source: Caselaw Access Project

author: Johnson, J.

license: Public Domain

text:
    The Morgan Run Railway Co. v. The Public Utilities Commission of Ohio et al.

      Railroads — Private tracks — Jurisdiction of public utilities commission— Section 523, General Code — ■Railroad’s duty to public —•Discrimination—Common carriers — Extension of lines, etc.

    1. A railroad company created, organized and operated under the laws of Ohio is a common carrier under obligation to serve the public without discrimination, and is amenable to the supervision of the public utilities commission in the conduct of its business. By the provisions of Section 523, General Code, the commission has the same jurisdiction over the use by a common carrier of private tracks, while used by it in connection with its railroad for the transportation of freight, as it has over the tracks of such railroad.
    2. A railroad company is required to use its property in the performance of its duty to the public, and in this behalf is subject to governmental supervision; beyond this it has the right to control its own affairs so long as it does not injuriously affect the public or exceed its charter powers. Matters of purely business policy are for the decision of the company, and in the absence of special circumstances the question whether it shall extend its lines to points not before reached, is one to be determined by it.
    (No. 15806
    Decided April 2, 1918.)
    Error to the Public Utilities Commission.
    John and Peter Ingham filed their complaint with the Public Utilities Commission against the plaintiff in error, in which they allege that it is an Ohio corporation formed for the purpose of owning and operating a steam railroad; that it is now operating a railroad from Morgan Run Crossing in Coshocton county in connection with The Wheeling & Lake Erie Railway Company and the Pennsylvania Company, and is hauling and delivering cars to and from the Wheeling & Lake Erie tracks to the two mines owned by The Morgan Run Coal & Mining Company and R. B. Dennis and others, and placing them along other lines and tracks to be loaded with freight, and transporting the cars when loaded back to the W. & L. E. railway tracks; that on the 20th day of May, 1907, the heirs at law of Washington Burt sold and conveyed to the plaintiff in error about 1.51 acres of land, more or less, being a strip of land 33 feet in width immediately west of another piece of land of about 48 acres conveyed to The Morgan Run Coal & Mining Company; that the deed contained the condition that the grantee would construct on or before the first of January, 1909, and thereafter maintain and operate, a railroad or tracks, sidetracks, switches, etc., on the premises, and would secure to the grantors, their heirs or assigns, the same and equal opportunities and facilities for receiving and shipping freight of all kinds as are received by other persons, and would permit grantors, their heirs and assigns, to build a railroad or switch from the premises so conveyed to premises owned by the grantors.
    The complaint sets out in detail the terms and conditions upon which this shall be done, and further recites that the complainants. as grantees of the heirs of Washington Burt, are the owners of the rights and privileges provided for above, and have opened and are operating a coal mine on the premises, and have sold coal to the said R. B. Dennis, who secured the plaintiff in error to set in cars from the Wheeling & Lake Erie to and upon all the tracks of the plaintiff in error near the mines of complainants, where they could conveniently load the same, and that as long as complainants sold their coal to him they had no trouble getting cars to load set in for them, but that when complainants desired to sell coal to other parties for a better price, and made such sale, and arranged with the Wheeling & Lake Erie for cars, and on the 9th of June, .1917, had the same set on the switch at the junction of the Wheeling & Lake Erie and the Morgan Run Railways, and demanded of the said Morgan Run Railway Company to transport said cars to the point it had heretofore transported and placed them for the said Dennis, and on the same terms, plaintiff in error refused. The complainants asked for an order to secure the placing of the cars.
    For its first defense the company admits its corporate existence and alleges that it is now operating a railroad extending from a connection with the Wheeling & Lake Erie in Lafayette township, Coshocton county, for a distance of a little less than one mile to the township line between Lafayette township and Tuscarawas township; that it is engaged in hauling and delivering cars to and from the Wheeling & Lake Erie to the tracks of The Morgan Run Coal & Mining Company at the township line named; and that from said intersection south to the mines of The Morgan Run Coal &' Mining Company the right of way and tracks are owned by the latter company. It admits that on or about the 24th of November, 1915, the heirs of

      Washington Burt conveyed the real estate described in the complaint to the complainants and that the complainants are operating a coal mine thereon, and denies every other allegation in the complaint.
    For a second defense it alleges that the coal mine of the complainants is what is commonly known as a country bank, or wagon mine, whereby the coal is dumped at the mouth of the mine on a platform, from which it is shoveled into wagons and hauled into the city of Coshocton; that in October, 1916, The Morgan Run Coal & Mining Company made a contract with complainants to purchase the entire output of their mine until the first day of April, 1918, at $1.50 for the run of mine coal delivered on board cars on the mine tracks of the coal and mining company; that at the time said contract was made it was the intention of the coal and mining company to put a siding from their main line at a point where it would be convenient for complainants; that the arrangement proved to be exceedingly inconvenient and about that time coal advanced sharply in price and complainants repudiated their contract and discontinued all work on the tramway leading to the sidetrack; that complainants have no facilities for loading into the railway cars at any point on the tracks of the coal and mining company and have no arrangement with the coal and mining company for the use of that company’s tracks; that in order to connect complainants’ mines with the track of the railway company it would be necessary to build about two miles of railway track, none of which has been done; and that when complainants repudiated their said contract, and stopped work on the necessary-grading for said tramway, the coal and mining company declined to submit to the further inconvenience of permitting the complainants to use their said tracks for loading purposes.
    For a third defense the railway company alleges that for some time past there has been a great dearth and shortage in the supply of cars and great inconvenience and expense would result in complying with the demands of complainants.
    In the reply the complainants allege that the railway company and the coal and mining company are owned by the same persons and have conspired together for the purpose of compelling the complainants to sell their coal to them at the price they would name, and that since the filing of this complaint the railway company has moved the portion of its tracks off the lands purchased from the heirs of Washington Burt in order that it might claim it had no tracks near the mines of the complainants.
    On the hearing the commission found that the railway company was operating as a common carrier the entire line of railroad owned by it and the coal and mining company, either or both, extending from the point of connection with the tracks of the Wheeling & Lake Erie Railway Company, at a point east of Coshocton known as Morgan Run, some three miles to the mines of the coal and mining company; and ordered it to furnish service as a common carrier and without discrimination to the complainants, and ordered it to connect and operate with the tracks now maintained the track abandoned without the consent of the commission, or provide at a point adjacent to its main track, near the point where the tracks cross the public highway at common grade, a suitable and adequate loading platform in lieu of the facility heretofore maintained adjacent to such abandoned track, or provide some other suitable means for the loading of complainant’s coal, and that it move said cars, from time to time, to the junction of the Wheeling & Lake Erie railway.
    An application for a rehearing was filed, which was overruled, and this proceeding is brought to reverse the order of the commission.
    By leave of court The Morgan Run Coal & Mining Company has been made a party to this error proceeding and has filed its cross-petition in error herein.

      Messrs. Booth, Keating, Pomerene & Boulger, for The Morgan Run Coal & Mining Company and The Morgan Run Railway Company.

      Mr. W. S. M err ell and Mr. J. B. Shepler, for defendants in error, John and Peter Ingham.
   Johnson, J.

The Morgan Run Railway Company was created and organized under the laws of Ohio in 1889 for the purpose of constructing and operating a steam railroad from Coshocton to Cambridge. Only a little over three miles of road has been constructed and operated. This extends from the junction with the Wheeling & Lake Erie railway up the Morgan Run valley to the mines of The Morgan Run Coal & Mining Company. It is contended by the plaintiff in error that the line of railroad from the junction with the Wheeling & Lake Erie to a point on the township line between two townships in Coshocton county is the property of the railroad, and that the tracks extending beyond that line are the property of The Morgan Run Coal & Mining Company. The railroad is one continuous line of road from the Wheeling & Lake Erie junction to its farthest end at the mines of the coal and mining company, with switches and turnouts to the several mines located on the way.

Since 1910, The Morgan Run Railway Company has had on file with the Public Utilities Commission a tariff covering rates from points which are now alleged to be on The Morgan Run Coal & Mining Company’s tracks, and has also filed a code of demurrage rules in which the station, “Morgan Run Mine, Ohio,” is shown, this point being also beyond the township line. The railway company has conducted its operation along the entire line of road.

The plaintiff in error, being so created, organized and operated, is a common carrier under obligation to serve the public without discrimination, and is amenable to the supervision of the Public Utilities Commission in the conduct of its business as such. State v. Hazelton & Leetonia Ry. Co., 40 Ohio St., 504; Scofield v. L. S. & M. S. Ry. Co., 43 Ohio St., 571; Adena Rd. Co. v. Pub. Serv. Comm., 92 Ohio St., 1, and Hocking Valley Ry. Co. v. Pub. Util. Comm., Id., 9.

The act creating the Public Utilities Commission, Section 487 et seq., General Code, defines the jurisdiction of the commission and prescribes the method of its exercise.

It is clear that the order of the commission, in so far as it affects the operation of the line owned and operated by the railway company, must be affirmed. The company has no right to make any of the discriminations complained of.

It is conceded that the controlling interest in the railway company and the coal company was owned by substantially the same persons, although in different proportions, and that the same person was president of both companies.

Some years ago the heirs of Washington Burt, deceased, sold to the railway company a 33-foot strip across a tract of land owned by them along the line on which the railway company was extending its tracks. The deed to the railway company for this strip contained the terms of an agreement by the company to construct and operate across the same a railroad with main track and necessary sidetracks, switches, turnouts, etc., and to secure to the grantors, their heirs and assigns, or anyone holding under them, equal'facilities with all other shippers for receiving and shipping freight. It provided that the grantors, their heirs and assigns, should have the right to build a railroad track or switch from the premises so conveyed to the premises now owned by them, and specifically set forth provisions for the furnishing of shipping 'facilities in connection therewith,

The railway company built its line of railroad across the 33-foot strip and extended it about a half mile beyond to a new mine of The Morgan Run Coal & Mining Company. John and Peter Ingham, the complainants before the commission, have acquired the rights of the Burt heirs in the land and in the agreement referred to. A loading platform was constructed along the public highway on the 33-foot strip for the loading of coal from wagons on to cars, and coal was, from time to time, transported by the railway company from that point to the Wheeling & Lake Erie at a fixed price per ton. The 33-foot strip was not connected with the portion of the line of railroad which is conceded to be the railway company property. It was near a portion of the line claimed by the coal company. Subsequently the strip was conveyed by the railway company to the coal company and the line of road was shifted therefrom to land of the coal company. The proceeding before the Public Utilities Commission grew out of the refusal of the railway company to continue the service which it had been rendering to the Ingham mines.

It is contended that the order of the commission requires the railway company to furnish facilities and operate a line on property not owned by it; that the commission has no jurisdiction to require one who is not a common carrier to act as such; and that the tracks which are located on the land of the coal and mining company are the private tracks of that company, over which the commission has no jurisdiction.

Section 523, General Code, provides that the commission shall have the same control over private tracks, so far as such tracks are used by common carriers in connection with a railroad for the transportation of freight, as it has over tracks of such railroad. Section 8990, General Code, requires all railroad companies to extend to all- persons receiving and shipping freight the same and equal opportunities. This statute is declaratory of the common law on the subject.

As we have shown, the railway company is, as to so much of the line of railroad as is owned or operated by it, a common carrier; and any arrangement made by it for the transportation of freight over its road in connection with private tracks is subject to the supervision of the commission.

Authorities are cited by plaintiff in error which show that courts have prevented the enforcement of orders, which, in their effect, operated to deprive persons of property without due process of law, or-that require work the expense of which would be out of proportion to any reasonably anticipated return. .

It is contended that the order of the commission in this case in effect requires -the railway company to extend its line over property which it does not own, to purchase equipment which it is unable to buy, and forces the coal company to grant the use of its land to the railway company for the benefit of a competitor.

While a railroad company’s property must be used by the company in the performance of its duty to the public, and in this behalf is subject to governmental supervision, beyond this it must be held to have the right to control its own affairs and to manage its business in its own way so long as it does not injuriously affect the public or exceed its charter powers. Matters of purely business policy must be left to the decision of the company, and except in unusual circumstances, the question whether it shall extend its lines to points not before reached, or engage in any additional enterprise, is one to be determined by its directors. Chicago, M. & St. P. Rd. Co. v. Wisconsin, 238 U. S., 491; Gt. Northern Ry. Co. v. Minnesota, Id., 340, and Atchison, T. & S. F. Ry. Co. v. Railroad Commission, 173 Cal., 577.

Now, in this case, there was a dispute as to whether the railway company was the owner of the entire line and equipment.

In the year 1917 The Morgan Run Railway Company filed with the State Tax Commission a statement, verified by the oath of its president, who was also president of the coal company, in which it is stated that the railway company was the owner of the lines in question, 3.48 miles in length, from the Wheeling & Lake Erie railway to the mines of the coal company.

But assuming for the purpose of this case that the Public Utilities Commission had no authority to finally adjudicate the question of title, and assuming, without deciding, that the coal company was the owner of the portion of the line which it claims, we are still confronted with the fact that the railway company insists on a plan of procedure which will result in the operation, exclusively for the coal company’s benefit, of all that portion of the line which is concededly owned by the railway company. As a common carrier, subject to the control of the state and its commission, the railway company denies to complainants the benefit of the provisions of Section 523, General Code, above set out. It must be noted that by the terms of that section it is not necessary that the railway company own the line. It is sufficient to give the commission jurisdiction that private tracks are used in common with the line of the railway company.

In W. C. Agee & Co. v. L. & N. Rd. Co., 142 Ala., 344, it was held that a railroad which serves business houses located along a spur track by delivering to them cars of freight, and cars to be freighted and shipped, is a common carrier with respect to the use it makes of the track, and is, as such, bound to treat the houses located along the track without discrimination, and cannot discontinue its service as to one and continue it as to others. In that case the answer averred that the track was owned by and was on the land of the complainants, and persons other than defendant, and that the car service thereon was not rendered by the railroad company as a common carrier. The court held that on the facts stated it was a common carrier.

In McCallum et al. v. Minneapolis & R. R. Ry. Co., 129 Minn., 121, the defendant company owned and operated a line of railroad, and also a number of connecting stub lines, the roadbed and ties of which were owned by a lumber company. The railway company owned the rails and fasteners, and laid the rails and maintained the tracks. It exacted a charge of one dollar per car, called track-age charge, in addition to the tariff rates for cars originating on the stub lines, except those of the lumber company. In holding such charge invalid, the court, after stating that it was contended that the lumber company was not a common carrier and not within the jurisdiction of the commission, say at page 124: “This is conceded. It is not a common carrier nor even a private carrier. It has a roadbed and ties but the defendant is the common carrier which exclusively operates over them. The suggestion is made that the result reached amounts to a confiscation of the property of the lumber company. The lumber company is not in this suit. It presents to the court no grievance. It and the plaintiffs sustain no contractual or other relations. And besides it is not injured. * * * The lumber company was not required to permit the use of its roadbed by others. The defendant railway company was not required to operate these stub lines as a common carrier. It was not required to run its cars in and take out the products of the plaintiffs. It undertook to operate these stub lines as a common carrier. Then it became entitled to reasonable transportation and service charges and was charged with-correlative duties. * * * We place our decision upon the ground that the defendant was a common carrier over the stub lines just as much as over its own main line.” The court further point out that a different holding might lead to abuses, and say: “The harm to be apprehended is far greater when there is a common ownership.”

In Bedford-Bowling Green Stone Co. v. Oman et al., 115 Ky., 369, the railroad company had a contract by which it operated over a switch owned by one of the parties, and the court say at page 379: “So far as this record shows, it exercises the same control and dominion over this line that it does over any other part of its system; and we think, by the terms of the contract in question, the switch, during the continuance of the contract in question, at least, becomes a part of the general system of the Louisville & Nashville Railroad Company. This being so, it can not lawfully refuse to receive and transport freight belonging to appellees to and from such reasonable points along the line at which they may lawfully ship or receive it. * * * ‘And they have no right to contract with a corporation or individual to give exclusive rights to transfer any commodity over any part of their line. * * * By accepting its charter the railroad company assumed obligations to the public.’ ”

Again assuming, for the purposes of this case, that the coal company owns the portion of the railroad claimed by it, and that the coal company itself made up the deficiency in the cost of operating the railroad, still the railway company has no right to make the discrimination found by the commission to be made. It is not a question as to the right of the railway company to take and use the lands or property of the coal company without consent and without compensation. It is a question as to the right of a corporation, having all the rights and subject to all of the duties and obligations of a common carrier, to operate its own line for the exclusive benefit of the coal company, and to use the coal company’s line over the coal company’s property with its consent to transport its coal to and over the railway company’s line, all to the exclusion of the general public or those who have the right to equal shipping privileges.

We therefore hold that as long as the railway company operates any portion of the railroad in question, it must do so without discrimination in favor of any shipper.

This is a small and unimportant railroad, whose operations are very limited, but the questions that are brought to the court for consideration are not limited. They affect every common carrier. If this company may arbitrarily select those whom it will serve, any company may do so.

The order of the commission will be modified so as to be effective over the line claimed by the coal company during such period as it is used by the railway company for the transportation of freight, and as so modified will be affirmed.

Order affirmed.

Nichols,. C. J., Wanamaker, Newman, Jones, Matthias and Donahue, JJ., concur.


author: Matthias, J.

text:
    Moor et al. v. Parsons et al.

      Judgments — Proceedings to open — Section 11632, General Code — Service by publication — Foreclosure — Bona fide purchasers unaffected, when — Section 11633, General Code — Claim of actual residence by defendant — Real property.

    1. The right granted under the provisions of Section, 11632, Gen-
    eral Code, to a party against whom a judgment or order has been rendered without service other than by publication in a newspaper, within five years after the date of the judgment, to have it opened and be let in to defend, is limited by the provisions of Section 11633, General Code, that the title to property which is the subject of the judgment or order sought to be opened, and which, by or in consequence of the judgment or order, has passed to a purchaser in good faith, shall not be affected by proceedings under the former section.
    2. Where, in an action to foreclose a mortgage the record whereof
    shows the proceeding valid and regular in all respects, a defendant was served by publication in complete conformity with the provisions of the statute applicable thereto, and the court found said defendant duly and legally served and in default, and, after finding the amount due on the mortgage claim, ordered said premises sold, and they were sold to a purchaser in good faith, the title so obtained will not be affected by an application of said defendant under favor of Section 11632, General Code. In that proceeding he cannot as against such purchaser assert the claim that he was in fact a resident of the state and by the exercise of due diligence could have been served with summons.
    (No. 15520
    —Decided May 14, 1918.)
    Error to the Court of Appeals of Lucas county.
    This action was filed in the common pleas court of Lucas county November 25, 1911, by Tammie Blood to foreclose a mortgage on certain real estate located in that county. The mortgage had been executed by Margaret Parsons who was deceased, and her sons, James P. Parsons, John W. Parsons and Lewis H. Parsons, having inherited the property, were made parties defendant in the said action, as were also certain holders of tax liens. Personal service was had upon John W. Parsons and Lewis H. Parsons, and was attempted to be secured upon James P. Parsons along with certain other defendants, summons for whom was returned by the sheriff indorsed with the statement that they “could not be found within Lucas county, Ohio.” Thereupon an affidavit in the form required by statute for the purpose of procuring constructive service was filed, which affidavit stated that the place of residence of James P. Parsons was unknown and could not with reasonable diligence be ascertained. Upon motion the court ordered that service by publication be made as provided by law. On January 22, 1912, the court found that the publication and proof were in all respects regular and according to law, and approved the same; that the defendants had been duly served with process; and that certain of the defendants, including James P. Parsons, were in default. It also found the amount due on the mortgage of plaintiff and upon the tax liens asserted in said action.
    The premises were ordered sold, and one parcel thereof was purchased by Fred O. Peak and the other by William H. Moor and Edmond Collins. The court found the sale had been in all respects regular and confirmed the same and ordered deeds to the purchasers.
    From the proceeds of the sale the costs and the amount due on plaintiff’s mortgage and the several tax liens were ordered paid, and one-third of the remainder was paid to John W. Parsons, one-third to Lewis H. Parsons, and the remaining one-third was held for the defendant James P. Parsons.
    On November 13, 1914, James P. Parsons filed a motion in said suit setting up that he was the owner of the undivided one-third of said premises and also held a mortgage on the same, and asked that the decree theretofore entered be vacated and that he be permitted to defend against the claims of the plaintiff and the cross-petitioners and also to prosecute his rights under the mortgage owned by him. The court of common pleas granted the motion with the condition that such order should not affect the title to any property which had passed to the purchasers in good faith by or in consequence of the former judgment and order of the court.
    James P. Parsons filed an answer and cross-petition setting up his claim, and also filed another cross-petition against William H. Moor, Fred O. Peak and Edmond Collins, the purchasers at the judicial sale, and they were served with summons as defendants in the case. He therein prayed that the sale of the property to them should be held for naught. The newly-made parties defendant demurred to the cross-petition, and the demurrer was sustained by the court of common pleas, and judgment rendered in favor of the plaintiff and the other defendants.
    Upon appeal the court of appeals overruled the demurrer to the cross-petition and, thereafter, upon hearing, said court found that service upon James P. Parsons was not valid and that the judgment against him was void, and ordered the same to be

      vacated and set aside. The court found, however, that the right of James P. Parsons to foreclose the mortgage set up by him was barred by the statute of limitations, and dismissed his cross-petition in so far as it sought a foreclosure of his mortgage. Thereupon William H. Moor, Edmond Collins and Fred O. Peak filed their petition in error in this court to reverse the judgment of the court of appeals.

      Mr. Edward H. Ray and Mr. Herbert P. Whitney, for plaintiffs in error.

      Mr. C. A. Thatcher; Mr. E. M. Beard; Mr. F. M. Dotson; Mr. J. J. Waldvogel and Mr. G. B. Keppel, for defendants in error.
   Matthias, J.

The plaintiffs in error are the purchasers of property which was sold by the sheriff pursuant to an order of court upon foreclosure of mortgage. They were not parties to that suit. Nearly three years thereafter one of the defendants in that action, James P. Parsons, filed his motion therein, under favor of Section 11632, General Code, and asked that the judgment in that case be opened and that he be let in to defend.

The question of prime importance in this case is presented by the demurrer of these purchasers to the cross-petition filed by James P. Parsons after his motion had been granted, wherein they were made parties. That question is whether the title of said property, having passed to these purchasers, who were purchasers in good faith, in consequence of such judgment, can be divested or affected by the proceeding under Section 11632, General Code.

The court of common pleas held that it could not, and, although that court granted the application of the plaintiff, it did so with the express condition that such order should not affect the title to any property which had passed to the purchaser in good faith by or in consequence of the former judgment or order of the court; and thereafter that court sustained the demurrer of the purchasers to the cross-petition of James P. Parsons.

The court of appeals took the opposite view and admitted evidence upon the question as to the regularity of service by publication upon James P. Parsons, and found that at the time publication was had he was a resident of the city of Toledo, Lucas county, and that his place of residence therein could have been ascertained by the exercise of reasonable diligence, and service of summons had upon him.

Section 11633, General Code, provides that the title of property which is the subject of the judgment or order sought to be opened, and which, by or in consequence of the judgment or order has passed to a purchaser in good faith, shall not be affected by proceeding under the next two preceding sections.

There is no question but that the record in this case at the time of the sale of said premises showed the proceedings valid and regular in every respect. It was there disclosed that every requirement of the statute relative to service by publication had been fully complied with. Indeed, more was done than is required by the letter of the statute, in that a summons had been issued for James P. Parsons directed to the sheriff of Lucas county and returned by the sheriff with the statement that he could not be found in that county, and in that the trial court ordered service to be made by publication as provided by law and thereafter found that service by publication had been made in all respects in accordance with law, and approved the same.

The court of appeals took the view that because the evidence submitted to it disclosed that James. P. Parsons was a resident of Lucas county, and could have been served with summons, he was not rightfully served by publication as mentioned in Section 11632, General Code, and, therefore, that the restrictive provisions of Section 11633 would have no reference or application to him.

It is well settled that it is competent for each state to prescribe the mode of bringing parties before its courts, and that the legislature may prescribe such modes of judicial procedure as it may deem proper, and also direct the manner of service of process, and may declare also the effect of a judgment rendered in pursuance of such notice. Judgments rendered upon constructive service in accordance with the requirements of the statute are conclusive upon the parties until set aside by some direct proceeding for that purpose. It is true that strict compliance must be had with the provisions of statute authorizing other than personal service, and such must affirmatively appear.

Section 11292, General Code, authorizes service by publication in an action for foreclosure of a mortgage “when the defendant is not a resident of this state or his place of residence cannot be ascertained.”

Section 11293, General Code, requires that before service by publication can be made an affidavit must be filed that service of summons cannot be made within this state on the defendant sought to be served, and that the case is one of those mentioned in the preceding section. Under these provisions, therefore, in the actions in rem mentioned therein, service may be made by publication upon a defendant whose place of residence cannot be ascertained, although he may be in fact a resident of the state. It follows that a judgment rendered upon such service, where the record shows that all the requirements of the statute have been complied with, and the proceedings are in all respects regular, is not void.

The question we have here was given some consideration by this court in the case of Hammond v. Davenport et al., 16 Ohio St., 177. In that case it was held that where it was alleged in the petition that part of the defendants to such action were nonresidents of the state, and the court thereupon ordered the giving of notice to them by publication, and such publication was made and approved, and the court decreed a sale of the land, and pursuant thereto a sale in all respects regular was made to a bona fide purchaser, the defendants on whom no service of process was had, otherwise than by publication, would not be allowed, in a collateral proceeding and for the purpose of invalidating the title acquired under the decree and sale, to draw in question the jurisdiction of the court rendering the decree, by proving that at the commencement and during the pendency of the proceeding they were in fact residents of the state. The importance of this decision in the present controversy lies chiefly in the fact that it has been determined in this jurisdiction that such a judgment is not absolutely void. The court suggests in that case that there was no necessity for an order of publication, but that such action of the court was invoked and the order was made. That observation applies to the case under consideration. In that case, as in this, the sheriff returned the process “not served,” and, after proof of publication, the court proceeded to exercise jurisdiction in the case. From these facts, the court, while acknowledging the difficulty of the question presented, concluded that “overmastering considerations of public policy require that opposing consideration should yield, and that such a decree should be held free from liability to indirect attack.” But the court rested its conclusion, as it stated, not “solely upon general considerations of public policy, irrespective of express declarations of legislative will,” and after quoting the statute as then in force, which is substantially the same as Sections 11632 and 11633, supra, the court makes this very pertinent observation, which seems conclusive of the matters in controversy in the instant case: “Now, it would seem that the holders of title to the real estate in controversy, deriving title thereto 'by/ and hn consequence of’ the decree in question, are ‘bona fide purchasers.’ There is nothing in the record, either by way of allegation or proof, to the contrary; and it seems to me that the indications of legislative policy, in respect to such purchasers, shining out from the face of this section of the statute, are too plain to be mistaken, and ought to be decisive of a question which, on other grounds, might, perhaps, be doubtful. For if, when a decree is opened up, and parties, served by publication only, and having had no actual notice are permitted to defend, the title of bona fide purchases on the faith of the decree is held inviolable, a fortiori ought the same inviolability to hold in favor of a like purchaser, where the decree is collaterally assailed on the same ground, and for the sole purpose of invalidating his title under it.”

It was held in the case of Winemiller v. Laughlin et al., 51 Ohio St., 421, that a junior mortgagee who had been served by publication could not in a subsequent proceeding against a bona fide purchaser of the premises sold in the former action attack the judgment or order upon which the premises were sold, upon the ground that she was at the time service by publication was had upon her in that case in fact a resident of the state; that the judgment was not void as against the grantee of the purchaser of said premises and was therefore not open to collateral attack by her in the face of a finding by the court of common pleas that she had been legally served by publication, the court having capacity to determine in the first instance its own jurisdiction.

To the same effect is the decision of C., S. & C. Rd. Co. v. Village of Belle Centre, 48 Ohio St., 273.

As in that case the judgment was held not void on the ground that there was in fact no service at all even though the defendant was a resident of the state, so in this case the judgment is not void as against purchasers in good faith on the ground that the place of residence was in the state and could have been ascertained.

We have heretofore seen that in the case under consideration there had been strict compliance with every requirement of the statute providing for constructive service, so that when the premises involved therein were offered for sale there was nothing whatever upon the record of the case which indicated any irregularity in the proceeding, but upon the contrary the same appeared regular in all respects. Defendant Parsons sought the favor and benefit of Section 11632, General Code. Undoubtedly the right was conferred upon him by that section to proceed as he did in this case, but the right there conferred carried with it the limitation imposed by the succeeding section, that the title to property which by reason of the judgment had passed to bona fide purchasers should not be disturbed. The contention that the provisions of Section 11633, General Code, have no application except in a proceeding instituted by a defendant whom the proof in the subsequent hearing shows was in fact a nonresident of the state, or if a resident thereof could not have been found, begs the question entirely. Defendant was a party, served only by publication, and on that ground he sought the favor of Section 11632. The benefits thereby conferred are limited by the provisions of Section 11633, and the defendant cannot enjoy the beneficial provisions of the one, freed from the restrictions imposed by the other.

Counsel for defendant Parsons rely upon the decision of this court in the case of Kingsborough v. Tousley et al., 56 Ohio St., 450. That was an action upon a personal judgment, and it was held that the defense, though in contradiction of the record, that the defendant was not served with process or jurisdiction of his person otherwise obtained by the court rendering the judgment, was competent, because it was not a collateral impeachment but in the nature of a direct attack upon the judgment. In our opinion the conclusion of the court in that case has no application whatever here, for the reason that the suit there under consideration was between the same parties as the original action and no question of rights of bona fide purchasers or other third parties was involved.

It is quite apparent, we think, even in an attack in the original action, as in the case before us, that the impeachment is collateral so far as it is sought to affect others than parties to the record. Undoubtedly, in the Kingsborough case, the court had this distinction in mind when it used the following language at page 458: “The rule which forbids the collateral impeachment of judgments is founded on those considerations of public policy which require stability of judicial records for the protection of those who acquire rights and property in reliance upon their conclusive effect, and for the

peace of society; and, as said by Read, J., in Boswell v. Sharp, 15 Ohio, 447, 465, ‘seems to have been adopted from right and necessity, to give confidence to the judicial action of the country, and protect those who have made purchases on the faith of judicial sales.’ It is obvious these reasons find no just application in an action brought upon the judgment, in which the only relief sought is a new recovery on it, as a debt of record; and where no rights of third persons have intervened, or are involved.”

Nor were the rights of third parties involved in the case of Haley v. Hanna et al., 93 Ohio St., 49, and hence the decision in that case can have no application here. We think it clear that Section 11633 has the effect of limiting the rights which are conferred upon defendant by Section 11632, and that he takes those rights with the limitation therewith imposed, and that under the circumstances disclosed in this case he is entitled to no order that will affect the title of the plaintiffs in error. .

We cannot reconcile our views with those announced by the supreme court of Nebraska in the case of Herman v. Barth, 85 Neb., 722, and cases there cited construing similar provisions much relied upon by counsel for the defendant in error.

The court of appeals was correct in its finding that defendant Parsons’ right of foreclosure was shown to have been barred by the statute as against these parties. (Hopkins v. Clyde, Admr., 71 Ohio St., 141.) And therefore his only interest was as an owner of the undivided one-third of the mortgaged premises.

It is possible that the application of the provisions of the statutes above.considered may work a hardship in some cases, but it, is difficult, if not impossible, to frame remedial statutes which may not sometimes have that effect.

On the other hand, as has been pertinently suggested, if these statutes be not construed and applied as above indicated, service by publication, though specifically authorized by statute, would place a cloud Upon every title which passes through a proceeding wherein any parties are so served, and the title and tenure of the purchaser would be doubtful and uncertain. The result would be that a prospective purchaser at any such sale must not only take notice of disclosures made by the record, but must, at his peril, ascertain whether the record speaks the truth. He would be required to assume the burden of conducting an independent investigation for the purpose of finding whether each defendant served by publication was or was not a resident of the state; and, if not, whether his place of residence could by reasonable diligence have been ascertained — determining in each case the extent of care necessary to meet the test of reasonable diligence. The same obligation would devolve upon grantees of bona fide purchasers at such sales. These considerations must have influenced the enactment of Section 11633, General Code, and the imposition of the limitation therein specified upon the remedy afforded by Section 11632.

The judgment of the court of appeals is reversed and judgment is entered for plaintiffs in error.

Judgment reversed.

Wanamaker, Newman, Jones and Donahue, JJ., concur.

Nichols, C. J., dissents.


author: By the Court.

text:
    The City of Cincinnati et al. v. Rogers, a Taxpayer.

      Municipal corporations — Rapid transit system — Authority of commission to employ legal counsel and fix compensation — Section 4000-18 et seq., General Code (106 O. L., 286).

    (No. 15722
    Decided June 11, 1918.)
    Error to the Court of Appeals of Hamilton county.

      Mr. Charles A. Groom, solicitor of the city of Cincinnati; Mr. Saul Zielonka, assistant city solicitor, and Messrs. Dinsmore & Shohl, for plaintiffs in error.

      Mr. Powel Crosley, for defendant in error.
   By the Court.

The defendant in error brought a suit in the common pleas of Hamilton county against the city of Cincinnati, its board of rapid transit commissioners, its city auditor, city treasurer, and Frederick S. Spiegel.

The petition alleges that the rapid transit commissioners on May 19, 1916, adopted the following resolution: “Resolved, That Frederick S. Spiegel be appointed Counsel for this Commission, as provided in Sec. 4000-18, of an Act passed by the Legislature, Volumes 105-106, page 287, at the rate of $5,000 per annum, to be effective on and after June 1st, 1916, subject to the pleasure of the Boardthat said resolution providing for the payment of the salary named is without authority in law and that the payment thereof would be a misapplication of the funds of the city. The petition contains the necessary averment with reference to the request to the city solicitor to bring the suit and his refusal to do so.

Defendants admit the passage of the resolution and the request made of the solicitor to bring the suit referred to. They allege the creation of the rapid transit commission ,in pursuance of the statute known as the Bauer Law, 106 Ohio Law, 286, and aver that the necessary steps were taken to authorize the issuing of bonds for the purpose of providing funds for the construction of a rapid transit railway system and for the purchasing and condemning of the necessary land therefor.

The plaintiff filed a general demurrer to the answer, which was overruled by the court, and plaintiff not desiring to plead further judgment was entered in favor of the defendants. On error this judgment was reversed by the court of appeals and error is now prosecuted to this court.

Defendant in error contends that Section 4214, General Code, provides the necessary steps that must be taken to authorize the payment of the compensation to employes of the city.

The plaintiffs in error insist that by the provisions of the rapid transit act, (106 Ohio Laws, 286), the board of rapid transit commissioners was vested with full authority to act in the premises and to employ counsel and fix his compensation. The pertinent portion of Section 4214, General Code, is as follows: “Except as otherwise provided in this title, council, by ordinance or resolution, shall determine the number of officers, clerks and employes in each department of the city government, and shall fix by ordinance or resolution their respective salaries and compensation, and the amount of bond to be given for each officer, clerk or employe in each department of the government, if any be required.”

The pertinent portion of Section 3 of the rapid transit act is as follows: “The board of rapid transit commissioners may employ clerks, engineers, superintendents and such other employes as may be necessary. * * * The superintendents, clerks, engineers, real estate experts, and attorneys of the board shall be in the unclassified service and all other employes shall be in the classified civil service of the municipality.”

It is contended, first, that there was no authority for compensation to an attorney employed by the board of rapid transit commissioners; second, that the board of rapid transit commissioners abused its discretion in employing an attorney, because of the fact that there is a solicitor for the city of Cincinnati.

Section 5 of the rapid transit act includes the following: “The board of rapid transit commissioners shall have control of the expenditure of all moneys appropriated by the city council or received from sale of bonds provided for in this act or from any other source whatever, for the purchase, construction, improvement, maintenance, equipnient or enjoyment of all such rapid transit property.” •

It is clear that in the act referred to the general assembly has endowed the board of rapid transit commissioners with comprehensive powers to establish and construct a rapid transit system in the municipality. An independent proceeding has been created to be conducted by a separate and independent commission for the construction of the system referred to. ‘

It will be observed, that, by the provisions of Section 4214 quoted, it-is provided that the council shall determine the number of officers, clerks and employes in each department of the city government, and shall fix, by ordinance or resolution, their respective salaries or compensation. But by Section 4000-18, General Code, which is Section 3 of the rapid transit act, it is provided that the board of rapid transit commissioners may employ clerks, engineers, superintendents and such other employes as may be necessary. This provision, as pointed out, is included in an independent act passed subsequently to Section 4214, and for the specific purposes pointed out.

The provision in Section 4214, General Code, with reference to the fixing of compensation by council, relates to the compensation of the officers, clerks and employes which the council had by its resolution determined there should be.

The provisions of Section 3 of the rapid transit act confer upon the rapid transit commissioners the power to employ clerks, engineers, superintendents and such other employes as may be necessary. There is no requirement that council shall first determine' the number of officers, employes, etc., to be employed by the board. The board determines that matter for itself. The necessary implication from this provision is that having given the board power to engage the employes referred to, it had the power to fix their compensation, and the provisions of Section 5, above quoted, sustain us in this view.

We see no reason in the circumstances of this case to hold that the board abused its discretion in the employment of counsel. The wisdom of securing the assistance of counsel appointed by itself to assist in the manifold responsible duties imposed by the statute is clear.

For these reasons we think the judgment of the court of appeals should be reversed.

Judgment reversed.

Nichols, C. J., Newman, Johnson and Donahue, JJ., concur.


author: Newman, J.

text:
    The State, ex rel. The Ohio Hair Products Co., v. Rendigs, Building Commissioner.

      Municipal corporations — Police power — Obnoxious business prohibited— In residence districts — Constitutional law — Impairment of contracts and retroactive legislation — Building permit — Revocation after ordinance enacted —Mandamus to compel reissue.

    1. Ordinance No. 457 —1917, enacted by the council of the city of Cincinnati, October 2, 1917, forbidding the erection or use of buildings in the residential districts of the city of Cincinnati for the storage, cleaning or renovation of uncured animal hair and the by-products thereof, is not unreasonable nor arbitrary and is a valid exercise of the police power.
    2. A building permit issued by the building commissioner of the city of Cincinnati for the erection of a building and factory for the purpose of buying, selling, processing and manufactur- ► ing the hair of animals and packing-house by-products is not ■protected by the constitutional prohibition as to the impairment of the obligation of contracts.
    (No. 15782
    Decided June 11, 1918.)
    In Mandamus.
    This is a proceeding in mandamus instituted in this court and was submitted upon the pleadings and the evidence, the testimony of the witnesses having been taken before a special master commissioner.
    The relator is a corporation organized for the purpose of buying, selling, processing and manufacturing the hair of animals and packing-house by-products, and is located in the city of Cincinnati where its principal business is transacted. Defendant is the duly appointed, qualified and acting building commissioner of the city of Cincinnati, Ohio.

      On or about September 1, 1917, the relator, having in view the erection and construction of a proper and necessary building and factory for the purpose of carrying on its business, procured to be made sketchings and drawings thereof which were ’submitted to the defendant preliminary to the preparation and submission of final plans and specifications. These preliminary plans and specifications were approved by the defendant and there was issued to the relator a temporary permit authorizing it to proceed with the excavation for the building. After the issuance of this temporary permit relator acquired a tract of land upon which to' erect its building and factory, situated at the southeast corner of Dane street and Chase avenue in the city of Cincinnati. On or about September 20, 1917, there was submitted to the defendant the final plans and specifications of said proposed building and factory, and on or about September 24, 1917, the defendant, as building commissioner, issued to the relator his permit to proceed with the erection of the building and factory according to the final plans and specifications. Immediately thereafter relator entered into certain contracts for the erection of its building and factory, and the contractors entered upon said work and proceeded therewith until on or about October 4, 1917, when the defendant, as building commissioner, without authority and in violation of law, according to the allegations of the petition, revoked his permit, and refused to again issue the same, although requested so to do, and ordered the relator not to proceed with said work. It is averred in the petition that the relator has complied with all the laws and ordinances of the city of Cincinnati in force at the time of the submission of the final plans and specifications to the defendant, and that the same are in accordance therewith. It is further averred that upon the revocation of said permit the relator was required to and did cease the further prosecution of the work of construction upon its building and factory and has suffered great injury and damage by reason of said revocation; that it will suffer further and great irreparable injury unless the defendant be required and is compelled to reissue said permit; and that it is without any plain and adequate remedy in the ordinary course of the law. The prayer of the petition is that a writ of mandamus issue commanding the defendant as building commissioner of the city of Cincinnati, Ohio, to issue his building permit to the relator as of the date of September 24, 1917, authorizing it to proceed with the erection and construction of its building and factory in accordance with the plans and specifications theretofore by it submitted to him.
    Defendant in his answer admits that the relator is a corporation organized for the purposes set out in the petition and that the permits were issued to it as alleged in the petition.
    He avers that on or about September 20, 1917, a written protest of the owners of the property in said section of said city was filed with the defendant against the erection of the building proposed to be erected by the relator, and on September 25, 1917, there was introduced in the council of the city of Cincinnati an ordinance as follows: “Section 452-1. No building shall be erected or used for the storage, cleaning or renovation of uncured animal hair or any of the by-products thereof, or for the manufacture of any combination of the same requiring the use or handling of animal substances emitting noxious odors, gases, or volatile substances, upon any land or property abutting any public street, alley or natural boundary such as streams of water, well-defined ravines or railway rights of way in the city of Cincinnati, which form any part of a boundary of a residential block or square as defined by section 452 of the code of ordinances of the city of Cincinnati.”
    This ordinance was referred by the council of said city to the committee on health of said council, and on September 27, 1917, a public hearing was had upon said ordinance by this committee. It is averred that said committee made an investigation of and visited places of business where buying, selling, processing and manufacturing of the hair of animals and packing-house by-products was prosecuted, and reported to the council of said city, as a result of said public hearing and said investigations and visits, that in all of said places of business noxious odors, gases and volatile substances are emitted. On' October 2, 1917, said ordinance was duly passed. Section 452 of the code of ordinances of the city of Cincinnati is as follows: “Block Restriction. — No reservoir for the storage of an inflammable, explosive or odorous gas, blacksmith shop, foundry, packing-house, rendering plant, soap factory, tannery, brewery, distillery, grain elevator, ice house, junk shop, laundry or any building, tipple or plant for the handling or distribution of coal or coke, shall be erected in any residence block, or residence square. For the purposes of this section a block or square shall be a section of land bounded by three or more public streets or alleys or -natural boundaries, such as streams of water, well-defined ravines or railway rights of way; and a residence block or residence square shall be a block or square in which more than sixty per cent, of the surface of the land contains buildings or premises used for residence purposes, and a building shall be deemed used for residence purposes when a majority of the floor space of such building is used for residence purposes.”
    It is further averred that the building proposed to be erected by the relator for the uses and purposes set forth in its petition is upon land abutting two public streets in the city of Cincinnati, viz., Chase and Dane avenues, and that Chase and Dane avenues form a part of the boundary of a residential block or square as defined by said Section 452 of the code of ordinances of the city of Cincinnati; that on October 2, 1917, the council of said city of Cincinnati passed a resolution by which the building commissioner was ordered to rescind the permit which he had given for the erection of the building; and that on October 4, 1917, the defendant in accordance with said resolution and ordinances canceled the building permit theretofore issued by him.
    In the reply of the relator it is admitted that the ordinance referred to in the answer was duly enacted by the city council; that said resolution was duly passed and that the defendant canceled and revoked the building permit theretofore issued by him. There is a denial of each and every other allegation contained in the answer.

      Mr. Chas. H. Urban and Mr. Geo. B. Okey, for relator.

      Mr. Charles A. Groom and Mr. Saul Zielonka, city solicitors; Mr. Frank K. Bowman, assistant city solicitor, and Mr. Timothy S. Hogan, for defendant.
   Newman, J.

The relator is asking this court to issue a writ of mandamus compelling the defendant to reissue the building permit to erect its building and factory, which it claims was revoked without authority and in violation of law. The defendant in justification of the revocation and of his refusal to reissue the permit relies upon the provisions of the ordinance of October 2, 1917. It is admitted that this ordinance was duly enacted. The motive, therefore, which induced council to enact it is not a subject of inquiry here. This ordinance prohibits the erection or use of a building for the storage, cleaning or renovation of uncured animal hair, or any of the by-products thereof, or for the manufacture of any combination of the same requiring the use or handling of animal substances emitting noxious odors, gases or volatile substances, upon any land or property abutting any public street, alley, or natural boundary, such as streams of water, well-defined ravines or railway rights of way in the city of Cincinnati, which form any part of the boundary of a residential block or square as defined by Section 452 of the code of ordinances of the city of Cincinnati. The building proposed to be erected by the relator is upon land abutting Chase and Dane avenues, and these avenues form a part of the boundary of a residential block as defined by Section 452 of the code of ordinances of the city of Cincinnati.

The validity of the ordinance of October 2, 1917, is challenged by the relator. The presumption, of course, is in favor of its validity, and it is therefore incumbent upon the relator to show that the action of the council of the city of Cincinnati in the enactment of the ordinance in the exercise of the police power is clearly unreasonable and arbitrary. It is conceded by counsel that the guaranties contained in our Bill of Rights and in the Fourteenth Amendment to the Constitution of the United States were not designed to interfere with the police power of the state in the protection of the lives, liberty and property of its citizens and in the promotion of their health, morals, education and good order. But it is urged that this power has its limitations and must stop when it encounters the prohibitions of the constitution, and the claim is made that this is a case where a municipality in the exercise of the police power is attempting to override the constitutional guaranties in order to prevent the completion of a building in process of erection for a business not a nuisance per se, in order to satisfy the demands of a few people,

In the well-known case of Mugler v. Kansas, 123 U. S., 623, which involved the constitutionality of the law of Kansas prohibiting the manufacture or sale within the limits of that state of intoxicating liquors for general use there as a beverage, it is said that under our system there is lodged with and there belongs to the legislative branch of the government the power and authority to exert what are known as the police powers of the state, and to determine, primarily, what measures are appropriate or needful for the protection of the public morals, the public health or the public safety. In the General Code of this state there is an enumeration of powers conferred upon municipal corporations, and the councils of these corporations are authorized to. provide by ordinance or resolution for the enforcement or exercise of them. Among the powers conferred — under the head of health and sanitation — is the following: “Section 3650. To cause any nuisance to be abated, to prosecute in any court of competent jurisdiction, any person or persons who shall create, continue, contribute to or suffer such nuisance to exist; to regulate and prevent the emission of dense smoke, to prohibit the careless or negligent emission of dense smoke from locomotive engines, to declare each of the foregoing acts a nuisance, and to prescribe and enforce regulations for the prevention thereof; to prevent injury and annoyance from the same, to regulate and prohibit the use of steam whistles, and to provide for the regulation of the installation and inspection of steam boilers and steam boiler plants,”

A municipality under the provisions of this section is authorized to regulate and suppress all places that in its judgment are likely to be injurious to the health of its inhabitants or to disturb the people living in the immediate neighborhood by offensive odors. In Fisher v. St. Louis, 194 U. S., 361, 370, Mr. Justice Brown uses this language: “The power of the legislature to authorize its municipalities to regulate and suppress all such places or occupations as in its judgment are likely to be injurious to the health of its inhabitants or to disturb people living in the immediate neighborhood by loud noises or offensive odors, is so clearly within the police power as to be no longer open to question.”

In the instant case, the determination of the question whether or not the ordinance was reasonably necessary for the protection of the health and comfort of those within the locality in question was committed in the first instance to the judgment of the municipal authority. If, in the exercise of the discretion conferred upon it, the municipality acted reasonably, and not arbitrarily, its action is not subject to objection and will not be disturbed.

The business which is proposed to be carried on by the relator is that of buying, selling, processing and manufacturing the hair of animals and packjing-house by-products. This business is prohibited at the place where the relator proposes to carry it on. After the ordinance was introduced in council it was referred to the committee on health, and a public hearing was had by this committee, and it visited places of business in the city of Cincinnati where the buying, selling, processing and manufacluring of the hair of animals and packing-house by-products was prosecuted. As a result of this public hearing and the investigation the committee reported that in such a business noxious odors, gases and volatile substances were emitted, and upon its recommendation the ordinance was passed, council thereby declaring in effect that the business in which the relator was about to engage was offensive and unwholesome. We do not think it can be said that council abused the discretion conferred upon it and that it acted arbitrarily. In the case of Cusack Co. v. Chicago, 242 U. S., 526, 531, Mr. Justice Clarke uses the following language in reference to the power of local legislative authority in the exercise of the police power, which, we think, is pertinent here: “It [the court] will interfere with the action of such authority only when it is plain and palpable that it has no real or substantial relation to the public health, safety, morals, or to the general welfare.” It is suggested by counsel that the evidence of the relator shows that by the modern method to be used by it in the curing of animal hair no offensive odors will escape to the surrounding atmosphere. We do not think that this is material here. It appears from the evidence and from the investigation of the committee in council that the business in which the relator proposes to engage produces disagreeable and unwholesome odors, which interfere with the comfort, and are more or less injurious to the health, of the community where the business is located. We agree with counsel for defendant that the only issue, aside from- the power to enact the ordinance, is whether the class of business sought to be restrained is such as may in good faith be deemed a nuisance within the limit of restraint. We are therefore constrained to hold that it has not been made to appear that the action of council in the enactment of the ordinance had no real or substantial relation to the public health or comfort and that it acted unreasonably or arbitrarily.

The ordinance in question was enacted after the permit was issued to the relator'. The further claim is made that the relator having expended considerable money in the purchase of land and material, and having entered into certain contracts for the erection of the building, and the building being in course of construction, acquired certain vested rights which could not be affected by the ordinance — that the ordinance could not be retroactive. It is not necessary to devote much time to this proposition, for it seems to be well settled that a permit such as was issued in this case has none of the elements of a contract, and may be changed or entirely revoked, even though based on a valuable consideration, if it becomes necessary to do so in the exercise of a legislative power on subjects affecting the public health or public morals. Cooley on Constitutional Limitations, 283; Beer Co. v. Massachusetts, 97 U. S., 25; Fertilizing Co. v. Hyde Park, Id., 659; Butchers’ Union Slaughter-House & Live-Stock Landing Co. v. Crescent City Live-Stock Landing & Slaughter-House Co., 111 U. S., 746; New Orleans Gas Co. v. Louisiana Light Co., 115 U. S., 650; Moore v. Indianapolis, 120 Ind., 483, and Dobbins v. Los Angeles, 139 Cal., 179. In the Dobbins case, which is similar to the one under consideration here, 'it was held: “The fact that the plaintiff had lawfully commenced it's work by purchasing land for a site within the limits allowed by the original ordinance, and had expended money in laying a foundation, and had entered into contracts for the erection of its works, and had secured a building permit from the fire commissioners in pursüance of fire and building ordinances, cannot estop the city from the further exercise of its police power to change the limits so as to make the erection and maintenance of such gas-works unlawful where begun and existing within the changed limits.”

This is a proceeding in mandamus and it has been repeatedly held that the right of the relator to a writ must be clear and there must be shown a plain dereliction of duty on the part of the officer. We think the relator has failed to establish its right to the writ and the same must be refused.

Writ refused.

Jones, Matthias, Johnson and Donahue, JJ., concur.


text:
    The Board of County Commissioners of Wyandot County v. Boucher.

      Negligence — County commissioners — Public highways — Failure to erect guardrails — Perpendicular wash banks — Sections 7563 and 7565, General Code.

    (No. 15725
    —Decided June 11, 1918.)
    Error to the Court of Appeals of Wyandot county.

      Mr. F. J. St alter and Mr. D. C. Parker, for plaintiff in error.

      Mr. Benjamin Meek; Mr. Chester A. Meek and Mr. J. S. Hare, for defendant in error.
   By the Court.

This case originated in the common pleas court of Wyandot county where defendant in error brought an. action against the plaintiff in error to recover damages on account of personal injuries. It was alleged in the petition, in substance, that there was a public highway in Wyandot county running east from Upper San-dusky, which highway ha'd adjacent thereto in an unprotected condition a perpendicular wash bank more than eight feet high having an immediate connection with the highway, and that plaintiff in error had carelessly and negligently failed and omitted to protect by suitable guardrails or otherwise this perpendicular wash bank. The claim was made by defendant in error that while riding in his automobile over and upon this public highway, along where the wash bank was adjacent thereto and had immediate connection therewith, his automobile skidded toward said wash bank, and, for the want of suitable guardrails or other protection, the automobile ran down said bank, turned over, and he received certain injuries for which he asked damages.

The case was submitted to a jury upon the pleadings and the evidence and resulted in a verdict for plaintiff in error. A motion for a new trial was overruled and judgment was rendered on the verdict. Error was prosecuted to the court of appeals and the judgment of the common pleas court was reversed for errors in the admission of evidence and in the charge of the court, and the cause was remanded for a new trial. Upon application of plaintiff in error the court of appeals was directed to certify its record to this court.

The right of defendant in error to recover in this action, if at all, is by force of the provisions of Sections 7563 and 7565, General Code. Section 7563 provides, among other things, that the board of county commissioners shall protect, by suitable guardrails, all perpendicular wash banks more than eight feet in height, where such banks have an immediate connection with a public highway, or are adjacent thereto, in an unprotected condition; and under the provisions of Section 7565 the county is made liable for all accidents or damages as a result of the failure to comply with the provisions of Section 7563. Section 7563, being in derogation of the common law, is not to be extended beyond the plain meaning of its terms. The Board of County Commissioners of Franklin County v. Darst, 96-Ohio St., 163.

Section 7563 does not require the county commissioners to protect by suitable guardrails all wash banks more than eight feet in height — those to be protected are perpendicular wash banks. Assuming for the purposes of this case that the bank in question is a wash bank, it appears from the evidence that its slope was made a foot and one-half to the foot and its declivity was of an angle of approximately forty-five degrees, which is certainly not a perpendicular bank within the plain meaning of that term as used in the section under consideration. We are constrained to hold, therefore, that the statute upon which defendant in error relies for a recovery has no application here and that the judgment of the court of common pleas was correct.

Judgment of the court of appeals reversed and that of the court of common pleas affirmed.

Nichols, C. J., Newman, Jones, Matthias and Johnson, JJ,, concur,


text:
    The Frisbie Company v. The City of East Cleveland.

      Municipal corporations — Contracts — Validity — Statutory powers and procedure control — Failure to advertise for bids — Section 2419, Revised Statutes — Waterworks —Agreement to reimburse private corporation — Installing system in its allotment — Action for cost of construction — Invalidity of contract as de fense by city — Implied liability and damages for conversion— Public officers — Notice of powers and restrictions.,

    1. Where a statute prescribes the mode of exercise of the power therein conferred upon a municipal body, the mode specified is likewise the measure of the power granted, and a contract made in disregard of the express requirements of such statute , is not binding or obligatory upon the municipality.
    2. No valid obligation is imposed upon a municipality by a contract entered into by its waterworks trustees in 1902 for the construction of an addition to the waterworks system of the municipality at a cost in excess of $500 without advertising for bids as then required by Section 2419, Revised Statutes.
    3. Where a company, owning an allotment within a municipality, pursuant to permission procured by it from the waterworks trustees thereof, laid water mains in the streets of such allotment, the estimated and actual cost of which was in excess of $500, and connected same with said waterworks system under the control and management of said trustees who had agreed to repay the money so expended by said company when the rental of such lines should equal 10- per cent, of the cost of construction, if in funds applicable thereto, the municipality is not estopped to set up a violation of the statute, requiring advertisement for bids, as a defense to an action to recover on such contract.
    4. No implied liability arises against the municipality from the use of said water pipes in supplying water to residents in such allotment, nor can an action in damages for conversion be maintained against it.
    5. It is incumbent upon persons dealing with public officers to ascertain whether their proposed action falls within the scope of their authority, and whether the requirements of law affecting a contract proposed tó be entered into have been complied with.
    (No. 15732
    —Decided May 14, 1918.)

      Error to the Court of Appeals of Cuyahoga county.
    The Frisbie Company seeks to recover from the city of East Cleveland the sum of $19,815.78, which it claims is due it by virtue of three several contracts entered into by said company with the board of waterworks trustees of the then village (now city) of East Cleveland, whereby it was agreed that the plaintiff should lay water mains .in the streets of three allotments owned by it, arid that when water rents received by the village of East Cleveland from the users of water on said streets should equal 10 per cent, of the cost of laying such mains the municipality should refund to the plaintiff the cost of the installation of said pipes.
    It is averred that the first of said contracts, re-' lating to one of the subdivisions owned by plaintiff, was entered into February 2, 1901, and that pursuant thereto plaintiff expended the sum of $2,953.70; that the second of said contracts, relating to another subdivision owned by plaintiff, was entered into November 2, 1901, and in pursuance thereof plaintiff expended the sum of $1,608.73; that the third of said contracts, relating to another subdivision owned by plaintiff, was entered into April 8, 1902, and in pursuance thereof plaintiff expended the sum of $15,253.35; and that the water rents received by the municipality for the fiscal year ending March 1, 1915, equaled 10 per cent, of the cost of installation of said pipes, but that the defendant on demand refused to refund to the plaintiff the cost of installation of said water mains.
    As a fourth cause of action the plaintiff asserts that the city of East Cleveland is wrongfully applying the property rights of the plaintiff .in said waterworks, water pipes, water rights and easements to its own use, benefit and profit without having compensated the plaintiff therefor, resulting in damage to plaintiff in the sum of $19,815.78.
    Issues were made up and tried to the common pleas judge, a jury having been waived. Upon such hearing it was admitted that said water pipes were installed by the plaintiff to the satisfaction of the board of trustees, and that the cost thereof was as recited in the petition; that water rents received from the users of water from the pipes so laid have been equal to 10 per cent, of the cost of installation since March 1, 1915; and that subsequent to June 21, 1915, The Frisbie Company tendered to the council of East Cleveland a duly executed conveyance to the city of its right, title and interest to said water pipes so laid and installed, on condition that the city pay the cost of installation, which deed and payment were refused.
    The action of the board of waterworks trustees relative to such matter was by way of resolution, wherein it was provided:
    ' “All of said work shall be done under the inspection and supervision of the engineers of the Board, and subject to plans and specifications approved by said engineers. Said work to be done at the cost of said The Frisbie Company. Said mains when laid shall be under the control of this Board, and when the rentals along said lines shall equal annually, 10 per cent, of the cost of the construction thereof, this Board shall, if in funds applicable thereto, repay said The Frisbie Company, (but without interest), the cost of such work, provided such cost shall not exceed what said work could be done for by this Board at the time said Company causes the same to be done. Should such cost exceed what same work could be done for by this Board, then and in that event, said The Frisbie Company, shall accept in full payment fox' all work done, a sum equal to the cost estimated by the engineers of this board, of doing said work.”
    In the court of common pleas judgment was rendered for the amount asked. Upon proceeding in error the judgment of the court of common pleas was reversed, whereupon a petition, in error was filed in this court.

      Messrs. Clum & Marty, for plaintiff in error.

      Mr. E. A. Binyon, for defendant in error.

      Mr. Francis R. Marvin, amicus curiae.

   Matthias, J.

The primary question involved in this case is the validity of the contracts entered into by the board of waterworks trustees and the liability of the city of East Cleveland thereon.

The Frisbie Company at the time the agreement was made with such board was the owner of three tracts of land in the village, now city, of East Cleveland, which it had allotted in three subdivisions, plats of which had been approved by the council of the village, for record only; but the acceptance of streets dedicated to the public use was deferred until some time later. The company, presumably pursuant to its written obligation to the purchasers of lots in these subdivisions “to cause lake water to be supplied in the street,” sought and secured the permission of the board of waterworks trustees • to lay water mains in and along certain designated streets in those allotments and connect the same with the waterworks system of the village, under the terms and conditions set forth in the foregoing statement of this case.

It is pleaded that these contracts are in full accord with the plan previously adopted and followed, whereby extensions of the waterworks lines of the village of East Cleveland had been made by these and other owners of land desiring to allot the same and lay out new streets therein; that pursuant to the terms of such contracts the municipality had refunded to said owners the cost of the laying of such extensions when the water rents along the lines so constructed equaled 10 per cent, of the cost of installation; and that such facts “were well known to the plaintiff herein and to the public generally, and had become the fixed and established custom and method of extending and operating the waterworks of the Village of East Cleveland.”

As is stated by the court in Thomas v. The Guarantee Title & Trust Co., 81 Ohio St., 432: “Usage or custom cannot create a contract or liability, where none otherwise exists. A usage or custom can only be used to explain, or aid in the interpretation of, a contract or liability existing independently of it.” It would be quite contrary to the long-established and frequently-applied rule in this state to permit a public officer or agent, by the adoption of methods or a course of action forbidden by law, to validate the same by his unauthorized action, no matter how long continued.

The contention that the provisions of Section 2702, Revised Statutes, familiarly known as the Burns law, have application to the contract entered into by the trustees of waterworks is fully met by the decision of this court in the case of Kerr v. City of Bellefontaine, 59 Ohio St., 446. In that case the court had under consideration provisions relative to the powers and duties of trustees of gas works, quite similar to the statutes under consideration here conferring powers upon and prescribing the duties of waterworks trustees. The condition in the contracts under consideration here, that “when the rentals along said line shall equal annually, 10 per cent, of the cost of construction thereof, this board shall, if in funds applicable thereto, repay said The Frisbie Company,” etc., makes the following language used by the court in the case of Kerr v. Bellefontaine quite pertinent here: “Not only was this requirement of the statute designed to place a restriction upon the increase of municipal indebtedness but its terms are inapplicable to a contract of this character. The requirement is that the certificate must show that the money required for the contract is in the treasury to the credit of the fund and not appropriated for any other purpose. The fund from which the plaintiff is entitled to satisfaction of his demand is not raised by taxation. It is derived from the operation of the gas works and made subject to the order of the board whose authority is so limited that they can make valid contracts only for appliances and supplies for the gas works to which the fund is devoted. The fund can be appropriated to no other purpose, and the trustees can contract for no other purpose.”

Nor do we regard Section 1693, Revised Statutes, providing that “No contract, agreement or obligation shall be entered into except by ordinance of council,” etc., as having application to the matters under consideration, for the reason that by Section 2415, Revised Statutes, the trustees of waterworks are specifically authorized to make contracts essential for the efficient management and construction of waterworks, and it is provided by Section 1693, Revised Statutes, that the section shall not be construed “to impair the power to contract wherever elsewhere given' in this title.” Sections 2415 and 1693, Revised Statutes, are in the same title.

The powers of the board of waterworks trustees of the Village of East Cleveland, at the time the contracts here sued upon were made, were conferred, and their duties prescribed, by the provisions of Sections 2407 and 2435, Revised Statutes of 1900, being Bates’ Third Edition. We must therefore look to those provisions for the authority possessed by the trustees, and from a consideration thereof ascertain whether it has been exceeded or any of the express restrictions thereof disregarded-

Section 2415, Revised Statutes, conferring general authority upon trustees of waterworks to make contracts is as follows: “The trustees or board shall be authorized to make contracts for the building of machinery, waterworks, buildings, reservoirs, and the enlargement and repair thereof, and the manufacture and laying down of pipe, and the furnishing and supplying with connections all necessary fire hydrants for fire department purposes, and keeping the same in repair, and for all other necessary purposes to the full and efficient management and construction of water-works.” The power thus conferred is limited and restricted by the provisions of Section 2419, Revised Statutes. That section is as follows:

“The trustees or board, before entering into any contract for work to be done, the estimated cost of which exceeds five hundred dollars, shall cause at least two weeks’ notice to be given, in one or more daily newspapers of general circulation in the corporation, that proposals will be received by the trustees, for the performing of the work specified in such notice; and the trustees shall contract with the lowest bidder, if in their opinion he can be depended on to do the work with ability, promptness, and fidelity; and if such be not the case, the trustees may award the contract to the next lowest bidder, or decline to contract, and advertise again.”

It is well settled in this state that where the statute prescribes the mode by which the power therein conferred upon a municipal body shall be exercised, the mode specified is likewise the measure of the power granted, and that a contract made otherwise than as expressly prescribed and limited by statute is not binding or obligatory as a contract. (City of Lancaster v. Miller, 58 Ohio St., 558.) Zottman v. San Francisco, 20 Cal., 96, 81 Am. Dec., 96, is a leading case upon this subject, the opinion being by Chief Justice Field.

Concededly the provisions of Section 2419, Revised Statutes, were not followed, and it is claimed that they have no application to the contracts in question in this case. Each of the contracts sued upon contemplates the expenditure of a sum of money far in excess of $500, and, therefore, should have been let by competitive bidding after advertisement, unless for some reason exempt from the provisions of Section 2419, Revised Statutes.

Provisions of similar import and effect have been construed by this court in several cases, and in every instance the court has held such provisions mandatory, that a compliance therewith was a condition precedent to the power to enter into a valid contract providing for the improvement,. that no implied liability arises against the municipality by the approval or acceptance of such improvement by its officers, and that the municipality is not estopped by the acts of its officers to rely upon the provisions of statutes relating to their powers in defense to actions upon contracts made in disregard thereof. City of Lancaster v. Miller, supra; McCloud & Geigle v. City of Columbus, 54 Ohio St., 439; Buchanan Bridge Co. v. Campbell et al., 60 Ohio St., 406; City of Wellston v. Morgan, 65 Ohio St., 219, and McCormick v. City of Niles, 81 Ohio St., 246.

The decision in the case of City of Lancaster v. Miller, supra, is particularly in point, and is controlling as to the matter now under consideration. It was there held that a contract entered into by a municipal corporation, by which, in its own behalf, it was to pay for the construction of a sewer in one of its streets, the cost of which exceeds $500, imposed no valid obligation upon the corporation, unless it had advertised for bids according to the requirements of Section 2303, Revised Statutes.

The syllabus in the case of McCloud & Geigle v. City of Columbus, supra, is as follows: “Where a municipal corporation, acting under Chapter 4, division 7, of Title XII, Revised Statutes, improves a public street, the provisions of section 2303, prescribing the mode and time of advertising for bids, are mandatory, the compliance with which is a condition precedent to the power of the municipality to enter into a valid agreement in respect thereof.”

But it is urged that even these clearly mandatory provisions of the statute can have no application in the present case for the reason that the trustees did no work and purchased no material, all the work done and material furnished having been paid for by The Frisbie Company. This is begging the entire question. Under the provisions of the contract entered into The Frisbie Company was to pay the entire expense of the proposed improvement. That company did the work and furnished the material and now seeks to recover the cost and expense thereof under the terms of its contract. The provisions of Section 2419, Revised Statutes, clearly apply to any contract for work to be done, the estimated cost of which exceeds $500, and the term “work,” as here used, is broad enough to include material necessary for the proposed improvement. As a matter of course the trustees did no work and' furnished no material. It is that for which they are required to contract, pursuant to the provisions of Section 2419, Revised Statutes, and for which they did contract with The Frisbie Company, but in a manner violative of the mandatory provisions of the statute. It is to be borne in mind that the arrangements under which these improvements were made were initiated by the application of The Frisbie Company, and apparently for its own material advantage and profit. The contention of the company, therefore, that the provisions of Section 2419, Revised Statutes, cannot apply because no one but plaintiff could do this work for the reason that at the time the contract was let the streets where pipes were to be laid had not yet been accepted by the municipality, merits no consideration. If that view were to be adopted a plain and palpable evasion of the statute would be accomplished.

These restrictive statutes enacted for the protection of the public have been and should be strictly construed, and the very evident purpose of their enactment accomplished. That object has been recognized and advanced by the courts whenever such legislation has been under consideration. The plaintiff in this case should have been admonished by the language of the court in City of Lancaster v. Miller, supra, that “Persons who deal with municipal bodies for their own profit should be required at their peril to take notice of limitations upon the powers of those bodies which these statutes impose.”

Plaintiff also seeks to recover as damages the sum expended by it in the performance of its contracts with the city upon the claim set out in its fourth cause of action, which is in substance, that, without appropriating the property rights of the1 plaintiff in said waterworks, water pipes and easements, the city of East Cleveland is wrongfully applying the same to its own use, benefit and profit. In short, it charges the city with conversion of its property 'and seeks to recover its value.

The facts disclosed by the record show an utter absence of the elements essential to constitute conversion of the plaintiff’s property by the city. It is elementary that the mere breach of a contract, even though it results in the loss of specific property, does not constitute conversion, and it is also fundamental that if the owner expressly or • impliedly assents to or ratifies the taking, use or disposition of his property he cannot recover for the conversion thereof.

The plaintiff, apparently for the purpose of enabling it to render desirable for residence purposes its new addition to the municipality, and also to comply with its agreement with purchasers of ' lots therein to “cause lake water to be supplied in the street,” procured the privilege of laying mains in the streets of its addition and connecting the same with the waterworks system of the village, one of the conditions thereof being that said mains should be under the control and supervision of the waterworks trustees. Said pipes also came under the supervision and control of the trustees by force of the provisions of Section 2418, Revised Statutes, which is as follows: “Attachments of whatever nature made to the waterpipes, or other fixtures belonging to the water-works, and intended for public use, shall be subject to the same supervision, rules, and regulations, as are made for the protection of water-works against abuse, destruction, and inordinate or unnecessary use or waste of water, or the trustees may make general or special rules and regulations for such purposes.”

At the time the contracts in question here were entered into the dedication of the streets to public use was in contemplation, and soon thereafter was consummated and accepted by the municipality.

The rule announced in Buchanan Bridge Co. v. Campbell, supra, applies and governs this case. Here, as there, and in other cases of like character, it is alleged that the conclusion reached results in a hardship to the plaintiff. It would be difficult to perceive, however, how any special benefit would be afforded the public by either constitutional or legislative limitations and restrictions upon the power of inferior public bodies and boards to contract, if, notwithstanding the violation of such provisions, there can still be a. recovery from the municipality. This plea of seeming hardship imposed by the rule adopted and applied in this state and elsewhere is well answered by the court in McCloud & Geigle v. City of Columbus, supra: “An occasional hardship may accrue to one who negligently fails to ascertain the authority vested in public agencies with whom he deals. In such instances, the loss should be ascribed to its true cause, the want of vigilance on the part of the sufferer, and statutes designed to protect the public should not be annulled for his benefit.”

The judgment of the court of appeals reversing that of the common pleas is affirmed.

Judgment affirmed.

Wanamaker, Newman, Jones and Johnson, JJ-, concur.


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    Reed v. The State of Ohio.

      Criminal law — Evidence — Character of prosecutrix — Rebuttal— General reputation inadmissible, when.

    (No. 15787
    —Decided June 11, 1918.)
    Error to the Court of Appeals of Licking county.

      Messrs. Fitz gibbon, Montgomery & Black, for plaintiff in error.

      Mr. Charles L. Flory, prosecuting attorney, and Messrs. Kibler & Kibler, for defendant in error.
   By the Court.

The plaintiff in error was indicted and convicted for attempting to break and enter a dwelling house with intent to commit a felony. This conviction was affirmed by the court of appeals. He was a young man about 23 years of age, and a neighbor of the chief prosecuting witness, who at the time of the indictment was herself 52 years of age.

On the night of June 3, 1916, plaintiff in error attempted to enter the dwelling house by means of a ladder which reached the bedroom of the prosecuting witness. This performance was due, as he claims, because of her invitation to visit her that night. It appears from the testimony of the defendant below that upon the afternoon of that day he called upon the prosecuting witness, and, in the course of an indelicate conversation, took liberties with her person, which she repulsed. He testified further that upon leaving that afternoon she invited him to come back again and that he said, “Yes, I will be back tonight.”

This is the only evidence given by the defendant below touching her character for virtue. The prosecuting witness, however, testified of the attempted liberties upon her person, and of the further fact that he stated to her that his brother and she had improper relations. This she denied. She also denied that she gave him any invitation to come back that night or at any other time. This is substantially all of the testimony offered by either party relating to her character for virtue. The defense offered no testimony as to her general reputation.

On rebuttal the state offered several witnesses in proof of her general reputation in the community for virtue. The defendant below objected to this evidence. The court overruled the objection, and the evidence was admitted. This is the chief error relied upon by the plaintiff in error, and the only one to which it is necessary to allude.

The evidence offered by the defendant below did not tend in any wise to affect the reputation in the community of the prosecuting witness for virtue and chastity. The most that can be said is that, if it were believed, her character might be brought into question by reason of the evidence of Reed as to what occurred on the afternoon in question. But it in no wise assailed the community reputation of the prosecuting witness.

We think the rule is established in Ohio that, before the state can offer, in rebuttal, evidence of general reputation for chastity in cases of this character, the defendant must offer some evidence assailing the general reputation of such witness. The distinction between deserved reputation and accredited reputation is pointed out in the case of McDermott v. State, 13 Ohio St., 332.

For error in admitting this class of testimony on rebuttal, the judgments of the court of appeals and the court of common pleas are reversed, and the case remanded to the latter court for further proceedings according to law.

Judgments reversed.

Nichols, C. J., Jones, Matthias, Johnson and Donahue, JJ., concur.

' Wanamaker, J., dissents.