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Menderson v. City of Phoenix

Supreme Court of Arizona

February 16, 1938

C. M. MENDERSON, Appellant,
v.
CITY OF PHOENIX, a Municipal Corporation, JOHN H. UDALL, as Mayor of City of Phoenix, a Municipal Corporation, and E. E. READING, C. G. SULLIVAN, J. R. FLEMING, HARRY T. DUFFY, as City Commissioners of the City of Phoenix, a Municipal Corporation, EVAN S. STALLCUP, as City Manager of the City of Phoenix, a Municipal Corporation, and JAMES GIRAND, as Superintendent of the Street Railway of City of Phoenix, and City Engineer of the City of Phoenix, a Municipal Corporation, Appellees

APPEAL from a judgment of the Superior Court of the County of Maricopa. E. W. McFarland, Judge. Judgment affirmed.

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

Mr. I. A. Jennings, City Attorney, and Mr. Hess Seaman, his Assistant, for Appellees.

OPINION

[51 Ariz. 281] LOCKWOOD, J.

C. M. Menderson, hereinafter called plaintiff, brought suit against the City of Phoenix, a municipal corporation, and various and sundry of its officers, hereinafter called defendants, seeking an injunction preventing defendants from operating a municipal bus line within the corporate limits of the City of Phoenix. The complaint, after the various necessary formal allegations, set up that plaintiff was operating certain bus lines within the City of Phoenix, under a certificate of necessity and convenience issued by the Corporation Commission, and that the [51 Ariz. 282] defendants, although possessing no such certificate, operated a municipal bus line paralleling and competing with plaintiff's lines, to his great damage. A temporary injunction was issued, and thereafter defendants demurred to plaintiff's complaint. The demurrer was sustained by the court, and, plaintiff declining to amend further and standing upon the allegations of his complaint, the temporary injunction was dissolved, and judgment rendered dismissing the action, whereupon this appeal was taken.

Page 322

The facts are not in dispute, there being but one ultimate question of law presented by the record for the determination of this court, which is,

"has a municipal corporation the right to own and operate a bus line for the common carriage of passengers within its corporate limits, without first obtaining a certificate of necessity and convenience from the Corporation Commission?"

In answering this question, there are three points which require consideration: (a) Does the Constitution of Arizona confer jurisdiction upon the Corporation Commission to regulate the operation of a municipally owned transportation system for hire by a municipal corporation within its own limits? (b) If the Constitution does not directly confer such jurisdiction, may the legislature, under the provisions of section 6, article 15, of the Constitution, confer it upon the commission? And (c) If it may do so, has it done so as far as motorbuses are concerned, by virtue of chapter 100 of the Regular Session, 1933?

The constitutional powers, and limitations of the Corporation Commission are set forth in article 15 of the Constitution. Section 2 thereof defines public service corporations in the following language:

"All corporations other than municipal engaged in carrying persons or property for hire; or in furnishing gas, oil, or electricity for light, fuel, or power; or in [51 Ariz. 283] furnishing water for irrigation, fire protection, or other public purposes; or in furnishing, for profit, hot or cold air or steam for heating or cooling purposes; or in transmitting messages or furnishing public telegraph or telephone service, and all corporations other than municipal, operating as common carriers, shall be deemed public service corporations."

And all regulatory powers over public utilities granted the commission by the balance of article 15 are expressly referred to as being over "public service corporations."

It will be seen thereby that all corporations which are engaged in carrying passengers for hire, and all corporations operating as common carriers, are deemed public service corporations within the meaning of the Constitution, with the express and specific exception of municipal corporations. We think that no plainer language could have been used by the makers of the Constitution to state that the constitutional powers conferred upon the Corporation Commission, in regard to the government and regulation of public utilities, were not intended to, and did not, include those owned and operated by municipal corporations of any character. Indeed, while plaintiff presents an argument which might well have been addressed to the discretion of the Constitutional Convention, pointing out the terrible consequences which he believes will result to the public in case the Corporation Commission is not allowed to regulate municipal corporations operating public utilities, his contention that such constitutional power does exist is not very strenuous. We think it too clear for extended discussion that the Constitution not only does not expressly authorize the Corporation Commission to regulate municipal corporations which are operating public utilities, but that it, by necessary implication, forbids such regulation.

[51 Ariz. 284] The next question is whether, notwithstanding this fact, the legislature may grant such power to the commission, under section 6, article 15, of the ...


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