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People Ex Rel. Hafer v. Flynn

APRIL 21, 1958.

THE PEOPLE EX REL. ROBERT L. HAFER ET AL., APPELLEES,

v.

WILLIAM P. FLYNN. — (YELLOW CAB COMPANY, INC., ET AL., APPELLANTS.)



APPEAL from the Appellate Court for the First District; — heard in that court on appeal from the Circuit Court of Cook County; the Hon. HARRY M. FISHER, Judge, presiding.

MR. JUSTICE DAILY DELIVERED THE OPINION OF THE COURT:

Opinion filed November 20, 1957; additional opinion filed on rehearing

A petition was filed February 25, 1954, in the circuit court of Cook County by eighteen relators for a writ of mandamus to compel William P. Flynn, Public Vehicle License Commissioner of the city of Chicago, to issue certain taxicab licenses to them. Answer was filed by Flynn and the writ was ordered to issue. Thereafter the order was vacated, and the Yellow Cab Company and the Checker Taxi Company, Inc., intervenors, pursuant to leave of court, filed petitions, and the plaintiffs filed an answer thereto. The intervenors filed a motion for summary judgment which the trial court sustained and dismissed the petition for mandamus, from which ruling plaintiffs appealed to the Appellate Court, which court reversed and remanded with instructions to reinstate the order to issue the writ of mandamus. From this decision the intervenors perfected an appeal to this court.

The petition for mandamus alleged, among other things, that on December 20, 1951, pursuant to and by virtue of certain sections of article 23 of the Revised Cities and Villages Act, (Ill. Rev. Stat. 1953, chap. 24, pars. 23-1 et seq.) an ordinance was passed by the council of the city of Chicago, which became effective January 1, 1952, (Municipal Code of Chicago, chap. 28); that under such ordinance it was the duty of William P. Flynn, Public Vehicle License Commissioner, to ascertain the fitness of applicants for license, their respective motor vehicles for operation as taxicabs, and to issue not more than 3761 licenses to qualified applicants; that the plaintiffs filed applications for licenses and in all other respects complied with the requirements of this ordinance; that the defendant Flynn conducted an investigation as to the character and reputation of the plaintiffs, as required by ordinance, and found them eligible to pursue the occupation of cab driver; that subsequent to January 30, 1952, there were 3761 licenses issued and in use; that at the time of the filing of the present petition the number of such licenses had been reduced by death or other causes to 3742; that there were 19 existing and unissued licenses and it was the duty of the defendant Flynn under the provisions of the ordinance to issue 18 of such licenses to the plaintiffs and that he failed and refused to do so after being duly served with notice and demand.

Flynn, in answer to the petition, stated that under the ordinance it was not mandatory upon him to issue 3761 licenses to applicants, even though they had been ascertained to be qualified.

Plaintiffs filed a motion for judgment on the pleadings and on August 4, 1954, the trial court entered judgment in favor of the plaintiffs for a writ of mandamus, which order directed the defendant Flynn to forthwith issue public passenger vehicle licenses to each and all of the plaintiffs.

Thereafter the Checker Taxi Company, Inc., and the Yellow Cab Company filed petitions for leave to intervene. The petitions, in substance, alleged that on February 25, 1946, a decree was entered in the circuit court of Cook County in cause No. 46 C 943 forever enjoining and restraining the city of Chicago from issuing more than 3000 public passenger vehicle licenses except in accordance with its terms; that the decree provided that the city of Chicago be restrained from issuing licenses in excess of 3000 without first holding hearings with respect to the public convenience and necessity therefor and without first affording plaintiffs therein (intervenors here) an opportunity to apply for and obtain such licenses to the number provided for by an ordinance adopted December 22, 1937.

On September 27, 1954, defendant Flynn and plaintiffs filed motions to strike the petitions filed by the intervenors. These motions alleged, in substance, that the petitions to intervene should be denied, in that the injunction decree relied on by the intervenors was based on a contract ordinance passed by the city council on December 22, 1937, as amended; that this contract ordinance expired on December 31, 1951; that the injunction decree neither enlarged nor created rights beyond those granted in the contract ordinance; and that therefore the intervenors had no interest in the subject matter of the action now before the court.

On January 19, 1956, the motions were overruled and the intervening petitions were permitted to stand as answers to plaintiff's petition for a writ of mandamus. The plaintiffs filed replies in which they realleged authority of the city of Chicago to issue the licenses in question under the then controlling taxicab ordinance and denied that the intervenors had any property interest in the subject matter of the action. No reply was filed by Flynn.

On February 26, 1956, the intervenors filed a motion for summary judgment, in which they alleged that the Public Vehicle License Commissioner, under the provisions of chapter 28 of the Municipal Code of Chicago, while restricted to the issuance of not more than 3761 public passenger vehicle licenses, is under the obligation only to issue licenses in renewal of valid outstanding licenses for the preceding year, and is not required and has no authority to issue any licenses to applicants who were not, prior thereto, the holders of valid unrevoked licenses; that under the provisions of the decree for injunction issued in the circuit court of Cook County in 1946, the city of Chicago and the Public Vehicle License Commissioner are prohibited from issuing any licenses in excess of 3000 without first holding hearings with respect to the public convenience and necessity therefor and without first affording the intervenors the opportunity to apply for and obtain such licenses to the number thereof provided for in the ordinance passed by the city council on December 22, 1937, the substance of which was there set forth; that the decree was affirmed by the Supreme Court of Illinois in Yellow Cab Co. v. City of Chicago, 396 Ill. 388, and is now in full force and effect; that no opportunity has been given the intervenors to apply for and receive additional licenses up to the number provided for in that ordinance; that since the plaintiffs in this case seek the issuance of a writ of mandamus to require the Public Vehicle License Commissioner to issue 18 licenses to them and such licenses would be in excess of the total number of 3000 public passenger vehicle licenses, and as such are licenses to which the intervenors have a prior right, the plaintiffs therefore have no right in law to the issuance of such licenses; and that their issuance would be in violation of the injunction decree and the contract between the city of Chicago and the intervenors.

On February 24, 1956, the court entered an order that the plaintiffs take nothing by their suit and the defendants go hence without day. From this order plaintiffs appealed to the Appellate Court which reversed and remanded with instructions to reinstate the judgment ordering the writ of mandamus to issue. From this judgment intervenors have appealed to this court on the ground that a franchise is involved. While we do not regard a franchise as being involved, (Yellow Cab Co. v. City of Chicago, 396 Ill. 388,) we conclude that the constitutional question of impairment of the obligation of contract (Const. of 1870, art. II, sec. 14,) arose for the first time in the judgment of the Appellate Court, and that under section 11 of article VI of our State constitution, this court has jurisdiction to review that judgment. Ill. Rev. Stat. 1955, chap. 110, pars. 74(3) and 75(1); Altschuler v. Altschuler, 410 Ill. 169; Merlo v. Public Service Co. 381 Ill. 300.

While intervenors have argued several grounds for reversal, we think the dispositive issue is a narrow one, which poses the question of whether the intervenors and other surrendering licensees, subject to the provisions of the ordinance of December 22, 1937, became vested with a right to a preference in the reissuance of surrendered licenses when they complied with its conditions.

Intervenors argue that the contract ordinance of December 22, 1937, was an offer which, when accepted, bound the city not to issue licenses in excess of 3000 without first proferring them to surrendering licensees. Plaintiffs contend that any rights under the ordinance of 1937, as an amendment to the licensing ordinance of 1934, expired on December 31, 1951, the same time as the licensing ordinance.

In considering these questions we must examine the history of the regulatory and contract ordinance involved. This is fully set out in Yellow Cab Co. v. City of Chicago, 396 Ill. 388. In the present case we need only repeat that the city council, on May 18, 1934, passed a comprehensive ordinance regulating the operation of taxicabs, which provided for the issuance of licenses to operate taxicabs for a term ending December 31, 1940. The ordinance contained no limitation on the number of licenses that might be issued to accepting licenses. Under this ordinance 4108 licenses were issued, of which 2166 were issued to Yellow Cab Company and 1500 to Checker Taxi Company, Inc., intervenors. Thereafter, due to economic conditions, operations became unprofitable and widespread violence and strikes pervaded the industry. It was apparent to all concerned that it would be desirable to limit the number of licensees, although the existing licenses did not expire until December 31, 1940. The city council therefore, on December 22, 1937, passed an ordinance of general application providing for the voluntary surrender of licenses, which provided:

ORDINANCE OF DECEMBER 22, 1937

Decrease in Number and Assignment of Taxicab Licenses

"196A-1. In the event that a sufficient number of taxicab licenses shall be surrendered by licensees under the ordinance of May 18, 1934, to reduce the number of taxicabs within the city of Chicago to 3,000 on or before March 31, 1938, no taxicab licenses shall thereafter be issued except upon transfer to permit replacement of a taxicab or in the annual renewal of any such license or upon assignment of any such license or upon assignment of the right to apply for such license as hereinafter provided or upon revocation for cause or termination in any other manner of any such license.

"196A-2. Notwithstanding section 1 of this ordinance, taxicab licenses in excess of 3,000 may be issued when authorized by general ordinance without consent of licensees under the ordinance of May 18, 1934; provided that such licensees who shall have voluntarily surrendered any taxicab licenses or their right to renewal of any taxicab licenses on or before March 31, 1938, shall have the right to such number of taxicab licenses as were so surrendered, and such right shall be prior to the right of any persons, firm or corporation until such licensees who have so surrendered their taxicab licenses shall have either released their right to apply for taxicab licenses or shall have failed to make application therefor within thirty days after publication of notice of public hearing upon the question of public convenience and necessity for the issuance of licenses for taxicabs as provided by ordinance. As between such licensees who have so surrendered taxicab licenses and who have not released or waived ...


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