author: Spear, J.

text:
    The Queen City Telephone Company v. The City of Cincinnati.

      Action in probate court by telephone company — Concerning mode of constructing its telephone lines — Telephone company must prove, incorporation, etc. — Petition defective as to differences between corporation and city — Does not state facts justifying order of judgment, when — Power of probate court to grant rights to telephone company — Municipal law — Pleadings.
    1. In an action brought in the probate court by a telephone company against a city asking that the court direct in what mode plaintiff may construct its telephone line along the streets of such city, it is incumbent upon the company, as an incident to action by the court in its favor, to prove its incorporation according to law, including the due and legal election of directors; and, upon a plea of the general issue by the defendant, the burden is upon the company to establish such claim.
    2. A petition in such case which shows no specific questions of difference between the corporation and the municipal authorities, but alleges only in that behalf that they have failed to agree on the mode of use of the streets, and prays for a general judgment directing in what mode the plaintiff may construct its telephone lines along the streets, does not state facts justifying any order or judgment in its favor.
    3. The statutes of Ohio do not confer power on the probate court 'to grant to a telephone company the right to put its wires and apparatus in conduits under the streets of a city in the absence of consent by the municipal authorities.
    (No. 9334
    Decided November 28, 1905.)
    Error to the Circuit Court of Hamilton county.
    The controversy out of which the present error proceeding arises originated in the probate court of Hamilton, by the filing, January 26, 1904, of a petition by the Telephone Company against the City, averring in substance that the plaintiff is a corporation organized under the laws of the state of Ohio, for the purpose of constructing, operating and maintaining lines of telephone and telegraph, with the necessary poles, conduits, wires and appurtenances, in the city of Cincinnati; that on the twelfth day of October, 1903, the plaintiff made application to the council of the City of Cincinnati, to prescribe the manner of use by it of the streets, alleys, public ways, and other public property of the City, in constructing plaintiff’s lines of telephone and telegraph, and transmitting at the same time the form of an ordinance that the plaintiff was willing to accept and bind itself to perform and conform to; that on the twenty-fifth day of January, 1904, a committee to whom the application had been referred reported to the council that there was not room in the streets of the City for the accommodation of the lines asked for and that it was inexpedient to make any grant or agreement, which report was by the council on the date above named adopted, and thereupon the council finally rejected the application of plaintiff, and so the City and plaintiff have failed to agree on the mode of use of the streets, alleys, public ways, and other public property of the City in constructing plaintiff’s, lines of telephone and telegraph, although plaintiff has been and is willing to accept the permission upon any terms and conditions prescribed by the council that may be proper and lawful'for it to prescribe, or to accept any amendment which might be lawful and proper to the proposal presented by plaintiff. Then follows a prayer. that the court direct in what mode plaintiff may construct its telephone and telegraph lines along the streets, alleys, public ways and public property 'Of the City so as not to incommode the public in the use of the same.

      To this petition the City interposed a motion to make more definite by setting out what streets, etc., plaintiff proposes to occupy with the poles, wires and underground conduits; by setting out also the exact location of its proposed poles, wires, conduits, and other structures, and by stating further specifically the character of the poles and wires to be erected and the conduits and other structures proposed to be put upon or under the streets, etc.
    This motion, and likewise a motion asking that the cause be consolidated with actions by three other companies then pending in the probate court for like relief, being overruled, the defendant answered and admitted that the plaintiff presented to the- council the ordinance set forth in the petition and asked council for the consideration and passage thereof. Admitting that the council adopted the report of the committee referred to, and refused to pass the ordinance, the answer further averred that at the time the ordinance was so presented three other companies, to-wit: The Cincinnati Telephone Company, The Interstate Telephone Company, and The Fitzsimmons Telephone Manufacturing Company, presented to council for passage ordinances fixing the mode of like use of the streets for each, which were all referred to the committee and in pursuance of its report, council refused to pass any of said ordinances, and thereupon plaintiff and each of the three other companies named filed applications in the probate court asking said court to fix the mode of use of the streets, etc., for telephone purposes, all of which actions are still pending. The answer further alleged that “all the streets in the City of Cincinnati, in the business portion thereof, and the majority of said streets in the residence portion and the outlying districts, have been permanently improved, either with granite, asphalt, brick, bowlder or macadam; that in the various streets and highways of said City there is now an underground network of telephone, telegraph, electric light conduits, gas, sewer and water pipes, with the various manholes and fire cisterns used in connection therewith ; that at the intersection of the principal streets such conduits, pipes, manholes and other structures now occupy so great a proportion of the streets that it is dangerous, if not impossible, to permit a further use of the streets for such purposes; that in said City it is the uniform custom to permit property owners to utilize the space underneath the sidewalk as far as the curb for the purposes of their buildings ; that in the continued growth of said city such space as is not now used for underground purposes will be necessary to be used in the extension of the system of underground purposes by the City and other persons now having a right to use the streets for such purposes.
    ‘ ‘ This defendant further says that The Cincinnati & Suburban Bell Telephone Company, a corporation under the laws of Ohio, now owns and operates a telephone exchange and system of wires for telephone purposes through conduits and upon poles in the streets and highways of the City of Cincinnati, under an agreement with said defendant for the maintenance and use of telephone conduits and poles; that said Company occupies all of the business portion and a large part of the residence portion with underground conduits, to-wit, all that portion between Freeman and Eggleston avenue, and the Ohio river and McMicken avenue, together with many other thoroughfares leading in the suburbs of tbe City, and that with these facilities and pole lines in outlying portions it is able to and it has supplied all the demands made or existing within the City for telephone service; that no further occupancy of the streets or highways is at all necessary for the purpose of such service, and that further occupancy for the same would incommode the public in the use of such streets and highways, and would cause additional expense to the residents and business concerns of the City; and if the plaintiff were permitted to occupy and should occupy the streets and highways of the City for telephone purposes, and much more if the other applicants aforesaid or any future applicants were permitted so to do, and should occupy said streets and highways, such occupancy would, in operation and effect, divert the said streets and highways, especially in the business portions of the City, from their original and legitimate purposes and uses, and prevent the further growth and extension of the uses to which the said City of Cincinnati ought to and will be compelled to apply them; and that under these circumstances and facts "it was impracticable, as in substance and effect-stated in the report above set out, for the city to formulate the terms of or to enter into an agreement with the plaintiff, of the other applicants above mentioned’, for the occupancy of its streets and highways for further telephone use and service, and that in consequence it did not unreasonably refuse to adopt the ordinance which plaintiff presented and sought to have passed either as the ordinance was written or as it could reasonably be amended. By reason thereof, said Cincinnati & Suburban Bell Telephone Company claims an interest in the streets and highways of said City superior to any right which plaintiff may acquire.
    “This defendant denies all other allegations in plaintiff’s petition not herein expressly admitted.
    “Wherefore this defendant prays that said-The Cincinnati Telephone Company, The Interstate Telephone Company, The Fitzsimmons Telephone Manufacturing Company and The Cincinnati & Suburban Bell Telephone Company he made parties herein, and he required to set up their several claims to rights in the streets- of the City of Cincinnati, and for all other and proper relief.”
    The reply admitted that the application of the three other companies named in the answer, accompanied by ordinances similar to that of plaintiff, were referred by council to the committee along with that of plaintiff; that the committee made the report alleged, and that council refused to pass any of the ordinances so presented, and denied all the other allegations of the answer.
    Upon trial the probate court found for the plaintiff ; further finding in substance that it was a corporation organized under the laws of the state for the purpose of building, owning, maintaining and operating a system of telephone and telegraph lines and conducting a telephone and telegraph business ' in the City of Cincinnati and elsewhere, and is authorized to bring this proceeding; that the plaintiff applied to the city, through its council^ for the purpose of coming to an agreement as to the mode of use- of the streets, alleys, public ways, and other public property of, and within the limits of the City, - but the City, on January 25, 1904, refused to agree with the plaintiff upon the mode of use of such streets, etc., for the purpose stated upon any terms, and that it is necessary for plaintiff to nse said streets, alleys and public ways. The court, then proceeding to direct a mode of such use, adjudged and decreed that upon certain designated streets, and in such other thickly settled portions of. the City as plaintiff may from time to time select, all its wires shall be placed in underground conduits or subways, and no poles should be erected in said district or other portions of the city where the wires are placed in conduits, except for distribution of wires or cables from conduits to buildings, and all such poles shall be, as far as possible, located in alleys; and further provided for the erection of the poles and wires therein in other portions of the City, with authority to the plaintiff to construct all conduits, etc., etc., in. such manner as to make its system a complete working system of telephonic communication. Then follow specific directions with respect to the character of the poles, wires, etc., the manner in which they are to be placed and maintained, for the method of procedure generally, and for change of the poles, wires, etc., as the future necessities of the streets and ways may require. The order further provides that before entering upon the construction of the contemplated work the plaintiff should file with the board of public service plans showing the location and character of the work designed to be constructed, and with power to the board to change and adjust the location and character of the work to meet conditions existing at particular localities at the time.
    Error being prosecuted by the defendant to the common pleas the judgment of the probate court was reversed. The Company then prosecuted error to the circuit court, by which court the judgment of the common pleas was affirmed. To reverse these latter judgments the Company brings error to this court.

      Mr. C. B. Matthews, attorney for plaintiff in error,
    cited and commented upon the following authorities:

      Zanesville v. Telephone Co., 64 Ohio St., 67; Macklin v. Telephone Co., 24 O. C. C., 446; 1 C. C. R. (N. S.), 373; People v. Kerr, 27 N. Y., 188; Railroad Co. v. Savannah, 45 Ga., 602; Lewis on Eminent Domain, sec. 391-255; School Dist. v. Dorton, 125 Mo., 439; Cable Co. v. Mayor, 104 N. Y., 1; Railway v. Sullivant, 5 Ohio St., 276; Atkinson v. Railroad Co., 15 Ohio St., 21; Chamberlain v. Railroad Co., 15 Ohio St., 225; Glass Co. v. Carnegie, 204 Pa. St., 459; Railroad Co. v. Stroud, 132 N. C., 413; Zanesville v. Gas Light Co., 47 Ohio St., 1; Railroad Co. v. Miller, 56 Ind., 88; Niemeyer v. Railroad Co., 43 Ark., 111, 120; Clark & Marshall on Corporations, secs. 73, 74, 95, 509, 510, 510b., 511; Railroad v. Smith, 15 Ohio St., 328; State v. Relief Assn., 29 Ohio St., 399; State v. Taylor, 25 Ohio St., 279; Powers v. Railroad Co., 33 Ohio St., 432; Mining Co. v. Ruble, 8 Ore., 284; Hammond v. Straus, 53 Md., 1; Hotel v. Dickinson, 6 Gray (Mass.), 586; Manufacturing Co. v. Vanner, 12 R. I., 491; Mokelumme, Hill Co. v. Woodbury, 14 Cal., 424; Utley v. Tool Co., 11 Gray, 139; Amendment of April, 1880 (77 O. L., 266); State v. Insurance Co., 49 Ohio St., 440; Insurance Co. v. Wilson, 70 Ohio St., 354; Hessler v. Punch & Shear Co., 61 Ohio St., 625; Ex parte Littledale, L. R. 6 Cr., 257; Thos. Haven Co. v. Rose, 4 Man. & G., 552; Henry v. Railroad Co., 17 Ohio, 191; 1 S. & C., p. 276, see. 6; Navigation Co. v. Eagle, 29 Ohio St., 238; Peter v. Manufacturing Co., 56 Ohio St., 181; Railroad Co. v. Commissioners, 36 Kan., 121; Mitchell v. Railroad

      Co., 17 Ga., 574; Elevator Co. v. Towboat Co., 152 Mass., 428; McDermott v. Donegan, 44 Mo., 85; Commonwealth v. Railroad Co., 3 Gr., 6a, 200; Bank v. Investment Co., 74 Tex., 421; Blair v. Rutherford, 31 Tex., 465; Jones v. Davis, 35 Ohio St., 474; Hartt v. Harvey, 32 Barb., 55; Commissioners v. Woodward, 4 Phil., 124; In re Chenango Co. Mut. Ins. Co., 19 Wend., 635; Wiltz v. Peters, 4 La. An., 339; In re Leslie, 58 N. J. Law, 609; Plank Road Co. v. Thatcher, 11 N. Y., 102; State v. Lehre, 7 Rich. (S. C.), 234; Society of Gal. v. Smithers, 12 Ohio St., 248; Hullman v. Honcomp, 5 Ohio St., 237; Ehrman v. Insurance Co., 35 Ohio St., 324; Ryder v. Railway Co., 13 Ill., 516; Grayble v. Y. & G. Turn. Co., 10 Serg. & R., 269; Beach v. Smith, 28 Barb., 254; Beach v. Smith, 30 N. Y., 116; Baldwin on American Railroad Law, 64; Nellis on Street Surface Railroads, 252; Telephone Co. v. Turnpike & Railroad Co., 135 N, Y., 403; Rochester v. Telephone Co., 52 N. Y. App. Div., 6; Teachout v. Railway Co., 75 Ia., 732; Railway Co. v. Mills, 85 Mich., 634; Taggart v. Railway Co., 16 R. I., 668; Fulton v. Transfer Co., 85 Ky., 640; Railway Co. v. Grundy, 51 N. J. Eq., 231; Dand v. Kingscote, 6 M. & W., 173, 197; Bishop v. Worth, 11 M. & W., 417, 426; Bridge Proprs. v. Hoboken Co., 1 Wall., 116; Corporation Act of 1853 (N. Y.), chap. 471; Keasbey on Electric Wires, p. 85, sec. 67; Harrison v. Cable Co., 9 Dec. Re., 805; 17 W. L. B., 265; Attorney General v. Telegraph Co., L. R. 6, Q. B. Div., 244; Cincinnati v. Cameron, 33 Ohio St., 336; Telegraph Co. v. Benton Harbor, 121 Mich., 512; Electro Mag. & Dev. Co. v. Van Auken, 9 Col., 204; Gas Co. v. Wheeling, 8 W. Va., 320; Attorney General v. Plank Road Co., 2 Mich., 139; Thompson v. Bulson, 78 Ill., 277; Nichols v. Wells, 2
      Ky., 255; Carpenter v. State, 12 Ohio St., 457; Monahan v. Telephone Co., 9 Dec., 532; 7 N. P., 95; Tulare Irrigation Dist. v. Shepard, 185 U. S., 1; Wells Co. v. Manufacturing Co., U. S. S. C., May 8, 1905; Minor v. Bank, 1 Pet., 47; Telephone Co. v. St. Joseph, 121 Mich., 502; In re Janvrin, 174 Mass., 514; Telegraph Co. v. Myatt, 98 Fed., 335; State v. Johnson, 61 Kan., 803 ; Express Cases, 117 U. S., 1; Railway Co. v. Telegraph Assn., 48 Ohio St., 390; Telephone Co. v. Chagrin Falls, 14 Dec., 449; O. L. R., March 28, 1904; Prentiss v. Telephone Co., 1 Dec., 97; 32 W. L. B., 13; State v. Murphy, 134 Mo., 548; Edison Co. v. Cincinnati, Goeb., 304; State v. Commissioners, 54 Ohio St., 333; Morawetz on Corporations, secs. 2, 27, 33, 638, 639, 640, 654, 672, 3168; Clement v. Cincinnati, 9 Dec, Re., 688; 16 W. L. B., 355; Cincinnati v. Railway Co., 4 Dec., 507; 30 W. L. B., 321; Simmons v. Toledo, 3 Circ. Dec., 64; 5 C. C. R., 124; Pelton v. Railway Co., 10 Dec. Re., 545; 22 W. L. B., 67; Lancy v. Boston, 71 N. E. Rep., 302; People v. Canal Co., 52 N. Y. S., 850; Bank v. Greenburgh, 173 N. Y., 215; Young v. Salt Lake City, 67 Pac. Rep., 1066; Eskridge v. Emporia, 65 Pac. Rep., 694; McCrea v. Roberts, 43 Atl. Rep., 39; Moore v. Vance, 1 Ohio, 1; Brown v. Farran, 3 Ohio, 140; Chestnut v. Shane, 16 Ohio, 599; Craig v. Fox, 16 Ohio, 563; Dutoit v. Doyle, 16 Ohio St., 400; Railway Co. v. Lynde, 55 Ohio St., 23; State v. Akins, 10 Circ. Dec., 121; 18 C. C. R., 349; Campbell v. Campbell, 2 Circ. Dec., 256; 3 C. C. R., 449; secs. 3236, 3238, 3239, 3242, 3243, 3244, 3245, 3266, 3283, 3454, 3455, 3461, 3471, 3588, 3589, 3590, 3591, 3631-25, 3631-35, 3632, 3633, 3634, 3635, 3636, 3641, 3670, 3686, 3687, 3691-1 to -8, 3691-14, 3691-21, 6414 and 6420, Rev. Stat.

      Mr. Poivel Crosley, also for plaintiff in error,
    submitted a supplemental brief as amicus curiae, citing and commenting upon the following authorities:
    History of Underground Wires: J. J. Fahie on History of Electric Telegraph; Keasbey on Electric Wires, p. 84, sec. 67; Robert Sabine on the History and Progress of the Electric Telegraph; Natural Philosophy; The Electric Telegraph; secs. 3454, 3461 and 3471, Rev. Stat. Construction of Statutes: Moore v. Vance, 1 Ohio, 1; Brown v. Farran, 3 Ohio, 140; Chestnut v. Shane, 16 Ohio, 599; Craig v. Fox, 16 Ohio, 563; Dutoit v. Doyle, 16 Ohio St., 400; Railway Co. v. Lynde, 55 Ohio St., 23; State v. Akins, 10 Circ. Dec., 121; 18 C. C. R., 349; Campbell v. Campbell, 2 Circ. Dec., 256; 3 C. C. R., 449; United States v. Healey, 160 U. S., 136; Detroit City Ry. v. Mills, 85 Mich., 634; Goshorn v. Purcell, 11 Ohio St., 641; Morris v. Williams, 39 Ohio St., 554; Corwin v. Benham, 2 Ohio St., 36; Stetson v. City Bank, 2 Ohio St., 167; Ives v. McNicoll, 59 Ohio St., 402; Railway Co. v. Telegraph Assn., 48 Ohio St., 390; Electric Co. v. Cincinnati, Goeb., 304; Telephone Co. v. Chagrin Falls, 14 Dec., 449; 1 N. P. (N. S.), 534; State v. McGregory, 44 Ohio St., 628; art. 12, sec. 1, Const.; Commonwealth v. Warwick, 185 Pa. St., 623.

      Mr. Charles J. Hunt, city solicitor; Mr. J. W. Warrington, Mr. H. D. Peck and Mr. Miller Outcalt, attorneys for defendant in error,
    cited and commented upon the following authorities:
    1 S. & C., 299; Zanesville v. Telegraph & Tel. Co., 64 Ohio St., 74; Macklin v. Telephone Co., 24 O. C. C., 446; 1 C. C. R. (N. S.), 373; sec. 47, General Corporation Act of May 1, 1852 (S. & C., 271); Brower v. Hunt, 18 Ohio St., 311; Commonwealth v. War

      wick, 185 Pa. St., 623; Light & Power Co. v. Gas Co., 69 Ohio St., 259; Electric Light Co. v. Electric Co.; 3 Circ. Dec., 168; 5 C. C. R., 344; 29 W. L. B., 72; State ex rel. v. Board of Public Works, 36 Ohio St., 409; State v. Railway Co., 37 Ohio St., 176; State ex rel. v. Chase, 5 Ohio St., 529; Currier v. Railroad Co., 11 Ohio St., 231; Coal Co. v. Wigton, 19 Ohio St., 566; Platt v. Pennsylvania Co., 43 Ohio St., 244; Telephone Co. v. Turnpike & Railroad Co., 135 N. Y., 393; State ex rel. v. McGregor, 44 Ohio St., 628; Cincinnati v. Holmes, Admr., 56 Ohio St., 104; Davis v. Davis, 11 Ohio St., 386; Powers v. Railroad Co., 33 Ohio St., 429; Atlantic Railroad v. Sullivant, 5 Ohio St., 276; Atkinson v. Marietta Railroad, 15 Ohio St., 21; Railway Co. v. Daniels, 16 Ohio St., 390; Markley v. Vil. of Mineral City, 58 Ohio St., 430; Pelton v. Railroad Co., 10 Dec. Re., 545; 22 W. L. B., 67; Railway Co. v. Telegraph Assn., 48 Ohio St., 390; State ex rel. v. Murphy, 134 Mo., 548; State v. Insurance Co., 49 Ohio St., 440; Powers v. Railway Co., 33 Ohio St., 429; Zanesville v. Telephone & Tel. Co., 63 Ohio St., 442; State ex rel. v. Telephone Co., 72 Ohio St., 60; 3 O. L. R., 27; Dash v. Van Kleeck, 7 Johns., 477; 1 Bl. Com., 269; Spirit of Laws, bk. 11, chap. 6; Kilbourn v. Thompson, 103 U. S., 191; Moynihan’s Appeal, 75 Conn., 358; Wakeman’s Appeal, 74 Conn., 313; Street Railway Co.’s Appeal, 69 Conn., 576; Malmo’s Appeal, 72 Conn., 1; Bradley v. New Haven, 73 Conn., 646; Telephone Co. v. St. Joseph, 121 Mich., 502; Telephone Co. v. Benton Harbor, 121 Mich., 512; Toledo v. Telegraph Co., 12 O. F. D., 704; 107 Fed., 10; Telegraph Co. v. Toledo, 121 Fed., 734; Reagan v. Loan & Trust Co., 154 U. S., 362; Commerce Commission v. Railway Co., 10 O. F. D., 556; 167 U. S., 479; Telegraph Co. v. Myatt, 98 Fed., 335; Telephone Co. v. State, 55 Neb., 627; Shephard v. Wheeling, 30 W. Va., 479; State v. Young, 29 Minn., 474; State v. Field, 17 Mo., 529; State v. Railway, 43 N. J. Law, 339; Express Cases, 117 U. S., 1; 18 Harv. Law Rev. (June, 1905), 572; State v. Harmon, 31 Ohio St., 250; art. 4, sec. 1, Const.; Cooper’s Case, 22 N. Y., 84; Pennsylvania v. Bridge Co., 13 How., 518; In re Railway Co. v. Bridge Co., 7 Fed., 653; Cincinnati v. Taft, 63 Ohio St., 141; Shoemaker v. Cincinnati, 68 Ohio St., 603; act of March 31, 1865 (S. & S.), 153; Ash v. Ash, 9 Ohio St., 383; Tyler v. Winslow, 15 Ohio St., 364; Hamilton v. Steamboat Hamilton, 16 Ohio St., 428; Stannard v. Case, 40 Ohio St., 211; Collins v. Millen, 57 Ohio St., 295; Conger v. Barker, 11 Ohio St., 1; Boley v. Ohio Trust Co., 12 Ohio St., 139; Dutoit v. Doyle, 16 Ohio St., 400; secs. 1536-131, 1536-184, 3243, 3244, 3245, 3454 to 3471, inclusive, Rev. Stat.
   Spear, J.

Séveral questions are presented by the record. 1. Was The Queen City Telephone Company so organized at the time it made application to the City, and later, as to give it a standing calling for action by the council and afterward by the probate court? 2. Even though the Company were legally organized, did the petition filed in the probate court itself state a case warranting affirmative action in favor of the Company by that court? 3. If the petition did state a case warranting such affirmative action, had that court power to grant a right to such company to place its wires and apparatus in conduits under ground?

1. It was the judgment of the circuit court that the Company- had not been so legally organized as to give it a standing to maintain its action. In this conclusion we concur. As held in Zanesville v. Tel. Co., 64 Ohio St., 67, the proceeding is practically for an appropriation; that is, it partakes of the character of an exercise of the right of eminent domain. In Powers v. Ry. Co., 33 Ohio St., 429, it is held that it is essential to a judgment of condemnation in an appropriation proceeding that the company should prove its corporate existence, and among other things show that it has been fully organized by the election of directors. Proof of the existence of the corporation and of its right to make the appropriation is also now required by section 6420, Revised Statutes, and the determination by the court of those questions favorable to the company is made jurisdictional. Sections 3243, 3244, and 3245, Revised Statutes, taken together, require that an installment of ten per cent on each share of stock shall be payable at the time of making the subscription; that as soon as ten per cent of the capital stock is subscribed notice for the election of directors may be given; that no person shall vote for directors for any share on which any installment is due and unpaid, and the votes of a majority of the number of shares shall be necessary for a choice. Tested by these requirements the record shows that there had been no legal election of directors, and that the corporation had not been organized in such manner as to entitle it to a decree under section 3461. As a predicate to any action by the probate court it must have been made to appear that the plaintiff and the municipal authorities could not agree, and since the plaintiff could act only through its legally constituted officers, the absence of such officers was fatal to its claim of a failure to agree.

It is urged that the pleadings do not raise the issue as to the organization of the corporation. We agree also with the conclusion of the circuit court that the issue is sufficiently made, the rule being that in such a case as this a general denial puts the burden on.the company to show that it has complied with the statute.

The foregoing disposes of the case, but inasmuch as the Telephone Company might, in a new uroceeding, correct this error, and especially as the other cases referred to in the statement are still pending in the probate court, we proceed to consider briefly other questions.

2. As to the petition. It was the judgment of the circuit court that the petition did not present to the probate court defined issues to invite judicial determination. In this conclusion we concur. There is no statutory warrant for the claim that the probate court is free to make any order or decree that may be demanded. The power of the probate court is judicial power, as held in the Zanesville case, and in order to invoke the exercise of that power defined issues must be presented, issues showing specific questions of difference between the parties, and in the absence of such showing it seems clear that the probate court has no power in the premises other than to dismiss the petition. The petition in this case does not show that any defined plan for occupancy of streets had been presented to council for its acceptance or refusal, nor that any such defined plan was even presented to the probate court. The defendant was entitled to have the issue made as to each street, and as to the question of incommoding the public by the proposed use, and if it appeared that for any cause the proposed use would incommode the public in the use of such street as a street then the demand should be refused on that ground. In such situation, also, it was manifestly the exercise of legislative, as contrasted with judicial power, for the court to go forward and make a general order giving the right to the use of the streets generally, and prescribing the mode of use not only for the present but directions for change of poles, wires, etc., as the future necessities of the streets and ways may require, and requiring the plaintiff before entering upon the construction of the work to file with the board of public service plans showing the location and character of the work, and authorizing the board to change the location, etc., thus delegating to an administrative body power to make necessary specifications as to mode of use, location, etc. To hold and direct a mode of use of a street at the present would be, upon issues joined, judicial; to direct its use under changed conditions in the future would be legislative. It was also error for the court to overrule the motion of defendant to make the petition more definite and certain.

3. In any event had the probate court power to grant a right to the Company to place its wires and apparatus in conduits under ground? It is believed that this point is satisfactorily answered by reference to the sections of the Revised Statutes relating to. the subject of the control of streets and the construction of conduits thereunder. Section 3454, enacted in 1852, is the foundation of the right of telephone companies to use the public roads of the state. This right is there given to telegraph companies, but by section 3471, this section, as also the entire chapter, is' made to apply to telephone companies also, but telephone companies are specifically made subject to all the restrictions imposed by the chapter upon telegraph companies. Then by section 3461, enacted in 1865, the manner of acquiring the right to use streets of a municipality is provided for. Where the lands sought to be appropriated to the use of a company are subject to the easement of a street the mode of use shall be such as shall be agreed upon between the municipal authorities and the company, and if they cannot agree then the probate court shall direct in what mode the line shall be constructed along such street so as not to incommode the public in the use of the street. But this use, as authorized by section 3454, is simply “by the erection of the necessary fixtures, including posts, piers and abutments necessary for the wires. ’ ’ Applying the rule of expressio unius exclusio alterius, this language by inference excludes the idea of conduits in subways. Looking for a specific provision on the subject, we find that the first which in terms covers the subject of conduits is section 3471-1, enacted in 1891. The title of the act is “To authorize telephone companies to place and maintain their wires under ground, when consent is had of cities where the same are situated,” and the body of the act provides that any company owning and. operating a telephone' exchange in any city “may construct and maintain underground wires and pipes or conduits and other fixtures for containing, protecting and operating such wires in the streets and public ways of said city, when the consent of such city has been obtained therefor,” etc. By the following section this consent is to be given by the board of street commissioners, of public improvements, of public works, and administration, or by the council in cities where no such board exists, and these are the only provisions of statute to which attention has been called which treat of the subject of conduits. They are special provisions enacted long after the general provisions of section 3461, and by the application of familiar rules of construction, must be regarded as exceptions to the general provisions of previous statutes. The consent of the city is thus made an essential condition.

It is of course conceded as now well settled that the general power to occupy the streets of a municipality by a'telephone company is derived from the state, as held in Zanesville v. Tel. Co., supra, and Farmer v. Tel. Co., 72 Ohio St., 526. (Referring to this last case, it may not be amiss here to remark that oh page 532 the types make the writer say that the probate court is a substitute in all respects for the municipal authorities. This was not intended. The words “as to rates,” which should precede the above statement have dropped out. Without them the statement is too broad.) But, taking the sections of the statute as a whole and considering the conditions imposed on the exercise of such right, it is not to be inferred that the municipal authorities are stripped of all power to finally determine any matter relating to the general subject. It will be remembered that by section 2640 those authorities are given the control of the streets and are required to keep them open, in repair, and free from nuisance. It is to be noted, also, that by no statute is power given any tribunal to authorize permanent structures upon or in, or the use of any street, which will incommode the public, the dominant purpose being to facilitate public travel and transportation. Railway Co. v. Tel. Assn., 48 Ohio St., 390; L. S. & M. S. Ry. Co. v. Elyria, 69 Ohio St., 414. It seems, therefore, clear that there is no power in the prohate court to authorize or direct the construction of conduits in subways under the streets of a city in the absence of consent by the municipal authorities.

The subject is a broad one, but we are not inclined to add unduly to the already copious literature by extended discussion. The case will be found fully and ably reported by the common pleas, opinion by Littleford, J., 2 O. N. P. R., N. S., 349, and by the circuit court, opinion by Swing, J., 5 O. C. C. R., N. S., 411.

The judgments of the circuit and common pleas courts will be affirmed and the cause remanded to the probate court with direction to dismiss the petition and to carry into effect the judgment of this court as to costs.

Judgment affirmed.

Davis, C. J., Shauck, Price and Crew, JJ., concur.


source: Caselaw Access Project

author: Summers, J.

license: Public Domain

text:
    Forest City Railway Company et al. v. Day.

      City council shall not grant franchise for street railroad except upon certain conditions — Street railway must obtain written consent of majority of property holders — Right of property holder to consent or not — Property holder can not limit consent to particular corporation, when — Question of lowest rates of fare — Section SO, new municipal code — Section 1536-185, Revised Statutes — Municipal law — Corporation law —Granting of franchises.

    The requirements of section 30 of the new municipal code, section 1536-185, Revised Statutes, that the council of a city shall not grant a franchise for the construction of a street railroad excepting “to the corporation, individual or individuals, that will agree to carry passengers upon such proposed railroad at the lowest rates of fare, and shall have previously obtained the written consent of a majority of the property holders upon each street or part thereof, on the line of the proposed street railroad, represented by the feet front of the property abutting on the several ■ streets along which such road is proposed to be constructed,” confers upon such • property holder the privilege of giving or withholding his consent to the construction of such road, but it does not give him the privilege of limiting his consent to a particular corporation or individual. His consent so limited is inconsistent with the requirement that the ■ franchise be given to the corporation or individual that will carry passengers at the lowest rates of fare and would tend to defeat the purpose of the statute; the limitation, therefore, is void and the consent good as a consent to the construction of the road by the lowest bidder.
    (No. 9417
    Decided November 28, 1905.)
    Error to the Circuit Court of Cuyahoga county.
    September 9, 1903, the city of Cleveland granted a franchise to Albert E. Green and assigns for the .construction and operation for twenty years of an electric street railway on Denison avenue between Lorain and Pearl streets in said city.

      Green in writing accepted the terms of the ordinance and commenced the construction of the railway.
    November 12, 1903, the defendant in error, Day, an owner of property fronting on that part of Denison avenue, brought suit in the court of common pleas of Cuyahoga county to enjoin Green and The Forest City Railway Company, plaintiffs in error, from constructing the railway, on the ground that at the time of the passage of the ordinance the written consent of a majority of the property owners on that part of Denison avenue, represented by the feet front of the property abutting that part of the avenue, had not been obtained.
    The court of common pleas found for the defendants and dismissed the petition. On appeal the circuit court made a special finding of facts and concluded as matter of law that a majority of consents had not been obtained and perpetually enjoined the construction of the road.

      Mr. Gilbert JH. Stewart; Messrs. Blandin, Rice <& Ginn, and Messrs. Garfield, Howe & Westenhaver, attorneys for plaintiffs in error,
    cited and commented upon the following authorities:
    2 Jones on Evidence, sec. 460; Johnson v. Pierce, 16 Ohio St., 477; Tuttle v. Burgett, Admr., 53 Ohio St., 508; State v. Bell, 34 Ohio St., 194; 27 W. L. B., 64; Knorr v. Miller, 3 Circ. Dec., 297; 5 C. C. R., 609; Traction Co. v. Parish, 67 Ohio St., 181; Street Railroad v. Cumminsville, 14 Ohio St., 523; Roberts v. Easton, 19 Ohio St., 86; Currie v. Atlantic City, 66 N. J. Law, 142; Paterson Traction Co. v. Wostbrock, 56 Atl. Rep., 698; Booth on Street Railways, secs. 27, 156; Sloane v. Electric Railway Co., 3 Circ. Dec., 674; 7 C. C. R., 84; Simmons v. Toledo, 4 Circ. Dec., 69; 8 C. C. R., 535; 31 W. L. B., 367; Parish v. Traction Co., 13-23 O. C. C., 527; Biddle v. Riverton, 29 Vroom, 289; Hays v. Jones, 27 Ohio St., 218; White v. Railway Co., 18 N. Y. Supp., 396; Irwin v. University, 56 Ohio St., 9; Dalrymple v. Wyher, 60 Ohio St., 108; Makemson v. Kauffman, 35 Ohio St., 444; Gill v. Pinney, 12 Ohio St., 38; Sidle v. Maxwell, 4 Ohio St., 239; Fosdick, v. Barr, 3 Ohio St., 471; Bingham on Descent, 1; 1 Jones on Mortgages (6 ed.), sec. 474; Melledge v. Iron Co., 59 Mass., 158; Cook on Corporations, secs. 714, 715, p. 1502; 21 Am. & Eng. Ency. Law (2 ed.), 886, p. 856; Railway Co. v. Railway, 163 U. S., 597; Serhaut v. Englebury, 50 W. L. B., 68; Bay v. Railway, 27 O. C. C., 68; Tone v. Columbus, 39 Ohio St., 281; Mt. Vernon v. State, 71 Ohio St., 428; 11 Am. & Eng. Ency. Law (2 ed.), 429; State ex rel. v. Beacom, 66 Ohio St., 491; Stauffer v. Eaton, 13 Ohio, 322; Gilbert, etc. v. Port, 28 Ohio St., 298; Smith v. Loewenstein, 50 Ohio St., 346; 29 Am. & Eng. Ency. Law (2 ed.), 712-13; sec. 30, Municipal Code; secs. 412, 2501, 2502, 3439, 3439a, 6264, 6269, Rev. Stat.

      Messrs. Gollister £ Halle, attorneys for defendant . in error,
    cited and commented upon the following authorities:

      Simmons v. Toledo, 4 Circ. Dec., 69; 8 C. C. R., 535; State ex rel. v. Bell, 34 Ohio St., 194; Traction Co. v. Parish, 67 Ohio St., 192; Parish v. Traction Co., 13-23 O. C. C., 536; 11 Am. & Eng. Ency. Law (2 ed.), 434; Joyce on Electric Law, sec. 355; Roberts v. Easton, 19 Ohio St., 86; Stephen’s Digest of the Law of Evidence (Chase ed. 1886), art. 9, p. 19; art. 91, p. 167; Hays v. Jones, 27 Ohio St., 218; Makem

      son v. Kaufman et al., 35 Ohio St., 444; Lancaster v. Miller, 58 Ohio St., 558; Bridge Co. v. Campbell, 60 Ohio St., 406; State v. Yeatman, 22 Ohio St., 546; Louisville Trust Co. v. Cincinnati, 47 U. S. App., 36 (70-71); Seeger v. Mueller, 133 Ill., 86; Snyder v. Mt. Pulaski, 176 Ill., 397; Hibbard v. Chicago, 173 Ill., 91; $i. Patti v. Railroad, 63 Minn., 330; Platter v. Commissioners, 103 Ind., 361; 1 Dillon on Municipal Corporations (4 ed.), sec. 447; Beach on Public Corporations, sec. 252; McCloud v. Columbus, 54 Ohio St., 439; Railway v. Carthage, 36 Ohio St., 631; Gas Co. v. Avondale, 43 Ohio St., 257; Comstock v. Nelsonville, 61 Ohio St., 288; Booth on Street Railways (ed. 1892), secs. 18, 22, 24; secs. 3238, 3439 and 3439a, Rev. Stat.

      Mr. Newton D. Baker, city solicitor,
    also filed a brief by leave of the court, contending that section 30 of the municipal code (96 O. L., 32) and section 3439, Revised Statutes, in so far as they require the consent of owners of abutting property to the construction of a street railroad, are unconstitutional and void, but the decision being that the grant did not fail for want of consents it is unnecessary to determine the constitutional question and for that reason his argument is not set.out.
   Summers, J.

The total frontage is 28,793 feet and a fraction. One-half is 14,397 feet, and anything in excess a majority. Of the consents, 9,310 feet were uncontested, and of the consents contested the circuit court found good 3,843 feet, making a total of 13,153 feet, about 1,250 feet less than a majority.

The circuit court found certain consents not good, but it will be unnecessary to notice all of these because those covered by the eleventh, twelfth, thirteenth, twenty-second, twenty-third and thirty-second findings of fact, covering 2,023 feet, present the same question, and upon the facts found the circuit court erroneously concluded that they were not good. ' Being of opinion that they are good, a majority of the consents was produced to council and it is unnecessary to notice the others held not good.

It appears from the eleventh finding of fact that on July 27, 1903, The Cleveland Electric Railway Company, a corporation owning and operating a system of street railways in said city, applied to the council for leave to extend its tracks onto said Denison avenue and to operate an extension of its said system thereon; that George Fleisher, the owner of property having a frontage of 209.59 feet on said Denison avenue, on August 3, 1903, signed and delivered to an agent of said company a writing as follows:

“Cleveland, Ohio, Aug. 3, 1903.
“I, the undersigned, being the owner of property on Denison avenue in the city of Cleveland, to the extent of 210.59 feet front, hereby request the Cleveland Electric Railway Company to construct an extension of its existing street railway lines upon and along said street in front of my premises, and to maintain and operate the same as a part of its system of street railway now in operation in the city of Cleveland. This request is made as- a personal request, and to the Cleveland Electric Railway Company only, and I consent to the construction and operation of such an extension of said company’s lines .upon and along said street; but this consent shall not be assignable, and is not intended as authority for any other street railroad to be constructed and operated upon said street.
“George Fieisher. “Witness: J. R. Hawthorne.”

That on August 19, 1903, he signed a consent in writing as follows:

“The undersigned property owner hereby consents to the construction of a double track street railroad on Denison avenue for all the property standing in my name. ’ ’

And that on August 24, 1903, he signed a writing as follows:

“I, the undersigned, being the owner of property to the extent of 210.59 feet on Denison avenue in the city of Cleveland, hereby withdraw and, cancel any and all consents which I have- heretofore given for the construction of any other street railroad except the Cleveland Electric Railway Company upon said street.”

The last two writings were filed with the clerk of the city and he had them with him in the council chamber on September 9, 1903, when he reported to the council that he had examined “the consents for the construction of a double track street railroad on Denison avenue presented by Albert E. Green, and find that the same represents a majority of the feet frontage on Denison avenue.”

The first writing was not filed with the clerk and was not presented to the council.

The first is a consent to an extension, the second and third relate to an original construction.

We may assume that if the first writing had been brought to the attention of council that the third would have operated as a cancellation or revocation of the second, but, as it was not brought to the attention of council, the effect of the third writing must be determined without reference to the first,' and, looking alone to the second and third, the third must be held to be merely an attempt to limit the second, so that it would be a consent only to The Cleveland Electric Railway Company. Section 1536-185, Revised Statutes, section 30 of the municipal code,. requires the grant to be made by council to the person or corporation who will agree to carry passengers at the lowest rates of fare and provides that the written consent of a majority of the property holders upon each street or part thereof, on the line of the proposed street railroad, represented, by.the feet 'front of the property abutting on the several streets, along which such road is proposed to be constructed, must be obtained before any grant is made. The requirement that the grant must be made to the person or corporation agreeing to carry passengers at the lowest rates of fare would afford little security if the highest bidder could by obtaining a majority, of the consents prevent a grant to anyone but himself. The right conferred by the legislature is to consent to the construction of a road in the street and a limitation of the consent to a particular bidder is inconsistent with the requirement that the grant be to the lowest bidder and is void. The consent is good, but the limitation is void. The ruling in The State ex rel. v. Bell, 34 Ohio St., 194, where a similar statute was under consideration, is to this effect.

The judgment of the circuit court is reversed, the injunction dissolved, and this court, proceeding to render the judgment that court should have rendered upon the facts found, dismisses the petition.

Reversed and petition dismissed.

Davis, C. J., Shauck, Price, Crew and Spear, JJ., concur.


author: Crew, J.

text:
    The State ex rel. The Physicians’ Defense Company v. Laylin, Secretary of State.

      Foreign corporation for the purpose of defending physicians and, surgeons against prosecution for malpractice — But not agreeing to pay judgment against physician — Is not engaged in the insurance business — Such corporation not entitled to transact business in Ohio — Section 3235, Revised Statutes— Insurance law.

    1. A foreign corporation, the sole business of which as authorized by its charter, is that of defending physicians and surgeons against civil prosecution for malpractice, which, in the prosecution and conduct of said business, issues and sells to members of the medical profession a contract whereby it undertakes and agrees to defend the holder of said contract against any suit for malpractice that may be brought against him during the term therein specified, but does not assume, or agree to assume or pay, any judgment that shall be rendered against him in such suit, is not engaged in the business of insurance, nor is the contract so issued and sold an insurance contract.
    2. But a foreign corporation created for the purpose of engaging in and carrying on such business, is not entitled to have or receive from the secretary of state of the state of Ohio, a certificate authorizing it to transact such business in this state, for the reason that the business proposed is professional business, and as such is expressly prohibited to corporations by section 3235 of the Revised Statutes of Ohio.
    (No. 9487
    Decided November 28, 1905.)
    Error to tlie Circuit Court of Franklin county.

      The facts of this case, in so far as they have relation to the questions here presented, or are essential to a determination of the judgment proper to . he entered herein, are stated in the opinion.

      Messrs. Nash, Lents, Addison é Fritter; Mr. Charles M. Nieser and Mr. B. S. Taylor, attorneys for plaintiff in error,
    cited and commented upon the following authorities:

      State v. Insurance Co., 69 N. E. Rep., 608; People v. Fidelity & C. Co., 153 Ill., 25; 38 N. E. Rep., 752; Cowell v. Springs Co., 100 U. S., 55; Bartholomew v. Bentley, 1 Ohio St., 37; Leonard v. Insurance Co., 97 Ind., 299; 16 Am. & Eng. Ency. Law, 838; State ex rel. v. Investment Co., 50 N. W. Rep., 1028; Insurance Co. v. Insurance Co., 38 Ohio St., 11; West v. Insurance Co., 27 Ohio St., 9; Little v. Insurance Co., 38 Ohio St., 117; Insurance Co. v. Cappellar, 38 Ohio St., 572; Insurance Co. v. Butler, 38 Ohio St., 133; May on Insurance, sec. 1; Commonwealth v. Beneficial Assn., 137 Pa. St., 419; Porter on Insurance, 44; Commomvealth v. Bicycle Assn., 178 Pa. St., 636; 35 Atl. Rep., 197; Pearl v. Railroad Co., 57 N. E. Rep., 339; Quinn v. Railroad Co., 30 S. W. Rep., 1036 ; Bristor v. Krets, 49 N. Y. Supp., 404; Ex parte Garland, 4 Wall. (U. S.), 333; State v. Raihvay Co., 67 N. E. Rep., 93; Electro-Medical Institute v. State, 103 N. W. Rep., 1078; State v. Paul, 76 N. W. Rep., 861; secs. 3235 and 3691-14 to -24, Rev. Stat.

      Mr. Wade H. Ellis, attorney general, and Mr. ■George H. Jones, attorneys for defendant in error,
    cited and commented upon the following authorities:

      State v. Insurance Co., 69 Ohio St., 317; Spelling on Extraordinary Relief, see. 1807; State ex rel. v. Ackerman et al., 51 Ohio St., 163; 6 Thompson on Corporations, par. 7876-7884; W. U. Tel. Co. v. Mayer, 28 Ohio St., 521; Railroad Co. v. Pennsylvania, 136 U. S., 114; Bank v. Earle, 13 Pet. (U. S.), 566; Insurance Co. v. Massachusetts, 10 Wall., 566; chap. 127, Laws of Indiana, app. March 9, 1901, secs. 289 and 3235, Rev. Stat.
   Crew, J.

On June 20, 1904, the plaintiff in error, a foreign corporation incorporated and organized under the laws of the state of Indiana, brought suit in mandamus in the court of common pleas of Franklin county, Ohio, against the defendant in error, Lewis C. Laylin, to compel him, as secretary of state of the state of Ohio, to issue and deliver to it, agreeably to the provisions of section 148d, of the Revised Statutes of Ohio, a certificate authorizing it to transact business in the state of Ohio as a foreign corporation. The petition filed by plaintiff in error in the court of common pleas contains among other allegations the following: '

“Your relator further shows that its proposed plan of business as determined by its charter is: to aid and protect the medical profession in the practice of medicine and surgery by the defense of physicians and surgeons against civil prosecutions for malpractice; by the sale of contracts to physicians and surgeons for a stated and agreed compensation by which it undertakes and agrees to maintain and manage the defense of the holder of such contract against any action brought against him for damages for alleged malpractice in relation to or connection with services performed, or which should have been performed, within the time covered by the contract; by engaging attorneys and paying the expense of snch defense. Bnt yonr relator does not assume to pay any judgment for damages or costs or other judgment rendered against the contract holder, but only agrees to arrange and maintain the defense of the suit brought against- the contract holder for malpractice up to the time judgment is rendered therein. ’ ’

A copy of the form of contract made and entered into between the Company and its contract holders is attached to the petition, and by appropriate averment is made part thereof. This contract, so far as its terms and provisions are material and pertinent to the present inquiry, is as follows :

“In consideration of the written and printed application, which is hereby made a part of this contract, and the sum of Ten Dollars, receipt of which is hereby acknowledged, being the consideration of one year’s defense, and the further payment of Ten Dollars annually, in advance on the .... day of ........ of each year during the life of this contract,
The Physicians’ Defense Company.
(Hereinafter known as company)
hereby agrees to defend the legally qualified physician, .....................................of the City of........, County of........, State of........, against all civil suits for damages for malpractice, based on professional services rendered by himself or his agent during the term of this contract, at his own expense, not exceeding Twenty-five Hundred Dollars in defense of any one suit, nor exceeding in the aggregate Five Thousand Dollars in defense of suits based on services rendered by the holder hereof, within one year from the date of this contract, or within any one year for which this contract shall be renewed, all in the manner and upon the conditions herein below stated, to-wit:
“Immediate notice by telegram, must be given the company at the Home Office at Fort "Wayne, Ind., of any suit brought or demand made; and the holder hereof shall immediately forward the summons, or other process served, and the complaint or petition filed; together with a full and complete history of the case and services rendered.
“Upon receipt of notice from the holder hereof that a suit has been commenced against him for damages for civil malpractice, the company will employ a local attorney, in whose selection the holder hereof shall have a voice, who, together with the company’s attorney, will defend the case without expense to the holder hereof.
‘ ‘ Such defense will be maintained until final judgment shall have been obtained in favor of the holder hereof, or until all remedies by appeal, writ of error or other legal proceedings shall have been exhausted, or until the sum of Twenty-five Hundred Dollars shall have been expended in said defense; provided said company shall not be under obligation to expend more than Five Thousand Dollars in the aggregate in the defense of suits based on services rendered, by the holder hereof, during the original one year term of this contract.
“Said company does not obligate itself to pay or to assume or to secure the payment of any judgment rendered against the holder hereof in any suit defended by it.
“The company shall not compromise any suit or claim for malpractice against the holder hereof. Nor shall the holder hereof, after the company has entered upon the defense of any snch suit in behalf of the contract holder, compromise the same without the consent of the company in writing first thereto had, and by reimbursement of the company its expenses theretofore incurred.” ■

The plaintiff further alleges in its petition that prior to the filing thereof, to-wit: on the twenty-sixth day of January, 1904, pursuant to the provisions and requirements of section 148i, of the Revised Statutes of Ohio, and in conformity therewith, it made due application to Lewis C. Laylin, secretary of state, for a certificate authorizing it to do business in Ohio, tendered to him the required fee therefor, and demanded of him that he issue to it a certificate admitting it to the state of Ohio as a foreign corporation, and entitling it to transact in this state, the business authorized and provided for in its charter, but that said Lewis C. Laylin then refused, and still refuses so to do. ' "Wherefore, plaintiff prays that an alternative writ of mandamus may issue commanding said Lewis C. Laylin as secretary of state, to show cause, if any he have, why a peremptory writ should not issue requiring him to make and deliver to plaintiff a proper certificate authorizing it to transact and conduct its proposed business in the state of Ohio. To this petition the defendant, Lewis C. Laylin, interposed a general demurrer which was, upon submission, sustained by the court of common pleas and the petition of plaintiff was dismissed. On appeal to the circuit court the cause was there again heard and submitted upon the demurrer to the petition, and a like judgment was rendered by that court sustaining said demurrer and dismissing the plaintiff’s petition. To procure a reversal of this judgment of the circuit court, The Physicians’ Defense Company prosecutes the present proceeding in error.

It is the claim and contention of counsel for defendant in error in this case, that the plaintiff in error, The Physicians’ Defense Company, is without right, under favor of section 148 í?, Bevised Statutes, -to either demand or receive from the secretary of state of the state of Ohio, a certificate admitting it-to this state with authority to transact business herein as a foreign corporation, because: 1. The business it proposes to transact is an “insurance business,” and said company has not complied with the statutes of this state regulating the admission to Ohio of foreign insurance companies. 2. That the business which said company proposes, if admitted, to conduct and carry on in this state is “professional ■business” and as such is expressly prohibited to corporations by section 3235, Bevised Statutes, which section provides in part as follows: “Corporations may be formed in the manner provided in this chapter for any purpose for which individuals may lawfully associate themselves, except for carrying on professional business. ” It is admitted in this case that if the business which plaintiff in error is, by its charter, authorized and empowered to transact, is an insurance business, that then plaintiff in error is not entitled to admission to this state, because of its not having complied with the requirements of the statutes of this state regulating and governing the admission of foreign corporations doing an insurance business. "While we have in Ohio no general statutory definition of insurance, it has been repeatedly held by this court, in numerous cases, that the contract of insurance, is a contract of indemnity. May on Insurance, section 1, defines it as “a contract whereby one for a consideration, undertakes to compensate another if he shall suffer loss.” In Joyce on Insurance at section 24, it is said: “It is elementary that the contract of insurance, other than that of life and of accident, where the injury results in death, is one of indemnity. By indemnity is meant that the party insured is entitled to be compensated for such loss as is occasioned by the perils insured against, in precise accordance with the principles and terms of the contract of insurance. The right' to recover being commensurate with the loss sustained.” Measured by these definitions, and assuming the same to be correct, whether or not The Physicians’ Defense Company is an insurance company, and the business it proposes to transact is insurance business, must be determined from its charter, and from a consideration of the character, terms, and provisions of the contract it issues and sells.

The purpose of the Company, as defined and declared in and by its charter, is as follows: ‘ ‘ The purpose of this association shall be to aid and protect the medical profession in the practice of medicine and surgery, by the defense of physicians and surgeons against civil prosecutions for malpractice. ” And the proposed plan of conducting its said business, as stated in its charter, is as follows:

“The association shall issue to physicians and surgeons, for stated and agreed compensation, contracts by which it will undertake and agree to defend the holder of the contract at its own expense against any action brought against him for damages for alleged malpractice, in relation to or in connection with services performed or which should have been performed within the time covered by the contract. But the association shall not, in any defense contract issued by it, assume, or agree to assume, or pay any judgment for damages for malpractice rendered against the holder of such contract. ’ ’

The contract issued by the Company under this provision of its charter, a copy of which contract is hereinbefore set out, is neither in form nor legal effect, anything more than a contract for services. And said contract imposes upon the Company no duty or obligation other than that of defending the physician or surgeon who may hold such contract, against any action that may be brought against him for alleged malpractice. By its contract the Company does not undertake or agree to indemnify or protect its contract holder against loss that may result to him because of any judgment that may be rendered against him in such suit, but any intention or purpose on its part to assume such risk oi liability, is in express terms directly negatived by the language of the contract itself, which as we have seen provides: 1 ‘ Said Company does not obligate itself to pay, or to assume, or to secure the payment of, any judgment rendered against the holder thereof in any suit defended by it.” The undertaking of the Company is not that it will compensate the physician or surgeon for loss or injury he may actually sustain, but only that it will, after suit brought against him, undertake and conduct for him his defense, and thereby, if may be, protect him against liability to loss, by preventing judgment being obtained against him. If the Company successfully performs its contract no loss or injury results to the defendant. But if not, and judgment-be obtained against him, there is no obligation or liability on the part of the Company to pay or satisfy said judgment or any part of it. Obviously, we think, such contract is not one for indemnity, for under it the liability of the Company ceases, at the precise point and time, that the right to indemnity attaches or begins. We are of opinion, therefore, that the plaintiff Company is not an insurance company, nor the contract it issues an insurance contract.

There remains then the question, Is the business in which The Physicians’ Defense Company pro-' poses to engage, if admitted to this state, professional business 1 And this we think must be answered in the affirmative. Becurring to its charter, and to the terms and provisions of the contract issued and sold by said company, we learn that the business authorized and proposed, is that of defending physicians and surgeons against suits at law that may be brought against them for alleged malpractice. The language of the contract is: “The Physicians’ Defense Company hereby agrees to. defend the legally qualified physician ........ of the City of........, County of........, State of ........, against all civil suits for damages for malpractice,” etc. By the plain letter of this contract, the business to be transacted, and the matter or thing stipulated to be undertaken by the company, is the defense of a law suit. The services necessary to be rendered by the company in the carrying out and performance of its said contract, being such, as in this state, may only be performed by a member of the legal profession, an attorney at law, who shall have been first duly authorized and licensed to perform the same, are professional services, and a business which in its conduct or transaction requires and permits only that character .of service, is essentially and certainly, a professional business. But it is said by counsel for plaintiff in error, that The Physicians’ Defense Company, being a corporation, an impersonal entity, cannot and does not itself, engage in the practice of law, or the management and conduct of defenses in suits at law, but in what it does, or obligates itself to do, it undertakes only “to act. as the agent of the contract holder in retaining legal counsel and in managing- and maintaining the defense of the suit.” How else we may ask, could the corporation, being an impersonal entity, discharge its contractual obligation, other than by the employment of natural persons as its authorized agents-to carry out and perform its said contract1?

The agents to be employed, are and must be, attorneys at law, and by the express terms of its contract they are to be employed and paid by the corporation. While, therefore, the services rendered by the persons thus employed are rendered to, and in defense of, the contract holder, they nevertheless are rendered for, and in legal contemplation are performed by, the corporation itself. If this be not the engaging in or carrying on of professional business, then it would be difficult to conceive how professional business could be engaged in or carried on by a corporation. We are of opinion that the business proposed is professional business, and may not therefore be transacted or-carried on by a corporation in the state of Ohio because of the prohibitive provisions of section 3235, Revised Statutes. This conclusion renders it unnecessary to consider the further question suggested by counsel for defendant in error in their brief, viz.: that the contract issued and sold by The Physicians ’ Defense Company, is a contract, the making of which is against public policy, because of the stipulations and provisions therein contained, restricting the right to compromise. .

Judgment affirmed.

Davis, C. J., Shauck, Price, Summers and Spear, JJ., concur.


author: Price, J.

text:
    The State ex rel. Bender, Jr., Treasurer, v. Lewis, Auditor.

      Compensation of county auditors — Entitled to graded per cent. . of entire grand duplicate, when — Amount allowed on school hoard levy — Section 1069, Revised Statutes.

    Under section 1069, Revised Statutes, which provides for the compensation of county auditors, they are entitled to the graded per cent, therein specified, calculated on the entire grand duplicate of the county, including moneys collected on levies made hy school hoards, and also, to one percentum on the latter.
    (No. 9643
    Decided November 28, 1905.)
    Error to the Circuit Court of Hamilton county.
    On the eighteenth day of July, 1905, the plaintiff in error filed in the circuit court of Hamilton county, a petition in mandamus against the defendant in error, in which it is alleged, that relator is the treasurer of Newtown School District of Hamilton county, and that for the year 1904 the board of directors of said district, duly fixed the rate of taxation necessary to be levied for school purposes after the state funds are exhausted, as follows: for tuition, 6.67 mills; for building and contingencies, 1.33 mills; for bonds, interest, etc., 1.00 mills; that these levies were certified to the auditor of the county and the same were duly assessed by him upon all the taxable property of the district and the tax was entered upon the tax duplicate of said county for the year 1904. It is further alleged that at the February settlement of the December collection of taxes, it was ascertained that there had been collected on said several levies the gross sum of $1,473.90 plus $11.19 of other taxes, from which there was deductible under sections 1069 and 1117, Revised Statutes, for auditor’s and treasurer’s fees, $29.48, leaving as apportionable to said school district the following several sums: For tuition, $1,078.77; for building contingencies, $215.11; for bonds, interest, etc., $161.73; making a total of $1,455.61.
    The relator filed with the auditor a certificate of the township clerk to the effect that the relator was the treasurer of the said school district, and demanded of the auditor that he draw his warrant upon the county treasurer in favor of relator, as treasurer of said school district for the full remainder of the amount above stated — $1*455.61; hut said auditor refused to draw his warrant for said sum but did draw it for $1,452.67 and the relator received it, and the same was paid by the county treasurer. But said auditor refused to draw his warrant for $2.94 remaining due to said school district..
    The prayer of the petition is for a writ of mandamus commanding the auditor to draw his warrant on the county treasurer in favor of relator for the further sum of $2.94, unless he show cause why he should not do so.

      The auditor immediately filed an answer, denying the right to the writ prayed for, and setting up his right to the $2.94 in dispute, because of the compensation provided for the auditor by section 1069, Revised Statutes, as amended on the twelfth of May, 1902 (95 O. L., 574), to be allowed him at the settlement under sections 1115 and 1043, Revised Statutes, on account of the December collection of taxes in 1904. He avers that under said section 1069, his compensation should be the graduated percentages provided for in said section, calculated upon the entire gross collections of the grand duplicate of the county, including in the basis the collections made under levies by school district boards, the compensation so ascertained to be deducted from the shares or portions of revenue payable to the state, county, township, corporations and school districts, and in addition thereto, a further compensation as also provided in said section, of one per cent, on the gross collections under such school board levies.
    The auditor says his construction of section 1069 is the reasonable and proper construction and sets out what he regards as sufficient reasons for the same, such as the number of school districts in Hamilton county, ninety-three in number, the ascertainment and preservation in his office of the boundaries of each; the placing on the duplicate of a separate rate of tax for each district; the separate distribution to each district of its school taxes; settlement made with each of the ninety-three districts; all which impose on the auditor the clerical and supervisory work outside of, distinct from and additional to that required of him in making up the general duplicate for taxation, for which the graded per cent, is prescribed as the basis of compensation.

      The respondent, auditor, next sets out certain calculations made on the construction contended for by relator, which, he says show that his income under such construction of section 1069 would not be sufficient to pay the working expenses of his office.
    • The relator demurred to the answer. The circuit court overruled the same and the relator not desiring to reply, the court dismissed the petition. To-the judgment of that court, error is prosecuted in this court.
    . Messrs. Ireton, Collms, Schoenle é Poor, attorneys for plaintiff in error.

      Mr. W. M. Ampt; Mr. A. D. Alcorn and Mr. Wm.. Thorndyhe, attorneys for defendant in error.
   Price, J.

The reasons assigned by the auditor for his construction of section 1069, Revised Statutes, and which he sets out as part of his answer, are-argument rather than pleading, and have no weight, against the demurrer, unless the meaning of that section is doubtful or uncertain. Or to state it otherwise, if the language of the section is plain,, extrinsic facts and circumstances as to the effect and consequences of its operation — whether his compensation is adequate of inadequate — should not be considered. The whole controversy is as to the meaning; of said section.

The auditor maintains that in apportioning to the' Newtown School District the sum of $1,452.67 as its distributive share of the school levies, the amount-due. said district should be, and it was by him, ascertained, by a calculation made upon the basis of the-entire gross collections of the grand duplicate at the. rate per cent, fixed by said section, with one per cent, additional on school district funds. As against this, the relator claims that said district is entitled to the sum of $1,455.61, the total amount of the school levies for said district, based on a like per cent, on the gross collections of the grand duplicate, but after deducting therefrom the-.collections made under levies by and for school districts of the county. The difference of views reduced to money, is $2.94, for which a writ of mandamus is asked against the auditor.

Before proceeding further, and as statutes are subject to amendment and repeal, we incorporate the important section referred to in this opinion.

“Section 1069. (Compensation of auditor.) The county auditor, on settlement semi-annually with the county treasurer and the auditor of state, shall be allowed as compensation for his services the following percentages on all moneys collected by the county treasurer on the grand duplicate of the county, and the same shall be apportioned ratably by the county auditor and deducted from the shares or portions of revenue payable to the state as well as the county, townships, corporations and school districts, to-wit: On the first ten thousand dollars, two and one-half per cent.; oh the next ten thousand dollars, one and one-half per cent.; on the next ten thousand dollars, one per cent.; on the next ten thousand dollars, seven-tenths of one per cent.; on the next two hundred thousand dollars, four-tenths of one per cent.; and on all further sums, two-tenths of one per cent.; and on all moneys collected on any special duplicate, five-tenths of one; and on moneys collected on levies made by school boards, one per cent., to be paid as nearly as possible in equal monthly payments, or that monthly estimates in lieu of said salary shall be allowed to said auditor and paid to him by the county treasurer. Provided, however, that in any county whose auditor receives a fixed compensation payable out of the fee fund of said county, the compensation herein provided for shall be received and paid in by him to the credit of said fee fund of said county, as earnings of the county auditor’s office.”

The question therefore arises: is the graded per cent, prescribed by this section based on the collections of the entire grand duplicate, or, upon the total amount thereof after deducting the aggregate of all the collections made upon levies, by the local school boards of the county? Should the school funds apportioned to each school district be counted as a part of the grand duplicate to form the basis of the percentage prescribed in the section, and be also subject to one per cent, as provided in a subsequent clause? There seems to be no dispute about the right to the one per cent, on moneys collected on levies made by the school boards, and this being conceded, it is insisted that when the auditor takes the collections on the grand duplicate as the basis for the percentage allowed in the preceding language of the section, he should, before laying the percentage, deduct from the amount of the grand duplicate, the aggregate of the collections made upon levies by the local school boards; otherwise he will receive double percentage on such school funds.

The amended section under consideration was enacted May 12, 1902 (95 O. L., 574). It is entitled “An act to amend sections 1069 and 1117, and to repeal sections 1070 and 1072, Revised Statutes.” Section 1069 in the revision referred to together with section 1070 provided for compensation of county auditors on a basis of population. Section 1117 in tbe revision referred to provided for the compensation of county treasurers on a percentage of amount collected. The amendment of this section by the act of May 12, 1902, made some changes in the compensation of the treasurer with which we are not here concerned. But the change in section 1069 was quite radical, and the compensation of the county auditor is now a percentage based on the several sums specified in the act as collected by the county treasurer on the grand duplicate of the county. The rate of percentage is graded, and is to be determined on settlement semiannually with the county treasurer and the auditor of state, when he shall be allowed as compensation for his services the certain percentages on all moneys collected by the county treasurer on the grand duplicate of the county, and the same shall be apportioned ratably by the county auditor and deducted from the shares or portions of revenue payable to the state, as well as to the county, township, corporations and school districts. We have in this language the basis of compensation couched in clear and unambiguous language, — “shall be allowed as compensation for his services the following percentages on all moneys collected by the county treasurer on the grand duplicate of the county,” — and after this basis is used in the calculation to ascertain the compensation, “the same shall be apportioned ratably by the county auditor and deducted from the shares or portions of revenue payable to the state, as well as the county, township, corporations and school districts,!’ etc. The school funds raised by local levy are collected on the grand duplicate and are a part of the same, and as such are collected by the county treasurer, and hence the percentage laid is on all moneys collected on the grand duplicate, including school moneys raised by local levies, unless there is something in the balance of the section to exclude such meaning. But we discover nothing to indicate a different meaning.

On the contrary the legislative purpose is made more manifest in fixing the schedule of amounts upon which the varying rates of percentages are laid. On the first ten thousand dollars, the rate is. two and one-half per cent.; on the next ten thousand dollars, the rate is one and one-half per cent.; on the next ten thousand dollars, it is one per cent.; on the next ten thousand dollars, it is seven-tenths of one per cent.; on the next two hundred thousand dollars, it is four-tenths of one per cent.; and on all further sums, two-tenths of one per cent.

If the section ended thus, who would deny that school funds raised from levies made by school boards should be included in collections made by the county treasurer on the grand duplicate of the county? Beyond doubt they would be so included.

But the balance of the section says: “and on all moneys collected- on any special duplicate, four-tenths of one; and on moneys collected on levies made by school boards one per cent., to be paid,” etc.; and it is urged that as there is an express provision here, that the auditor’s per cent, on school moneys is one per.cent., such moneys should not be counted as a part of the grand duplicate on which his percentage is calculated in the former part of the section.’ To do so, it 'is said, will give him double percentage as to such school funds. If we assume the latter to be a fact, can it change the plain language of the former provision?

If the relator’s position is to he sustained, it must he sustained by reading into the section under consideration a very valuable exception, that could easily have been expressed in simple words, had the legislature intended it to exist and have operation. The section is but one provision, and that is a provision for the compensation of county auditors. It is not to be separated so as to consider one paragraph a general, and the other part a special statute. This construction is attempted by relator’s counsel and when they so have the premises, they quote the rule, that a special statutory provision upon a particular subject supersedes and takes the place of a more general provision found elsewhere in the statute. This rule is sought to be drawn from the opinion of the court in Railway Co. v. Commissioners, 71 Ohio St., 454. The statutes there under consideration were separate and distinct enactments, being sections 5182, 6411, and 6451, Revised Statutes — the former a part of title one and the latter two a part of title two. It would be carrying the above doctrine to an unjustifiable extreme, to apply it here where the premises do not exist. There are no two statutes in section 1069. It provides for the compensation of county auditors, and after it fixes a percentage on the several sums collected on the grand duplicate of the county, which include school moneys. levied by local boards, it provides an additional one per cent, on moneys collected, on levies made by school boards.

It is claimed for the auditor that this addition is made, because of the extra or additional service rendered by him on account of those local levies; that besides the making up of the grand duplicate, he must prepare a tax list to show what property and persons are in the school district; make settle-merits and distributions for each district, not only with the county treasurer, but with the school treasurers, making a complete record of all such transactions. This may have been in mind when the section was enacted. We cannot say. We can only determine what the legislature meant by what it has plainly said.

We think the court rendered the proper judgment and it is' affirmed.

Judgment affirmed.

Davis, C. J., Shauck and Crew, JJ., concur.


author: Shauck, J.

text:
    Hunter, Admr. v. The Niagara Fire Insurance Company.

      Action to recover upon fire insurance policy — TJpon cause arising in another state — Limited to statutory time of foreign state —Section Jf990, Revised Statutes — Injunction against action does not prevent running of limitation, when — Question of who may plead' limitation of statute — Interstate law — Pleadings.

    1. An action to recover upon a policy of fire insurance, though transitory, when brought in this state upon a cause arising in another state is, by virtue of section 4990, Revised Statutes, limited to the time fixed by the statute of that state.
    2. An injunction against the commencement of an action does not save the running of the statute of limitations unless the statute so provides, and no such provision is found in the statute of Ohio or in that of the state of Florida.
    3. Only those who are actors in procuring the allowance of such injunction can, upon that account, be equitably estopped from pleading the statute of limitations.
    (No. 9157
    Decided November 28, 1905.)
    Error to the Circuit Court of Ashland county.

      Mrs. Hunter brought suit in the court of common pleas to recover against the defendant, a New York corporation, the amount of a policy of fire insurance executed by it upon her property situated in Clay county, in the state óf Florida. Her petition was filed March 30, 1898. It alleged that the policy was executed on April 29, 1891, and that the property was totally destroyed by fire on the twenty-first day of May, 1891.
    She further alleged that on or about the eighth day of June, 1891, the circuit court of Clay county, Florida, in a suit wherein Post and Flagg were plaintiffs and T. J. Adams, J. I. Adams, The Niagara Fire Insurance Company, Thomas S. Hunter et al. were defendants, an injunction was allowed restraining the defendants from adjusting, settling, collecting or attempting to collect the amount of said loss; that on or about March, 1893, she learned that said injunction had been dissolved and that afterwards said cause was appealed to the supreme court of Florida and was pending therein for several years. She also alleged that she was a resident of Ohio. In its answer the company alleged numerous matters of defense including the following: that the insurance was upon property situated in the state of Florida; that the contract was executed in that state; that the cause of action arose there; that by the statutes of Florida, and therefore by the statutes of Ohio, an action upon it was barred in five years; that the company has kept an office at Jacksonville, Florida, where the policy was executed, from that time until the beginning of the suit and that in the injunction suit in Florida, Mrs. Hunter was not a party and was not served with summons.

      Upon the trial of the case the statute of limitations of the state of Florida was introduced by stipulation and it provides that an action upon an instrument in writing not under seal is limited to five years. The cause was submitted to the court without the inter- • vention of a jury and judgment was rendered for the plaintiff. In the circuit court that judgment was reversed upon the ground that- the action was upon a Florida contract; that it was barred by the statutes of that state and therefore barred by the statutes of this state.

      Mr. M. L. Smyser and Mr. C. P. Wmbigler, attorneys for the plaintiff in error.

      Mr. J. W. Mooney, attorney for the defendant in error.
   Shauck, J.

The transitory character of an action to recover on a policy of fire insurance is not denied by the judgment of the circuit court. That character requires the conclusion that jurisdiction of the action may be'exercised by a court of any state where service upon the insurer may be effected. The question presented by the record does not relate to the jurisdiction of the Ohio court, but to the time limited for invoking the exercise of that jurisdiction.

This contract of insurance was applied for, signed and delivered in the state of Florida and it covered property situated in that state. The property was destroyed by fire on the twenty-first day of May, 1891. The cause of action then arose in that state. The action was commenced-in a court of Ohio, March 30, 1898. On behalf of the plaintiff it is urged that if this cause of action had arisen in this state it would not be barred by our statute and that the limitation of an action, being a part of the remedy, must, under the general rule upon that subject, be determined by the law of the forum. The force of this view seems to be entirely averted by the terms of our own statute, which, for the government of such a case, adopts the limitation of the state in which the cause of action arose, at least, to the extent that the action cannot be brought here when barred there. Section 4990 of our statutes is: “If, by the laws of the state or country where the cause of action arose, the action is barred, it is qlso barred in this state.” On the trial of the present case the statute of limitations of the state of Florida was introduced by stipulation. An examination of that statute makes it quite apparent that the question is determined by the third section which limits to five years the commencement of “an action upon a contract, obligation or liability founded upon an instrument of writing not under seal.” It follows that when the circuit court concluded that the action was barred it gave full effect to the law of the forum.

But it is urged that the operation of the injunction granted by the Florida court either prevented the operation of the statute or estopped the defendant to plead it. This proposition must fail even if we assume in its aid that the plaintiff was bound by the injunction and that it continued in force for the time necessary to give it the effect claimed. Neither the statute of Ohio nor that of Florida provides for such 'an exception to the operation of the statutes by which actions are limited. In a number of the states the statute expressly saves causes from its operation during the time of the operation of an injunction which prevents the bringing of an action thereon. There is no snch saving unless the statute so provides. In Wood on Limitations, section 243, the law is so stated, and the statement is justified by a collection and classification of the decisions according to the presence or absence of such saving provisions.

Counsel for the plaintiff urge the view that because of the pendency of the injunction suit the company is estopped to plead the statute, and Treasurer v. Martin, 50 Ohio St., 197, is cited in its support. The second proposition of the syllabus in that case states the point decided with reference to the pleading of the statute of limitations; and it holds that the estoppel operates against him who has wrongfully procured the injunction. That the doctrine of the case is not applicable here is apparent,- since, in the present case, the party pleading the statute was in no sense an actor in procuring the injunction.

Judgment affirmed.

Davis, C. J., Price, Crew, Summers and, Spear, JJ., concur.