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Northeast Rapid Transit Company v. City of Phoenix

Supreme Court of Arizona

November 16, 1932

NORTHEAST RAPID TRANSIT COMPANY, a Corporation, Appellant,
v.
CITY OF PHOENIX, a Municipal Corporation, Appellee

APPEAL from a judgment of the Superior Court of the County of Maricopa. Joseph S. Jenckes, Judge. Judgment affirmed.

Messrs. Baker & Whitney and Mr. Lawrence L. Howe, for Appellant.

Mr. L. C. McNabb, for Appellee.

OPINION

Page 952

[41 Ariz. 73] LOCKWOOD, J.

The city of Phoenix, a municipal corporation, brought suit against Northeast Rapid Transit Company, a corporation, to enjoin it from engaging in intracity business as a common carrier of passengers within the city of Phoenix. The case was tried to the court on an agreed statement of facts, certain documentary evidence, and some undisputed oral testimony, and judgment was rendered granting the injunction as prayed for. From such judgment this appeal was taken.

The facts in the case may fairly be stated as follows: The city of Phoenix is a municipal corporation organized under article 13, section 2, of the Constitution. Defendant is a corporation organized under the laws of Arizona and engaged in the business of a common carrier of passengers for hire. On April 17th, 1929, one C. M. Menderson was general manager of defendant, which was then engaged in business as such common carrier between a point within the city of Phoenix and various points without, conducting only intercity and country business. On that date the Phoenix Motorbus Company and defendant made joint application to the city commission of the city of Phoenix for a right to conduct intracity business as common carriers of passengers, which right was duly granted to Menderson individually upon certain terms set forth in the permit. No permit was granted to the motor-bus

Page 953

company or defendant in their corporate capacities, nor was the permit granted Menderson ever transferred to defendant. At some time thereafter Menderson individually made application to the corporation commission for the right to engage in business as a common carrier between Phoenix and the Arizona Biltmore Hotel outside the corporate limits of Phoenix over certain designated [41 Ariz. 74] routes. On December 31st, 1930, three certificates of necessity and convenience were granted to him, two of which expressly allowed intra-urban service. On April 1st, 1930, upon the petition of Menderson, Order No. 4569 of the corporation commission issued under date of September 8th, 1929, which denied him the right to give intra-urban service, was modified to authorize such service. These orders authorizing intra-urban service were apparently based by the corporation commission upon the fact that the city of Phoenix had agreed that such service might be granted in the permit aforesaid. No certificate of necessity and convenience, so far as the record shows, was ever issued by the corporation commission to defendant in its corporate capacity, nor was one ever assigned or transferred to it, but Menderson has permitted it to operate over the routes set forth in his certificates without objection. Defendant has been engaged in common carrier passenger service, apparently on the theory that it might operate under the various certificates and permits issued to Menderson in his individual capacity, although such permits and certificates were never transferred by him to it and he has always been the individual owner thereof, so far as shown by the record herein. Neither the permit from the city nor the certificates of necessity and convenience could be assigned or transferred without the consent of the city or corporation commission, and no such consent was ever asked or given.

On the 28th of January, 1931, the city commission revoked the permit theretofore granted to Menderson authorizing intra-urban service, and under their instructions on March 6th this action was filed.

On April 18th, 1931, and after the filing of the action, defendant secured from the city tax collector a license to engage in and carry on the business of a [41 Ariz. 75] "bus line" within the city of Phoenix for the year ending October 1st, 1931, and on the 2d day of October defendant tendered to the city tax collector the sum fixed by the city ordinances for the reissuance of the bus line license aforesaid, which was refused. Defendant has continued to operate its interurban passenger service in the city of Phoenix up to and including the date of trial of this action.

It is further agreed that the city of Phoenix has never applied to the corporation commission or endeavored to procure it to cancel any of the certificates of necessity and convenience issued by it as aforesaid.

It is the contention of plaintiff that no common carrier of passengers for hire may conduct an intracity business within the limits of the city of Phoenix without a franchise or permit therefor being first obtained from such city, and that none such has been held by defendant since before the commencement of this suit. It is the claim of defendant, on the other hand, that the sole and exclusive jurisdiction over common carriers of passengers for hire, whether within or without the limits of a corporate city, is vested by the Constitution and laws in the corporation commission, and that it has been and is operating its ...


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