
    No. 718
    STATE v. OHIO PUB. SERV. CO.
    Ohio Appeals, 9th Dist., Wayne County
    No. 762.
    Decided July 10, 1924
    553. FRANCHISES — 1. Public corporation has no right to transfer without consent of state.
    2. Municipality has right to give or withhold1 23franchise.
    3. Where a franchise contract is silent as to duration, it is terminable at will of either.
   WASHBURN, J.

Epitomized Opinion

Published Only in Ohio Law Abstract

This was an action in quo warranto to determine the right of the Ohio Pub. Serv. Co. to use the streets of Orrville by the maintenance of electric equipment therein, for the purpose of supplying electricity to the inhabitants of said village for commercial and private lighting purposes. On Feb. 1, 1892, an ordinance was passed by Orrville granting a franchise to Gans and Wilson to supply the village with electricity. The ordinance contained no express provision as to the right to use the streets to furnish! electricity for commercial and private lighting purposes, but the parties construed said ordinance as granting such right and a plant was constructed under such ordinance and electricity for both public and private lighting was furnished.

Attorneys — Critchfield & Etling, Wooster, for State; C. H. Henkel and Franklin L. Maier, Orville, for the Pub. Serv. Co.

In 1893 a corporation known as the Orrville L., H. & P. Co. was formed, which corporation succeeded to the rights and assumed the obligations of Gans and Wilson. At the expiration of the ten-year period the franchise was continued for five years, and in 1907 the village passed an ordinance by which it contracted with said company for the lighting of the streets of the village for another period of five years, and fixed the price at which sasid company should furnish light for commercial purposes to the citizens of said village. Soon thereafter, the light company sold its asserts to one Rennecker.

In 1913 Rennecker sold out to the Massillon Elec. & Gas Co. Shortly thereafter the city built a municipal plant. The Massillon Co. furnished a few of the residents electricity from this time on till 1921 when the Ohio Pub. Serv. Co. purchased the assets and rights of the Massillon Elec. & Gas Co. and since that time has furnished electricity to some of the citizens of the village for commercial purposes and claims the right to do so by virtue of the ordinance of 1892 and the acts of said village subsequent thereto. In rendering judgment against the public service company, the Court of Appeals held:

1. Public and quasi-public corporations have no right to transfer their corporate powers and privileges and thereby disable themselves from performing their public duties without legislative authority.

2. A municipality has the right to give or by a public utility; the giving of such consent by the municipality confers the right to use the streets and constitutes the contract by which the rights of the parties are to be determined; in other words, the franchise is given by the municipality and not by the state direct, and is to be construed as a contract between the utility and the municipality.

3. A contract between the utility and the municipality, which is silent as to duration, is terminable at the will of either party thereto; and whatever right was granted by said village to use the streets of said village for the purpose of furnishing electricity for commercial purposes was properly revoked and terminated by said village by the action taken in 1923, and therefore the respondent had no right to use the streets of said village for said purpose.  