Keith v. Johnson, 109 Ky. 421

Keith v. Johnson

109 Ky. 421 | Ky. Ct. App. | 1900

Opinion of the couet by

JUDGE HAZELRIGG

Affirming.

Section 164 of the Constitution provides, among other things, that before granting a franchise for a term of years a county, city, town, taxing district or other municipality “shall first, after one advertisement, receive bids therefor publicly, and award the same to the highest and' best bidder; but it shall have the right to reject any or all bids.” Ip obedience to this provision, the city of Covington advertised for bids for the franchise of supplying the city and its inhabitants with fuel and illuminating gas for the term of 20 years. The board of aldermen, composed of the ap-pellee Johnson and others, being about to award the franchise to the Covington Cas Company, one of the bidders therefor, the appellant, a citizen and taxpayer of the city, sought to. enjoin the appellees from so doing, in substance, first, because that company had no authority to bid, and a contract with it would be void; and, second, because another bid — that of one Detwiler — was the highest and best bid, as the bidder offered gas at the lowest rate,

Touching the first ground, it is urged that the gas com-pa.ny was incorporated in 1854 for the sole purpose of carrying out a prior grant of the city of Covington to *425James Southgate and his associates to supply.the city with gas for the term of fifty years from October, 1852; and therefore the company could not acquire, a new or different franchise, because it could only transact the business it Avas expressly incorporated to transact. Const., sec. 192. We think this contention was based on a too narrow construction of the purposes for which the company was incorporated. It is true it is stated in the act of incorporation that the business and operations of the company shall consist in furnishing the city of Coving-ton, etc., with gaslight, in pursuance of and according to the terms of an ordinance passed by the city of Coving-ton October 28,1852, entitled “An ordinance to provide for lighting with gas the city of CoA'ington, Ky.;” and it is true that such ordinance was the one under which South-gate and his associates Avere authorized to furnish gas for the term of fifty years. But we regard the reference to the Southgate ordinance as intending merely to fix the terms of the contract upon which the gas was to be furnished by the corporation, rather than as intending to designate the carrying out of that contract as the sole business for which the corporation was organized. Indeed, the very terms of the charter shoAv this; for, confessedly, the Southgate contract terminated in fifty years from October 28, 1852, and yet the company was given the exclusive right to supply gas to the city and its inhabitants (under the terms and conditions provided in the South-gate ordinance) for the term of fifty years from the 1st day of January, 1854. It may be noticed that it is not contended that, because the life of the company is only some four or five years, it could not receive a grant to it of a franchise to last twenty years. It seems to be conceded on the authority of Detroit Citizens’ St. Ry. Co., *426v. City of Detroit, 12 C. C. A., 365, (64 Fed. 628), and cases there cited, that, if otherwise entitled to do so, the company, although so nearly extinct, might receive the grant in question. As already indicated, we do not think the charter of the company defines and limits the purpose of its creation to the business' of supplying gas under the Southgate ordinance.

With respect to the second ground there is more difficulty. The difficulty, however, is' not, as we think, in ascertaining the meaning of the Constitution, or in defining the power of the courts to enforce the provisions of that 'instrument. We believe that it is mandatory on the municipality to award the franchise “to the highest and best bidder.” When this bidder is found, the mandate of the Constitution must be followed. The act of awarding the franchise to such a bidder is a ministerial one, although involving the exercise of judgment and discretion. When it is ascertained who is the highest and best bidder, the problem! is solved, and the demands of the constitutional provision may be enforced by the courts at the instance of an aggrieved bidder or of a citizen'and taxpayer. We are not speaking now of the mere act of granting a franchise. That is a legislative act, to be exercised or not, as the legislative body may determine. We are referring to the act of conferring the award, if it is to be conferred at all, on the bidder designated by the Constitution. If the wrong bidder is about to be selected, the act of so doing may be pi’evented in advance, as any other illegal or wrongful ministerial act may be prevented. The municipal body is to be treated precisely as if the duty of making the. award were conferred on the clerk of the council, or the mayor of the city, or other executive or ministerial officer. Undoubtedly, however, *427the ascertainment of who is the highest and best bidder is, in the first instance, committed by the Constitution and the statutes to the governing authorities of the municipality; and it would seem clear that except in cases where there was about to be on the part of such authorities a plain and palpable violation of their duty to award the franchise to the highest and best bidder, the courts should not interfere. The ascertainment of this fact is one to be determined as other facts are determined, and force is to be given to both the controlling words “highest” and “best,” found in the Constitution. In the present case, in the Detwiler bid, there seems to be one price only to the city for public lighting, and it is sought to be demonstrated that this is the lowest and best bid. In the company’s bid for such lighting there are a number of apparently important matters to be considered. When using a five-foot tip and four-foot burner on a moonlight schedule, a certain price is fixed; using same on an all and every night schedule, a certain price; using the Wels-bacli incandescent gais burner on an all and every night schedule, so much per lamp post per year, etc. The Detwiler bid does not contemplate the use of the Wels-bach burner. Again, Detwiler proposes to charge the inhabitants of the city for illuminating gas from the 28th October, 1902, 95 cents per 1,000 cubic feet. The company proposes $1 perl,000cubic feet, but the latter puts this price in force at once in lieu of the1 $1.50 rate now prevailing, and which, under the Detwiler award, would continue to prevail until October, 1902. Again, the question of tearing up the streets, many of them of asphalt and brick, is to be considered in determining what is the best bid. Under an award to Detwiler, this disturbance is inevitable. Under an award to the old company, this is avoided. This *428may not be a controlling factor, still it is worth considering. Other considerations are referred to in argument, but need not be noticed in detail. It is sufficient to say that an examination of the averments of the petition and its amendments, on which alone the case was tried, and a comparison of the bids- involved, do not convince us that an acceptance of the company’s bid by the appellees would be a plain or palpable violation of their duty to award the contract in dispute to the highest and best bidder, as required by the Constitution. The chancellor therefore properly dismissed the petition, and the judgment is affirmed.