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district if served with process.(9) Although consent of parties cannot confer jurisdiction on a court of the United States, yet the parties may admit the existence of facts, and the court may found its jurisdiction on such admission.(h) An action may be maintained in the circuit court, although the right to sue is given by a state law;(i) but the party must take his remedy in the same manner as he would in any other competent tribunal, and may be enjoined in a proper case.(j) A municipal corporation may be sued although the statute creating it exempts it from suits elsewhere than in the state court.(k)
Nor AFFECTED BY STATE LEGISLATION. The jurisdiction of the United States courts cannot be affected by state legislation. They will enforce equitable rights if they have jurisdiction of the subject matter and the parties. (1) And the fact that the legislature has conferred jurisdiction on state courts to enforce such rights does not oust the jurisdiction of the federal courts.(m) The state legislature cannot authorize the institution of a suit against a receiver appointed by a federal court,(12) nor can it require leave of court before bringing an action on a judgment rendered by a state court.(0)
SOUTHERN DISTRICT OF NEW YORK. The following are the cases affected by the above decision: The district court for the southern district of New York has jurisdiction over a vessel attached in the Morris canal basin, at Jersey City.(p) Its jurisdiction does not extend below low-water mark on the New Jersey shore.(9) It has jurisdiction, although the vessel, when seized, was attached to a pier on the New Jersey side of the North river, and upon the waters of the bay.(-) The L. W. Eaton was attached by the marshal under process issued by the district court for the southern district of New York, while she was afloat in the navigable waters of the Hudson river, lying west of Manhattan island, and to the south of the mouth of Spuyten Duyvil creek, and wbere the tide ebbed and flowed, she being fastened by means of a line to a dock at Jersey City, in the State of New Jersey, and outside low-water mark, said wharf projecting into the navigable waters of the Hudson river lying west of Manhattan island, and to the south of the mouth of Spuyten Duyvil creek.(s)—[ED.
(m) Benjamin v, Cavaroc, 2 Woods, 168.
(n) Hale v. Duncan, 7 Cent. Law J. 146. See West. U. Tel. Co. v. Atlantic & P.T. Co.7 Biss.
(g) McMicken v. Webb, 11 Pet. 25; Vore v. Fowler, 2 Bond, 291; Locomotive Co. v. Erie R. Co. 10 Blatchf. 292.
(n) Ry. Co. v. Ramsey, 22 Wall. 322.
(1) Holmes v.0.& C. R. Co.5 Fed. Rep. 75; Keith v. Rockingham, 2 Fed. Rep. 831.
() City Bank v. Skelton, 2 Blatchf. 26.
(k) Cowles v. Mercer Co. 7 Wall. 118; Cun. ningham v. Ralls, 1 Fed. Rep. 453.
(2) Smith v. Railroad Co.99 U. S. 399. See Per. sons v. Lyman, 5 Blatchf. 170; Livingston v. Jef. ferson, 1 Brock. 203; Dennick v. Railroad Co. 103 U.S. 11.
(0) Phelps v. O'Brien Co.2 Dill. 518.
(6) Malony v. City of Milwaukee, 1 Fed. Rep. 611.
(T) U.S. v. The Julia Lawrence, synopsis of opinion, 6 Amer. Law Rev. 333, cited in full; The L. W. Eaton, 9 Ben. 291.
(*) The L. W. Eaton, 9 Ben. 289, denied.
NEW ORLEANS WATER-WORKS Co. v. Sr. TAMMANY WATER-WORKS Co.
and another. *
(Circuit Court, E. D. Louisiana, September, 1882.) 1. JURISDICTION OF CIRCUIT COURT.
The circuit court of the United States has jurisdiction in a case where its correct decision depends on the construction of a section of the constitution of the United States.
Railroad Co. v. Mississippi, 102 U. 8. 141, followed.
The complainant, the New Orleans Water-works Company, having been chartered, in 1877, by the legislature of Louisiana, the exclusive right and privilege was then conferred on said company of supplying the city of New Orleans with water by a system of public water-works. In 1879 a new consti. tution was adopted by the state, by which it was provided, in section 258, that “the monopoly features in the charter of any corporation now existing in the state, save such as may be contained in the charters of railroad companies, are hereby abolished." Held, that quoad the complainant's charter, the said constitutional provision was null and void, under section 10 of article 1 of the constitution of the United States, as impairing the obligations of the contract
between the state and the complainant, as set forth in the latter's charter. 8. POLICE POWER.
Whenever any business, occupation, rights, franchises, or privileges become obnoxious to the public health, manners, or morals, they may be regulated by the police power of the state, even to suppression,-individual rights being compelled to give way for the benefit of the whole body politic; but when, in the exercise of the police power, private property or private vested rights must be taken for public use, in order to carry out, or allow to be carried out, improvements or regulations, or to carry on business or occupations, or schemes of public works, looking to the amelioration and benefit of the public health, manners, or morals, such private property, or private rights of property, must be entitled to the protection given by the constitution of the United States, and by that of the state of Louisiana, declaring that private property shall not “ be taken for public use without just compensation,” and “previ. ously made."
Const. U. 8. Fifth Amend. ; Const. La. 1879, $$ 155, 156; Crescent City, etc., Slaughter-house Co. v. Butchors' Union, etc., Slaughter-hous0 Co. 9 FED. REP. 743, affirmed.
In Equity. On application for an injunction pendente lite.
PARDEE, C. J. The hearing is on the bill, exhibits, and affidavits.
That in March, 1878, and for years prior thereto, the city of New Orleans was tho owner and in possession of a system of water-works for the supplying of the said city, and the houses and inhabitants thereof, with water, &c *Reported by Joseph P. Hornor, Esq., of the New Orleans bar. Affirmed. See 7 Sup. Ct. Rep. 405.
quired from the Commercial Bank of New Orleans under grants and legislation of the state giving the said city the necessary authority and privilege therefor exclusively forever.
That the said city was embarrassed in the financial management thereof, and was indebted therefor in the large sum of $1,393,400, which indebtedness was represented by outstanding bonds issued by the city, running 40 years from date and bearing 5 per cent. per annum interest, known as the "waterworks bonds."
That in 1877, in order to relieve the said city from its embarrassment growing out of its indebtedness, the legislature of the state of Louisiana, at an extra session held in that year, passed and adopted an act entitled “An act to enable the city of New Orleans to promote the public health; to afford greater security against fire by the establishment of a corporation to be called the New Orleans Water-works Company; to authorize the said company to issue bonds for the purpose of extending and improving the said works, and to furnish the inhabitants of the city of New Orleans an adequate supply of pure and wholesome water, and to permit the holders of water-works to convert them into stock and to provide for the liquidation of the bonded and floating debt of the city of New Orleans."
That said act provided that a corporation be created, to be known as the New Orleans Water-works Company, and among other things provided that the holders of the “water-works bonds” might convert them into the capital stock of the said company, and that, when so converted, the said bonds should be surrendered and canceled; that there should be issued to the city of New Orleans stock amounting to the sum of $606,600, in full-paid shares of stock, and an additional full-paid share of stock to every $100 of the said "waterworks bonds” which she had paid, taken up, or funded, and that for the purpose of carrying out the provisions of the act all of the certificates for all of the stock in the said company should be issued to the city of New Orleans; one set of certificates, equal in value and amount to the then outstanding par value and amount of the said “water-works bonds," being held by the city to be exchanged for the said bonds, with the holders thereof, and the other set of certificates being held by the said city in her own right and in trust for the holders of all her other bonded and floating indebtedness.
And that it was also provided in the said act that the said water-works company should be organized by the mayor of the city giving 30 days' notice that he would receive subscriptions of bondholders who may agree to exchange their said bonds for the stock aforesaid, and that the city should subscribe to the amount of her interest and the bonds redeemed or funded by her, as soon as the sum of $500,000 in par value should have been subscribed by the holders of the water-works bonds, and the bonds surrendered and canceled as provided in the act, and that thereupon the company should be organized with a board of directors,—four to be appointed by the mayor of the city, and three to be appointed by the stockholders other than the city,
That all the conditions and provisions of said act were accepted and complied with by said city, and by the holders of said “ water-works bonds," who made the subscriptions required by the act, in manner and form as required, so that on the -- day of March, 1878, the said company was duly organ
ized, and thereupon said company agreed to and accepted all of the conditions of the said act, as well as those of an amendatory act passed February 26, 1878, the provisions of which it is not necessary to recite, whereby the complainant became and was vested with corporate character, and with all the rights, and privileges granted by the said act No. 33, Ex. Sess. 1877, and the amendatory act thereto of 1878; and thereupon the city of New Orleans, as provided by the said acts, did by notarial act transfer, set over, and grant unto complainant all its rights, title, and interest in and to the water-works in said city, as it had acquired the same from the Commercial Bank of New Orleans, and all subsequent additions thereto.
That by reason of the premises the complainant became and was vested with full and absolute and complete title to all the said water-works, and to all the privileges acquired by the city of New Orleans from the Commercial Bank of New Orleans, and the exclusive right of supplying the city of New Orleans and its inhabitants with water from the Mississippi river, and any other stream or river, by means of pipes or conduits, and the right of con. structing any necessary works, engines, or machinery for that purpose, for the period of 50 years from and after March 31, 1877.
That the said act No. 33 of 1877, aforesaid, also conferred upon complainant the right to increase the capital stock of the corporation, and to borrow money for the purpose of improving and enlarging its works, etc., and for this latter purpose complainant was authorized to issue bonds of the company to an amount not exceeding $2,000,000, and in such sums and on such terms as the complainant might determine, securing the same by mortgage on all the property and franchises of the complainant, acquired and to be acquired; but the said bonds were not to be issued nor disposed of except upon the consent and approval of the council of the city of New Orleans.
That for the purpose of enlarging and improving the water-works, and in compliance with said act, complainant has expended large sums of money, and has, with the consent and approval of the council of said city of New Or. leans, made, issued, and disposed of a large amount of bonds, secured by mortgage on its franchises and works, and has received the proceeds thereof and devoted them to the enlargement and improvement of the works, to supply the said city and its inhabitants with water.
That complainant has in all things acted in good faith; that it accepted the terms and conditions of said act of the legislature only after baving obtained the full consent of the city of New Orleans; that complainant supposed that it was obtaining the full and exclusive right and privilege of supplying the city of New Orleans with water by a system of public water-works, to the exclusion of all other companies, otherwise complainant would never have accepted the terms and provisions of the said act of the legislature.
That it was by reason of the exclusive right so as aforesaid granted that complainant was able to borrow money and negotiate the said bonds.
That in order to continue to comply with the terms of and provisions of said act, and make the water-works competent to an adequate supply of water in said city of New Orleans, complainant will be compelled to borrow large sums of money to be expended thereon; and that unless the exclusive rights and privileges of complainant are protected and preserved, complainant will
be absolutely without credit or means to borrow money or negotiate bonds to carry on the necessary enlargement and improvement of the water-works.
That by reason of the premises the city of New Orleans and the state of Louisiana became and were obligated in equity and good conscience to warrant, maintain, and protect complainant in the full right and exercise of its exclusive rights and privileges aforesaid, and that the obligations of a contract grew up and were created between the said state and city and complainant, which contract, it is claimed, was and is sacred under and by virtue of section 10 of article 1 of the constitution of the United States.
That the new constitution of the state of Louisiana, adopted in December, 1879, article 258, provides that “the monopoly features in the charter of any corporation now existing in the state, save such as may be contained in the charters of railroad companies, are hereby abolished.”
That the defendant company has been lately incorporated under the general incorporation law of the state, with the avowed purpose of establishing a system of water-works to supply the city of New Orleans and the inhabitants thereof with water in competition with complainant, and are holding out and pretending that by virtue of said provision of the constitution of 1879, and of their act of incorporation, and the privileges they will obtain from the council of the city of New Orleans, they have full right and will establish a competing system of water-works in said city.
The defendant has obtained an act of Congress anthorizing the laying of pipes and mains across Lake Pontchartrain, and has applied to the council of the city of New Orleans to pass ordinances giving the right to said defendant to establish competing water-works, and lay down in the streets of the city pipes and mains to that end.
That it is probable the members of the city council will collude with the said St. Tammany Water-works Company, and pass some ordinance or ordinances granting rights and privileges to said St. Tammany Water-works Company in conflict and in competition with the rights of complainant.
That the proceedings and pretensions of the defendant have already injured the complainant, and if continued will undoubtedly inflict irreparable damage.
The bill herein is filed to protect complainant's rights by enjoining the defendants from further action in the premises. As to the pending matter, the issuing of an injunction pendente lite, the case seems so narrow that counsel have argued but two questions, i. e.:
(1) Has the court jurisdiction? (2) Does the constitution on the United States, $ 10, art. 1, protect the complainant against the repeal of the monopoly features of its charter, as declared in article 258 of the constitution of the state of Louisiana, adopted in 1879?
The statement of the second question seems to dispense with argument as to the first. No question could more clearly show “a matter in dispute, arising under the constitution of the United States." And in such a dispute original jurisdiction is given the