Colonial Furniture Co. v. Cleveland Union Terminals Co.

The Colonial Furniture Company, the plaintiff in the court of first instance, prosecutes error to this court, complaining of an adverse judgment entered against it by the trial court without the intervention of a jury, by which it was denied damages. It is here forcefully urged that the judgment is against the manifest weight of the evidence and is contrary to law.

The plaintiff pleads that it is the owner of a perpetual leasehold estate located on Ontario street, in the city of Cleveland, in which it conducts a retail furniture business, and that on March 1, 1928, the defendant took possession of the street, tore it up, and excavated it to a depth of eighty feet, and that from that date until May 1, 1930, the plaintiff's business was subjected to a terrific din and a constant shower of dust and dirt; and that this work, together with the maintenance of a high board fence at the curb, deprived the plaintiff of its right to ingress and egress, and to light and air, and that thereby the rental value of the plaintiff's estate was damaged in a considerable amount, for which it has not been compensated. The plaintiff further pleads that the conduct of the defendant was "unnecessary, unreasonable, negligent and unlawful, an invasion to and infringement of plaintiff's constitutional rights, and a taking of its property without due process of law."

The defendant company answers, saying that it is a union depot company incorporated under the laws of Ohio, and that as such it contracted with the city of Cleveland for the construction of its terminal and the building of a tunnel under Ontario street as necessary incidents of the total plan. It is also averred that by initiated ordinance and several ordinances amendatory and supplemental thereto the people and the council of the city of Cleveland had authorized the work to be done, and had thereafter issued its permits to the defendant to so do. The defendant further says that it employed an experienced and responsible contractor, who, in accordance with a plan reasonably designed, performed the work at the minimum expense, expenditure of time, and danger to the traveling public and the abutting owners, and with minimum interference with the ordinary uses of the street; and that all that was done from the standpoint of plan, method, and time was reasonably necessary to the accomplishment of the ultimate purpose. It is also alleged that the damages suffered by the plaintiff were different only in degree and not in kind from those suffered by the public generally, and that the obstruction and incroachment on the street were neither unreasonably imposed nor unnecessarily prolonged.

The reply admits the organization of the defendant, the passage of the ordinances, and the issuance of the permits, but avers that any such authorization is in derogation of Article I, Section 19 of the Ohio Constitution, and of theFourteenth Amendment to the Constitution of the United States, in that it is a taking of property without compensation.

From the voluminous and controverted evidence in this action the trial court found that the open plan of construction carried on in Ontario street was performed without negligence, and without unreasonable or unnecessary delay, and that the method of construction adopted was reasonable and proper under all the circumstances. This conclusion reached by the trial court, which is supported by much creditable evidence, has cast around it the same sanctity that assures repose to a jury's verdict on the facts, for which a reviewing court may not substitute its judgment. It therefore remains for this court to determine whether the judgment entered on the conceded facts — that is, that plaintiff did suffer a temporary damage to its leasehold estate by reason of the improvement's interference with its right of ingress and egress to and from its premises and was deprived of light and air — is contrary to law and deprives plaintiff of its property rights without compensation therefor.

The legal question presented may be thus stated:

May a public service corporation, to wit, a union depot company organized for private profit, and expressly authorized by statute to undertake the accomplishment of its purpose of creation, which has been found conducive to public necessity and convenience, enter into a contract, sanctioned by statute, with a municipality which is to pay no part of the cost of the improvement, and is thereby permitted by the municipality to occupy its streets during construction, which causes incidental and temporary damage to an abutting owner by limiting his property's accessibility and impairing his right to light and air, and subjecting it to noise and dirt, all necessarily incident to the construction process, be held liable for such damage, in the absence of a negligent prosecution of the work or any undue protraction thereof, when the plan pursued is reasonable and designed to accomplish the project at a minimum of expense to the utility and a minimum of time and danger to the public, where there is no direct encroachment upon or actual taking physical possession of the private property of the abutting owner?

The question is further made in this action as to whether or not a terminal subway creates an additional servitude upon the street, and we deem it expedient to first consider that subject in view of what may be hereinafter concluded. It is in evidence that this subway is not only to carry into and from the terminal station trains operating between Cleveland and other cities, but is also to accommodate rapid transit trains operated within the city for the benefit of its citizens; in which latter respect its use is analogous to street railway service. All these trains are to be operated by power other than steam.

It is settled in this state that steam railroads and elevated roads are an additional burden on a street's use, and that street and interurban railways are ordinarily not such an additional burden. We are unable to find that Ohio courts have ever given expression to a view as to which category terminal companies and subways belong. In 10 Ruling Case Law, 106, Section 92, it is stated as a general rule that subways are not an additional servitude. This view is found ably discussed in the case of Sears v. Crocker, 184 Mass. 586, 69 N.E. 327, 100 Am. St. Rep., 577. The case of Smith v. Central Power Co., 103 Ohio St. 681,137 N.E. 159, involved the erection of poles in a city street for the distribution of power, and the reasoning of the court therein could just as well have been made in the Sears case, supra. A subway, such as this court is now considering, in part serves the local needs of the people of the city of Cleveland and helps to eliminate the congestion of the city's streets, and facilitates and expedites travel, and in that respect its purpose and use is like that of a street railway. And now considering that the subway is used by trains entering and leaving Cleveland, from and to other cities, it is apparent that its use in that respect is similar to that of railroads not powered by steam and interurban railways. It eliminates stations for each road, and minimizes tracks and street railroad crossings and danger to the public generally. And considering further its use in toto we recognize that an abutting owner is not denied access from the public street to his property; nor is his right to light and air affected; nor is he subjected to dirt and noise thereby. We can quickly perceive that this may not be true in the case of steam railroads, or in the case of elevated roadways in a city street. Without reiterating the reasoning of many cases as to why public streets in populous communities must now carry constantly increasing facilities for expediting communication, transportation, and required services to the public, we unhesitatingly reach the conclusion that a subway, as a necessary incident to a terminal plan, is not an additional servitude upon or in the street which it mines.

The defendant first directs our attention to the early and oft-cited case of Clark v. Fry, 8 Ohio St. 358, 72 Am. Dec., 590, and correctly says that the doctrine therein announced is applicable to the question made. It is therein held: "The right of transit in the use of the public highways is subject to such incidental, temporary, or partial obstructions as manifest necessity requires; and among these are the temporary impediments necessarily occasioned in the building and repair of houses on lots fronting upon the streets of a city, and in the construction of sewers, cellar-drains, etc. These are not invasions, but qualifications, of the right of transit on the public highway; and the limitation on them is, that they must not be unnecessarily and unreasonably interposed or prolonged."

In the interest of collecting authorities we could with ease unduly prolong this opinion, but this is not our purpose. We shall, however, adopt the language of several courts, among which is that to be found in Atwater v. Trustees of Village ofCanandaigua, 124 N.Y. 602, 27 N.E. 385: "The doctrine, however, is well established in this state, that public officers lawfully employed in making public improvements, and corporations engaged in the performance of work of a public nature authorized by law, are not liable for consequential damages occasioned by it to others unless caused by misconduct, negligence or unskillfulness."

This, to our notion, well states the general rule, with the reservation, of course, that the utility constructed or permitted be not purely a proprietary function. The case of NorthernTransportation Co. v. City of Chicago, 99 U.S. 635,25 L. Ed., 336, is in point. The court there said, at page 640: "That cannot be a nuisance, such as to give a common-law right of action, which the law authorizes. * * * A legislature may and often does authorize and even direct acts to be done which are harmful to individuals, and which without the authority would be nuisances; but in such a case, if the statute be such as the legislature has power to pass, the acts are lawful, and are not nuisances, unless the power has been exceeded. In such grants of power a right to compensation for consequential injuries caused by the authorized erections may be given to those who suffer, but then the right is a creature of the statute. It has no existence without it."

The plaintiff makes the claim that the immunity of a public body extends no further than to one who contracts with it for the performance of the work to be done for it, and not to one like the defendant herein, who constructs and operates a public utility under a permit for its own personal profit. It is well recognized that operations of public utilities are of two kinds: that is, those that are publicly and those that are privately owned. We are unable to appreciate any such distinction. The privately owned utility serves the people of the political subdivision wherein it operates with its permission and under its direction. It affords a service which perhaps the public body could not furnish by reason of financial inability. An instance of such character is to be found in those companies which explore for natural gas and transport it for great distances. To say that such a public servant might not repair its lines in the streets of a city which it serves without constant fear of restraining orders and damage actions for causing inconvenience to abutting property owners would be to make such service and convenience impossible. Such public servant only operates by legal sanction, and, so long as it employs a reasonable and practical method of construction or repair, without unnecessary protraction or negligent prosecution, it should be immune from damages for temporary inconvenience to abutting owners.

Article I, Section 19 of the Constitution of Ohio, provides that: "Private property shall ever be held inviolate but subservient to the public welfare." It was necessary and subservient to the public welfare that a subway be made under Ontario street. The plaintiff's possession of its abutting property was in nowise disturbed. It was not "taken" for public use. It but suffered temporary inconvenience in its easement in and to the public street; without doubt its hardship was greater in degree than that of the public generally, by reason of its close proximity to the operation. It must look for its recompense to the future advantages to be secured by it and to the public generally. As said in Clark v. Fry, supra, this was not an invasion of a property right held inviolate by constitutional provisions, but a qualification of the right of transit or easement in a public street. The plaintiff's property was subservient to the public welfare.

The Fourteenth Amendment to the Federal Constitution is subject to the same interpretation, and affords no greater aid and comfort to the plaintiff. Article XIII, Section 5 of the state Constitution, is also invoked. It provides that a right of way shall not be appropriated without compensation therefor. Our prior comments fully deny its application in this action.

But one further inquiry remains. Do the statutes of this state provide that an abutting owner be compensated for temporary interference with his street easement? Plaintiff directs our attention to Section 3714, General Code, which provides that municipalities shall keep their streets open, in repair, and free from nuisance. This section also empowers a municipality to regulate the use of its streets in the manner provided by law. The law provides that it may contract with terminal companies and provide for temporary interference with traffic when necessary in the construction of tunnels. Section 9163, General Code. Such construction is not a nuisance as herein previously indicated.

Section 8765, General Code, pertains to steam railroad tracks laid upon or over a street, and provides that in such case such a company shall be responsible for injury done to private property. This statute makes no mention of any such compensation when tracks are placed below the surface grade.

Section 9146, General Code, has to do with interurban railroads and provides for payment of damages to nearby property owners when such company elevates or depresses its tracks. The defendant, however, is not an interurban railroad company.

The defendant points out that Section 9163, General Code, which provides for construction of terminals by union depot companies, makes no mention of damages for any interference with adjoining properties. But the plaintiff counters with the claim that Section 9167, General Code, gives such a right of compensation to those who suffer inconvenience. That section reads: "The company controlling and operating such union depot and terminal property shall be liable to the public and persons who contract with such company, for all contracts made and damages caused by it, and for all damages, costs, and expenses which arise from the fault or neglect of its officers and employees."

The terms of this act clearly indicate that this section does not apply to the construction period of a terminal project. It makes no reference, as do other related sections commented upon, to damages to nearby property interfered with at construction; but rather fixes liability upon the operating company for contracts made and damages caused by it as an operating company.

That portion of Section 9162, General Code, pertaining to the power and privileges of union depot companies, refutes the plaintiff's claim made for Section 9167, General Code. Section 9162 says that such companies "Shall have all the powers given to railroads by the laws of this state, for the purpose of acquiring, constructing and operating its depot, tracks and terminals." Section 8765, General Code, previously considered, is to be found in Chapter 1, Subdivision I, Division II, Title IX, Part II, Railroads, and is styled "Special Powers." It therefore follows that in construction union depot companies have the same rights and immunities possessed by railroads in the matter of responsibility to nearby grounds.

We find no statute which gives the plaintiff a right to recover damages for the inconvenience suffered and for loss in rental values.

We would in conclusion direct attention to two Ohio courts which have applied the principal rule herein adopted, the case ofGlidden v. City of Cincinnati, 4 O.D. (N.P.), 423, 30 W.L.B., 213, 11 Dec. Rep., 853, and Dowling v. Dayton Union Ry. Co., 30 N.P. (N.S.), 129. The Court of Appeals report of the last-noted case is to be found in 13 Ohio Law Abs., 606.

Judgment affirmed.