City of Danville v. Danville Water Co CITY OF DANVILLE v. DANVILLE WATER CO. (Supreme Court of Illinois, June 17, 1899.) Title of Statute.-The purposes of the act of June 6, 1891, of Illinois, entitled "An act to enable cities, towns and villages incorporated under any general or special law of this state to fix the rates and charges for the supply of water furnished by any individual, company or corporation to any such city, town or village and the inhabitants thereof", are fully expressed in its title, as the act merely enables such municipalities to exercise such governmental power by delegation, and cannot be applied so as to be, in effect, amendatory of the charter of a water company created under the general corporation laws. Water Companies-State Powers.*- -The state has power to change the rates to be charged by a water company created to serve the public under the general incorporation act, whenever rates previously established have become extortionate. Water Rates--Subsequent Statute-Obligation of Contracts.-A city, to which the power to fix water rates to be charged by a water company has been given by a statute, may fix lower rates to be charged by such company than those established by an ordinance of the city passed prior to the enactment of such statute without impairing contract obligations. Municipal Indebtedness-Water Hydrants-Rentals. The obligation of a city, under an ordinance fixing the reasonable rate of annual rental to be paid by it for water hydrants, does not create that character of indebtedness to pay which the constitution of Illinois requires that a direct annual tax shall be provided at the time of incurring the indebtedness. Same-Appropriations-Statutes.-Under the revised statutes of Illinois, within the first quarter of the fiscal year which may ensue prior to the passage of an annual appropriation ordinance, a city council may incur any indebtedness not otherwise unlawful, without an appropriation therefor having been previously made. Claims against Municipal Corporations-Interest.*—In the absence of an express agreement, a municipal corporation is not chargeable with interest on claims against it under a contract. *See notes at end of case. City of Danville v. Danville Water Co ERROR by defendant to circuit court. Case Stated. Reversed. This is a writ of error sued out to reverse the judgment entered in the circuit court of Vermilion county against the plaintiff in error city, in favor of the defendant in error company, in an action of assumpsit. In substance, the declaration recites: That the Danville Water Company is incorporated under the general laws with reference to private corporations, and that the city of Danville is incorporated under general laws with reference to municipal corporations. That on November 11, 1882, the city council passed an ordinance giving the water company the privilege of carrying on the business of supplying the city and its inhabitants with water, and giving it the right to use the streets and alleys for the laying of pipes, etc., which ordinance is set forth in hæc verba, and contains provisions as to the details of the work, the locations of hydrants, the rates to private consumers, and other matters, and in section 8 reads: "The city of Danville hereby rents of the Danville Water Company, for the uses hereinafter stated, one hundred fire hydrants, of the character hereinbefore described, for and during the term of thirty years from the passage of this ordinance, *** and agrees to pay rent for said one hundred hydrants at the rate of $75 each per year, and agrees to pay during the unexpired term of said ordinance and privilege for any additional fire hydrants which the city may hereafter locate, at the rate of $62.50 each per year for the next forty additional hydrants, and for all fire hydrants in excess of one hundred and forty at the rate of $50 each per year." That afterwards, from time to time, by various ordinances, which are also set forth in hæc verba, other hydrants were rented for the balance of the term of 30 years, at various prices (from $62.50 to $40 each per annum), until the number reached 158, as follows: Ordinance passed November 11, 1882, 100; June 7, 1883, 1; August 7, 1884, 2; April 1, 1885, 4; June 19, 1890, 5; August 20, 1890, 3,-a total of 115. Ordinance passed September 3, 1891, 3; November 5, 1891, 1; October 20, 1892, 2; June 21, City of Danville v. Danville Water Co 1894, 31; October 18, 1894, 6,—a total of 158. That these ordinances make use of this language: "And the city of Danville hereby rents of the Danville Water Company the said additional fire hydrants," etc., "and agrees and binds itself to pay therefor at the rate of dollars per annum"; the blanks being filled with the number and price. That the ordinance of June 21, 1894, makes a reduction in price from $62.50 to $50 for certain hydrants, and from $50 to $40 for future hydrants. That each of the ordinances contained a provision that a written acceptance should be filed within 10 days, and the declaration avers such acceptance. That the plaintiff built its waterworks and made extensions from time to time in pursuance of the terms of said several ordinances. That from August 1, 1895, to November 1, 1895, it supplied water to each of said hydrants, and that, in accordance with the several ordinances, there is due it $2,620.62. That the city promised to pay this, but has neglected, wherefore it brings suit. The plaintiff in error (the defendant below) filed pleas as follows: First Special Plea. As to all except $1,930, parcel of the several sums of money in the declaration mentioned, defendant says that plaintiff was engaged in the public business of supplying water to the city and its inhabitants, and that on January 19, 1895, the city council, under authority of an act approved June 6, 1891 (Laws 1891, p. 85), passed an ordinance known as "Ordinance No. 517," declaring the rents and rates mentioned in the ordinances set forth in the declaration to be unreasonable and oppressive, and fixing the rental for said 158 hydrants at the following rates, which said ordinance. declared to be just and reasonable, viz. $50 per annum for the first 140 hydrants, and $40 per annum for the next 18 hydrants, making a total of $1,930 for the quarter ending. November 1, 1895; that this new rate went into effect May 1, 1895, and the company was duly notified in January, 1895, of the passage of the ordinance, and of an offer of the city to enter its appearance in the circuit court of Vermilion county MC CAS-31 City of Danville v. Danville Water Co at the February term, 1895, if the company should deem the new rate unreasonable,-wherefore the rates for said water so furnished are $1,930, and no greater sum, and this the defendant is willing to pay. Second Special Plea. Is as to all except $1,930, parcel, etc., and is the same in substance as the first, except that it contains the additional allegations that the rates fixed in the original ordinances are now, and were at the time they were fixed, unjust, unreasonable, and excessive, and in excess of the reasonable compensation for said service, and that said rates were voidable at the option of said city, and that the city, by virtue of the statute aforesaid, as well as by virtue of other competent legal authority, passed said Ordinance No. 517, which is set forth in hæc verba, wherefore the plaintiff is entitled to receive no greater sum than $1,930. Third Special Plea. As to said $1,930, etc., avers a tender of a city warrant prior to the institution of the suit. Fourth Special Plea. As to the whole cause of action, alleges that neither at the time of the passage of the ordinances mentioned in the amended declaration, nor at any other time before or at the time of creating the indebtedness claimed, was any provision made for the collection of a direct annual tax sufficient to meet the same or any part of said alleged indebtedness as it fell due, in manner and form as required by section 12 of article 9 of the constitution of this state. Fifth Special Plea. As to the whole cause of action, alleges that there was no compliance with section 4 of article 7 of the city and village act, which provides that no contract shall be made by the city council unless an appropriation shall have been previously made concerning such expense. A general demurrer was interposed to each of the special pleas. The court sustained the demurrer to each of the pleas, and the city elected to stand by its pleas. The court entered judgment nihil dicit, and assessed the damages at $2,679 and costs (which is $2,620.62, with 5 per cent. interest to date), and entered judgment accordingly, to each of which holdings and judgments the city then and there excepted. The errors assigned are that the court erred City of Danville v. Danville Water Co 2, in sustaining a demurrer to the special pleas numbered 1, 4, and 5; the court erred in entering judgment against the defendant; the court erred in entering judgment against the defendant for interest. G. F. Rearick, City Atty. (Calhoun & Steely, of counsel), for plaintiff in error. W. R. Lawrence and Remey & Mann, for defendant in error. Title of Statute. BOGGS, J. (after stating the facts). There is no force in the position that the title to the act of June 6, 1891, which act is relied upon to confer upon the city council authority to adopt the ordinance set forth in pleas Nos. 1 and 2, does not express the subject embraced in the act. The defendant in error is a corporation engaged in an enterprise essentially public in its nature. Its property and its efforts are devoted to a use in which the public has an interest. It was granted corporate existence to enable it to serve the public. It is not a private corporation, but a quasi public. The duty devolves upon it to furnish water for reasonable compensation and without unjust discrimina tion, and the power resides in the state, acting in its sov ereign capacity, to enforce the performance of this duty. Water Co. v. Fergus, 178 Ill. 571, 53 N. E. 363; City of Danville v. Danville Water Co., 178 Ill. 299, 53 N. E. 118. The state, by the enactment of June 6, 1891 (Hurd's Rev. St. 1897, p. 305, par. 267f), selected the corporate authorities of all incorporated cities, towns, and villages, as agencies of the state, to exercise by delegation the power possessed by the state to secure observance and performance of this duty on the part of any corporation having power and authority to supply water to such municipalities or the inhabitants thereof. The act is not amendatory of the charter of the plaintiff in error city or the defendant in error company. It added nothing to the chartered powers of the former, and detracted nothing from such powers of the latter. It merely clothed the city with authority, as the representative |