Bethlehem v. Allentown

Opinion by

Mr. Chief Justice Moschziskee,

This case is before us on appeal by plaintiff from the refusal of the court' below to continue a preliminary injunction. It is not usual in such instances to pass on more than is actually required to dispose of the appeal, and we shall adhere to that rule; but, in order to afford an understanding of the controversy, it is necessary to state the material facts considered by the court below, and several of the contentions involved.

The Bethlehem South Gas and Water Company, incorporated in 1864, was empowered to introduce into the “village of Bethlehem South, and the villages adjoining in Saucon, Salisbury and Hanover townships, in the Counties of Northampton and Lehigh, a sufficient supply of water.” The company was organized in 1867, and immediately thereafter began to carry out the provisions of its charter. The Mountain Water Company was incorporated in 1893, and the Bethlehem Consolidated Water Company in 1902. These three concerns were, on April 18,1902, merged into the Bethlehem Consolidated Water Company, which, in 1903, conveyed all its franchises, powers, rights, privileges, property, real and personal to the Bethlehem City Water Company; and the latter on September 28,1920, after approval by the Public Service Commission, conveyed all the merged rights, powers, privileges and franchises to the City of Bethlehem (plaintiff). On February 2,1920, a portion of Hanover Township was annexed to the City of Allentown (defendant). Previous to that date, the Bethlehem City Water Company, or its predecessor, had laid mains and pipes in certain parts of the annexed territory, supplying the inhabitants with water; in the fall of 1921, Allentown, began to extend its municipal water mains into this district and continued to do so until the preliminary injunction issued.

Plaintiff contends it is vested with the franchise rights of the Bethlehem South Gas and Water Company (hereinafter referred to as the Water Company), one of which is to serve the territory here involved, and another, — ■ since the Public Service Company Law (Act of July 26, 1913, P. L. 1374,1388, article III, section 3, par. d), — is to demand that any municipality, desiring t’o enter this territory, shall first receive a certificate of public convenience: Barnes Laundry Co. v. Pittsburgh, 266 Pa. 24, 31-2. Defendant replies that the City of Bethlehem is not1 a public service company, but a municipality, therefore the part of the Act of 1913 relied on by plaintiff has no application; and argues with some force, that it would be unjust, in many ways, to deprive one municipality, in favor of another, of the right to serve with water any part of the territory covered by the former.

While, in the Barnes Laundry Company Case, supra, this court held that municipalities come within the Act of 1913 only to the restricted extent signified by the statute itself, we did not1 there decide that, if the franchise of a water company were purchased by a city, it,— when asserting a right to the protection against competition which the Public Service Company Law affords the vendor, — was not to be considered (for that limited purpose) as standing in the shoes of the latter, within the purview of the legislation just mentioned; and, since the point indicated was not touched on by the chancellor, we shall not now pass on the questions involved in an answer thereto, but await a fuller development of facts, as hereinafter stated. In the meantime, however, we must consider the ground on which the court below disposed of the present case.

The learned chancellor construed the water company’s charter as confining that corporation’s rights to the village of Bethlehem South with other immediately contiguous villages, and decided the case on the express ground that, since the territory defendant had invaded, albeit occupied by plaintiff, did not immediately adjoin, or touch, Bethlehem South, the district in question was not covered by the charter of the water company, whose assignees were similarly powerless to assert any right in respect to such territory; and concluded that on this state of facts plaintiff had no standing in the present controversy. On the facts developed, as understood by us, we cannot agree with the position thus taken by the learned chancellor. '

It appears that the original water company, whose charter is now under consideration, first extended its mains, out of Bethlehem South into adjoining territory, as early as 1884 (see Bethlehem City Water Company v. Bethlehem Boro., 231 Pa. 454, 456; and 253 Pa. 333, 335), and continued such extensions toward and into the district now in controversy, long before its annexation to defendant city, and prior to the acquisition of the water company franchise by plaintiff municipality; just when these events took place appellant was not allowed to show, practically all its offers of evidence being refused (in most instances erroneously) as irrelevant, under the view (already stated) taken by the chancellor concerning the meaning of the water company’s charter.

As previously said, the charter empowers the .company to supply water to the “village of Bethlehem South and the villages adjoining in Saucon, Salisbury and Hanover townships.” If, for a long term of years, this provision were construed by all concerned as covering villages generally in Saucon, Salisbury and Hanover townships, whether or not every one of such communities actually adjoined, or touched, the village of Bethlehem South, it would be too late now for any one but the Commonwealth to question that construction, even if it could do so: Com. v. Bala & Bryn Mawr Turnpike Co., 153 Pa. 47; Pittsburgh Rys. Co. v. Boro. Carrick, 259 Pa. 333, 339. In other words, if the provision under consideration has, for a long time, been construed, and acted on, as embracing “all villages in the adjoining townships of Hanover,” etc., that meaning, not being impossible, will prevail to protect material rights acquired under such contemporary construction: see authorities last above cited; and, on governing general principle, see Pa. Schuylkill V. R. R. Co. v. P. & R. R. R. Co., 160 Pa. 277, 298, 299; Nesinger v. Clay & Hinkletown Turnpike Co., 203 Pa. 265, 267, 268; Chicago v. Sheldon, 76 U. S. 50, 54. This being the case, the chancellor should have admitted any evidence tendered that might shed light on the matters for decision, but, as before stated, instead of so doing, he refused practically all plaintiff’s offers of proof, including the charter itself; hence there must be a rehearing.

When the record comes back to this court (if it ever does) with the relevant facts established, we shall then be in a position to pass intelligently on the several questions of law involved, and also have the benefit of the views of the learned court below concerning those questions. Of course, the chancellor can take judicial knowledge of local geography (Pearce v. Langfit, 101 Pa. 507, 512), including the class into which -the several cities and other communities, with which we have to deal, fall; but, for the benefit of the reviewing tribunal, he should be careful to state all information in that regard which may be necessary to a proper understanding of the record.

Since the litigation involves public interests, and as counsel say, in their briefs, that defendant is willing to pay a reasonable price for plaintiff’s property, but not a franchise value, we venture to suggest that, for the sake of the public, which the parties represent, they should make every effort to arrive at a fair understanding and adjustment1, so this controversy may be brought to a speedy close. We also take occasion to note that the matter before us strongly suggests the necessity for further legislation, authorizing municipalities, situated as are the present ones, to move the Public Service Commission to condemn and value the property involved (including, in a proper case, franchise value) wherever a municipality acquires the assets and franchises of a water company, which incidentally operates within t'he territorial limits of an adjoining municipality; but, pending this legislation, where such a situation arises, those representing the several communities should make every reasonable endeavor to reach a fair adjustment in their own way.

The bill, as drawn, prays for general relief, and, specifically, that the status quo be maintained till final hearing; and, then, that defendant be restrained from invading the territory of plaintiff. If, when the facts are properly developed, the Public Service Company Law should be held to apply to the present case, then, perhaps, according to our recent decisions (see Fogelsville, etc., Co. v. Pa. P. & L. Co., 271 Pa. 237, 244-5, and authorities there cited), working out' a system for administering that law, the prayer for general relief would warrant the chancellor in issuing an injunction, pending application to the. Public Service Commission; but, when the record is returned t'o the court below, if the case is proceeded with, and plaintiff still desires that form of relief, it had better move to amend the bill accordingly.

The order áppealed from is reversed, the status quo, as at time of order, is reinstated, and the record remitted for further proceedings consonant with the views here expressed; costs to await final order.