Valley Rys. v. Mechanicsburg Borough

Citations

• 265 Pa. 222
• 108 A. 629
• 1919 Pa. LEXIS 529

Syllabus

<p>Street railways — Municipal consent — Consideration for use of streets — Conditions subsequent — Contract —Presumption of good faith — Tax—License fee — Police power.</p> <p>1. Where a street railway company enters into a contract with a borough for the use of streets, and agrees to pay $100 per year to the borough for a term of years “at the expiration of which period the borough reserves the right to regulate and determine the future annual payments,” the borough may, after the expiration of the term of years increase the annual payment to $1,200, if it appears that such payment was not unreasonable and excessive, and that the population served by the company had increased, through connections, from 15,000 to 90,000 people.</p> <p>2. Such annual payment is based on a contract for the purchase of the franchise. It is not a tax, nor is it a license fee collectible under the police power of the municipality; nor is it governed by the rules applicable to taxes and license fees.</p> <p>3. Where municipal consent to the use of streets relates to conditions subsequent, such conditions must be reasonable and within the power of the company to perform. The presumption is in favor of the validity of the subsequent condition imposed, on the assumption that the municipalities have acted properly and in good faith.</p>