Commercial Bank of New Orleans v. City of New Orleans

| La. | Nov 15, 1865

IiiSUBY, J.

This action was instituted by the plaintiff to recover from the defendant the aggregate sum of twelve thousand nine hundred and thirty dollars, for water furnished and supplied by the plaintiff to the public schools, to the offices of the city hall, to the offices of the recorders, to the houses of refuge, to the parish prison, to the corporation prison, to the watchhouses, to the workhouses and to the sugar platform, as the same is particularly set forth in the plaintiff’s petition and in the detailed account annexed to it,

The plaintiff's demand is resisted by the city, which traverses it, by setting up the general issue.

The plaintiff had judgment for the whole amount in the court below, and from that judgment this appeal is taken.

The defence, on which the defendant relies to defeat the plaintiff’s claim is, that, under the charter of the Commercial Bank, it was incumbent on it to supply all the water needed for any public purpose, within the limits of the city and its faubourgs, free of any charge; and, if this were really so, the plaintiff’s claim should be rejected.

To determine whether this position is a tenable one', reference must be made principally to the thirty-eighth section of the act of incorporation, which, as the result of our present enquiry depends upon a correct solution of it, is herein transcribed, in extenso :

“ Sec. 38. Be it further enacted, that the corporation of New Orleans shall be supplied by said company, free of charge, with all water necessary for the extinguishment of fires and other public purposes; nor shall the city counsel be subjected to any charge for water furnished to supply the gutters of the said city and faubourgs; and that the said company, in the progress of laying aqueducts, shall place, free of any charge whatr ever, two hydrants of a proper construction, in front of each square, at a suitable distance from each other, from which a sufficient quantity of water may conveniently be drawn, for extinguishing fires, for wetting, washing, watering the streets and gutters, and any other public.purpose ; that, on the squares which do not front on the river, the hydrants shall be placed on opposite sides of the streets, at equal distance from each other and the corners; that the said hydrants shall be of a proper size, and made so as at all times to furnish water for the fire engines and purposes herein mentioned, at all times during the continuance of the charter, unless prevented by some unavoidable accident, and in case such shall occur, the repairs shall be made and the water again furnished at the expiration of the necessary delay; and the said company shall supply a sufficient quantity of clear, pure and wholesome water, for the use of the inhabitants within the limits aforesaid, at the elevation of fifteen feet, when the same may be required: provided, however, that the said hydrants shall be under the control of the Commercial Bank. ”

In eonneetion’with section thirty-eight, it will be useful to refer to a portion of section eleven of the same act, which provides for the expeditious progress of the water works : “so that the city of New Orleans and the faubourgs thereof, may be furnished with water in the streets; and such inhabitants may procure it by means of conduits or pipes, within their houses and lots, at a price to be regulated by the company.” Had the purposes for which water was to be furnished to the city, free of charge, been fully specified in section thirty-eight, or elsewhere in the act, no question could possibly have arisen as to the purposes intended; but the use of the words “other public purposes,” as the complement to the specified purposes, in one instance, and the words “any other public purpose,” in the second instance, is what gives rise to this controversy and necessitates a judicial interpretation of the section referred to, in order to determine whether the charges set out in the bill of particulars are exigible or not.

The contract contained in the plaintiff’s charter was one between them and the State, and the connection between the city and the water works company has existed from the outset, and is of the most intimate character, if the city was not actually a party to it. The city furnished two out of the five commissioners. It was authorized to subscribe, and did subscribe for five thousand shares of the capital stock of the company, not subject to reduction. It might annually appoint a committee, to have access to such of the books of said bank as relate to the water works, and to make such extracts from the same as it might deem necessary. The very object of the incorporation of the company was, as stated in the preamble of the charter, “ to convey water from the river to the city and its faubourgs,” to contribute, among other things, “ to the security of the city from fire.”

Reading sections 11 and 38 of the plaintiff’s charter or contract, with the view of ascertaining the common intent of the parties, and, to this end, applying to it those rules of interpretation which the law furnishes to unravel doubtful or obscure clauses in statutes or contracts, we are not greatly embarrassed in putting, as we think, a correct construction on that section which requires the bank to supply water to the city of New Orleans, free of charge, for the public purposes therein prescribed.

The first rule for the interpretation of a law is found in Article 16 of the Civil Code:

“ Where the words of a law are dubious, their meaning may be sought by examining the context, with which the ambiguous words, phrases and sentences may be compared, in order to ascertain their true meaning;” and this rule is no less applicable to contracts than to.laws. See Article 1943 0. C.

These rules are merely the enunciation of the one founded in common sense, that a proposition should always be interpreted secundum subjeclam maieriam.

The words, “and other public purposes,” first used in the section 38, are intended as the complement to the only prescribed purpose, so far mentioned : the furnishing of water necessary for the extinguishment of fires, free of charge; and the words, “ for any other public purpose,” subsequently found in the same section, are also used as the complement not only to the first prescribed purpose, the extinguishment of fires, which is again mentioned in the same connection, but to other prescribed public purposes, for “wetting,” “washing” and watering the streets and gutters;- and the words, “other public purposes,” and “any other public purpose,” are to be understood as being of a like character with the public purposes speciallymentioned; and they are all, whether specially described or embraced in the more general or comprehensive term, to be subserved in the mode, and the only mode, prescribed in section 38.

The act of incorporation contemplated and provided but one place, and one mode, by which the city was to be furnished, without charge for the necessary supply of water for the public purposes mentioned, specially or generally. The place was “in the public streets,” and the mode was through the company’s hydrants placed therein, and controlled solely by them. That was one of the prescribed modes; the other mode was a lateral division of the water from the main pipes or aqueducts, through connecting pipes, into the yards and houses of inhabitants; but, that supply, by the last mode, at a certain elevation, to whomsoever and for whatever use it was furnished, was not intended to be a gratuitous supply, or one free of charge, but for a price to be fixed by the company.

The mode of supplying water, free of charge, for public purposes, is a key to the sense in which those words must be understood. It was the supply to be furnished in the streets and through the hydrants. This view of the obligation imposed on the bank to furnish water to the city, free of charge, for every public purpose, might supercede the necessity of enquir-ing into the verbal signification of the word “ public,” as used in section 38. Whatever was the character of the described public purposes, the use of the words other and any other public purpose, put all the public purposes, whether special or general, if not into the same class, upon an equal footing, so far as related to the mode of satisfying them.

Under the Roman law, things for public use were divided into two kinds only: 1. Those destined for the common use of mankind, and which every one might freely use, such as rivers, seas, the banks of rivers and the sea shore. These things were destined by nature for public use. 2. Those things which public policy deemed necessary and appropriate in spiritual or temporal affairs. In the last mentioned class were embraced the streets, highways, market places, the [places where courts of justice were held, colleges, town-houses and other public places. Domat, book 1, tit. 8.

Art. 445 of our Code subdivides the last class into two kinds: 1. Common property, to the use of which all the inhabitants of a city, or other place, are entitled in common; such as the streets, the public walks and the quays; and, 2. Common property which, though it belongs to the corporation, is not for the common use of all the inhabitants of the place; but may be employed for their advantage by the administrators of its revenues.

The “public purposes” intended by the legislature in the act of incorporation are such as bear relation to the things properly classed as public things, and which are included in the first division of common things, in Art. 449, such as the streets, the public walks, etc.

It was not contemplated that such buildings or establishments as are included in the second division of common things, and which are not for the common use of all the inhabitants of the city, although employed for their advantage, such as the city hall, the court house, the public school, etc., should receive from the bank a supply of water free of charge.

The purposes specially mentioned in Art. 38 are strictly public purposes, connected with public things, in which all are interested, and which are for the common use of all; and “ other public purposes ” contemplated by the legislature were, it is safe to presume, of a like character.

If water was needed for any quasi-public purpose, to be furnished gratuitously, provision should have been made for it in the charter, which prescribes the obligations of the bank, and which no consideration of public convenience can render more onerous.

The act of the legislature, passed in 1852, at page 158, exempting the property held by the plaintiffs from any taxation by the city of New Orleans, provided “that all charitable institutions in the said city be supplied with water free of charge,” was simply a proposition to the plaintiffs to grant them this boon; provided they would supply, not all the public or quasi-public institutions in the city, which were then paying without objection, but only all charitable institutions (public and private) in the city. It throws no light on the contract or charter granted in 1833, even if the bank had accepted the proposal, unless the fact being manifest that all the public charitable institutions in the city had been furnished, up to the date of the act, with water, for a price paid by the city; that the exemption from such payment in future, for a valuable consideration, was virtually a recognition by the legislature that 'the construction which the parties had put upon the words, “other public purposes,” was the correct one.

It is in proof that, up to the year 1854, more than twenty years after the date of the charter, the plaintiff and' defendant have put upon the sections 38 and 11 the construction we now put upon it. Up to that time, the water rates were always paid for the purposes described in the petition; and this is a fit case to apply the rule of interpretation found in Arts. 1951 and 1957 of the Civil Code. See also 11 A. 113; 10 A. 601; 4 A. 441; 2 A. 475; 1 A. 230, 232.

It has been held by this court, that “the usage under a statute, if ambiguous, is its best interpretation.” Optima legum inierpres consuetodo.

“The common interpretation of statutes which had existed for a length of time, will be considered, as it generally is, the correct interpretation.” 1 Hen. Dig. 1861, 786-7.

In Clay v. Bullard, 9 Rob. 308, it was held that “contracts will be construed as the parties must be supposed to have understood them at the time of their execution.

It has been held that the intention of the parties must be sought in the whole language and the surrounding circumstances, to which the instrument itself points. Peck v. Bemis, 10 A. 160.

The argument of defendant’s counsel, that water required for any use which is to be paid out of the money in the city treasury, is water supplied for a public purpose, and as such, it is to be supplied by the plaintiff, free of charge, is wholly untenable, unless the words used, “other public purpose” and “any other public purpose,” are equivalent to and convertible terms with “ any purpose whatever,” which are no where to be found in the charter.

The judgment of the District court is according to law and the evidence, and must be sustained.

It is therefore ordered, adjudged and decreed, that the judgment of the District court be affirmed, the costs of appeal to be paid by the appellant.

Howell, J., recused.