Rockland Water Co. v. Camden & Rockland Water Co.

Foster, J.

The Rockland Water Company claims that it has the exclusive right of supplying the city of Rockland and portions of adjoining towns with the water of Tolman’s Pond and Oyster River Pond for domestic purposes, the extinguishment of fires, and the supply of shipping in Rockland harbor. By bill in equity the plaintiffs ask that the defendant corporation may be perpetually enjoined from withdrawing the water or any portion thereof from Oyster River Pond, and from conveying the same to the city of Rockland or towns adjoining for domestic purposes, the extinguishment of fires, supplying shipping, and the use of manufactories, notwithstanding such right has been granted by the legislature of this state.

Both plaintiff and defendant corporation derive their franchises and authority from the state acting in its sovereign capacity. Only such portions of their charters as are necessary to be considered in the' determination of this case will be referred to.

By the provisions of c. 381, special laws of 1850, certain individuals therein named, with their associates and successors, were constituted a corporation by the name of the Rockland Water Company, 'Tor the purpose of conveying to the village of Rockland, a supply of pure water for domestic purposes, including a sufficient quantity for the extinguishment of fires, and the supply of shipping in the harbor of Rockland.”

The third section of said act reads thus : "Said corporation is hereby authorized for the purposes aforesaid, to take, hold and convey to, into and through the’ said village of Rockland, the water of Tolman’s Pond, so called, situated in Rockland and Camden, by pipes sunk below the bottom of its outlet; and maj' also take and hold by purchase or otherwise, any land or real estate necessary for laying and maintaining aqueducts for *559 conducting and discharging, disposing of, and distributing waiter, and for forming reservoirs. But nothing in this act shall be taken or construed to prevent the owners of mills, or of mill privileges on the stream flowing through the outlet of said pond, from using the water thereof in the same manner that they now do or have heretofore done; but said mill owners shall not nor shall any other person or persons, be permitted, either by cutting below the pipes of said corporation, or in any other way to withdraw the water or obstruct the water works of said corporation.”

There are other provisions authorizing the construction of an aqueduct from Tolman’s Pond through the city of Rockland, and for securing and maintaining reservoirs, and distributing water by means of pipes throughout the city; for regulating its use and establishing rents ; for the payment of damages accruing to mill privileges and mill owners on the stream flowing through the outlet of the pond, and for the taking of land or excavating through the same for the purpose of laying down pipes.

Under the authority thus granted this corporation constructed works and introduced water into the city.

By a subsequent act of the legislature, (c. 79, Special Laws of 1861,) amendatory of the plaintitfs’ charter, this company was authorized "to take, hold and convey,” in the manner provided in the original act, "as well the waiter of Oyster River Pond in Camden, as of Tolman’s Pond, into and through the city of Rockland and towru of Thomaston, and also from the city of Rockland into the towns of Camden and South Thomaston, not exceeding one mile frorh the boundary line of said Rockland; and the corporation shall have the same rights, powers and privileges and be subject to the liabilties, limitations and conditions and be answerable to parties injured thereby in the same manner in respect to taking and conveying the said water, as are provided for in said act, in respect to taking and appropriating the water of Tolman’s Pond.”

The second section of this act is in these words : "The said corporation is hereby empowered to take, use and appropriate water from both or either of said ponds, for supplying the *560 people of said city and towns with pure water and for all necessary and useful purposes subject to the liabilities provided for by said act.”

In 1885., the legislature granted an act of incorporation to the defendant company by the name of the Camden and Rockland Water Company, "for the purpose of conveying to and supplying the towns of Camden, Thomaston, South Thomaston and the city of Rockland with pure water for domestic and municipal purposes, the extinguishment of fires, supplying of shipping and the use of manufactories.”

By the provisions of this act the defendants are authorized, for the purposes aforesaid, "to take, detain and use the water of Oyster River Pond and all streams tributary thereto in the town of Camden,” etc. Authority is also given, for erecting and maintaining dams and reservoirs, laying down and maintaining pipes and aqueducts necessary for accumulating, conducting, discharging, distributing and disposing of water and forming proper reservoirs, for taking and holding by purchase or otherwise lands or real estate necessary therefor, and for the payment of damages for property taken.

Prior to the filing of the plaintiffs’ bill, the defendants had purchased iron pipe, castings and materials necessary for the construction of their works, and had entered upon the construction of the same. They had also entered into a written contract with the city of Rockland for the term of ten years, to supply the city with pure water for domestic and municipal purposes and the extinguishment of fires. The defendants have since completed their works and extended them into,the towns of Camden and Thomaston, and are supplying the citizens of Rockland, Rockport, West Camden and Camden village with pure water.

The plaintiff corporation has never used or undertaken to use or appropriate the water of Oyster River Pond, and the case shows that the supply in Tolman’s Pond is sufficient for all its purposes.

The question which is presented to the court, under the claim set up by the plaintiffs, involves the validity of the charter of *561 the defendant corporation — whether the act of incorporation authorizing the defendants to use the water of Oyster River Pond for the purposes named is valid, or void as impairing the obligation of contract between the state and the plaintiff corporation.

This act authorizing the defendants to supply the citizens of Rockland with pure water appertains to purposes of public utility. It emanates from the legislative power of the state, and must be held to have the force of law, unless in passing it the legislature exceeded its powers, or it is found to be in violation of some provision of the constitution of the state or United States.

The contention iu behalf of the plaintiffs is, that the acts of 1850 and 1861, together with what was done in pursuance of the same, constituted an executed contract which is binding on the state, and that the subsequent grant from the legislature of the defendants’ franchise, rights and privileges, impairs the obligation of that contract, and brings the case within the contract clause of the constitution of the United States, (Art. 1, § 10,) and of this state. (Art. 1, § 11.)

Unquestionably the state in the exercise of her sovereignty may contract like an individual and be bound accoi’dingly. The cases are numerous in support of this principle. For more than seventy years it has been settled in this country that acts of incorporation', when granted upon a valuable consideration, partake of the nature of contracts within the meaning of that clause of the constitution of the United States which declares that no state shall pass any law impairing the obligation of contracts. The Binghamton Bridge, 3 Wall. 73 ; Charles River Bridge v. Warren Bridge, 11 Pet. 527 ; State v. M. C. R. R. Co. 66 Maine, 494; Wilmington Railroad v. Reid, 13 Wall. 266 ; Stone v. Mississippi, 101 U. S. 816 ; State v. Noyes, 47 Maine, 205. This principle rvas settled many years ago in Dartmouth College v. Woodward, 4 Wheat. 518 . And when rights have become vested under them, the authority of the legislature to disturb those rights is at an end; nor can any subsequent act control or destroy them, unless such power is reserved in the act of incorporation, or, what is equivalent, in *562 some general law in operation at the time the act was passed. Holyoke Company v. Lyman, 15 Wall. 511 ; Tomlinson v. Jessup, Id. 457.

. The-question, therefore, to be determined in cases of this kind, where legislative interference is claimed, is whether such interference does in fact impair the obligation of the contract. For there may be legislation such as to injuriously affect the interests of those with whom such contract' exists, and yet impair no obligation of contract. Thus it has been held that where a state by act of incorporation confers no exclusive privileges to one company, it impairs no contract by incorporating a second one with powers and privileges which necessarily produce injurious effects and consequences to the first. Turnpike Company v. State of Maryland, 3 Wall. 210 . The misfortunes which follow in such cases, as the court aptly remarks in that case, "may excite our sympathies, but are not the subject of legal redress.”

Such was the doctrine laid down in Charles River Bridge v. Warren Bridge, supra ; and which from that day to this has been sustained by the courts of last resort in this country. Union Bridge Co. v. Spaulding 63 N. H. 298 ; Tuckahoe Canal Co. v. Tuckahoe R. R. Co. 11 Leigh (Va.), 42 . The recent cases of Lehigh Water Co's. Appeal, 102 Penn. St. 515, 528, and Lehigh Water Co. v. Easton, 121 U. S. 391 , are directly in point.

In considering the question whether the legislature has transcended its powers by the act of ineorporatian of the defendant company, with the rights and privileges therein contained, it becomes necessary to construe the legislative acts under which the plaintiffs assert their claim of exclusive right. For, notwithstanding the plaintiffs’ act of incorporation became a contract between the state, acting in its sovereign capacity, and the corporation, founded upon mutual considerations, yet, if no exclusive right was conferred by legislative grant, such as the plaintiffs claim, then the act of the legislature incorporating the defendant company is valid, because no obligation of contract is thereby impaired. Bridge Proprietors v. Hoboken Co. 1 *563 Wall. 145 ; Lehigh Water Co. v. Easton, 121 U. S. 391 . Nor will equity interfere by injunction to restrain the operations of persons claiming the right to exercise a similar franchise under legislative authority. High on Injunc. § 902.

What construction, then, is to be given to the plaintiffs’ charter? Does it in terms or by necessary implication confer those exclusive rights asserted by the plaintiffs? While it is the accepted doctrine that all grants are to be construed1 according to the intention of the parties, yet there are certain, general rules of construction by the light of which such contracts, are to be examiued. These rules are well settled by numerous-authorities. One is, that in all grants by the government to-individuals or corporations, of rights, privileges and franchises,, the words are to be taken most strongly against the grantee, contrary to the rule applicable to a grant from one individual to-another. Another rule is, that one who claims a franchise or-exclusive right or privilege in derogation of the common rights-of the public, must prove his title thereto b}? a grant clearly and. definitely expressed, aud cannot enlarge it by equivocal or-doubtful provisions, or probable inferences. "Every reasonable-doubt is to be resolved adversely. Nothing is to be taken as conceded but what is given in unmistakable terms, or by ail. implication equally clear. The affirmative must be shown. Silence is negation, and doubt is fatal to the claim. This doctrinéis vital to the public welfare.” Fertilizing Co. v. Hyde Park, 97 U. S. 666 . "Repeated decisions of this court,” remarks Mr.. Justice Clifford in Holyoke v. Lyman, 15 Wall. 512 , "have-established the rule, that whenever privileges are granted to a. corporation, and the grant comes under revision in the courts, such privileges are to be strictly construed against the corporation and in favor of the public, and that nothing passes but what is granted in clear and explicit terms. Whatever is not unequivocally granted in such acts is taken to have been withheld, as all acts of incorporation and acts extending the privileges of corporate bodies are to be taken most strongly against the corporations.” Rice v. Railroad Co. 1 Black. 380 ; Newton v. Commissioners, 100 U. S. 561 ; Charles River Bridge v. *564 Warren Bridge, supra; Commissioners, &c. v. Holyoke Water Power Co. 104 Mass. 449 : Attorney General v. Jamaica Pond Aqueduct Co. 133 Mass. 365 .

Applying the foregoing rules to the charter of the plaintiff ■corporation, and the amendatory act of 1861, the result is ¡adverse to the plaintiffs’ claim. No language expressly ■conferring any exclusive right is to be found in either act. The word exclusive no where appears. Neither do any words ¡synonymous therewith. Nor is there in either of the acts anything in terms prohibiting the legislature from chartering a ¡rival corporation. If the plaintiffs have an exclusive right to the water in either of those ponds, or if the legislature is (prohibited from granting a charter to a rival corporation with ¡similar rights, it must result from inference or implication. This ■corporation was created for a definite and specific purpose — for ■conveying to the city of Rockland a supply of pure water. That -supply was for purposes expressly limited. The language of the ■charter is plain and clear upon that point. It was to be "a .supply of pure water for domestic purposes, extinguishment of fires, and the supply of shipping in the harbor of Rockland.” 'The water whieh, by the terms of the charter, the company was ¡authorized to take and use was for certain specific and defined ¡purposes, and beyond that the plaintiffs were not authorized to go. By that charter they had no right to take or use the water for the purpose of propelling machinery. The right which they acquired from the state was a franchise right to so much water as was necessary for the "purposes' aforesaid.” When those purposes were fulfilled or satisfied, this company could not lawfully hold the whole pond .and thus eliminate the express provision of the legislature limiting their rights. This franchise right was not an exclusive right — a right by title or property right to the entire body of water of Tolman’s Pond,— but only to so much thereof as was required for those purposes specified in the charter. Any other construction would render nugatory the limitation by which the company was prohibited from using the water for the purpose of propelling, machinery.

*565 Among numerous authorities which might be cited sustaining these views, the case of Bailey v. Woburn, 126 Mass. 420 , furnishes an illustration. There the town of Woburn by special act of the legislature was authorized "to take, hold and conve}' to, into and through said town the waters of Horn Fond, so called ; in Woburn, or the waters of any other pond in Woburn,” for the purpose of supplying its inhabitants with pure water. In that case as in the one before us an exclusive right to all the water in the pond was claimed, but the court held otheiwise, saying: "But this construction is not correct. The town can take only so much water as is required for the purposes named in the act.”

But in support of their claim of exclusive right to the water of Tolmau’s Pond, the plaintiffs rely upon the language of the last clause of section three which is in these words : "But nothing in this act shall be taken to prevent the owners of-mills, or of mill privileges on the stream flowing through the outlet of said pond, from using the water thereof in the same manner that they now' do or have heretofore done ; but said mill owners shall not, nor shall any other person or persons, be permitted, either by cutting below' the pipes of said corporation or in any other way to withdraw the water or to obstruct the water works of said corporation ”

Conceding to the plaintiffs the most favorable construction which this language warrants, yet wre are inclined to the opinion that no such exclusive rights are reserved to the plaiutiffs as contended for. This clause in the section referred to has particular reference to the rights and duties of the owners of mills and mill privileges upon the stream flowing through the outlet of the pond. The language employed shows that it was the purpose of the legislature to protect this company against the acts of the mill owners upon the stream. This clause in the section has reference to a particular class of individuals. It defines their rights, permitting them to use the water naturally flowing through the outlet of the pond, but declares that they shall not, either by cutting below the pipes of the corporation or in any other way withdraw7 the water or obstruct the water works of *566 said corporation. In order therefore to effectually guard the corporation against any person representing such mill owners, whether servants or employes, not only the mill owners but all persons are prohibited from doing it by cutting below the pipes or in any other manner. The language of the prohibition in its broadest and most general sense, if standing alone, would have a very different signification from that in the connection in which it is found. In this connection it, in terms, includes "any other person or persons,” prohibiting them "either by cutting below the pipes of said corporation, or in any other way, to withdraw the water.or to obstruct the water works of said corporation.” But these general words, in the connection in which they are used, undoubtedly refer to the particular class or subject matter in question, rather than indicate an intention of depriving the legislature of the right to grant the use of this water, not required for the purposes named, if public necessitj' should require it. The maxim, noscilur a soeiis, may well be applied here. It is frequently applied in the construction of statutes, the meaning of words, and consequently the intention of the legislature, being ascertained by reference to the context. In accordance with this principle it is laid down in the text books and decisions that "language, however general in its form, when used in connection with a particular subject matter, will be presumed to be used in subordination to that matter.” Story’s Agency, § § 21, 62. Emerson v. E. & N. A. Railway, 67 Maine, 393; Marston, Petitioner, 79 Maine, 36 ; Broom’s Legal Maxims, 523*. In Regina v. Cheworth, 4 Best & Smith, 932, (116 E. C. L. 930,) speaking of this principle Cockburn, C. J., says: "Then there is a .general expression 'other person whatsoever ;’ but, according to a w'ell established rule in the construction of statutes, general terms following particular ones, apply only to such persons or things as are ejusdem generis with those comprehended in the language of the legislature.” So in Allen’s Appeal, 32 P. F. Smith, (Pa.) 302, the words of an act giving a preference for wages to persons employed "in any works, mines, manufactory or other business,” &c. were ■construed to apply only to any other business ejusdem generis.

*567 By the amendatory act of 1861, the plaintiff corporation was authorized to take, hold and convey, "in the manner provided for’’ in the original charter, "as well the water of Oyster River Pond in Camden as of said Tolman’s Pond,” and was to have the same rights, powers and privileges, and be subject to the same liabilities, limitations and conditions, and be answerable to parties injured thereby in the same manner in respect to taking and conveying the said waters, as are provided for in said act, in respect to taking and appropriating the water of Tolman’s Pond.” Authority is also granted "to take, use and appropriate water from both or either of said ponds, for supplying the people of said city and towns with pure water,” etc.

Inasmuch as the controversy between the parties is in reference to the defendants’ use of the water in Oyster River Pond, the language of this act is important in determining the intent of the legislature, and ascertaining the plaintiffs’ rights therein.

The plaintiffs’ claim of exclusive right to this water is based upon what they assert to be their rights by legislative grant in Tolman’s Pond, for by the act of 1861, they are authorized to take, hold and convey the water of Oyster River Pond only "in the manner” and "with the same rights, powers and privileges” as are provided in the original act with reference to the water of Tolman’s Pond.

If the plaintiffs’ position is correct, that an exclusive right to the water of Oyster River Pond is granted by the provisions of tlthe act of 1861, then all the water of this pond became theirs by force of the act itself, excluding necessarily the idea of any future "taking and appropriating” by them. But the legislature in explicit terms refers to the plaintiffs as "taking and appropriating”— "to take, use and “appropriate water from”— language entirely repugnant to and inconsistent with the idea that the title to all this water was vested in them and required no act on their part to reduce it to possession. Webster defines pond as "a confined, or stagnant, body of fresh water.” It is the body of water which composes a pond. The legislature has authorized the plaintiffs "to take, use and appropriate water from” Oyster River Pond, for the purposes designated,— language *568 implying separation, as well as future action on the part of the plaintiffs, rather than immediate title to the whole corpus. It cannot, therefore, by any fair construction be said that the legislature intended to grant to the plaintiffs the absolute title to, or property in, the water of this pond with no further act to be done by them. Such intention must be clearly expressed or necessarily implied to have that effect, and not be left to-be discovered by astute construction and lame inferences. Piad it been the intention of the legislature to grant exclusive privileges, it could have been easily done in clear and definite language instead of being left to be inferred. On the other hand the language of the act clearly negatives any such intention. It was a franchise right only which was granted by the state, and which authorized this corporation "to take, use and appropriate” so much of the water from this pond as might be required for the particular purposes named in the act. Bailey v. Woburn, supra. In so much only as was thus required, taken and appropriated would the plaintiffs have a vested right.

There was no surrender on the part of the state of the right to grant other franchises of a similar character, if the interests or necessities of the public required it; and hence there was no impairing of the obligation of any contract with these plaintiffs in granting to this defendant corporation the franchise rights which they possess.

It will be observed that the authorities to which our attention has been called, where the court has' interfered to protect grants or franchises, the language of the acts has provided in explicit terms that the grant was exclusive. They are not analogous to the case at bar. They are Piscataqua Bridge v. N. H. Bridge, 7 N. H. 35 ; West River Bridge Co. v. Dix, 6 How. 530 ; Boston and Lowell Railroad v. Salem and Lowell Railroad, 2 Gray, 1 ; The Bridge Proprietors v. The Hoboken Co. 1 Wall. 116 ; The Binghamton Bridge, 3 Wall. 53 , 73 ; New Orleans Gas Co. v. Louisiana Light Co. 115 U. S. 650 ; New Orleans Water Works Co. v. Rivers, do. 674; Louisville Gas Co. v. Citizens’ Gas Co. do. 683, 687 ; St. Tammany Water Works v. New Orleans Water Works, 120 U. S. 64 . None of *569 these cases militate against the doctrine expressed in this opinion.

The facts before us show that at no time since the organization of the plaintiff corporation has there been a scarcity of water in Tolman’s Pond, or any necessity of connecting the two by aqueduct or otherwise to increase the supply in that pond. On the contrary it appears that there has been, during all these years, an average depth of about six feet of water above the plaintiffs’ outlet pipe. This pond has an area of three hundred and thirty acres, with a yielding capacity of four and a half million gallons in every twenty-four hours. Large quantities have continually run to waste from the outlet of the pond, and the evidence is conclusive that there has always been much more water than has been required for the purposes of the plaintiffs’ grant.

Oyster River Pond lies three miles distant from the other, and has an area of one hundred and five acres, with a daily yielding capacity of one million gallons.

More than twenty-five years have elapsed since the privileges, conferred by legislative enactment, were given to the plaintiffs, and yet no necessity has been shown, or attempt been made by them, to take or use the water of Oyster River Pond. Nor do the facts show that the defendants, in the exercise of their franchise rights, are using any water necessary for the plaintiff's’ works. They claim no rights to the water of Tolman’s Pond. That is left to the entire use of the plaintiffs for the purposes set forth in their charter.

The plaintiffs’ charter was granted after the enactment of the general statute of 1831, c. 503, (R. S. c. 46, § 23,) reserving to the legislature the power to amend, alter or repeal at pleasure all acts of incorporation afterwards passed, as if they contained express provision to that effect, unless there should have been inserted therein an express limitation to the contrary. But we do not, in the view we have taken of the case, consider it necessary to decide how far the rights of either party might be affected by this statute. It is not necessary in the determination of this case upon the facts presented.

*570 There are no grounds upon which the plaintiffs are entitled to the relief which they claim.

Bill dismissed with costs for defendants.

Peters, C. J. Walton, Virgin, Libbey and Haskell, JJ., concurred.