Wyandotte Electric Light Co. v. City of Wyandotte

Grant, J.

(after stating the facts). There is one controlling question in the case. Upon its determination depend the rights of the parties. It can, perhaps, be better stated by stating the several contentions. The defendants contend that complainant, by organizing under the general manufacturers’ act, obtained no franchise direct from the legislature to use the streets and highways, such as it would have acquired under the electric-light companies’ act. Their second contention results from the first, namely, that the city had no authority to grant the franchise claimed by complainant. The complainant contends :

1. That the defendant city cannot make this collateral attack upon its act of incorporation; that the State had for nine years recognized the validity of its incorporation, and that the State alone is the party which can complain.

2. That the city is estopped to claim in this suit that the complainant ought to have been organized under some other statute, or ought not to have exercised the franchise of manufacturing and vending electric light to its inhabitants.

If complainant were organized under chapter 191, 2 *47 Comp. Laws 1897, entitled. “Electric-Light Companies,” it would be clearly entitled to the relief asked. It would come within the doctrine enunciated in Michigan Telephone Co. v . City of St. Joseph, 121 Mich. 502 ( 80 N. W. 383 , 47 L. R. A. 87), and Michigan Telephone Co. v. City of Benton Harbor, 121 Mich. 512 ( 80 N. W. 386 , 47 L. R. A. 104). Section 7141, 2 Comp. Laws 1897, expressly gives to electric-light companies the authority—

“To lay, construct, and maintain conductors for conducting electricity through the streets, lands, and squares of any such city, town, or village, with the consent of the municipal áuthorities thereof, under such reasonable regulations as they may prescribe; _ and such corporation may make all such contracts and by-laws as may be deemed necessary and proper to carry into effect the foregoing powers.”

By this statute electric-light companies are given the same rights in the streets as are telephone companies, when the assent of the municipality is obtained. An incorporation under this act, a petition to the city to erect poles and wires, or for a franchise for that purpose, and the grant of the same by the city, would make a contract binding for the life of the corporation. It would be immaterial that no time for the existence of the right or the franchise was specified. The grant in such case would be limited to the period of existence fixed by the charter. If a railroad company were organized for a period of 30 years, and a party, natural or corporate, should grant it a right of way without specifying the time of user, the grant would be for the lifetime of the corporation. The law would imply that both parties contracted with reference to its period of existence. The same rule is applicable here. St. Clair County Turnpike Co. v. Illinois, 96 U. S. 63, 68 .

The purposes for which complainant was organized are precisely those covered by the electric-lighting act. It could not carry on its proposed business without the use of the streets, and immediately applied to the city for such use. The city so understood it. That the inhab *48 itants of a municipality should be supplied with light is as essential as that they should be supplied with water and telephones. They are all recognized by the law as necessary, made so by modern methods of living and business. The people of the State, through their legislature, have so determined by authorizing the formation of corporations for these purposes. Whether the defendant city knew under what act complainant was organized does not appear. Why complainant organized under this act is unexplained. No good reason appears or is suggested for its doing so. The only reasonable excuse is that somebody blundered. Whether the act under which it was organized would permit its incorporation, we need not determine. The State for nine years recognized its incorporation as valid. The defendant city dealt with it for the same time as a valid corporation, granted it the franchise as requested, permitted it to erect and maintain an extensive plant; and now, when the city has gone into the business of municipal and commercial lighting, seeks to crush it, to utterly destroy its property, and compel its patrons to become the patrons of the city, which charges more for its service than does complainant. It is needless to say that defendants are without equity, and that their contention ought not to prevail if the courts of equity have the power to prevent it.

We are of the opinion that the defendants are not in a position to raise the question of lack of power in the complainant, and that that question is one which the State alone can raise. Detroit City Railway v. Mills, 85 Mich. 634 ( 48 N. W. 1007 ), and authorities cited in paragraph 2 of the opinion, page 647. Where national banks have exceeded their authority in taking securities, the United States Supreme Court held that the parties interested could not complain so long as the government did not. National Bank v. Matthews, 98 U. S. 621 ; National Bank v. Whitney, 103 U. S. 99 . Applying the same rule to this case, defendants cannot complain so long as the State does not. The contract is not ultra vires *49 the corporation, but, on the contrary, is one expressly authorized by the statute above cited and the charter of the city. It now seeks to interpose a mere technicality to destroy a valuable property. This courts of equity will not permit. “A court of equity is always reluctant in the last degree to make a decree which will effect a forfeiture.” National Bank v. Matthews, 98 U. S. 621 .

The common council are authorized to enact reasonable rules and regulations for the erection and maintenance of the poles and wires, and to compel the removal of those that are dangerous. This authority is fully defined in the telephone cases above cited.

Decree affirmed.

The other Justices concurred.