We are of the opinion that the city of Pasadena has the power to accept the transfer in question and to undertake and perform the public service of supplying the water to the cities of Pasadena and South Pasadena and the respective inhabitants thereof, as it has been heretofore supplied, which is the duty attached to the property and imposed upon the possessor thereof.

The statute of 1891 on this subject is broad and comprchensive. It is as follows:

"Any incorporated city in this state may acquire by gift, purchase, or condemnation proceeding under the power of eminent domain, water, water rights, reservoir sites, rights of way for pipes, aqueducts, flumes, or other conduits, and all other property and appliances suitable and proper for supplying such city and its inhabitants with water." (Stats. 1891, p. 102.)

The special charter of the city of Pasadena gives the city power, "To construct and maintain waterworks, pipes, pipelines, acqueducts and hydrants for supplying the city and its inhabitants with water, and the right to supply water to persons who live without the city limits." (Subd. 8, sec. 3, art. I, Stats. 1905, p. 1021.)

It further provides for a board of water commissioners of five members, which board is given "control and management of all water and waterworks that now belong, or may hereafter be acquired by the city," and for a "water fund" which may be applied to the "purchase of necessary lands, waterrights and other property" for the improvement of the water system. (Stats. 1905, p. 1019, subd. 2, sec. 6, art. 612.) Subdivision 4 of section 3 of article 1, gives the city power "to purchase, receive, have, take, hold, lease, use and enjoy property of every kind and description, both within and without the limits of said city and control and dispose of the same for the common benefit." By subdivision 16 of the same section power is given to create a bonded debt, equal to fifteen per cent of the assessed value of the property, to pay the cost of public utilities, and under subdivision 23 it may exercise the right of eminent domain to acquire "water, water-rights and waterworks, within or without the corporate limits, necessary or convenient for the use of said city and its inhabitants." (Stats. 1901, pp. 888, 890.)

These provisions are ample to confer power to acquire and carry on a water system outside the city so far as it may be necessary or convenient to do so in order to accomplish the main purpose of furnishing water to the city and its inhabitants. Indeed, it is so seldom that a water supply can be obtained within the limits of a city, especially in this state, that a mere grant of power to provide and supply water to the city and its inhabitants would be construed to give power to acquire for that purpose water supplies without the city. The powers of a municipal corporation include not only those expressly named in the grant, but also "the authority to do such subsidiary acts as are incidental and necessary to the exercise of" the powers specifically described. (Von Schmidt v. Widber, 105 Cal. 157, [38 Pac. 682].) Or, as stated by Mr. Dillon, they include "those necessarily or fairly implied in or incident to the powers expressly granted." (1 Dillon on Municipal Corporations, 4th ed., sec. 89; Hammond v. San Leandro, 135 Cal. 452, [67 Pac. 692.].) Under powers much less comprehensive in terms it has been held that a municipal or public corporation may carry on a system and supply water to persons outside its limits, whenever it becomes necessary or convenient to do so in order to accomplish the main purpose of supplying waters to those within. In Fellows v. Los Angeles, in considering a provision merely giving that city power to acquire water and water-rights within or without the city for the use of its inhabitants, it is said: "In the exercise of this power, it would have the right to buy from any corporation or person, engaged in supplying water for public use outside the city, any surplus water which such person might possess. If it were necessary, in order to obtain such surplus, the city might, under this power, purchase the entire water supply of such person or corporation and the water plant or system used in connection with it, so that, after operating the system and supplying the persons entitled to use the water, it could devote the surplus to the use of the inhabitants of the city." In Hewitt v. San Jacinto Irr. Dist., 124 Cal. 192, [56 Pac. 893], it was held that an irrigation district, under its general power to acquire and hold such water, water-rights and other property as should be necessary to supply water to irrigate the lands within the district, had power to purchase and hold water already in part used on

lands outside the district, to take it subject to such use and to continue to furnish the water to such outside lands as it had been furnished before.

These authorities would seem sufficient to settle the question in favor of the respondent. The ingenuity of counsel for appellant has, however, suggested many objections to the rule stated and difficulties which he fears may arise in its application, and, in view of the importance of the question, we deem it proper to discuss them at more length.

In considering what powers are necessary, incidental, or fairly to be implied from the powers expressly given to the city of Pasadena by the foregoing provisions, it is proper to look to the conditions surrounding the city at the time. The court will take judicial notice that the two cities interested are situated in a comparatively arid region where there is little, if any, water not already applied to some extremely valuable public or private use, and that water sources in that vicinity are in great demand and command a high price where they can be purchased at all. It appears from the complaint that for many years the defendant company has been supplying water to portions of the two cities, precisely as it does now, the area supplied in South Pasadena being about two thirds of its territory, that more than three hundred families are now supplied therein from this source and that if they are now deprived thereof there is no other known source from which it can be replaced and they would be without water for any purpose. It may well be assumed that Pasadena could obtain no sufficient quantity of water for a municipal water system, except by buying or condemning that portion of the water of the defendant company now distributed to its inhabitants, or some other supply already devoted to use outside the city. It would be bad public policy under these conditions to require a city desiring to obtain water for its inhabitants, to take water in use by others for similar purposes outside its limits, where the effect would be to devastate and depopulate such outside territory. To condemn the individual right of each member of the outside community would be impracticable, and even if it could legally be done it would probably prove too costly for the resources of the city. To separate the supply and endeavor to control, manage, and if necessary, develop and increase the supply from time to

time, in concert or partnership with some other corporation, would probably cause many complications and render the successful administration of the municipal system much more difficult and doubtful. In order to accomplish the purpose for which these powers were given, it is reasonably certain that it would be advisable, and it might be necessary, for the city to take over a supply already partly in use outside and continue the service to the outside territory while supplying the remainder to the use of its own people. These probabilities and the conditions we have stated must have been well known to the framers of the charter, to the people of Pasadena, and to the legislature, when the charter was prepared, adopted, and ratified. In view of all the circumstances, we may reasonably believe that the clause adopted in 1905, giving the "right to supply water to persons who live without the city limits," was intended to authorize a plan such as that here under consideration. If not designed to authorize some similar plan it might as well never have been enacted at all.

Under the constitution South Pasadena has power to fix the rates to be charged for water supplied to its inhabitants and to control the manner of laying and repairing pipes in its streets for that purpose. Necessarily it has this power as against another city engaged in supplying such water, as well as when an individual or water corporation does so. It is suggested that the two cities each represent the sovereign power and would have equal authority in all municipal affairs, that a conflict would ensue, and that such consequences cannot be considered as intended, unless the intention is expressly and unmistakably declared. In this connection the rule is invoked that there cannot be two municipalities exercising the same powers at the same time within the same territory. But the two cities would not be of equal authority with respect to the use of water in South Pasadena, in such a case. South Pasadena would have the power above stated, under the constitution, and Pasadena, so far as that service is concerned, would be subject to those powers, to the same extent as the Pasadena Land and Water Company is now subject thereto. In the carrying on of the water service to the people of South Pasadena the city of Pasadena will not be acting in its political, public, or governmental capacity as an agent of the sovereign power equal in all respects to the city within which it

operates. In administering a public utility, such as a water system, even within its own limits, a city does not act in its governmental capacity, but in a proprietary and only quasipublic capacity. (Davoust v. Alameda, 149 Cal. 70, [84 Pac. 760]; Illinois etc. Bank v. Arkansas City, 76 Fed. 271, [22 C. C. A. 171]; Esberg Cigar Co. v. Portland, 34 Or. 282, [75 Am. St. Rep. 651, 55 Pac. 961].) Having taken over the whole system subject to the burden of supplying a part of the water to inhabitants of South Pasadena, the city of Pasadena will have no greater rights or powers, respecting that part of the service, than its grantor previously had. It will be under the same obligation as its grantor to continue the service and supply the water to all persons who may become entitled to it in the future, so long as it retains possession and control of the property so charged. (Fellows v. Los Angeles, 151 Cal. 52, [90 Pac. 141].) The powers of the two cities in regard to this water service will be separate and distinct, one will be subordinate to the other, and, hence, there will not be two cities exercising the same powers in the same territory at the same time; South Pasadena, within its own limits, will be the sole representative of sovereignty in the fixing of rates, and in the supervision of the streets; and Pasadena will be subject thereto, as a private person. If, by fixing too low rates, South Pasadena should attempt to compel the service to be made at a loss, Pasadena would have the same remedies, and no greater, in the courts that a quasipublic corporation or natural person would have in the samo circumstances. The fact that the outside service is within another city does not appear to be a significant factor in the question of the power. If it were in a rural community, the rates charged would be subject to judicial control to make them reasonable. Being in another city, the serving city has a right to demand reasonable rates and may enforce them if not granted. The limitations would not affect the power in one case more than in the other.

The act of March 27, 1897 (Stats. 1897, p. 182), authorizes a city, having in its supply more water than is necessary for its inhabitants, to sell the surplus, but provides that contracts for such sales shall not run for a period longer than one year. It is contended that the service of water to outside communities is not a "municipal affair" within the meaning of that

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