Opinion
No. 41409.
March 14, 1960.
1. Municipalities — creatures of the State — Legislature empowered to withdraw from municipality right to fix gas rates.
Municipalities are creatures of the State and the Legislature is empowered to withdraw from the municipality the right to fix gas rates.
2. Gas — rates — municipalities — statutes — jurisdiction to fix and determine gas rates of utility operating under existing franchise was not in city subject to review by Chancery Court, but in Public Service Commission.
Where city granted a franchise to gas company to furnish gas which provided that the rates were effective so long as they remained fair and reasonable or were changed or altered as provided by law and the Legislature subsequently vested in the Public Service Commission right to determine and fix rates, city's remedy in opposing an increase in gas rates was by appeal to the Public Service Commission and not under the provision of the franchise agreement that if the rates were not satisfactory an appeal should be had to the Chancery Court. Secs. 3374-120, 3374-139, 7716-01 et seq., Code 1942.
Headnotes as approved by Hall, J.
APPEAL from the Chancery Court of Neshoba County; J.K. GILLIS, Chancellor.
Avery Putnam, Brunini, Everett, Grantham Quin, Jackson; Wilkinson, Lewis, Madison Woods, W.O. Crain, Shreveport, La., for appellants.
I. The Chancery Court is without jurisdiction to issue an injunction where there is a full, adequate and complete remedy at law or when no irreparable injury will be sustained. Faison v. City of Indianola, 156 Miss. 872, 127 So. 558; Greenwood Lodge No. 118, I.O.O.F. v. Hyman, 180 Miss. 198, 117 So. 45; Hines Yellow Pine Trustees v. Knox, 144 Miss. 560, 108 So. 907; Illinois Cent. R. Co. v. Mississippi Public Service Comm., 220 Miss. 439, 71 So.2d 176; Madison County v. Mississippi State Highway Comm., 191 Miss. 192, 198 So. 284; Mississippi Valley Gas Co. v. City of Jackson, 236 Miss. 81, 109 So.2d 637; Moss v. Jourdan, 129 Miss. 614, 92 So. 690; Scott v. Lowe, 223 Miss. 312, 78 So.2d 452; Secs. 1169, 3433, 7716-26, Code 1942; Griffith's Mississippi Chancery Practice, Secs. 434, 436, 438.
II. The Legislature had the power to withdraw from municipalities all authority to fix rates for gas and electric service and, on March 29, 1956, by Chapter 372, Laws of Mississippi 1956, exclusive jurisdiction over such rates was vested in the Public Service Commission of Mississippi. Atlantic Coast Elec. R. Co. v. Public Utility Commrs., 92 N.J.L. 168, 104 A. 218, 12 A.L.R. 737, P.U.R. 1919C, 489; Atlantic Coast Line R. Co. v. Goldsboro, 58 L.Ed. 721; Benwood v. Public Service Comm., 75 W. Va. 127, 83 S.E. 295, L.R.A. 1915C, 261; Brooksville v. Florida T. Co., 81 Fla. 436, 88 So. 307, P.U.R. 1921D 281; Central Main Power Co. (Maine), 122 A.2d 541, 14 P.U.R. 3d 418; Central Union Tel. Co. v. Indianapolis T. Co. (Ind.), 126 N.E. 629; Chicago, B. Q.R. Co. v. McGuire, 55 L.Ed. 338; Chicago R. Co. v. Chicago, 292 Ill. 190, 126 N.E. 585, P.U.R. 1921A 77; Chicago R. Co. v. Illinois Com. Comm., 277 Fed. 970, P.U.R. 1922C 282; City of Mobile Elec. Co. (Ala.), 84 So. 816; City of Pascagoula v. Woodson, 229 Miss. 631, 91 So.2d 718; City of Pawhuska v. Pawhuska Oil Gas Co., 63 L.Ed. 1054; Day v. Hart, 232 Miss. 516, 99 So.2d 656; Duluth Street R. Co. v. Railroad Comm., 161 Wis. 245, 152 N.E. 887, P.U.R. 1951D 192; Dunn Constr. Co. v. Craig, 191 Miss. 682, 1 So.2d 166; Fuller Plywood Co. v. Moffett, 95 So.2d 475; Gully, State Tax Collector v. Williams Bros., Inc., 182 Miss. 119, 180 So. 400; Hoyne v. Chicago O.P. Elev. R. Co., 294 Ill. 413, 128 N.E. 587, P.U.R. 1921A 328; Hudson County Water Co. v. McCarter, 52 L.Ed. 828; Huff, Re, 254 N.Y. 316, 172 N.E. 520, P.U.R. 1930D 277; International R. Co. v. Prendergast, 52 F.2d 293, P.U.R. 1932A 161; Kansas City P. L. Co. v. Midland Realty Co. (Mo.), 93 S.W.2d 954; Knox, Atty. Gen. v. Board of Suprs. of Grenada County, 141 Miss. 701, 105 So. 541; Louisville N.R. Co. v. Mottley, 55 L.Ed. 297; Manigault v. Springs, 50 L.Ed. 274; Martin v. State, 190 Miss. 32, 199 So. 98; Mills v. Barrett, 213 Miss. 171, 56 So.2d 485; People ex rel. South Glens Falls v. Public Service Comm., 225 N.Y. 216, 121 N.E. 777, P.U.R. 1919C 374; Public Service R. Co. v. Public Utility Commrs., 276 Fed. 979, P.U.R. 1921E 632; Public Service Comm. v. Pavilion Nat. Gas Co. 187 N.Y. Supp. 363, 195 App. Div. 534, P.U.R. 1921D 11; Puget Sound Traction L. P. Co. v. Reynolds, 244 U.S. 574, 61 L.Ed. 1325, 37 S.Ct. 705, 54 L.R.A. 13, P.U.R. 1917 F 57; Rail River Coal Co. v. Ohio Ind. Com., 59 L.Ed. 607; Richmond v. Virginia R. Power Co., 141 Va. 69, 126 S.E. 353, P.U.R. 1925D 714; Salt Lake City v. Utah L. Tr. Co., 52 Utah 210, 173 P. 556, 3 A.L.R. 715, P.U.R. 1918F 377; Seward v. Dogan, 198 Miss. 419, 21 So.2d 292; Sheffield v. Reece, 201 Miss. 133, 28 So.2d 745; Southern Utilities Co. v. Palatka, 86 Fla. 583, 99 So. 236, P.U.R. 1924C 428, State ex rel. Swearingen v. Railroad Commr., 79 Fla. 526, 84 So. 444; State ex rel. Triay v. Burr, 79 Fla. 290, 84 So. 61; State ex rel. Webster v. Superior Court, 67 Wn. 37, 120 P. 861, L.R.A. 1915C 287, Ann. Cas. 1913d 78; State Highway Comm. v. Coahoma County, 203 Miss. 629, 32 So.2d 555; Town of Victoria v. Victoria Ice L. P. Co., 134 Va. 134, 114 S.E. 92; Town of Vinton v. City of Roanoke, 195 Va. 881, 80 S.E.2d 608; Union Dry Goods Co. v. Georgia Public Service Corp., 63 L.Ed. 309; Western Cities Utilities v. City of Waseca (Minn.), 65 N.W.2d 255; Westervelt's Sons v. Regency, Inc., 70 A.2d 767; Winfield v. Court of Industrial Relations, 111 Kan. 580, 207 P. 813, P.U.R. 1922E 791; Secs. 3374-139, 3433, Code 1942; Chap. 491, Sec. 139, Laws 1950; Chap. 372, Public Utility Act, Laws 1956; Chap. 19, Laws 1957, Ex. Sess.; 16 C.J.S., Secs. 244, 300 pp. 1225, 1320; Black's Law Dictionary, words "by law"; Words Phrases, words "by law".
Sanford Alford, Philadelphia, for appellee.
I. The Chancery Court of Neshoba County had jurisdiction to issue an injunction to restrain the appellants from changing its gas rates until they shall comply with the terms of the franchise with the City of Philadelphia, Mississippi. Faison v. City of Indianola, 156 Miss. 872, 127 So. 558; Madison County v. Mississippi State Highway Comm., 191 Miss. 192, 198 So. 284; Mississippi Valley Gas Co. v. City of Jackson, 236 Miss. 81, 109 So.2d 637.
II. The City of Philadelphia, Mississippi has the power to fix gas rates within the municipality subject to review and determination by the Chancery Court of Neshoba County, Mississippi during the life of the franchise granted by Ordinance No. 282 of the municipality; therefore, the Chancery Court had jurisdiction to issue its injunctive relief. Cincinnati v. Public Utilities Comm., 3 A.L.R. 705; Comm. ex rel. Clifton Forge v. Virginia Western Power Co., P.U.R. 1918E 791; Gandy v. Public Service Corp., 163 Miss. 187, 140 So. 688; Griffith v. Vicksburg Water Works Co., 88 Miss. 371, 40 So. 1011; Home Tel. T. Co. v. Los Angeles, 221 U.S. 265.
On November 6, 1946 the appellee granted to the United Gas Corporation a franchise to lay its lines in the streets, avenues, alleys and public places of the city for the purpose of distributing and selling gas to the inhabitants of the city. This franchise was for a period of twenty five years and was granted under the authority of Section 3406 of the Code of 1942 authorizing municipalities to grant to persons or corporations the use of its streets, avenues, alleys, public grounds, etc. for the purpose of laying gas mains and furnishing and supplying the municipality and inhabitants with gas. That section has since been repealed.
Section 3433 of the Code of 1942 then in effect authorized the city to fix the rates subject to review by the chancery court of the county.
Upon the granting of the franchise the gas company filed a schedule of rates which, at the time, was agreed to be fair and reasonable. It was provided in Section 7 of the franchise that the rates then fixed and agreed to be fair and reasonable should be effective so long as they remained fair and reasonable or changed or altered as provided by law.
The legislature thereafter enacted Chapter 372 of the Laws of 1956 effective from the date of its passage and approved on March 29, 1956. That act repealed Section 3433 of the 1942 Code and vested in the public service commission the right to determine and fix rates.
The question presented on this appeal is whether the jurisdiction to fix and determine the rates rests in the city subject to review by the chancery court, or in the public service commission.
(Hn 1) Of course, municipalities are creatures of the state and the legislature was empowered to withdraw from the municipality the right to fix the rates.
(Hn 2) The City of Philadelphia obtained an injunction in the Chancery Court of Neshoba County prohibiting the United Gas Corporation from increasing its gas rates in the State of Mississippi, including the City of Philadelphia, Mississippi and on hearing of a motion to dissolve this injunction the chancellor found that in the franchise granted to the United Gas Corporation on November 6, 1946 "it was stipulated and agreed that the gas rates, when they were not satisfactory, should be agreed upon by the parties to said contract and fixed by the city and, if not satisfactory, appealed to the Chancery Court of Neshoba County, Mississippi which was provided for in said cited law, all of which is shown by Ordinance No. 282, a certified copy of which is attached to the original bill." It will be noted that in his findings of fact the chancellor stated that the gas rates, when they were not satisfactory, should be agreed upon by the parties, and if not satisfactory, appeal might be had to the chancery court. It was in this finding of fact that the chancellor completely missed the point. Ordinance No. 282 of the city, in Section 7, provides that the gas company shall have the right to charge and collect reasonable and compensatory rates and it was agreed "that the schedule of rates for residential gas service and commercial gas service filed on November 6, 1946 with the city are fair and reasonable under the conditions existing at the time this franchise is granted, and that such a schedule of rates shall be effective so long as they remain fair and reasonable or changed or altered as provided by law."
We do not think that Section 39 of Chapter No. 372 of the Laws of 1956 had the effect of carrying over the franchise to 1971 as contended by the city. According to the very terms of the franchise it remained in effect only so long as the rates were fair and reasonable or until changed or altered as provided by law.
Under Section 7716.01 et seq. of the Code of 1942 (Chapter 372, Laws of 1956) the public service commission was vested with jurisdiction to determine and fix rates. Under the Public Service Commission Act a full right of hearing and appeal is guaranteed and it is our opinion that the appellee's remedy is before the public service commission and no longer before the Chancery Court of Neshoba County and that the chancery court erred in its findings of fact and in its conclusions of law. The legislature has provided an ample remedy for the apellee and it has always reserved the right to pass such laws as may be expedient or necessary in municipal affairs. Consequently the lower court was in error and the decision of the chancery court must be reversed and judgment entered here in favor of the appellant.
Reversed and judgment here for appellant.
McGehee, C.J., and Holmes, Ethridge and Gillespie, JJ., concur.