municipality. Notice of the proposition is required to be given. Sometimes these propositions are voted upon at a general election, in connection with the election of officers, and at other times a special election is held for the sole purpose of taking the sense of the electors upon the propositions submitted to them. Thus a statute of Massachusetts required two affirmative votes, taken at a meeting that is peculiar to the town organizations of that State, before the town could erect a plant; and if the vote should at both meetings be in the affirmative, the town could then erect a plant. It also provided that the town might purchase any existing plant in the town, after such votes had been taken, if the owner of it consented to sell it and they could agree on terms; but if the city declined to purchase, then the owner could apply to the court for the appointment of commissioners to fix the value of his plant, and the town was then compelled to take it at the figures thus fixed. Under this statute it was decided that a third vote to buy an existing plant was not necessary; that the fact of the poles of the plant not being legally in the streets would not defeat the petition of the owner, that fact going only to reduce the value of the plant; and that that portion of the statute requiring the town to purchase the plant was constitutional, it being optional with the owner to sell.23 Slight variations among the separate instruments calling for an election, the notice of election and the like do not invalidate the proceedings. But a proceeding for the building of a plant is invalidated by the fact that the resolution adopted stated that bonds would be issued "for the erection and purchase," the mayor's proclamation that it was "for the erection," and the ordinance that it was "for the erection or construction" of a plant. Such a double purpose is stated as to invalidate the proceedings. A city may issue bonds for a water plant alone under a charter provision by separate provisions to be voted on, for the issuing of bonds for building one 24 23 Citizens' Gaslight Co. v. Wakefield, 161 Mass. 432; 37 N. E. Rep. 444. See Baltimore, etc., Co. v. People (Ill.), 66 N. E. Rep. 246. 24 Elyria Gas, etc., Co. v. Elyria, 57 Ohio St. 374; 49 N. E. Rep. 335, reversing 14 Ohio C. C. 219; 7 Ohio Dec. 527; 38 Wkly. L. Bull. 200; 39 Wkly. L. Bull. 139. 26 kind of a plant without building the other also, although they are called "water and light bonds" in the charter.25 Of course the power to issue bonds or borrow money to build or purchase a plant is subject to constitutional limitations concerning indebtedness. Where a statute requires a vote to be first taken to determine whether a lighting system shall be acquired by the municipality, the municipal authorities cannot waive a compliance with the provisions of the statute; for the sanction of the vote is a condition precedent to the right of the municipality to institute condemnatory proceedings, when necessary, to acquire property for the plant." So power whereby a lighting undertaking may be authorized by a provisional order of a municipality to purchase such undertaking compulsorily on issuing corporation stock to a certain amount is in abeyance so long as the municipality has no power to issue irredeemable stock because of a subsequent provisional order taking away the power previously held, but not exercised by the municipality, although the statutes confirming the two orders were approved on the same day.28 $518. Municipality must be sole proprietor of plant.— Taking stock. Whether or not a municipality must be the sole owner of a gas plant, or whether it may embark in the enterprise in connection with private funds, depends upon the State constitution and statutes of the State. In some States their constitutions forbid a municipality to become a stockholder in any stock company, corporation, or association, or even to raise money for or loan its credit to or in aid of any such company, corporation, or association. Such a provision is sufficient to prohibit it from becoming a part owner of a gas plant, the remaining portion being held by private individuals. Such a provision is broad enough to forbid additions to the works of 25 Janeway v. Duluth, 65 Minn. 292; 68 N. W. Rep. 24. 26 Spilman v. Parkersburg, 35 W. Va. 605; 14 S. E. Rep. 279. 27 In re LeRoy, 23 N. Y. Misc. 53; 50 N. Y. Supp. 611. 28 Sheffield v. Sheffield, etc.. Co. [1898], 1 Ch. 203; 77 Law T. Rep 616; 67 L. J. Ch. (N. S.) 113. the municipality made by private capital, with a view of leasing such additions to it." But if no provision of the constitution prohibit the investment, a statute may provide that a municipality may take stock in a company organized to furnish light to a city and its inhabitants.30 A statute forbidding a municipality to make any subscription to the capital stock of an incorporated company or loan its credit for the benefit of such company, is not violated by an agreement in water contract to pay the hydrant rentals to the bondholders of the company supplying the water.31 $519. Right to purchase plant of gas company. Statutes frequently authorize a municipality to bind itself to purchase the plant of a gas company at the end of a term of years during which it supplies it with light; 32 and without such an express statute there is nothing objectionable to such a contract. It simply authorizes the purchase of a plant already in existence, instead of the municipality undertaking to build a plant of its own.33 29 Ampt v. Cincinnati, 56 Ohio St. 47; 37 Wkly. L. Bull. 161; 46 N. E. Rep. 69; 35 L. R. A. 737; modifying 12 Ohio C. C. 119; 1 Ohio C. D. 356. 30 See Marlborough Gaslight Co. v. Neal, 166 Mass. 217; 44 N. E. Rep. 139; Memphis v. Memphis Gayoso Gas Co., 9 Heisk. 531. 31 State v. Great Falls, 19 Mont. 518; 49 Pac. Rep. 15. A city may be authorized to take bonds in a gas company. New Orleans v. Clark, 95 U. S. 644. In England, it may issue stock to establish a lighting plant. Sheffield V. Sheffield Electric Light Co. [1898]. 1 Ch. 203; 77 L. T. Rep. 616: 67 L. J. Ch. (N. S.) 113. 32 Neosho City Water Co. v. Neosho. 136 Mo. 498; 38 S. W. Rep. 89. 33 See Wheeling Gas Co. v. Wheeling. 8 W. Va. 320. If the price to be paid by the city is to be fixed by arbitrators, part chosen by the city and part by the gas company, and the former choose its arbitrators and notify the company; and the gas company refuse to select any, the city's remedy is to apply for a writ of mandamus to compel it to select its arbitrators, and not a suit in equity to enforce a sale at the price fixed by the city's arbitrators. St. Louis v. St. Louis Gaslight Co., 70 Mo. 69. Where a municipality had the power to purchase certain gas works, and certain moneys were to be raised for this and other purposes, an injunction to restrain the municipality from opposing a bill promoted by the gas company to ex tend its works was refused, on the ground that such extension might prevent the municipality from purchasing the works, by exceeding in 1 1 $520. Trustees for gas works. Occasionally trustees are appointed to manage gas works where they are conducted by a municipality. This was the case with the Philadelphia gas plant. That plant was owned by private individuals, and was taken possession of by that city. The stock was replaced by certificates issued by the city to the stockholders according to their several holdings, and trustees were selected and given full control of the works and their management; and they were to create a fund to pay off these certificates and the indebtedness. After these trustees had taken charge, an ordinance was passed by the common council appointing a chief engineer, who was by it put at the head of the gas department of the city; and all moneys collected for gas furnished was to be paid to such officers as he should select. Creditors objected to the engineer taking possession, and to his interfering with the trustees' control of the gas works; and the court upheld them in their objection, and issued an order restraining them. They were entitled, so the court held, to an injunction on the ground that there was such a contract between the city and the creditors as a court of equity would protect; and that when it entered upon such an enterprise it was acting in its capacity as a private corporation, and not in its legislative capacity. These trustees are generally subject to the control of the municipality, and have only such powers as its common council or legislative body may bestow upon them. An instance of their limited power is found in an Ohio case. In that State a statute provided for a board of trustees to manage the municipality's gas plant; and also empowered them to "prescribe by bylaws the price of gas and coke, under such rules and regulations as by ordinance the council may prescribe." The board in the absence of such an 34 value the sum allotted to the municipality by its act for expenditure for this and other purposes. Attorney General v. Mayor of St. Helens, W. N. (1870) 150. 34 Western Saving Fund Society v. Philadelphia, 31 Pa. St. 175; 72 Am. Dec. 730. See Bailey v. Phila- ordinance undertook to fix the price of gas, over the objection of the gas company; and their action was held void. 35 In this State it is also held that so long as an ordinance is in force creating a board of officers to manage the city's gas plant, the council cannot take upon itself the management, through its employees, of its electric lighting plant.36 The statute referred to in the foregoing sentence authorized the common council to create and appoint a board of trustees, when it had determined to build a lighting plant, to construct the works, and to manage them when they should have been built. The board could not only construct the works, but extend gas pipes, manufacture and sell gas and coke, collect gas bills and other moneys due for gas, coke or other material sold by it, having power to purchase material, employ laborers, appoint officers, purchase or lease the necessary real estate and erect buildings upon it. All money collected for gas works purposes had to be deposited weekly, by its collectors, with the treasurer of the municipality, and be kept as a separate and distinct fund, subject to the order of the board. This money, as well as that levied by the municipality for the gas works, was to be disbursed by the board of trustees. It was held that the board of trustees did not have power, under this statute, to charge the municipality with a general liability on account of machinery or appliances purchased by them for the works under their control; and that they had no authority to control the funds thus placed in their hands independent of the council, because of another statute which provided that "no contract, agreement or other obligations, involving the expenditure of money shall be entered into, 35 Foster v. Findlay, 5 Ohio Cir. Ct. Rep. 455; 3 Ohio Cir. Dec. 224. See Bellaire Goblet Co. v. Findlay, 5 Ohio Cir. Ct. 418; 3 Ohio Cir. Dec. 205. 36 Shaw v. Jones, 6 Ohio Dec. 453; 4 Ohio N. P. 372. In a case involving the Philadelphia gas trustees' power, it was held that they were not required to advertise for bids for coal and let it to the lowest bidder as the city did when it purchased sup plies, for the reason that the gas works were not a department of the city government within the provi sion of the Act of May 13, 1856, requiring the city to advertise for bids and let out the supply of materials to the lowest bidder. Hacker v. Philadelphia, 6 Phila, 94. |