U.S. Supreme Court Murray v. Pocatello, 226 U.S. 318 (1912)
Murray v. Pocatello
Argued December 3, 4, 1912
Decided December 16, 1912
226 U.S. 318
ERROR TO THE SUPREME COURT
OF THE STATE OF IDAHO
This Court is not prepared on the facts in this case to overrule the highest court of a state in construing the relative powers of the legislature and municipalities in establishing rates for water.
The Supreme Court of Idaho having held that, under the constitution of the state, the legislature has a continuing and irrevocable power to establish the manner of fixing water rates, and that a municipality can only grant franchises subject to that power, this Court follows that construction, and therefore held that:
A statute of the State of Idaho establishing a method for fixing water rates is not unconstitutional under the federal Constitution as impairing the obligation of the contract with a water company under an ordinance of a municipality previously enacted and which established a different method of fixing such rates.
A court which is not empowered to grant relief whatever the merits may be cannot decide what the merits are, and a judgment sustaining a demurrer to and dismissing the bill on the ground of such lack of power is not res judicata on the merits.
Where the judgment cannot be res judicata on the merits because the court has no power to grant relief, it is not made res judicata by reference to the opinion in which the court expresses its views on the merits.
21 Idaho 180 affirmed.
The facts, which involve the constitutionality under the contract clause of the federal Constitution of a statute of Idaho, are stated in the opinion.
Memorandum opinion by direction of the court. By MR. JUSTICE HOLMES:
This was an application by the defendant in error for a mandate requiring the plaintiff in error, Murray, to appoint commissioners to act with commissioners appointed by the city in determining water rates to be charged by Murray. Murray relied upon an ordinance of June 6, 1901, as establishing by contract the only method of fixing rates. The city relied upon a subsequent statute, § 2839, Rev.Code. The supreme court of the state held that the
constitution in force when the ordinance was passed made it impossible for the city to make a contract on the matter beyond the power of the legislature to change. The constitution declared the use of waters distributed for a beneficial use to be a public use, and subject to the regulation and control of the state, and also declared the right to collect rates for water to be a franchise that could not be exercised except by authority of and in the manner prescribed by law. It then ordained that the legislature should provide by law the manner in which reasonable maximum rates might be established. Art. 15, §§ 1, 2, 6. The court relied upon Tampa Water Works Co. v. Tampa, 199 U. S. 241 ; Home Telephone & Telegraph Co. v. Los Angeles, 211 U. S. 265 , and Louisville & Nashville Railroad Co. v. Mottley, 219 U. S. 467 , which so far sustain its conclusion that we think further discussion unnecessary. We are not prepared to overrule the construction of the legislative power as continuing and irrevocable adopted by the supreme court of the state.
A defense more relied upon was res judicata. In 1909, the city brought a bill in equity in the circuit court, seeking to have the court fix reasonable rates. The defendant demurred for want of jurisdiction to give relief in equity and multifariousness. The decree was that the demurrer be sustained and the bill dismissed. The dismissal was in general terms, but with a reference to the opinion, reported in 173 F. 382. In the opinion, it is true, the court expressed the view that the ordinance relied upon by the defendant was not affected by the subsequent statute, but the point decided, and the only point that could be decided, was that the demurrer should be upheld, and that the court was without jurisdiction to
"take upon itself the exercise of the 'legislative or administrative' power to determine in advance what will be a reasonable schedule of water rates for the defendant to charge for the next three years."
173 F. 385. The
demurrer excludes a decision upon the merits, and even if the decree referring to it did not have the same effect by itself, the opinion to which the decree also refers would show the same thing. Of course, if the court was not empowered to grant the relief whatever the merits might be, it could not decide what the merits were. The two grounds are not on the same plane, as they were in Ontario Land Co. v. Wilfong, 223 U. S. 543 , 223 U. S. 559 , and when jurisdiction to grant equitable relief was denied, the ground of the merits could not be reached. In Forsyth v. Hammond, 166 U. S. 506 , jurisdiction had been taken in the earlier decision relied upon. Here, it was refused.