing power. It represents the expenditure of labor; and money. The question of value is not affected by the actual cost of the improvements. It depends, in the first instance, upon the number of feet of head, and the means and facilities which may be at hand for its use; not what the owner then actually possesses, but what he may be able to secure under ordinary circumstances. A dam without any adjacent land or conveniences for the use of stored water might not be very valuable. But suppose the owner of the dam and the adjacent land proprietor unite, and the water is then used.' Could the landowner refuse to pay for the water, or deny recompense for its use, on the ground that it was of no value without the use of his land ? Is a trespasser in a better position than as if he had contracted ? Can he be heard to urge that, “ Except for my canal, your power was valueless. You have but a ‘ barren right,’ and, although I have appropriated that right and it has become valuable to me, yet you have no remedy, because you have lost nothing. The water was publici juris, and would have gone to waste if I had not turned it to use; hence, as you have lost nothing, you cannot expect me to pay you anything ” ? This is virtually the position of defendant. While it may be true that the stored water, by itself, or by reason of the surrounding circumstances,-pay be of little value, it becomes valuable when its energy becomes applied to turn wheels and to move machinery. When the right to use becomes merged' in an actual use through canals and wheels, it reaches the summit of value. The head of water on the one side, and the canals, machinery, and land on the other, make complete that which, considered separately, may be comparatively insignificant. The union or joinder of the two elements being wrongful cannot be allowed to affect the question, otherwise the defendant would be in a better position than it would have been had it lawfully contracted with plaintiff. The facts surrounding this litigation indicate that this will result in a great hardship to defendant, but that fact cannot be permitted to prevail over well-recognized legal principles. The defendant’s persistent use of water after it had been determined that such use was unlawful puts it in a position where it mast respond to the rigorous exactions of the law, without extenuation or diminution on the ground of good faith. As we view the situation, the law implies a liability on its part to pay the actual value of the thing taken, when considered in connection with the manner of use, and that the defendant cannot be heard to say that plaintiff might not have used it or had no present facilities for its use. The positive character of the right involved and the quality of plaintiff’s ownership being established, we see no escape from the conclusion that defendant is liable for the market yalue of the horse power actually taken, with annual interest. Defendant’s acts suspended and impaired the enjoyment of the rights possessed by plaintiff. Those rights had a definite market value, which cannot be depreciated or affected by the assertion that plaintiff was not in a position to utilize them. To permit this to be done would, as remarked by the New York court, “place a premium on trespassing, because it makes, the .position of the trespasser more favorable than that of one lawfully contracting.” We therefore hold that the proper measure of damages is the rental value each year of the actual amount of horse power taken at the dam, with simple interest computed from the close of each year.

Ordinarily, the case, having been tried by the court, would be sent back with directions to enter judgment; but the case was not tried on the theory suggested, and we are not prepared, from the evidence presented, to determine the exact number of horse power actually taken, or the price that should be paid for the same. The defendant offered no evidence as to value, and the lower court made no finding on the subject. Neither are we prepared to say just what proportion of the rental value should be ascribed to the use of the canal and land in utilizing the water taken, although there is some evidence on the subject. In view of the situation, we deem it advisable to send the case back, with directions to the court below to take such additional testimony as either party may desire to offer as to the amount of water taken and its net value per horse power as suggested, and to enter judgment for the plaintiff fo,r that amount. Of course, the recovery must be limited to the water taken during the six years next preceding the commencement of the action.

We do not think the circumstances of the case are such as would permit the allowance of exemplary damages, or any damages beyond the net market value of the water taken with interest.

By the Oourt.— The judgment is reversed, and the cause is remanded for further proceedings as indicated in the opinion.

A motion by the appellant for a rehearing was denied December 17, 1901.