Western Union Telegraph Company v. Borough of New Hope/Opinion of the Court

It is conceded that the borough had the right, in the exercise of its police power, to impose a reasonable license fee upon telegraph poles and wires within its limits, and that an ordinance imposing such fee is to be taken as prima facie reasonable. But it is insisted that on the evidence in this case the presumption of reasonableness is rebutted, and that the ordinance as administered is void because a regulation of interstate commerce. While in the exercise of its control over its streets, it is admitted that the borough may supervise the location of the poles erected to sustain the wires of the plaintiff in error, may require them to be marked, may make such inspection of them as may be necessary to protect the public welfare, and may impose a reasonable license fee for the cost of such regulation and supervision, and of the issuing of such permits as may be required for the enforcement thereof, yet it is contended that if the license fee turned out to be in excess of the amount necessary to reimburse the municipality the ordinance became unreasonable and invalid. The superior court in its opinion referred to many decisions of the supreme court of Pennsylvania as definitely establishing, among other propositions, 'that in an action to recover the license fee for a particular year, the same being payable at the beginning of the year, the fact that the borough or city did not expend money for inspection, supervision, or police surveillance of the poles and wires in that year is not a defense,' and 'that the courts will not declare such ordinance void because of the alleged unreasonableness of the fee charged, unless the unreasonableness be so clearly apparent as to demonstrate an abuse of discretion on the part of the municipal authorities.' And it was said that in many of the cases cited the license fee was the same as that imposed by this ordinance. 16 Pa. Super. Ct. 309. The supreme court affirmed the judgment in a similar case on the opinion given below in this. 202 Pa. 532, 52 Atl. 127.

In Chester City v. ''Western U. Teleg. Co.'' 154 Pa. 464, 25 Atl. 1734, in which it was averred in the affidavit of defense that the rates charged were at least five times the amount of the expense involved in the supervision exercised by the municipality, the supreme court said: 'For the purposes of this case we must treat this averment as true, as far as it goes. The difficulty is it does not go far enough. It refers only to the usual, ordinary, or necessary expense of municipal officers, of issuing licenses and other expenses thereby imposed upon the municipality. It makes no reference to the liability imposed upon the city by the erection of telegraph poles. It is the duty of the city to see that the poles are safe, and properly maintained, and should a citizen be injured in person or property by reason of a neglect of such duty, an action might lie against the city for the consequences of such neglect. It is a mistake, therefore, to measure the reasonableness of the charge by the amount actually expended by the city for a particular year, to the particular purposes specified in the affidavit.'

In Taylor v. ''Postal Teleg. Cable Co.'' 202 Pa. 583, 52 Atl. 128, the supreme court said: 'Clearly the reasonableness of the fee is not to be measured by the value of the poles and wires or of the land occupied, nor by the profits of the business. The elements which enter into the charge are the necessary or probable expense incident to the issuing of the license and the probable expense of such inspection, regulation, and police surveillance as municipal authorities may lawfully give to the erection and maintenance of the poles and wires. . . . Whether or not the fee is so obviously excessive as to lead irresistibly to the conclusion that it is exacted as a return for the use of the streets, or is imposed for revenue purposes, is a question for the courts, and is to be determined upon a view of the facts, not upon evidence consisting of the opinions of witnesses as to the proper supervision that the municipal authorities might properly exercise and the expense of the same.' And see Philadelphia v. ''Western U. Teleg. Co.'' 32 C. C. A. 246, 60 U.S. App. 398, 89 Fed. 454.

Concurring in these views in general, we think it would be going much too far for us to decide that the test set up by the plaintiff in error must be necessarily applied, and the ordinance held void because of failure to meet it. As the supreme Court pointed out, the elements entering into the charge are various, and the court of common pleas, the superior court, and the supreme court of Pennsylvania have held it to be reasonable, and we cannot say that their conclusion is so manifestly wrong as to justify our interposition.

This license fee was not a tax on the property of the company, or on its transmission of messages, or on its receipts from such transmission, or an its occupation or business, but was a charge in the enforcement of local governmental supervision, and as such not in itself obnoxious to the clause of the Constitution relied on. St. Louis v. ''Western U. Teleg. Co.'' 148 U.S. 92, 37 L. ed. 380, 13 Sup. Ct. Rep. 485, 149 U.S. 465, 37 L. ed. 810, 13 Sup. Ct. Rep. 990.

Judgment affirmed.

Mr. Justice White, Mr. Justice Peckham, and Mr. Justice McKenna dissented.