Moberly v. Richmond Telephone Co.

| Ky. Ct. App. | Jun 28, 1907

Opinion op the Court by

Chief Justice O’Rear

Affirming.

Appellee, as assignee of Powell, is the owner Of a franchise to maintain and operate a telephone exchange and telephone system in the city of Richmond. The franchise was granted by the city for a term of 20 years, to occupy its streets, alleys, etc. In the ordinance granting it, it was provided that the grantee should not charge exceeding the schedule of rates fixed in the ordinance for service to the citizens of Richmond. Appellant, a citizen of Richmond, became a subscriber to the system. Later on appellee extended its system into the county beyond the city limits, but connecting with the city exchange. It proposed to charge a higher rate to its subscribers for the privilege of talking to all its subscribers, including those in the county outside the city and those inside. Appellant refused to pay the advanced rates, and appellee declined to give him the full service. This suit was brought by appellant to compel appellee to give him the full service by connecting his telephone at his call, or at the call of any of its subscribers, whether they called from boxes in the city, or in the county outside the city. The circuit court sustained, a demurrer to the petition, and dismissed it.

Under the present Constitution a city may sell such franchises at public sale to the highest and best bidder for a term of not exceeding 20 years, though they are not exclusive. Without such sale cities may not grant such franchises. Section 164, Const. The city may annex any lawful condition to the exercise of the franchise, which becomes a part of the contract under which it is thenceforth used. And we think it was competent for the city to provide, as a condition of the franchise, that the rates to citizens should not exceed the schedule fixed in the ordinance, or any future ordinance. The real question here is the construction of the franchise granted in this instance. It purported- to grant, and could only grant, a franchise operative within the city, The schedule of rates, being silent as to service or tolls beyond the city limits, must be construed with reference to the service to be rendered, or tolls to be charged, within the territory coterminous with the franchise granted. Even though it be conceded that the city could have lawfully imposed the condition to its grant that city subscribers should be charged not exceeding a schedule fixed by the city ordinance for service both in and out of the city, that was not done in this instance. The appellee did not, therefore, violate the ordinance conditioning its franchise when it proposed to charge a higher rate for its county service.

Id this view of the matter, we conclude that the judgment was not erroneous, and it is therefore affirmed.