HIGHEST COURT OF ARIZONA RULES THAT UTILITY COMPANY MUST PAY RELOCATION COSTS NECESSITATED BY STREET IMPROVEMENTS MADE BY IMPROVEMENT DISTRICT

THE PARADISE VALLEY WATER COMPANY HAD A FRANCHISE FOR THE PURPOSE OF CONSTRUCTING, MAINTAINING, AND OPERATING WATER LINES FOR A PERIOD OF 25 YEARS ALONG, UPON, UNDER AND ACROSS THE PUBLIC HIGHWAYS WITHIN THE PORTION OF THE COUNTY DESCRIBED IN THE FRANCHISE. THE WATER COMPANY INSTALLED CERTAIN MAINS UNDER A DIRT ROAD KNOWN AS LINCOLN ROAD. SEVERAL YEARS LATER AN IMPROVEMENT DISTRICT WAS ORGANIZED BY THE OWNERS OF PROPERTY ON EITHER SIDE OF LINCOLN ROAD FOR THE PURPOSE OF PAVING THAT PORTION OF THE ROAD. THE PLAN OF IMPROVEMENT AND THE SUBSEQUENT CONTRACT LET BY THE IMPROVEMENT DISTRICT DID NOT PROVIDE FOR THE COST OF RELOCATING THE WATER COMPANY'S LINES MADE NECESSARY BY THE ROAD IMPROVEMENT. SUBSEQUENT TO THIS ACTION, THE BOARD OF SUPERVISORS OF THE COUNTY PASSED A RESOLUTION REQUIRING THAT WHENEVER A UTILITY OPERATING UNDER A FRANCHISE GRANTED BY THE BOARD WAS REQUIRED TO RELOCATE ITS FACILITIES BECAUSE OF ROAD IMPROVEMENTS, THE UTILITY HAD TO BEAR THE EXPENSE OF SUCH RELOCATION. THE COUNTY MADE A DEMAND ON THE WATER COMPANY TO RELOCATE THE LINES AND WHEN THE COMPANY REFUSED TO DO SO, THE LINES WERE RELOCATED BY THE COUNTY AT THEIR EXPENSE. THE COUNTY AND THE IMPROVEMENT JOINTLY COMMENCED AN ACTION AGAINST THE WATER COMPANY FOR A JUDGEMENT DECLARING THAT THE FRANCHISE GRANTED TO THE COMPANY REQUIRED THE COMPANY TO REMOVE AND RELOCATE ITS DISTRIBUTION SYSTEM AT ITS OWN EXPENSE. THE SUPREME COURT NOTED THAT A PUBLIC UTILITY ACCEPTED FRANCHISE RIGHTS IN PUBLIC STREETS SUBJECT TO AN IMPLIED OBLIGATION TO RELOCATE ITS FACILITIES AT ITS OWN EXPENSE WHEN NECESSARY TO MAKE STREET IMPROVEMENTS. THE WATER COMPANY SAID THAT THIS DID NOT APPLY TO COUNTY IMPROVEMENT DISTRICTS, THE SUPREME COURT CONCLUDED THAT AN IMPROVEMENT WAS AN AGENCY CREATED BY A COUNTY AND, THEREFORE, HAD THE SAME POLICE POWER AS A COUNTY DID TO REQUIRE THE PAYMENT OF RELOCATION COSTS BY A UTILITY.

  • Supplemental Notes:
    • No 3, pp 4-5
  • Publication Date: 1965-6

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  • Accession Number: 00238789
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jul 21 1970 12:00AM