In Re Condemnation by Dairyland Power Cooperative

82 N.W.2d 56, 248 Minn. 556, 1957 Minn. LEXIS 536
CourtSupreme Court of Minnesota
DecidedFebruary 1, 1957
Docket36,978
StatusPublished
Cited by26 cases

This text of 82 N.W.2d 56 (In Re Condemnation by Dairyland Power Cooperative) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Condemnation by Dairyland Power Cooperative, 82 N.W.2d 56, 248 Minn. 556, 1957 Minn. LEXIS 536 (Mich. 1957).

Opinion

Murphy, Judge.

This case comes to us on certiorari from an order of the District Court of Olmsted County granting petitions for condemnation in 13 actions relating to separate tracts of land, which actions were consolidated for trial. The petitioner seeks to exercise the right of eminent domain to provide right-of-way to construct electric transmission lines. The relators, who are the objecting property owners, contend that the proposed taking is not necessary and further that it is not for a public use as required by U. S. Const. Amend. XIY, as well as Minn. Const, art. 1, § 13. They further assert L. 1955, c. 757, amending M. S. A. 308.05, which purports to authorize the right of eminent domain, is unconstitutional as applied to the petitioner, Dairyland Power Cooperative.

The Dairyland Power Cooperative is a nonprofit cooperative association originally incorporated under the laws of the State of Wisconsin and is qualified under the laws of the State of Minnesota pursuant to provisions contained in M. S. A. 308.05 to 308.18 to engage in the electric heat, light, and power business. Dairyland is commonly known as a “federated” or “central” cooperative, in that its membership consists solely of member cooperatives, commercial public utilities, and municipalities. It was organized primarily to serve as a corporate vehicle in performing the specialized function of furnishing at wholesale electric energy to member cooperatives who in turn distribute the energy at a lower voltage to ultimate consumers. While its articles and bylaws do not forbid it, presently it has no individual or ultimate consumers. Its membership consists of 26 member rural electric distribution cooperatives, all *559 EEA financed, which in turn distribute and furnish electricity to over 92,000 farms, homes, rural establishments, and small rural cities and villages in the four-state area of Minnesota, Wisconsin, Iowa, and Illinois. In addition Dairyland furnishes some electric energy at wholesale to six members which are commercial public utilities in its area. It has recently contracted to furnish supplementary and standby electric service to the city of Eochester, Minnesota.

It appears from the record that Dairyland owns and operates a large, modern, and integrated generation and transmission system which includes three steam generating stations on the Mississippi Eiver, four hydroelectric generating stations on the Flambeau Eiver, as well as Diesel generating stations at Chippewa Falls, Wisconsin, and at Twin Lakes near Albert Lea, Minnesota. These generating stations are all interconnected through a network of 2,250 miles of transmission line with eleven transmission substations and six generating plant substations. Its facilities extend through 44 different counties, including seven counties in the State of Minnesota.

In connection with Dairyland’s character as a public utility, it is important to note that since the fall of 1955 its system has been interconnected with the large integrated systems of the Northern States Power Company and Interstate Power Company in what is designated as “a power pool,” the practical effect of which is that all three participants may be operated as one combined system. It is reputed to be the largest cooperatively owned electric generation and transmission system in the world. Its facilities have been constructed through loans from the Federal government, acting through the Administrator of the EEA, under and pursuant to the terms of the Eural Electrification Act of 1936.

During the year 1955, Dairyland accepted as its 26th member the People’s Cooperative Power Association of Eochester, Minnesota. This cooperative, which is EEA financed and serves 5,208 ultimate consumers in rural areas throughout Olmsted and Wabasha Counties and in portions of four other counties in southeastern Minnesota, operates 1,988 miles of distribution lines and has seven distribution substations. People’s Cooperative, which started operations in 1938, *560 has purchased all of its power requirements from the city of Rochester which owns, operates, and maintains a municipal generating plant. Early in 1955, officials of the city advised the People’s Cooperative that it would have to look for another source of power because its limited capacity was needed for its own municipal uses and it could no longer spare the power it had been selling to it. As a consequence the People’s Cooperative sought the service of Dairyland’s facilities and upon application was accepted as a member of its group.

After Dairyland had accepted People’s Cooperative as a member, it instituted these proceedings to acquire by condemnation right-of-way easements for its electric transmission lines so as to connect its facilities between Dairyland’s principal generating plant at Alma, Wisconsin, and the substation near Rochester, Minnesota. The proposed line will serve the further purpose of improving service with two other member cooperatives in southern Minnesota.

The new line from Alma, Wisconsin, to the substation at Rochester, Minnesota, is approximately 31.6 miles. Dairyland has negotiated right-of-way easements of approximately 22.5 miles by voluntary purchase and has completed condemnation proceedings through award or settlement of approximately 3.75 miles. The right-of-way easements sought in these actions are all that are required to complete the remaining 5.4 miles of line.

Since the sovereign right of eminent domain can be exercised only for a public use, the property owners argue that the proposed condemnation is unlawful because Dairyland is a cooperative organized to furnish service to members only. They argue that the general public must have a definite and established right to use of the property appropriated, not as a matter of favor or by consent of the owner, but as a matter of right; and if a special benefit to be derived from the land sought to be appropriated is wholly for private persons, the use is a private one and not made a public, use by the fact that the public has a theoretical right to use it.

They specifically urge that the proposed taking of their property is not for public use within the meaning of that term as expressed *561 in Minn. Const, art. 1, § 13, and is in violation of the due process provisions of U. S. Const. Amend. XIV. They further urge that L. 1955, c. 757, amending M. S. A. 308.05, which purports to empower cooperatives organized or qualified under §§ 308.05 to 308.18 and “engaged in the electrical, heat, light, power or telephone business, * * * to exercise the power of eminent domain in the manner provided by the laws of this state for the exercise of such power by other corporations engaged in such business,” is unconstitutional as applied to the property owners because the proposed taking is not for a public use.

Much of the landowners’ argument is directed to the articles of incorporation of the Dairyland Cooperative. They emphasize that under Art. 5 of the articles of incorporation, which states the nature of the business, provision is made for the furnishing of electrical energy “to member distribution cooperatives and to member public utilities” and for the sale of energy “to its members only.” Citing Garkane Power Co. Inc. v. Public Service Comm. 98 Utah 466, 100 P. (2d) 571, 132 A. L. R.

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Bluebook (online)
82 N.W.2d 56, 248 Minn. 556, 1957 Minn. LEXIS 536, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-condemnation-by-dairyland-power-cooperative-minn-1957.