Appeal from the District Court of the United States for the District of Montana; George M. Bourquin, Judge.

Suit by the Monidah Trust against the City of Livingston and others to quiet title to its franchise under which it is engaged in supplying water to the City of Livingston and to the hydrants, pipes and mains, claimed by the plaintiff as part of its water system. Decree for plaintiff, and defendants appeal.

It is alleged in the bill of complaint filed October 24, 1917, that the defendant the city of Livingston, on or about the 5th of August, 1889, being then without any waterworks plant or system of fire protection and desiring to secure the erection of such waterworks plant for the purpose of procuring water for public and private purposes, including fire protection, passed an ordinance, numbered 24, granting to O. S. Stobbins, Isaac Orsehel, and Samuel Bundoek, their successors and assigns, the privilege of erecting, maintaining, and conducting a waterworks plant in the city of Livingston, said ordinance providing among other things the regulation, requirements, and conditions under which said plant should be maintained and conducted; that under said ordinance or franchise so granted the said Stobbins, Orsehel, and Bundoek, their successors and assigns, were to furnish the said city of Livingston with 25 double discharge fire hydrants at the time of the completion of said waterworks and to furnish additional double discharge fire hydrants thereafter as the same might he ordered by the said city; that the said city agreed to pay therefor annual rentals; that at the expiration of 20 years from the date of' the completion of said waterworks system the said city might, at its option, purchase the said waterworks plant and all pipes, pumps, reservoirs, and other property rights including the water rights and appurtenances connected with said works, at a price to be agreed upon by three commissioners, one to be appointed by the said city of Livingston, one by the said Stebbins, Orsehel, and Bundoek, their successors and assigns, and the third to be chosen by these two: that at the expiration of 20 years from the date of the completion and testing of said waterworks, if the city of Livingston did not purchase such waterworks upon the terms mentioned, it would renew the contract with said Stebbins, Orsehel, and Bundoek, their heirs, successors, or assigns, for a period of 20 years longer upon terms to be then mutually agreed upon, provided however, that such terms should in no case exceed the prices fixed and stipulated by Ordinance No. 24, nor should the renewal of the contract in any case annul the operation of said ordinance in its full force and effect; that said Stebbins, Orsehel, and Bundoek promised and agreed upon their part to comply with all things required by said ordinance to be done and performed by them, and accepted the terms, conditions, stipulations, and agreements contained in said ordinance; that on the 1st day of June, 1890, said Stebbins, Orsehel, and Bundoek, and their successors and assigns, did complete and place in operation said waterworks plant, and have since maintained and conducted the same in accordance with the terms and conditions of said ordinance, supplying the said city of Livingston and its inhabitants with pure and wholesome water for public and private uses; that the Monidah Trust is the successor and assignee in interest of said Stebbins, Orsehel, and Bundoek, and their successors and assigns, and is the owner of'said waterworks system and all of the property, reservoirs, water rights, pumping plants, machinery, and apparatus used in connection with the operation and maintenance of said waterworks system; that mofe than 20 years have expired from the date of the completion and testing of said waterworks and plant, and the city of Livingston has wholly failed and neglected to exercise the option to purchase the said waterworks system or the other property used in the construction and operation of the same; that since the expiration of said 20-year period mentioned the said city of Livingston has failed, neglected, and refused to renew said contract for the supplying of water to the said city and its inhabitants, and for several years last past has neglected and refused to pay plaintiff the hydrant rentals provided in said ordinance, and has neglected and refused to comply with any of the terms and conditions in said ordinance, claiming the .same to be void and unenforceable; that on or about the 30th day of September, 1913, the predecessors in interest of said Monidah Trust (Livingston Waterworks) commenced a suit in the state court (against the city of Livingston and its aldermen) for the purpose of enforcing the terms and conditions of said ordinance; that upon the trial of said cause a judgment was entered in favor of the defendant, wherein it was adjudged that said contract was void and unenforceable; that upon appeal to the Supreme Court of the state the judgment of the trial court was affirmed (Livingston Waterworks v. City of Livingston et ah, 53 Mont. 1, 162 Pac. 381, L. B. A. 1917D, 1074); that since the rendition of the judgment and the affirmance by ■ the Supreme Court the plaintiff and its predecessors in interest have offered to sell said waterworks system and the property connected therewith to the city of Livingston upon a fair, just, and equitable appraisement and valuation, but said city of Livingston has refused to consider any of the propositions of sale made by said plaintiff or its predecessors in interest, and has determined to erect an independent municipal waterworks system, and has procured a bond election at which a bond issue to the amount of $225,000 was voted for ¿he purpose of raising funds for the construction of such independent municipal plant; that said bonds have been issued and sold, and the city threatens. to and as plaintiff is informed and believes has actually commenced the erec-. tion of said independent municipal plant, and wholly refuses to consider any proposition of sale or purchase of the plaintiff’s waterworks system; that, plaintiff, because of its failure to negotiate a sale of its waterworks system to the city of Livingston, and because of its failure to procure a renewal of the, franchise and contract under which it has supplied water to said city and its¡ inhabitants, and because of the fact that plaintiffs plant will be wholly destroyed by the action of the city in erecting an independeift municipal plant, desires to discontinue said waterworks system in said city, withdraw therefrom, and remove all its pipes, machinery, and other personal property used in connection with said waterworks system, and abandon the conduct of its waterworks system in the said city of Livingston; that said city of Livingston, refuses to permit plaintiff to discontinue its said waterworks system, or remove its pipes, machinery, and other personal property used in connection, with said waterworks system in said city, and refuses to grant plaintiff per-* mission to dig up the mains, pipes, and hydrants belonging to plaintiff and used in connection .with said waterworks system, and threatens to use force for the purpose of preventing and restraining plaintiff from removing its said •property from the city of Livingston; that said city of Livingston and its board of aldermen claim that plaintiff has no right whatever to the streets oi; ■the city of Livingston, and as plaintiff is informed and believes claims the' ownership of the pipes, machinery, and hydrants used in connection with said waterworks system, and refuses and will continue to refuse to permit plain-; tiff, to withdraw its. property from said city of Livingston. ,

■ The prayer of the plaintiff in this original complaint is that the defendant be restrained and enjoined from in any manner interfering with the plaintiff in the disposal of its said property, and that a writ of injunction be issued, .pending the suit, enjoining and restraining the defendants from interfering with or preventing plaintiff from discontinuing the conduct of its waterworks ■system, or from removing and disposing of its property used in connection therewith.

i In an amended bill of complaint filed November 8, 1917, there are attached as exhibits a copy of Ordinance No. 24, passed April 5, 1889, and also Ordinanbe No. 25, passed September 22, 1889, amending Ordinance No. 24 by sub-, stituting for those words in the latter, “and thereby supply said city with pure and wholesome water for public and private uses.” the following words: “And thereby supply said city with as good and wholesome water for public and private uses as can be taken from the main Yellowstone river in the vicinity of Livingston.”

On a hearing on an order to show cause why an injunction should not issue as prayed for in the bill of complaint, and on a motion on the part of the defendants to dismiss the Mil for the reason, among other things, that another suit between the same parties, involving the identical subject-matter and the same controversy, and asking for the same relief, was pending undetermined in the state court, at the time this suit was commenced, the motion to dismiss the bill of complaint was denied, and the motion to vacate the order to show cause granted, with 10 days allowed to the plaintiff within which to file an amended bill.

In a second amended bill of complaint, filed December 6, 3917, the allegations of the first amended complaint are repeated in substance, with additional allegations to the effect that defendants claim that Ordinances Nos. 24 and 25, and all rights and privileges claimed by plaintiff thereunder, have fully terminated, and assert that the city is now the owner of all the rights and easements of plaintiff, together with the pipes, mains, conduits, hydrants, and other personal property in the city of Livingston; that the city, acting through its agents, officers, and employes, has entered upon plaintiff's property and with force and arms lias torn up and damaged certain mains, conduits, and pipes belonging to plaintiff and used in connection with the said system of waterworks; that defendants assert, the right to further tear up, interfere with, and destroy plaintiff’s property, and claim and assert that they intend to at some time in the future further interfere with and take possession of the same, and prevent plaintiff from further carrying on and conducting said system of waterworks in said city of Livingston; that defendants’ claims are false and groundless, and constitute a cloud on plaintiff’s title to the property, franchise, and easements described: that said claims are without any right whatever, and the defendant city lias no right, title, or interest in or to said property, franchise, easements, or any part thereof.

The prayer of this last amended complaint is that it be decreed that plaintiff’s privileges, rights, franchise, and easements in the streets of said city are perpetual, and plaintiff’s title thereunder is good and valid, and that the defendants ho enjoined and restrained from asserting any claim whatever into or 10 said property.

The defendants, in their answer to the second amended complaint, filed March 29, 3918, deny all the allegations in the amended complaint material to the controversy involved in this appeal, except that the defendants admit that in a suit pending in the slate court, brought by the plaintiff against the defendant city, the city does claim an estate and interest adverse-to the plaintiff in and to plaintiff's alleged franchise, easements, privileges, rights, and property in connection with said waterworks system; that said claim is set forth in a counterclaim in its answer in that; suit, to the extent of the pipes and mains underneath the streets of the city, and also that said rights, privileges, and so-called franchise claimed by plaintiff have been terminated and. forfeited.

In the suit in the state court, here referred to, the plaintiff herein brought suit on May 31, 1917, and filed an amended complaint on June 32, 1917, against the city of Livingston, the state board of land commissioners, and the registrar of the state land office, to restrain and enjoin the defendants from proceeding with and completing the sal,e of certain bonds issued by the city of Livingston for the purpose of procuring water supply and constructing an independent municipal water system for the city.

On June 18. 1917, the application and motion of the plaintiff for an injunction was denied by the state court. An appeal was taken to the Supreme Ourt of the state from this order, and on the 16th of October, 1917, the appeal was dismissed. In the counterclaim set up in the answer of the city of Livingston to plaintiff’s complaint in the state court, and referred to in its answer in this case, it is alleged: “That since said month of .Tune, 1910, said. Livingston Waterworks Company has been and now is without any right or authority to use the streets and alleys in the city of Livingston and the real property of said city of Livingston for the uses and purposes mentioned in said Ordinances Nos. 24 and 25, or otherwise, and that said Livingston Waterworks Company ever since said month of June, 1910, has been and now is a trespasser in and upon the streets, avenues, and alleys of said city of Livingston.”

In this answer the defendants prayed for a judgment against the plaintiff, declaring the city -of Livingston to be the owner of the pipes and mains and fire hydrants and pipe connections underneath the surface of the streets, avenues, and alleys heretofore used by the plaintiff in connection with its said waterworks in supplying the city and its inhabitants with water and that it be adjudged that the plaintiff has no right, title, or interest therein, and that plaintiff be enjoined and restrained from further using, operating, or interfering with said mains, hydrants, pumps, machines, and machinery on and in the streets and alleys of the said city, and for such other and further relief as might be deemed meet and equitable in the premises.

To this answer and counterclaim the plaintiff appears to have demurred, and the action is now pending in the state court upon that demurrer.

On August 16, 1917, a deed of conveyance was executed by the Livingston Waterworks and the Livingston Waterworks Company, purporting to convey the whole system of waterworks belonging to the grantors, together with all the mains, pipes, hydrants, and other property connected with the operation and management of the waterworks system to the Monidah Trust, a Delaware corporation and the plaintiff herein.

As has been stated, on October 24, 1917, the Monidah Trust, plaintiff, filed its original bill of complaint in this case. On the same day it obtained an order upon the defendants to show cause why an injunction should not issue, restraining the defendants from interfering with plaintiff’s management, control, and disposition of its waterworks system and all property connected therewith, and from interfering with its right to remove its said property from the city of Livingston, and from in any wise interfering or preventing plaintiff from discontinuing the conduct of its waterworks system in the city of Livingston, or removing or disposing of said property. The defendants moved to discharge the order to show cause on the ground of the said former suit pending in the state court, and also that the transfer of the property to the plaintiff was colorable and a fraud on the jurisdiction of die court. The court overruled the motion to discharge the order to show cause, and, retaining jurisdiction of the case, granted xilaintiff permission to amend the bill or complaint, and thereupon it filed its second amended bill of complaint.

Upon the hearing of the case the court directed the entry of a decree in favor of the plaintiff adjudging it to be the owner of the right, privilege, easement, and franchise to construct, maintain, and operate a water system in the city of Livingston for the purpose of supplying said city and its inhabitants with water, granted and conferred by Ordinances Nos. 24 and 25 of -said city, and that the right, privilege, easement, and franchise so granted is perpetual; that the plaintiff is also the owner of the water system constructed and installed pursuant to said ordinances, and now used for the purpose of supplying said city and its inhabitants with water. The title of the plaintiff to said right, privilege, easement, and franchise is by the decree quieted against all claims or pretensions of said city, its officers, agents, and representatives, that the same has expired, or has been canceled or forfeited by the city or its representatives, and the title of said plaintiff to said water system is quieted against all claims or pretensions of said city, its officers, agents, or representatives, that said city is the owner of any of the pipes, mains, or otner parts of said system, and that the said city, and each and all of its officers, agents, and representatives, are enjoined and restrained from asserting any claim that said franchise is not in full force and effect, or that the said plaintiff is not the owner 'of said water system and the whole thereof, and from in any manner interfering with the full and free use and enjoyment by said appellee of the right, privilege, easement, franchise, and water system aforesaid. From, this decree the defendants have brought the case to this court.