Knoxville Water Co. v. Knoxville, 200 U.S. 22 (1906)

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Knoxville Water Company v. Knoxville

No. 123

Argued December 11, 12, 1905
Decided January 2, 1906
200 U.S. 22

APPEAL FROM THE CIRCUIT COURT OF THE UNITED

STATES FOR THE EASTERN DISTRICT OF TENNESSEE

Syllabus

Where the bill properly sets forth the facts on which a corporation insists that the agreement under which it erected and is operating its plant constituted a contract whereby it acquired exclusive rights for a given period and that the obligation of that contract will be impaired by the threatened action of the municipality in erecting its own waterworks, the case is one arising under the Constitution of the United States and of which the proper Circuit Court can take cognizance without regard to the citizenship of the parties.

Only that which is granted in clear and explicit terms passes by a grant of property, franchises, or privileges in which the government or the public has an interest. Statutory grants of that character are to be construed strictly in favor of the public; whatever is not unequivocally granted is withheld, and nothing passes by implication.

Although the contract in this case between a waterworks company and a municipality provided that no contract or privilege would be granted to furnish water to any other person or corporation, the city was not, in the absence of a special stipulation to that effect, precluded from establishing its own independent system of waterworks.

The facts are stated in the opinion.