City of Union v. Board of Commissioners of Public Works

April 5, 1912. The opinion of the Court was delivered by This is an appeal from an order, sustaining a demurrer, to the complaint, on the ground that it does not state facts sufficient to constitute a cause of action. The complaint will be set out, in the report of the case.

The grounds of demurrer were: (1) That the defendants are under the statute law of this State, a body politic and corporate, and no duty is imposed upon them, to do and perform the acts and obligations, set forth in the complaint. (2) That under the statutes of this State, in such cases made and provided, the defendants have the right and power, to charge any and all persons and corporations, and upon the failure of such persons and corporations to pay such price, the defendants, under the law, have the right to discontinue such service.

Sections 2008, 2009, 2010, 2011 and 2012 of the Code of Laws are as follows:

Section 2008. "All cities and towns shall have full power and authority, to construct and operate waterworks and electric light works, within the corporate limits of said cities and towns, for the use and benefit of said cities and towns, and its citizens, and to purchase, own and operate apparatus for generating either electricity or gas for the use and benefit of said cities and towns, and its citizens, or to contract for the erection of plants, either for waterworks or sewerage or lighting purposes, or sewerage, one or both, for the use of said cities and towns, and to supply the citizens thereof; and to meet the cost of same the said cities and towns may issue coupon bonds, bearing interest at a rate not to exceed six per centum per annum, payable in any legal tender money of the United States, forty years after date, with the privilege of redemption after twenty years from date: Provided. That before any bonds shall be issued under the provisions of this section, the city or town council, of said municipality, shall submit the question of the issue to the qualified registered electors of such cities and towns, at an election to be held by said city or town council, appointed and conducted in accordance with the laws of force, governing municipal elections: And provided. That before any elections shall be held, under the provisions of this section, a majority of the freeholders of said city or town, as shown by the tax books of said city or town, shall petition said city or town council, that the said election be ordered; and if a majority of electors voting at said election, vote for said issue of bonds, the said city or town council shall so declare by ordinance, and shall issue said bonds, and turn them over to the board of commissioners of public works of said city or town, hereinafter established. * * *

Section 2009. "At such elections for bonds, the elector shall vote for three citizens of such town or city, whose terms of office shall be respectively two, four and six years, and until the general election for municipal officers, next following the expiration of the short term, and until their successors are elected and qualified. The classification above designated, as to the terms, shall be ascertained by the commissioners after election by lot. At each general election for municipal officers, following the expiration of the term of the commissioner holding the short term, and at every such election every two years thereafter, one such commissioner shall be elected for a term of six years, and until his successor is elected and qualified. The officers so elected, and their successors in office, shall be known as the commissioners of public works of such municipality, and by that name may sue and be sued, in any of the Courts of this State. At the first meeting of the commissioners after election, and after any election for a full term, they shall organize by the election of one of their number as chairman. The clerk or recorder of the municipality shall act as secretary of the commissioners. The mayor and aldermen of the city, or the intendant and wardens of a town, shall fill any vacancy occurring in said commissioners by death, resignation or otherwise, by appointment for the unexpired term. The persons elected or appointed to such office, shall qualify by taking the same oath, as the election officers of the municipality take. The mayor of the city or the intendant of the town, shall notify the persons so elected, as members of the commissioners of public works, of their election within ten days after the result of such election is declared. * * *

Section 2010. "Said board of commissioners of public works shall be vested with authority to build or contract for building said waterworks and said electric light plant, and to operate same, and shall have full control and management of same. They may supply and furnish water, to the citizens of the said cities and towns, and also electric, gas or other light, and may require and exact payment of such rates, tolls and charges as they may establish, for the use of water and lights. They may sell and dispose of said bonds and apply the proceeds, or so much thereof as may be necessary, towards the purchase of, or payment for said plants: Provided, That the said board shall make a full statement, to the city or town council, at the end of each month, of their receipts and disbursements of all kinds, during the preceding month. They shall have no power to incur any indebtedness, without the concurrence of such council.

Section 2011. "The said city or town council, are hereby authorized to assess, levy and collect, in addition to the annual tax levied for other purposes, a sufficient annual tax from the taxable property of said cities or towns, to meet the interest to become due upon said bonds, and also to raise the sum of at least one-fortieth part of the entire bonded debt, as a sinking fund in aid of the retirement and payment of said bonds. Said sinking fund shall be under the control and management of the board of commissioners of public works, and shall be applied to the said bonds, or invested to meet the payment of same when due."

Section 2012, as amended by the Act of 1909, page 42. is as follows:

Section 2012. "The said cities and towns shall have the power and authority to purchase and hold suitable lands and water, and to erect such aqueducts, dams, canals, buildings, machine shops and other works, and to construct and lay such conduits, mains and pipes, as may be necessary to obtain and secure a supply of water and power, for operating said waterworks and electric light works. And said cities and towns shall have power, to erect poles and wires along any of the adjacent highways, and in said cities and towns, and shall have the right to condemn any property and lands, the drainage from which would contaminate the water supply, of said city or town." * * *

Section 5, article VIII of the Constitution, is as follows:

"Cities and towns may acquire by construction or otherwise, and may operate, waterworks systems and plants for furnishing lights, and may furnish water and lights to individuals, firms and private corporations, for reasonable compensation:Provided, That no such construction or purchase shall be made, except upon a majority vote of the electors in said cities, or towns, who are qualified to vote, on the bonded indebtedness of said cities or towns."

The power of a municipality to operate an electric plant, for furnishing lights to private residences, did not exist in this State until the Constitution was adopted in 1895.

In the case of Mauldin v. City Council, 33 S.C. 1,11 S.E. 434, 8 L.R.A. 291, the Court held, that the municipality had the express power to purchase, and implied power to operate, an electric plant, so far as it was used for lighting its streets and public buildings; but so far as it was used for furnishing lights to private residences and places of business, at a compensation, it was not for the public use of the city, and, therefore, its purchase and maintenance were to that extent ultra vires.

The sections of the Code of Laws hereinbefore set out, were first embodied in the act of 1896, entitled: "An act to authorize all cities and towns to build, equip and operate a system of waterworks and electric lights, and to issue bonds to meet the cost of same."

In that act is this provision, conferring corporate existence on the commissioners of public works: "The officers so elected, and their successors in office, shall be known as the commissioners of public works, and by that name may sue and be sued in any of the Courts of this State."

The powers conferred upon the commissioners of public works were intended to make them a part of the municipal government.

The act conferred upon the commissioners of public works, certain powers in regard to furnishing lights to private individuals, which they could not have exercised, prior to the adoption of the Constitution, and cannot now exercise, unless they must be regarded as agents of the cities and towns.

It will be observed, that the Constitution provides, that cities and towns alone, are authorized to furnish electric lights to individuals, firms and private corporations for reasonable compensation, yet the statute provides, that these powers shall be exercised by the commissioners of public works, an independent corporation which is not under the supervision, nor subject to the control of the city of Union, but deriving its powers directly from the statute. Hardy v.Reamer, 84 S.C. 487, 66 S.E. 678.

Turning to the title of the act of 1896 (22 Stat., p. 83), it will be seen that it only intended, that power to operate electric plants, should be given to cities and towns, yet in the body of the act, not only is full power conferred upon cities and towns, but like authority is given to the commissioners of public works, a corporation created by that act.

But as the constitutionality of that act has not been attacked, the questions whether the commissioners of public works are authorized to exercise the rights and privileges conferred on cities and towns, by section 5, article VIII of the Constitution, or whether the title of the act of 1896 is obnoxious to section 17, article III of the Constitution, which provides that "every act or resolution, having the force of law, shall relate to but one subject, and that shall be expressed in the title." are not, at this time, properly before the Court for consideration.

The circumstances under which a public service corporation, may refuse to supply a private individual with water, are thus stated in the case of Poole v. Water Co., 81 S.C. 438,62 S.E. 874:

"While a public service water company, has the right to cut off a consumer's water supply, for nonpayment of recent and just bills for water rents, and may refuse to engage to furnish further supply, until said bills are paid, the right cannot be exercised, so as to coerce the consumer into paying a bill which is unjust or which the consumer, in good faith and with show of reason disputes, by denying him such a prime necessity of life as water, when he offers to comply with the reasonable rules of the company, as to such supply for the current term.State ex rel. Gwynn v. Citizens Tel. Co., 61 S.C. 98,39 S.E. 257, 55 L.R.A. 139; McEntee v. Kingston WaterCo. (N.Y.), 58 N.E. 785; Wood v. City of Auburn (Me.), 29 L.R.A. 376.

"The inconvenience arising from subjecting the water company, to the necessity of resorting to the regular Courts, to collect disputed claims, is not to be compared to the hardship to the consumer, as a member of the public, involved in permitting the water company to be judge in its own cause, and to coerce the disputant into submission by denying him water."

These principles apply with greater force when the commissioners of public works threaten to deprive the city of the electric lights, which it was furnishing. It would defeat one of the very objects for which, it is contended, the commissioners of public works were invested with corporate powers of public nature, to wit: to furnish lights not only to private parties, but also to the city or town. The statute authorizes the commissioners of public works to sue and be sued, and it has not been made to appear, that it has exhausted its remedies, nor that it was necessary to resort to measures so drastic, as to defeat one of the objects of its existence. On the contrary, it appears that its action was arbitrary, and that there was error in sustaining the demurrer.

Judgment reversed.