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U.S. Supreme Court

Minneapolis v. Minneapolis Street Ry. Co., 215 U.S. 417 (1910)

Minneapolis v. Minneapolis Street Railway Company

No. 46

Argued December 2, 3, 1909

Decided January 3, 1910

215 U.S. 417


This Court will consider the nature of a corporation organized under a state law only so far as may be necessary to determine federal rights.

Franchises to public service corporations will not be extended by implication, but whatever is plainly and legally granted is protected by the contract clause of the Constitution.

Where the corporate existence has been recognized after the expiration of the shorter period and the state has not moved in quo warranto, a franchise legally granted by municipal ordinance and legislative enactment for the life of the charter of a public service corporation cannot be impaired during the term specified in the charter filed before the grant was made, although such term be longer than that allowed by the act under which the corporation was organized.

A franchise contract may extend beyond the life of the corporation to which it is granted; at the end of the corporate life, it is a divisible asset.

Page 215 U. S. 418

An ordinance enacted before electricity as used as motive power prohibiting any power that would be a public nuisance will not be construed as excluding electricity, and a public service corporation accepting an ordinance permitting change from horse to electric power does not abandon its rights under the original ordinance so that they are no longer protected by the contract clause of the Constitution.

Where all that is necessary is to determine whether a right under a state charter is now in existence, the decree should be confined thereto, and should not attempt to determine the further duration of the charter under state statutes.

Waiver to a reasonable extent of certain privileges under a franchise does not withdraw the other privileges from the protection of the contract clause of the Constitution.

The ordinance granted by the City of Minneapolis, in 1875, to the Minneapolis Street Railway for the life of its charter continues for fifty years from 1873, when the corporation was organized, and the fare cannot be reduced during that period below five cents, and the ordinance of 1907, directing the sale of six tickets for twenty-five cents is void under the contract clause of the Constitution.

The facts, which involve the franchise of the Minneapolis Street Railway Company and whether the obligation of its contract was impaired by a subsequent ordinance, requiring it to sell six tickets for twenty-five cents, are stated in the opinion.

Page 215 U. S. 420

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