Columbia Water-Power Company v. Columbia Electric Street-Railway Light Power Company
This was a complaint, in the nature of a bill in equity, filed in the court of common pleas for Richmond county by the Columbia Water-Power Company, as plaintiff, to enjoin the Columbia Electric Street-Railway, Light & Power Company from using certain water power for the propulsion of its cars, lighting its lamps, and furnishing power motors, also from entering upon plaintiff's lands and erecting thereon its buildings, works, and machinery, and also requiring the defendant to remove such as had already been erected, and for the payment of damages.
The bill set forth that a structure known as the 'Columbia Canal' begins above the city, passes through the city near the western boundary, and empties into the Congaree river just beyond the limits of the city, passing around the shoals and falls in said river, and, when constructed and in use, made a continuous communication between the Broad and Congaree rivers; that the canal was begun by the state as a public work in the year 1824, and for the purpose of its construction certain lands were purchased within the limits of the city, through which the canal was to be carried and constructed; that the canal was used for purposes of navigation for some time, and remained, with the lands described, the property of the state until February 8, 1882, when the general assembly of the state, by an act of that date, authorized and directed the canal commission to transfer the canal, with the aforesaid lands, to the board of directors of the state penitentiary, with all the ights and appurtenances thereto acquired by the state; that the board was authorized and directed to, and subsequently did, take possession of the canal and lands, and proceeded with the work of enlarging and developing the canal, expending large sums of money for that purpose, and widened and enlarged its banks, and remained in the full possession thereof until December 24, 1887, when the general assembly passed an act (the material portions of which are printed in the margin)  'to incorporate the board of trustees of the Columbia Canal, to transfer to said board the Columbia Canal with the lands held therewith, with its appurtenances, and to develop the same' (19 St . at Large S.C.. p. 1090); that by section 1 of the act the board of directors of the penitentiary was authorized to transfer and release to the board of trustees of the canal the canal property and its lands, with their appurtenances, and that the same should vest in the trustees for the use and benefit of the city of Columbia; that such transfer was made and possession taken by the board of trustees, and the property so remained in their possession until the date and year hereinafter mentioned.
That by section 21 of the above act the board of trustees was declared a corporate body, and was authorized, among other things, to purchase, sell, or lease lands adjoining the canal, useful for the purposes of the canal, and to sell or lease the water power of the canal, subject to such rules and regulations as it should prescribe, and that by virtue of such act the trustees became entitled to the exclusive franchise and right to sell or lease the water power developed by the canal for manufacturing and other industrial purposes, without let or hindrance, and without the right of any person or corporation to interfere or interrupt in any manner the use of such water power, save and except it should provide a certain amount of water power to certain persons and parties in said act nominated and mentioned, and that no person or corporation had a right to divert, disturb, impede, or interfere with the flow of water down the said canal.
That by the twenty-third section of this act, as amended by the subsequent act of December 24, 1890 (20 St. at Large S.C.. p. 967), the board of trustees was given full power and authority to sell, alienate, and dispose of the canal, its lands and appurtenances, to any person or corporation, subject to all duties and liabilities imposed by the act, and to all contracts made by the board, prior to such transfer, upon the approval and consent of nine members of the council of the city of Columbia; that in pursuance of such section the trustees, before the completion of the canal, and on January 11, 1891, conveyed all of said property to the Columbia Water-Power Company, the plaintiff, including the canal and all of the lands held therewith, easements, rights of way, rights of overflow, and appurtenances acquired by t e board of trustees, with their rights and franchises; that the plaintiff went into possession of all the property, and so remained in possession without any claim or assertion of an adverse right, and thereby became entitled to all the franchises, privileges, and immunities conferred upon the board of trustees.
That the act of December 24, 1887, provided that upon the development and completion of the canal the board of trustees should furnish the state, free of charge, 500 horse power of water power, and the twenty-third section of the act, as amended, provided that this duty should be imposed upon any person or corporation to whom the board of trustees should sell or transfer the property; that in March, 1892, the development and enlargement of the canal were completed, and on said date, and ever since, the plaintiff was and is ready to furnish the state with the 500 horse power of water power as required by the act aforesaid.
That the defendant, a South Carolina corporation, was organized by the consolidation of three prior companies, and was authorized to construct through the city a street railway, and also to maintain a system of electric lighting; that in May, 1892, the plaintiff was informed by the board of directors of the penitentiary that the defendant company had been authorized by the said board to build a power house, with forebay, flumes, and water wheels, for the purpose of utilizing the 500 horse power to be furnished to the state, and that it was the purpose of such company to erect works, under such authority, to develop such power, and to furnish to the state, within the walls of the penitentiary, so much of said power as had been agreed upon by and between the board of directors of the penitentiary and the said company; that the plaintiff gave immediate notice to the said board and to the defendant that it would object to the use of any of its lands or embankments on the west side of the canal by any person or corporation, except so much as would be necessary for the erection of the power house to furnish 500 horse power for the use of the state, and that the state should have full liberty to build such works upon the embankments of the canal as were necessary in furnishing such water power, but that such works should be strictly confined to such portion of the property of the plaintiff as should be necessary for that purpose, and that the plaintiff would not recognize the right of the state to assign such horse power, or any part thereof, to any corporation, to be used for private purposes, outside of the walls of the penitentiary or any public institution of the state, and that it was under no obligation to furnish water power from the canal to be used by private corporations for private enterprises.
That subsequently the defendant, acting through the board of directors of the penitentiary, submitted plans and specifications for the erection of works for making the state water power available, and plaintiff approved of the same as not taking more of the land than was necessary for the development of the 500 horse power for the use of the state, and allowed the defendant to proceed with its work, which was completed in accordance with the plans and specifications so submitted, but that thereafter the defendant, against the protests and objections of the plaintiff, proceeded to place in such works machinery intended solely for the purpose of running its electric lights and street railway, and furnishing power to divers persons in the city for their industries, against which plaintiff protested, and gave notice that proceedings would be taken to prevent such misapplication by the electric company, which, notwithstanding such protests, continues to place such machinery in its power house for its own private purposes, and that plaintiff is wholly without power to prevent the action of the defendant in such misapplication of such power for its private purposes, owing to the duty of the plaintiff to furnish power for the use of the state and its penitentiary, as such power is furnished and mad available at and by the same water wheel, and that, unless such use be enjoined, it will suffer irreparable injury and damage, and its franchise to sell and lease water power for purposes of manufacturing and other industrial purposes will be affected and materially injured.
That the said defendant also in February, 1893, against the protest of the plaintiff, entered upon its premises on the western embankment of the canal, and at the southern end of the power house above mentioned, and excavated and removed the earth, rock, and works composing the foundation of such embankment, to the great danger of the canal and embankment, and began erecting the foundations for the steam engine to be used in running generators, dynamos, etc., as above stated, and has placed portions of its machinery in such structure, to be used in producing electric power, and in May, 1893, commenced to erect a boiler house and coal house for use in the same business.
The complaint further alleged that the plaintiff had performed all its obligations to the state, and stood ready to continue the performance of the same, but the defendant, in disregard of its rights, has trespassed upon its property, excavated its embankment, and has interfered with the enjoyment of the franchises granted to it by the state; that a judgment at law against the company would be worthless, and hence the plaintiff prayed for an injunction against such use of the water power, and against further trespasses upon its lands.
The answer put in issue the title of the plaintiff to the lands occupied by the defendant, denied that the board of trustees of the canal ever became entitled to the exclusive franchise and right to sell or lease water power developed by it for purposes of industrial enterprises, denied that the 500 horse power reserved to the state was provided solely for the individual use of the state in its public institutions, denied any intent on its part to injure the plaintiff in its franchise and property by the erection of its works, and alleged that the state, being seised in fee simple of the land, and entitled to the unrestricted use of the 500 horse power referred to in the complaint, but being without means to develop the same, entered into a contract, dated May 26, 1892, with the defendant, whereby it was stipulated that the defendant should erect suitable works and machinery for the development of such horse power, furnish to the penitentiary so much as was necessary for its purposes, and, as a consideration for this, should be allowed to make use of the surplus power for its own purposes; that such contract was thereafter ratified and confirmed by an act of the general assembly approved December 24, 1892 (21 St. at Large S.C.. p. 94); and that the defendant was entitled under such contract to the unrestricted use of such horse power for the purposes contemplated by the contract.
The attorney general, appearing on behalf of the state, filed a suggestion to the effect that, if the injunction were granted, defendant would be prevented from carrying out its agreement with the state, and the state would be deprived of the water power it was entitled to in the manner contracted for, and of the revenue it had secured under the contract. He did not, however, submit the rights of the state to the jurisdiction of the court, but insisted that the court had no jurisdiction of the subject, and asked that the complaint be dismissed.
The case came on for hearing upon the complaint, answer, the suggestion of the attorney general, and the articles of agreement, and resulted in a decree dismissing the complaint. An appeal was taken to the supreme court of the state, which affirmed the decree of the court below (43 S.C.. 169, 20 S. E. 1 002), whereupon plaintiff sued out a writ of error from this court, assigning as error the decision of the supreme court affirming the validity of defendant's contract with the board of directors of the penitentiary, and the act of the general assembly ratifying the same.
Le Roy F. Youmans, for plaintiff in error. Wm. H. Lyles, for defendant in error.
Mr. Justice BROWN, after stating the facts in the foregoing language, delivered the opinion of the court.
^1 Act of Dec. 24, 1887.
Section 1. Be it enacted by the senate and house of representatives of the state of South Carolina, now met and sitting in general assembly, and by the authority of the same, that the board of directors of the South Carolina penitentiary are hereby authorized, empowered and required to transfer, assign and release to the board of trustees of the Columbia Canal, property known as the Columbia Canal, together with the lands now held therewith, acquired under the acts of the general assembly of this state with reference thereto or otherwise, all and singular the rights, members and appurtenances thereto belonging; and upon such transfer, assignment and release all the right, title and interest of the state of South Carolina in and to the said Columbia Canal and the lands now held therewith, from its source at Bull's sluice through its whole length to the point where it empties into the Congaree river, together with all the appurtenances thereunto belonging, shall vest in the said board of trustees for the use and benefit of the city of Columbia, for the purposes hereinafter in this act mentioned, subject, nevertheless, to the performance of the conditions and limitations herein prescribed on the part of the said board of trustees and their assigns: provided, that should the said canal not be completed to Gervais street within seven years from the passage of this act all the rights, powers and privileges guaranteed by this act shall cease, and the said property shall revert to the state.
Sec. 2. That the said board of trustees are hereby authorized and directed, for the development of the said canal, to take into their possession the said property with all its appurtenances; and for the purpose of navigation, for
providing an adequate water power for the use of the penitentiary and for other purposes herein named, they are hereby authorized, empowered and directed to improve and develop the same.
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Sec. 7. That the board of trustees shall, within two years from the ratification of this act, complete the said canal so as to carry a body of water 150 feet wide at the top, 110 feet wide at the bottom and 10 feet deep from the source of the canal down to Gervais street, and furnish the state, free of charge, on the line of the canal, 500 horse power of water power, to Sullivan Fenner or assigns 500 horse power of water power, under his contract with the canal commission, and to furnish the city of Columbia 500 horse power of water power at any point between the source of the canal and Gervais street the city may select; and shall, as soon as is practicable, complete the canal down to the Congaree river a few yards above the mouth of Rocky Branch: provided, that the right of the state to the free use of the said 500 horse power shall be absolute, and any mortgage, assignment or other transfer of the said can l by the said board of trustees or their assigns shall always be subject to this right.
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Sec. 21. The said board of trustees shall be, and is hereby, declared a body politic and corporate. Its corporate name shall be 'Board of Trustees of the Columbia Canal.' Its officers shall be a chairman, and a secretary and treasurer. It shall have a corporate seal; may make and enforce its by-laws for its government; may purchase, sell or lease lands adjoining the canal useful for the purposes of the canal; may sell or lease the water power of the canal subject to such rules and regulations as it shall prescribe, having first provided for the state with 500 horse power of water power at the penitentiary, and 500 horse power of water power for Sullivan Fenner or his assigns, and 500 horse power of water power for the city of Columbia; may sue and be sued, plead or be impleaded under their corporate name, and exercise such other powers as are hereinbefore granted, and shall fix such compensation for the services of the secretary and treasurer as they may deem proper.
Section 23 as Amended by Act Dec. 24, 1890 (20 St. at Large S.C.. 967).
Sec. 23. That the said board of trustees, as soon as they have fully developed the said canal and secured the payment of the debts contracted by them in its development, they shall turn over the canal, with all its appurtenances, to the city of Columbia. But the said board of trustees shall have full power and authority, before the said canal has been fully developed and completed and turned over to the city of Columbia, to sell, alien-
ate, and transfer the same and all its appurtenances, the lands held therewith, and all the rights and franchises conferred by this act on said board of trustees, to any person or corporation, subject, however, to all the duties and liabilities imposed thereby, and subject to all contracts, liabilities, and obligations made and entered into by said board prior to such sale and transfer, upon the approval and consent of nine members of the city council of the city of Columbia; and before such sale, alienation and transfer is made thirty days' notice of the offer to purchase and the terms thereof shall be given to the council of the city of Columbia.
Approved December 24, A. D. 1890.