therein, such enterprises would be discouraged, the development, growth, and progress of the state would be much retarded, and its productive capacity greatly decreased. "This provision of the Constitution has been in force 33 years. It has never been understood that it had the effect here contended for. There have been many instances in which the owners of large tracts of land have acquired water, conducted the same to the land, and sold and conveyed the land in small tracts to actual settlers with a proportionate share of the water appurtenant to the land, coupled with an agreement to continue the water supply at a fixed annual rate. Such a disposition is essentially a matter of private contract, and it shows no intent to create a public use.' "The quotations above given relieve from the necessity of any further exposition of the matter. This applicant did carry out this declared purpose by dedicating so much of its water to public use as was or might be necessary to supply the town of Hemet. Further than that it has not gone. Further, the articles of incorporation as to the purposes declare that the corporation will acquire its water and water right by purchase and appropriation,' both methods being wholly within the purview of private ownership of such rights when acquired. It is not without significance that there is omitted therefrom the declaration of the right to acquire by condemnation, which right runs only with a public service; and of similar significance is the fact that when this applicant, in the course of its activities, needed to acquire, and did acquire, certain rights of way, it did not undertake to do so by condemnation, but effectuated its purpose by purchase. v. Soledad Land & Water Co., supra, has already been considered. In that case there was an acquiescence upon the part of the holders of private contracts to change in use from private to public. Here the holders of such contracts are protesting and have protested from the moment that it appeared that their contractual rights might be impaired. Limoneira, etc., v. Railroad Commission, 174 Cal. 232, 162 Pac. 1033, was a case where the company was indisputably a public service corporation, but it had entered into two agreements which were asserted to be private and beyond regulation. It has heretofore been said that such private right cannot be carved out of a public use (Leavitt v. Lassen Irrigation Co., supra), and the decision of this court upholding the ju risdiction of the Railroad Commission was based upon this ground, this court recognizing that if a new appropriation had been made by the company, waters from which appropriation were to be devoted to this private use, it might well be held that the contracts were of private character. But, so reads the decision, "There is nothing to compel the conclusion that there was any new appropriation of water to enable the utility to satisfy the requirements of these contracts.' Palermo Land & Water Co. v. Railroad Comm., 173 Cal. 380, 160 Pac. 228, is of no value to the present consideration, since the contracts there under review in themselves provided for a rate which should be 'fixed by public authority.' And, finally, it may be added upon this matter that in Copeland v. Fairview Land & Water Co., 165 Cal. 148, 131 Pac. 119, this applicant here contended, and successfully contended, against the position which it now takes, the position there taken being that it was not a public service corporation. We do not cite this as being a determinative adjudication upon the question, but it serves at least to illustrate the changeable views which the applicant has entertained of its own activities, functions, and duties. In all respects vital to this consideration these certificates are of the character of those considered in Stanislaus Water Co. v. Bachman, 152 Cal. 716, 93 Pac. 858, 15 L. R. A. (N. S.) 359. In the Thayer Case, supra, it was decided that the sale in gross by a water company of water to a mutual water company was not a dedication of such waters to public use. In Marin Water & Power Co. v. Town of Sausalito, 168 Cal. 587, 143 Pac. 767, it was decided that a sale and delivery of water by a water company to a municipality owning "Upon this branch of the case, then, the its own water system, to be sold by the muconclusion is inevitable that the applicant nicipality to its inhabitants, was not a dediwas not, as to all of its water and properties, cation of such water so sold in gross to a a public service corporation, and that these public use so that the gross rates were subpetitioners entered into their contracts with ject to municipal regulation. It is not posapplicant, both parties to each contract act- sible to see how, in the light of the princiing as of right in their private capacities. ples upon which these adjudications are restNothing in the cases relied on by respondents ed, it can be held that these private conmilitates against this conclusion. Franscioni tracts with private individuals for a private [7] "To hold that property has been dedicated to a public use is 'not a trivial thing (San Francisco v. Grote, 120 Cal. 60, 52 Pac. 127, 41 L. R. A. 335, 65 Am. St. Rep. 155), and such dedication is never presumed 'without evidence of unequivocal intention' (Niles v. City of Los Angeles, 125 Cal. 512, 58 Pac. 190). The character of the contracts evidenced by these water right certificates, the restriction upon transfer, the fixing of the acreage quantum, the enormous sum in the aggregate paid by these petitioners for their water rights, establish beyond the need of further discussion that the parties to those contracts believed that they were dealing in their private capacities and selling and receiving water for private use. But one suggestion here is sufficient. Is it conceivable that these landowners would have given Mr. Whittier and his associates a bonus of $438,938.60 for the right to use water, which right the law had given them without the expenditure of one dollar of it? supply of water upon their private lands was a dedication of such waters to public use. [8] 2. The second position adopted by respondents, as above outlined, is that this applicant is a public service corporation, without regard to the question of the dedication of its properties to public use, by virtue of the definitions of such public service corporations found in our law. To begin with, the Constitution, art. 12, § 23, declares that every private corporation furnishing water 'either directly or indirectly to or for the public is hereby declared to be a public utility, subject to control and regulation by the Railroad Commission.' Further, this section of the Constitution declares that 'every class of private corporations, individuals, or association of individuals, hereafter declared by the Legislature to be public utilities, shall likewise be subject to such control and regulation.' And, finally, this section provides that the right of the Legislature to confer powers upon the Railroad Commission respecting public utilities is plenary and unlimited by any provisions of the Constitution. Pursuant to this constitutional definition and grant of power, the Legislature in 1913 (Stats. 1913, p. 84, c. 80) declared: "Whenever any corporation sells, leases, rents or delivers any water to any person, firm, private corporation, municipality, or any other political subdivision of the state whatsoever, except as limited by section 2 hereof, whether under contract or otherwise, such person, firm or private corporation is a public utility, and subject to the provisions of the public utilities act of this state and the jurisdiction, control and regulation of the Railroad | Commission of the state of California.' "And the Public Utilities Act (Stats. 1915, p. 115) defines a water corporation in the following language: ""The term "water corporation," when used in this act, includes every corporation or person, their lessees, trustees, receivers or trustees appointed by any court whatsoever, owning, controlling, operating or managing any water system for compensation within this state.' er. He deals with the public; he invites and is urgent that the public should deal with him. The character of his business is such that under the police power of the state it may well be subject to regulation, and in many places and instances is so regulated. The preservation of cleanliness, the inspection of meats to see that they are wholesome, all such matters are within the due and reasonable regulatory powers of the state or nation. But these regulatory powers are not called into exercise because the butcher has devoted his property to public service so as to make it a public utility. He still has the unquestioned right to fix his prices; he still has the unquestioned right to say that he will or will not contract with any member of the public. What differentiates all such activities from a true public utility is this, and this only: That the devotion to public use must be of such character that the public generally, or that part of it which has been served and which has accepted the service, has the right to demand that that service shall be conducted, so long as it is continued, with reasonable efficiency under reasonable charges. Public use, then, means the use by the public and by every individual member of it, as a legal right. Such is not only the accepted sig nificance of the phrase by the great weight of authority as expounded by Mr. Lewis (Eminent Domain, sec. 164 et seq.), but is the definition repeatedly announced by this court. Thus, in Pinney & Boyle Co. v. Los Angeles Gas & Electric Co., 168 Cal. 12, 141 Pac. 620, L. R. A. 1915C, 282, Ann. Cas. 1915D, 471, explaining that it is not the use which the consumer makes of the commodity which constitutes the test as to whether or not the owner or purveyor of that commodity is a public service corporation, it is declared: "It is the duty which the purveyor or producer has undertaken to perform on behalf of and so owes to the public generally, or to any modity, or as an agency in the performance of defined portion of it, as the purveyor of a coma service, which stamps the purveyor or the agency as being a public service utility.' "It must in this be recognized that the Constitution of this state, and the Legislature in pursuance of it, has undertaken to put out of existence any and all private rights in the matter of the rental or sale of water. "To the same effect is Thayer v. California So far as our Constitution and laws are con- Development Co., supra, while in Del Mar cerned the state has done this thing. There Water Co. v. Eshleman, 167 Cal. 666, 680, stands between it and its enforcement, so 140 Pac. 591, 596, it is declared that ‘even a far as this court is concerned, only the Con- constitutional declaration cannot transform stitution of the United States, which, as the supreme law of the land, is, whenever it speaks, the supreme law of this state. [9] "What is a public utility, over which the state may exercise its regulatory control without regard to the private interests which may be affected thereby? In its broadest sense everything upon which man bestows labor for purposes other than those for the benefit of his immediate family is impressed with a public use. No occupa tion escapes it, no merchant can avoid it, no professional man can deny it. As an a private enterprise, or a part thereof, into a public utility and thus take property for public use without condemnation and payment.' [10] "Our Constitution and our statutory definitions above quoted therefore must be construed as applying only to such properties as have in fact been devoted to a public use, and not as an effort to impress with a public use properties which have not been devoted thereto. For if the latter be the true construction of our Constitution and statutes, then manifestly in their operation fere with private property or private contractual rights by force of article 1, § 10, and of the Fourteenth Amendment of the Constitution of the United States. If the first alternative be selected, then, for reasons already given, such parts of these properties as are affected by the contracts with these petitioners have not been devoted to public use and their private contractual rights must prevail. "For these reasons the determination, conclusion, and judgment of the commission that these petitioners' contractual and vested rights are subordinate to the regulatory powers of the commission is in excess of the commission's jurisdiction, and therefore void, and in so far the decree of the commis sion is annulled." Railroad Commission, the water company should be bound by its dedication, is held in Palermo L. & W. Co. v. R. R. Comm., 173 Cal. 380, 384, 160 Pac. 228, 229, where it is said by the court in bank: 66 *It appears that in December, 1912, the Palermo Company applied to the Railroad Commission to have its rates for water established, and that the commission made its order allowing an increase in the rates theretofore in effect. Opinions and Orders of the Railroad Commission, vol. III, p. 1247. The case, therefore, falls directly within the doctrine of Franscioni v. Soledad Land & Water Co., 170 Cal. 221, 149 Pac. 161, where we held that, as against the water company, such submission to the authority of the regulating body was effective to 'change the use from a private and particular use to a public use so as to make the service and terms of delivery subject to regulation and control by public authority.' No valid distinction can be drawn between the We concur: LORIGAN, J.; MELVIN, J.; Franscioni Case and the one before us." PalRICHARDS, Judge pro tem. ermo L. & W. Co. v. Railroad Commission, supra. In the instant case the owners of property costing $657,385 to reproduce dedicate the same to a public use, and the state, through its Constitution, its laws, and its duly accredited representatives, accepts and acts upon such dedication. It is held in the main opinion that such dedication of such property is ineffectual. If it is once conceded dedicated to a public use, it follows that the WILBUR, J. I dissent. The main opinion holds that our state Constitution, and laws passed in pursuance thereof, authorizing the Railroad Commission to fix rates for the use of water, are in conflict with the federal Constitution prohibiting the impairment of contracts, and are to that extent void and of no effect. It concedes that the state has exerted to the full all its sovereign pow-that the distributing system is, or has been, ers to regulate and control the rates for the use of water, but holds the state to be impotent in the presence of the private rights to water and its distribution in this case. I concur in the main opinion in so far as it holds that the rights to water (one-eighth inch per acre) is a private right. It was so held in Thayer v. California Development Co., 164 Cal. 117, 128 Pac. 21, and the subsequent constitutional amendment and statute must be held to have been adopted in view of that decision. But the decision of the Railroad Commission does not interfere with that right. To an understanding of the case it is essential that some facts disclosed by the record be stated in addition to those set forth in the main opinion. The contracts under which the petitioners claim, in addition to securing to them a certain amount of water, require the water company to deliver such water "at such points on the pipes or conduits of the party of the first part (water company) as may be nearest the land" of the grantee. The contract thus recognizes that the distributing system being burden of the maintenance thereof, inlongs to the water company. For this sys- cluding their proportion of the expense of tem the water company has expended $447,- distribution of the water contained therein, 000, paid in by its stockholders. It has also particularly as against the public also servreceived $438,938.60 from the sale of its wa-ed thereby. The Railroad Commission finds ter, a part or all of which was expended in that the system has at all times been run at payment of current expenses. It would cost a loss. Neither the public nor the private $657,385 to reproduce the distributing system. That the water company has done all in its power to dedicate its water and its distributing system to a public use is held in the main opinion, and that, having conceded and invoked the jurisdiction of the If we users of water have paid their proportion of the expense of maintenance. The annual loss, including depreciation, now approximates $30,000. The proportion thereof properly apportioned to the owners of water certificates (94 per cent., according to the main opinion) would be $28,200. If the system is to remain a going concern, this amount, at least, must be assessed upon the public users (the 3 to 6 per cent.), if the private users cannot be required to pay more than the contract rate. The holders of water certificates bought with knowledge that the system was used and to be used to distribute water devoted to a public use. By thus consenting that public waters, mingled with their private waters, could be conveyed through the distributing system in which they have an interest, they assented to the use of their property (the pipe line) for a public use. If they owned the whole pipe line and thus used it, it must be conceded that they thereby dedicated the same to a public use. Why does not their assent to such use of their undivided right therein necessarily constitute such a dedication thereof to a public use? Their rights in the water and in the system can be recognized by the Railroad Commission in fixing rates. A rate proportionately lower than that imposed on those having no property right in the water or distributing system can be fixed. Although it is conceded that the statute authorizes the fixing of rates by the Railroad Commission in this case, if constitutional, it is well to observe that the commingling of public and private waters in a privately owned distributing system is expressly made a basis of the juris diction of the Railroad Commission. Stats. 1913, p. 84, §§ 2, 3, 4. I pany at first sought a reasonable interest upon the alleged value thereof ($494,000), the company abandoned its claim, and the Railroad Commission refused to recognize it. In short, in effect, the water users who had paid $438,000 therefor were recognized as entitled to water claimed to be worth $494,000. The Railroad Commission fixed rates for water that would pay the operating and maintenance expenses and give a revenue to the company on a capitalization of less than onehalf of the value of their distributing plant. It seems clear that the water company and the certificate holders, by express dedication and by necessary implication, have consented to the jurisdiction of the Railroad Commission in so far as the distributing system is concerned, and that, therefore, it has jurisdiction, and that in the exercise of that jurisdiction it has not violated any rights of petitioners in the water or distributing system, such as would justify our interference. therefore conclude that the jurisdiction of the Railroad Commission may be well predicated upon the consent of the water company and the implied consent of the certificate holders whose property rights are given due consideration by the Railroad Commission. It is also true, I think, that the business of storing, conserving, and distributing water, whether privately owned or dedicated to public use, to large tracts of land for the use of large numbers of persons for domestic and irrigation purposes in an arid state, particularly where such distributor enjoys a monopoly, is so clearly a matter of great public concern as to justify the people in declaring that such business is a public utility. It is unnecessary to give reasons in detail for such an obvious conclusion, but it may be noted that changed labor conditions, increased cost of supplies and materials necessary to maintain such distributing system, bankruptcy, termination of corporate existence, or death of individuals furnishing water, all have a marked effect upon the ability of the distributor to distribute water, and upon the public so furnished with water, and that the ordinary remedies for breach of contract to distribute or deliver water, or equitable actions to protect and enforce such contract rights, would be wholly inadequate to protect the public directly and indirectly affected by such failure and the consequent damage. Many of these considerations, however, do not apply to the corporations excepted from control of the Railroad Commission, for the It is, of course, the duty of the Railroad reason that in such mutual companies the acCommission to recognize private and consti- tual cost of maintenance, whether great or tutional rights and fix the rates with refer- small, is distributed among the water owners. ence thereto. In this case, while finding, erAs we are dealing with legislation that defironeously, as we hold, that all the water dis- nitely and clearly authorizes the fixing of the tributed by the water company was dedicated rates for the water company under constituto a public use, it nevertheless refused to tional provisions, authorizing such legislaconsider the value of the water as a basis for tion and providing for such fixing of rates fixing the rates, and, although the water com- | (article 14, and article 12, § 23) we need only "Sec. 2. Whenever any private corporation or association is organized for the purpose solely of delivering water to its stockholders or members at cost, and delivers water to no one except its stockholders or members at cost, such private corporation or association is not a public utility, and is not subject to the jurisdiction, control or regulation of the Railroad Commission of the state of California. "Sec. 3. Whenever any private corporation or association organized for the purpose of delivering water solely to its stockholders or members at cost does deliver water to others than its stockholders or members for compensation, such private corporation or association becomes a public utility and subject to the terms of the public utilities act and the jurisdiction, control and regulation of the Railroad Commission of the state of California. "Sec. 4. Whenever any private corporation or association is organized both for the purpose of delivering water to its stockholders or members at cost and to persons, firms, corporations, municipalities or other political subdivisions of the state in addition thereto, such private corporation or association is a public utility and subject to the provisions of the public utilities act and to the jurisdiction, control and regulation of the Railroad Commission of the state of California." Stats. 1913, p. 85. That "That it is within the power of the government to regulate the prices at which water shall be sold by one who enjoys a virtual_monopoly of the sale, we do not doubt. question is settled by what was decided on full consideration in Munn v. Illinois, 94 U. S. 113 [24 L. Ed. 77]. As was said in that case, such regulations do not deprive a person of his property without due process of law." In the case of Munn v. Illinois, supra, in passing upon the power of the Legislature of the state of Illinois to declare grain elevators public utilities and regulating rates for the storage and handling of grain, the Supreme Court said: "This brings us to inquire as to the principles upon which this power of regulation rests, in order that we may determine what is within and what without its operative effect. Looking. then, to the common law, from whence came the right which the Constitution protects, we find that when private property is 'affected with a public interest it ceases to be juris privati only.' This was said by Lord Chief Justice Hale more than 200 years ago, in his treatise De Portibus Maris, 1 Harg. Law Tracts, 78, and has been accepted without objection as an essential element in the law. of property ever since. Property does become clothed with a public interest when used in a manner to make it of public consequence and affect the community at large. When, therefore, one devotes his property to a use in which the public has an interest, he, in effect, grants to the public an interest in that use, and must submit to be controlled by the public for the common good, to the extent of the interest he has thus created. He may withdraw his grant by discontinuing the use; but, so long as he maintains the use, he must submit to the control." In Atlantic Coast Line R. R. Co. v. City of Goldsboro, 232 U. S. 548, 34 Sup. Ct. 364, 58 L. Ed. 721, the rule is thus stated: "It is settled that neither the 'contract' clause nor the 'due process' clause has the effect of overriding the power of the state to establish all regulations that are reasonably necessary to secure the health, safety, good order, comfort, or general welfare of the community; that this power can neither be abdicated nor bargained away, and is inalienable even by express grant; and that all contract and property rights are held subject to its fair exercise. Slaughter-House Cases, 16 Wall. 36, 62 [21 L. Ed. 394]; Munn v. Illinois. 94 U. S. 113, 125 [24 L. Ed. 77]; Beer Co. v. Massachusetts, 97 U. S. 25, 33 [24 L. Ed. 989]; Mugler v. Kansas. 123 U. S. 623, 665 [8 Sup. Ct. 273, 31 L. Ed. 2051; Crowley v. Christensen, 137 U. S. 86, 89 [11 Sup. Ct. 13, 34 L. Ed. 620]; New York & R. R. Co. v. Bristol, 151 U. S. 556, 567 [14 Sup. Ct. 437, 38 L. Ed. 269]; Texas & R. R. Co. v. Miller, 221 U. S. 408, 414, 415 [31 In determining the question whether or not a business is of such public interest and concern as to subject it to regulation as a public utility, the Supreme Court of the United States holds that that question is primarily one for the Legislature. In Munn v. Illinois, supra, it is said: "For our purposes we must assume that, if a state of facts could exist that would justify such legislation, it actually did exist when the statute now under consideration was passed. For us the question is one of power, not of expediency. If no state of circumstances could exist to justify such a statute, then we may declare this one void, because in excess of the legislative power of the state. But if it could. we must presume it did. Of the propriety of legislative interference within the scope of legislative power, the Legislature is the exclusive judge.' It seems clear from these authorities, upon the facts found by the Railroad Commission, system a public utility. It finds thatthat the state had power to declare the water has "The consumers concede that, in so far as than the holders of water certificates is conthe supply of domestic water to persons other cerned, petitioner is a public utility." That the "petitioner adopted rules and regulations for the sale of water for irrigation and domestic use, which rules were printed and distributed to its consumers and referred to in petitioner's advertisements. Petitioner's business grown from its initial supply of domestic water to the first inhabitants of what is now the town of Hemet, until in 1915. as shown by petitioner's annual report for the year ending December 31, 1915, on file with the Railroad Commission, petitioner sold water through 85 meters for irrigation, 481 meters for domestic use, 5 meters for manufacturing and power, and 6 meters for public use. During the same year petitioner sold water measured through other devices for the irrigation of 5,554 acres of land. Approximately 2,500 people, including approximately 1,500 in the town of Hemet, rely upon petitioner's system as their sole source of water." That the "petitioner is a water company, incorporated under the laws of this state. It is the only water system in control of water which it sells for compensation. For more than 25 years petitioner has been engaged in the sale of water to the entire public on the land to the service of which petitioner has dedicated its water. Petitioner has fixed and enforced rates, rules, and regulations for the service of water for irrigation and domestic purposes and to the town of Hemet for public purposes. Petitioner's water system consists of watershed lands, the Lake Hemet reservoir on the south fork of the San Jacinto river, diversion works at four points of diversion, transmission mains of riveted steel and wood pipe, wooden flume and lined ditch and a distributing system of wooden and concrete flume. concrete and riveted steel pipe, all used in the delivery of water to wholesale and irrigation consumers. In addition, petitioner owns and operates a separate system with a separate diversion for the distribution of water through riveted steel and standard screw pipe to domestic consumers. In the operation of its system petitioner for more than fifteen years has had the control and use of 17/20ths of the water of the north fork of the San Jacinto river and Strawberry creek under agreements with Fairview Land & Water Company, the owner of such waters. The safe yield of petitioner's water system is 161.000 miner's inch days annually, or 6,376 acres feet, delivering 725 miner's inches during |