Old Colony Trust Co. v. City of Tacoma

230 F. 389, 144 C.C.A. 531, 1916 U.S. App. LEXIS 1447

• Court: Court of Appeals for the Ninth Circuit
• Decided: February 7, 1916
• Docket: No. 2601
• Status: Published

Opinion

GILBERT, Circuit Judge

(after stating the facts as above). [1] In the case before the state Supreme Court there were three principal’ questions: First, whether the condition of the ordinance that the Railway & Power Company should not furnish electricity for lighting purposes was a valid one — that is to say, whether.the city had the power so to limit the franchise; second, whether the provision so limiting the franchise was abrogated by tire Public Service Commission Law (Laws 1911, p. 543); and, third, whether the refusal of the Railway & Power Company to discontinue furnishing power to the Northern Pacific Railroad Company for lighting purposes warranted a judgment of ^forfeiture. The answers to the first two of these questions depended upon the construction of state statutes, and the decision of the Supreme Court of the state thereon is conclusive upon a federal court.

[2] While the third question did not depend upon the construction of a state statute, it involved the application of principles of law to local conditions, and the ruling of the state court should be controlling in a federal court. Blaylock v. Incorporated Town of Muskogee, 117 Fed. 125, 54 C. C. A. 639; Claiborne County v. Brooks, 111 U. S. 400, 4 Sup. Ct. 489, 28 L. Ed. 470; Detroit v. Osborne, 135 U. S. 492, 10 Sup. Ct. 1012, 34 L. Ed. 260.

. The appellant contends that the court below erred in denying it relief, and in refusing to restrain the forfeiture of the mortgaged property because of an act done by the mortgagor after the execution of the mortgage without the knowledge of the mortgagee, and under the belief of the latter that the litigation in the state court constituted a test case only for determining whether the mortgagor had or had not the right to do the acts in question. The court below found that the evidence was insufficient to' show “by the clear and convincing proof necessary” that the officers of the city wrongfully or intentionally misled the officers of the Power Company, or made statements of such a nature as to warrant the latter in assuming that the resolution declaring a forfeiture would be disregarded.

We find no ground to disturb that conclusion. The commissioner of light and water of the city of Tacoma is not shown to have had authority to bind the city by any statement to the Railway & Power Company, and while it does not appear whether or not the city attorney had such authority, the evidence is insufficient to show that he became a party to any understanding by which the litigation was to be a friendly suit for the purpose of determining rights, and with no view upon the part of the city to a forfeiture of the franchise. No effort was made by the Railway & Power Company to obtain any concessions from the city council. The company seems to have relied upon the strength of its own contention that the city had no authority to limit the franchise as it did, and that in any view the limitation was abrogated by the statute of 1911, and upon its belief that in any event the city would not resort to so harsh a measure as the forfeiture of the franchise. That confidence in its position seems to have influenced the company to disregard the two resolutions of the city council, and to continue to furnish current for lighting after the expiration of the 30-day period.

[3] We find no merit in the contention that the denial of the right of the Railway & Power Company to transmit current for lighting purposes was intended only to constitute a withholding of a franchise for that purpose, and that the prohibition against furnishing electricity for lighting purposes was not intended to constitute a condition for the forfeiture of the franchise granted for the other two purposes mentioned, namely, electricity for heating and power, but was merely intended to negative any possible claim on the part of the grantee that the current which it was authorized to transmit could be disposed of for lighting purposes. It is sufficient in answer to this contention to point to the plain provisions of the ordinance, one section of which grants the franchise to transmit electric current for furnishing power and heat, but provides that the grantee shall have no right to supply electric current for lighting purposes, and another section of which declared that the rights granted shall be null and void and absolutely of no effect “upon the failure of the grantee to perform any and all of the conditions in the ordinance specified.”

[4] Nor can we assent to the proposition that the franchise is not subject to forfeiture except for failure to perform some affirmative act in the ordinance mentioned. The language of the ordinance is: “Upon the failure of the grantee to perform any and all of the conditions in the ordinance specified.” To perform all of the conditions specified is to abide by all the conditions expressed, to conform to the requirements of the ordinance, whether it be to do a specified act, or to refrain from doing a specified act. “To perform is to execute the provisions, commands, or requirements of.”. 30 Cyc. 1392.

[5, 8] We have given careful consideration to the appellant’s contention that the charter of the city did not prevent the city council from granting a franchise for the sale of electric power for lighting purposes, and this for the reason that the charter adopted in March, 1896, containing the perpetual prohibition against the grant to any person or corporation of a franchise to sell electricity within the city, so long as the city was engaged in the public duty of supplying light, was abrogated by the statute of 1903, one section of which authorizes the city to grant a franchise for the construction of lines for transmitting electric power, and to fix the terms and conditions under which such franchise may be exercised.

We are unable to perceive any conflict between the charter and the statute, so far as the question of a franchise for furnishing light is concerned. But, if we assume that the statute supplants the charter, we find nothing in the terms of the statute which would prohibit the city from making the precise contract which it made with the Railway & Power Company. The city had the authority to grant franchises for the transmission of electric power, and whether or not it was bound by its charter to deny the right to transmit power for lighting purposes, it át least had the authority to withhold that right at its will, and we see no reason why it could not, even under the act of 1903, insert a reservation which would create in its own favor a monopoly of the business of furnishing light within the city limits. The provision of the state Constitution, directed against monopolies (article 1, § 12), makes an express exception of municipal corporations.

The decree is affirmed.