its agent, or by ratification, abandoned its power to regulate, the state's power is, by implication, written into the contract. And, after making a complete examination of all such statutes of that state, the court, as already stated, concluded among other things that nothing in the powers granted to the city "prevents the state from regulating rates, including the matter of compensation to the city."

The same may be said of the case of Sandpoint Co. v. Sandpoint (1918) 31 Idaho 498, P.U.R.1918F, 737, 173 Pac. 972, L.R.A.1918F, 1106, cited and relied on by the appellant. The issue in that case related to the authority of the Utilities Commission to revoke the right of the city to receive water for street sprinkling free of charge under the franchise. It was decided the Commission had such power. In discussing the issue reference was made to the doctrine that the power to supervise and regulate rates and charges by public utilities is an inherent function of Government, which occupies a large space within the domain of the police power of the state. Then, considering the question of the abrogation by the state for a limited period of its right to exercise this power, certain provisions of the Constitution of that state were cited to suggest the question if the Constitution does. not contain a limitation upon the legislature or any of its agencies to contract in any manner and at any time to suspend the right of the state to exercise its police power in such cases. In this connection, however, the opinion reads:

"But, without considering that question, our attention has not been called to any attempt upon the part of the legislature of this state to authorize municipalities to enter into contracts which will in any manner abridge this power of the state. The franchise must therefore be held to have been granted and accepted subject to the right of the state any time to exercise its reserved police power in the matter of regulating rates."

It follows, therefore, by the careful course pursued in those cases relied on by the appellant, that in answering the question in the present case we must consider not only the Public Service Commission Law of this state, but the statutes conferring powers upon cities as well, to see if the state has previously suspended it regulatory powers in respect to the particular charges in question. This court has been called upon in a number of cases to determine

the power and scope of authority of the Public Service Commission, the rights of cities under franchises which were granted to public service companies prior to the enactment of the Public Service Commission Law, and the rights and obligations of the public service companies as well as those of the general public. Those cases dealing with the power of the Commission to abrogate the provisions of such franchises have generally been divided into two classes: (1) Those affecting rates or service designed in behalf of the general public, such as State ex rel. Webster v. Superior Court, 67 Wash. 37, 120 Pac. 861, L.R.A.1915C, 287, Ann. Cas. 1913D, 78, and State ex rel. Seattle v. Public Service Commission, 103 Wash. 72, P.U.R.1918F, 810, 173 Pac. 737; and (2) those affecting the individual pecuniary and proprietary rights of the city itself as consideration for the franchise rights granted the public service company, such as State ex rel. Tacoma R. & Power Co. v. Public Service Commission, 101 Wash. 601, P.U.R.1918E, 277, 172 Pac. 890, and Seattle v. Puget Sound Traction L. & P. Co. 103 Wash. 41, 174 Pac. 464, the one governmental and the other proprietary, on the part of the city. As to the latter, the kind here involved, it has been decided that the leg islature intended to, and did, vest the city with the whole of the state's police power touching the subject-matter which has not been interfered with by the Public Service Commission Law. While counsel for the appellant contends others wise, we are satisfied the cases of State ex rel. Tacoma R. & Power Co. v. Public Service Commission, supra, and Seattle v. Puget Sound Traction L. & P. Co. supra, are authorities that settle the question in this

case.

In the Tacoma case the Public Service Commission decided it had no power to relieve the street railway company from certain of its franchise provisions which it had complained of and asked to have abrogated. The controversy was presented to this court by an application for a writ of mandate to the Commission. This court said:

"The franchise provisions complained of are those requiring the street car company, the petitioner, to pave between its tracks and one foot on either side, to contribute to the cost of bridges, to pay a certain percentage of its gross earnings to the city, and to permit certain officers or employees of the city free transporta

tion. The franchises containing these provisions were all granted prior to the passage of the Public Service Commission Law."

The opinion takes notice of the statute granting power to cities. of the first class (which need not be repeated here) and holds: "Here is a clear and specific grant by the state to the city to impose terms and conditions upon which any of its streets may be used by a street railway."

It was claimed, however, by the company, that, this being a matter within the police power, the state had the right by a subsequent statute to confer upon the Public Service Commission the power to abrogate such franchise provisions, and had in fact done so by the Public Service Commission Law. The court then examined and analyzed the Public Service Commission Law, and indeed the history of that law as it passed through the legislature, and decided there is nothing in the law which either expressly or by necessary implication confers power upon the Commission to deal with the question of franchises or to modify the terms previously imposed therein, and that the history of the legislation indicates an affirmative intention on the part of the legislature not to confer such power upon the Public Service Commission. The result was a denial of the writ prayed for.

In the Seattle case, the city sued the street railway company to recover 2 per cent on the gross receipts from the operation of its street railway, as provided for in its franchises. The opinion says: "The question here is whether the Public Service Commission Law, either by its terms or by necessary implication, attempted to confer power upon the Public Service Commission to modify or abrogate franchise provisions which had theretofore been imposed by the city in granting the franchises under the specific grant of the legislature."

The statutes were again examined and discussed, and reference, with approval, was made to the decision in the Tacoma case. The decision was in favor of the city.

Counsel for appellant, disagreeing with this view, seeks to distinguish the present case from the two cases just referred to, and indeed argues that this court has in effect done so. Reliance is had upon the case of State ex rel. Seattle v. Public Service Commission, 103 Wash. 72, P.U.R.1918F, 810, 173 Pac. 737, which was a case wherein it was decided the Commission had the power

to cancel a provision in a franchise requiring the street railway company to sell commutation tickets to the public generally. The particular thought or language in the opinion referred to by the appellant is that portion wherein, after referring to the Tacoma case, holding there was no power in the Commission to relieve the railway company from certain franchise provisions it was said: "But the provisions under consideration in that case did not relate to rates or fares as in this case."

And further certain language in the Tacoma case as follows: "The right to deal with the question of rates and service is an entirely different matter from the right to grant franchises or abrogate the provisions thereof."

The language in those opinions, selected and depended upon by the appellant, must be understood in the light of the subjects to which it was directly or impliedly intended. It referred to rates, fares, and service as related to the rights of the general public as distinguished from the proprietary rights of the city granting the franchises. Obviously, this is so, for in the Tacoma case one of the franchise provisions immediately and directly called in question (similar to the one in the case at bar) was free transportation to certain officers and employees of the city, relief from which it was therein decided the Commission was powerless to consider. Judgment affirmed.

Holcomb, C. J., and Mount, Main, and Tolman, J.J., concur.

1. A power company's franchise giving to a city benefits in the way of percentages of revenue, right to purchase plant, and additional taxes, discriminates against consumers in other localities served by the same utility, when the continuation of the franchise results in unnecessary duplication of equipment.

2. The Idaho Commission authorized increased rates in a municipality which was deriving special benefits from a franchise, in order

to offset the advantages derived therefrom and prevent discrimination. against other localities.

[March 4, 1921.]

APPLICATION for permission to enter into special contracts with a municipality; increased rate schedules authorized to offset discrimination derived from franchise.

Appearances: Hawley & Hawley and Clarence T. Ward, for the applicant, Idaho Power Company; E. P. Barnes and Henry Z. Johnson, for the city of Boise; Raymond L. Givens, Assistant Attorney General, for the Commission.

By the Commission (on rehearing): The original application in the above entitled matter was filed with the Commission March 11, 1920, and asked that the Idaho Power Company be permitted to enter into two contracts attached thereto, the provisions of which had been agreed upon between the applicant and the city of Boise. One of the contracts provided for a change in the street lighting system within the city, while the other provided for the cancellation of a certain franchise under which the Idaho Power Company was operating.

Notice was given to the city, but no answer or objection was made by the city, and the matter was set for hearing. The parties appeared by their attorneys at the time fixed, but no testimony was offered, and after some discussion the matter was subinitted upon what was then before the Commission, to wit, the verified application and the forms of contracts attached thereto. Subsequently, by its Order No. 762, [P.U.R.1920C, 949] the Commission approved the proposed street lighting contract and required the conditional rate named therein, filed, so that other cities might avail themselves of it. The proposed contract for the cancellation of the franchise was also approved, but as it appeared from the recitals in the application and the proposed contract some further action was necessary to prevent a preference or discrimination, the Commission required that rates within the city of Boise should be raised to do away with such discrimination and preference.

To that part of the order requiring that rates be raised, the city objected, and asked for a rehearing. In its amended application, filed July 14, 1920, it asked that the city might "be per