*1 ELECTRIC MEMBER RIVER DUCK CORPORATION, Appellant,
SHIP Tennessee, MANCHESTER, OF
CITY
Appellee. of Tennessee.
Supreme Court
Sept. 1975. *2 Merritt, Jr.,
Gilbert Gullett, S. Steele, Sanford, Merritt, Robinson & Nashville, Ed- Gordon, Bobo, ward F. Grissom, Gordon & Shelbyville, appellant. Griffith, III, E.
Charles Griffith & Nashville, Stokes, H. Parsons, Thomas City Manchester, Atty., for appellee. OPINION HENRY, Justice. actions,
These two civil consolidated for purposes appeal, raise questions, two viz:
1. City Does the of Manchester have the acquire, domain, eminent so much of the electric Duck River Electric Membership Cor- poration as is within the boundaries city? of the Assuming the 2. existence right, proper is the what measure of dam- ages?
I.
first suit was instituted
Manchester, seeking
acquire, by
emi-
domain,
certain
nent
owned
Membership Corpora-
River Electric
Duck
tion,
corporate
within the
limits of
located
city
used Duck River as a
system.
its electric distribution
dismiss, insisting
moved to
being
residents of the
supplied
Duck
municipal corporation, “is
city,
electricity
at the
of Duck River.
sufferance
delegated
and has
been
authorized
orderly processes
law
While
supply
used to
right to take
prevent
no doubt intervene to
*3
Coopera-
Electric
darkness,
under the
thrown
city being
electric
into
the fact
not, therefore,
the
and
take
Law
arrangement
fragile
tive
this
remains that
petition,
in
owned by
the
described
property
in
lacking
stability.
and
defendant, public non-profit electric mem-
a
city,
circumstances the
on
Under these
4
pursuant to
bership corporation organized
1974,
Duck River’s
after
franchise had
June
Law,
65-
T.C.A.
Cooperative
Electric
§
the
its
adopted
345,
Ordinance
expired,
Number
2501,
seq.”
et
declaring
prosperity
that “the
the City
overruled the
trial
motion to
The
materially
will be
Manchester
retarded and
dismiss, holding
city
authority
that the
had
be detrimental
the
that would
to
welfare
Duck River electric
acquire so much of
to
and
City
inhabitants
citizens of
the
system is located within the
as
distribution
to
continue to be
Manchester
[them]
Municipal Electric Plant
under the
city,
by
Duck River
Electric Member-
served
seq., T.C.A.).
et
of 1935
6-1501
Law
Corporation”;
they
that
bet-
ship
“be
by municipally
a
owned electrical
ter served
by
challenges
ruling
this
as-
appeal
This
system;”
directing
and
that a
distribution
(1)
that
a
which insist
Tennessee
signments
suit
filed.
condemnation
property
municipality may
condemn
cooperative without demon-
an electrical
determination
a
The
condemn
need
strating
public purpose
a
or
and ab-
authority
necessity
for the
ing
taking
judicial finding
taking
that
sent
judi
for resolution
question
is not
need,
(2)
and
that a Tennessee
such
serves
and,
palpable
absent a clear and
ciary
abuse
condemn,
is not
municipality
authorized
fraudulent, arbitrary
capri
or
or
power,
law,
of an
under
action, it
upon
is conclusive
courts.
cious
cooperative devoted
use.
electric
Harper
Housing Authority,
v. Trenton
38
assignments
being
as
fairly
treat these
396,
(1954);
Tenn.App.
City
Counsel jurisdictions Cases from other and text- urge upon proposition ably Court authority book follow the pat- same corporation may prop- that a condemn tern.
206 holding It compelling pose. permissible practice reasons for is
There but one pow- municipality give has recognition a Tennessee should foremost which of an electrical high obligation condemn service. er its boundaries. within cooperative Chumbley v. Duck Corp., In River Elec. (1958) 310 Tenn. S.W.2d 453 to the character of the two look first was confronted with an where- Court action entities. sought to Duck Riv- plaintiff compel in the Laski, (1872) Memphis v. Tenn. 511 him with electricity. er to furnish characterized Tennessee munici- Court very relief, properly holding denied Court thusly: palities duty electricity there was supply municipal corporation created A unless non-member and until he com- to a political purposes, government with the reasonable plied regula- rules powers with subordinate and local vested they (plaintiff insisted un- tions were most im- imperium is an legislation. It reasonable) Duck River. more be and can no embarrassed perio, department cityA electric can exact no governmental powers exercise of the membership requirement and must serve all invested which it is inhabitants, without discrimination and creating it. good, than can imposition of restrictions without *5 purpose general the of They exist for excepting those relating pay- to conditions of They agencies are arms or government. ment. exercise, a they by delegation, state and the no aspersions upon While cast these power public the sovereign of for portion freely recognize and and corporations fully Carrier, Tenn.App. Thornton 43 good. public service great they have rendered the (1957). 615, 208 311 S.W.2d and sparsely populated rural areas of our cooperatives, under membership Electric state, that they the fact remains are mani- law, general corpora- are welfare Tennessee low-grade, volunteer, festly public service T.C.A.). They organ- (§ 65-2503 tions. corporations, respects, inferior in all type to electricity their mem- distribute to ized to exist municipalities purpose which the for bers, agencies political and governmental general government. enjoy per- Cities of to non-members restricted subdivisions succession; there is provision petual (10%) of the number of mem- percent ten accompanied by a their dissolution division 65-2508). By appropriate by-laws bers. enjoy a They higher degree assets. of of membership and limitations qualification greater degree of permanency stabili- (§ 65-2514). imposed. may ty- expenses of certain payment After Ample authority supports the posi reserves, certain the reve- providing city that property tion of Duck year may be distributed in each fiscal nues However, use.” “public is not in refunds, patronage either as members to its legal context of technicalities and nice is in reductions, (§ 65- way of or both rate appraisal We think a fair the serv ties. 2516), upon among dissolution by electric membership corpo rendered ices (§ 65-2525). membership. demands conclusion that their rations corpora- distressing feature these A “public to are devoted use” in the facilities to power to refuse service is their tions Yet, proceedings. of condemnation context pre-eminent The customers. prospective legitimate can be no contention but there power, and of those public mission city distribution of electric current distribution, provide is to charged with its use. higher will be electricity maximum blessings to the adoption analysis, municipal member- And in the last extent. possible pur- has the exclusive to control the ity conditions tends frustrate ship
207 electricity within its distribution bounda- just right compensation is Elec., v. Mid. 1, ries. Franklin Tenn. 222 decreed Article 21 Con 182, (1968). 434 829 Tenn. S.W.2d This case of Tennessee which provides stitution inferentially city holds that take substance that no property man’s shall be property cooperative. of an electric just compensation. See taken without This at 833. 434 S.W.2d right compensation long existed before statutory scheme of condemnation came short, as between a Tennessee munici- being; right into therefore “such cannot be membership coopera- and an electric pality by any statutes, said to be created such tive, sovereign and supreme. because the latter are implemen enacted in Manchester condemn. It will hold tation the constitutional already acquired so general for the given.” Brooksbank v. Roane County, 207 benefit, with a higher larger Tenn. (1960). S.W.2d 570 scope of use and under a more stable and system. responsive Reference condem will nation statutes they reveal that con
III. only template the condemnation of land. personal No reference is made to suit was declaratory judg- The second yet constitutional prohibitions filed in aid ment action condemna- against taking private property without seeking suit and to have tion the Court just compensation applies with full force proper damages. declare measure of validity personal property. Zirkle v. 23-1414, T.C.A., The city insisted that § City Kingston, 396 S.W.2d statutes, (1965). applicable; whereas Duck River takes the This action seeks position that 6-320 T.C.A. is condemn land. applicable It *6 may may improved. or not be an It also since electric member- seeks personal to condemn ship corporation is involved. including conductors, anchors, poles, guy wires, light- The trial held that the damages arresters, transformers, ning street lights, by be determined con- and numerous other equipment items of statutes in demnation embraced 23-1401 § used in an electrical system. distribution seq. et Tennessee Code Annotated. Technically, some of may this be so at- appeal This ensued. part tached as to become a of its realty; however, we treat it personal property, IV. in with accordance the pleadings, for the phase purposes this of the controversy. provides, Section 23-1414 pertinent part: The condemnation statutes re- a estimating quiring jury view damages,
In jury shall “examine the give ground” apart by the value of the “set metes rights land taken deduction, bounds, a quantity sufficient without but for incidental benefits land purposes intended” T.C.A.) which result to the by owner reason are ludicrously inapplicable. (It improvement proposed of the tak- would be diffi- be guy a apart cult to set wire en into consideration in metes estimating inci- bounds). The damages. just standard measure of dental compensation, arrived at in the usual man- imprecise That this is a most statement ner, equally unacceptable. is damages the elements of there can doubt; however, through years 6-1301, down T.C.A. under which the courts have evolved rules for the deter- city’s sustained, condemn is is silent just compensation. damages. However, mination as to as heretofore out, general eminent domain power revenues pointed received from of all other are made stat- power consumers of electric with- statutes sales power area, conferring except the annexed consumers utes brings But large 23-1402 T.C.A. this us power greater industrial loads with unacceptable an measure of dam- kilowatts, during back than 300 the last twelve ages. preceding months the date of the (1) above, (ii) for in provided notice appro The courts have fashioned (50%) fifty per of the net centum reve damages speci measures without priate sales power revenues less (gross nues Legislature. from the We guidance fied including power cost of facili wholesale agree with the insistence of counsel for the charge) received from ties rental damages that “the determination of large consumers industrial sales legislative question.” not a judicial than greater 300 kilowatts power loads Memphis, supra, of Railroad v. old case The during the annexed area the last within question us that the suffi instructs (12) preceding months twelve date adequacy procedure ciency notice. aforesaid damages judicial ascertaining question to the courts. so hold. confided equi to be fair and We hold this determining just compensa method of table state, policy of our how as mandated our tion Constitution. ever, is formulated to a substantial extent this at arriving conclusion have Legislature, Home Beneficial by the Assn. necessary to determine whether found White, 585, 177 S.W.2d 545 “annexing Manchester is an City of (1944), positive and where it has made a meaning of municipality” within the 6-§ in an area of constitutional pronouncement the fact and we have not overlooked concern, carry we hesitate not to out its presently does own or that Manchester obvious intent. system. own electric In our operate its Legislature has arrived at formula not controlling view these considera- determining the fair market or method motivated the fact We are tions. just compensation paid to be value has found and Legislature determined involving acquisi- in these cases owner determining manner for proper to be a entities. tion compensation” or “fair value.” “just market *7 reads, 6-320 as follows: bring ourselves to believe We cannot would allow one measure of Legislature (2) Municipality purchase shall offer to for annexed utilities and an- compensation properties of the electric distribution acquired by for those condemnation. within other cooperative located the annexed we. area, would together with all of the Nor coopera- area, serve within rights to such tive’s probably ap- We realize we have which shall consist of cash consideration damages, but a liberal measure proved cost, reproduction (a) present-day entitled liberal think Duck new, being acquired, facilities less City of Manchester has consideration. computed straight-line on a depreciation beneficiary long its service for a been basis; (b) plus equal an amount River, doubt, time. Duck ex- period of constructing any necessary facili- cost its and facilities to accom- services tended coop- reintegrate the ties residents and their Manchester modate area after the annexed outside erative will have an adverse doubtless withdrawal sold; plus (c) portion detaching upon surcharges, rates reserves. effect amount, year payable each annual an (13094) is (10) years, equal to the This case reversed and ten period of (25%) twenty-five per centum with instructions to trial (i) remanded sum try the as if an judge LEECH, issues this were Special Justice, and COOPER suit, applying BROCK, JJ., inverse concurring. damages as above delineated.
measure jury partic- eliminate the of view in this HARBISON, J., participating. being unproductive inap- ular case
propriate. these appeals
The costs of will be borne parties.
equally by Court, accordance Rule of this of the Circuit Court
the costs Clerk to the
disallowed extent of du- unnecessary transcripts the two filed
plications in this The Clerk this Court will com-
Court. exceptions.
pute the al., Petitioners,
John Parker LAYNE et BROCK, JJ., LEECH, COOPER and Justice, concurring.
Special SPEIGHT, C. W. Commissioner of Highways of the State of FONES, JJ., partici- HARBISON Tennessee, Respondent. pating. Supreme Court Tennessee. ON PETITION TO REHEAR Oct. 1975. City of peti- Manchester has filed
tion to rehear and for clarification.
We held:
a. That the of Manchester has the
right to condemn. damages That the
b. would be deter-
mined in accordance with
T.C.A.
c. That on remand trial
try the as if this issues case were an suit,
inverse condemnation with the
jury view eliminated.
Condemnation had not been com *8 not so did hold. The
pleted
may proceed dismiss, with the may suit or it option. may its It
at construct its own it competing franchise a it
system, exercise numerous other
options alternatives. But if elects to
continue, of damages measure their
method of ascertainment are as herein
fixed. petition is
Overruled.