Russell v. Sebastian

Citations

• 233 U.S. 195
• 34 S. Ct. 517
• 58 L. Ed. 912
• 1914 U.S. LEXIS 1281

Syllabus

<p>In determining the question of impairment under the contract clause of the Constitution it is the duty of this court to determine for itself the nature and extent of rights acquired under prior legislative or constitutional action.</p> <p>The state court having construed a statutory or constitutional provision, which gave specified privileges in regard to public utilities in a certain class of municipalities under specified conditions without specifying the persons or corporations who could avail thereof or the method of acceptance, to the effect that the grant became effective in any municipality within the designated class by the party accepting it as if it had been made specially to the accepting party, this court follows such construction in regard to § 19 of art. XI of the constitution of 1879 of California as amended in 1884.</p> <p>When the State declares that it is bound if its. offer to grant a privilege, which plainly contemplates the establishment of a plant and the assumption of a duty to perform the services incident to a public ■ utility, is accepted, the grant resulting from the acceptance constitutes a contract apd vests a property right in the accepting party which is within the protection of the contract clause of the Federal Constitution.</p> <p>The rule that public grants are to be construed strictly in favor of the public, and ambiguities are to be resolved against the grantee, is a salutary one to frustrate efforts through skilful wording of the grant by interested parties; but the rule does not deny to public offers a fair and reasonable interpretation or justify withholding that which the grant was intended to convey.</p> <p>An offer of the State to allow parties, ready to serve municipalities with gas or water, provisions for conveying the gas or water, is to be given •a practical common-sense construction; and the breadth of the offer is commensurate with the requirements of the undertaking invited.'</p> <p>■Where the constitution-of the