72 Iowa 125 | Iowa | 1887
I. The railroad corporation in whose aid the tax was voted, before the construction of its road, when only about $1,900 had been expended in its construction, transferred by lease,'which is in effect perpetual, the contemplated road to the Burlington, Cedar Bapids & Northern- Bailway Company. The statute under which the tax was levied was repealed by chapter 159 of the acts of the Twentieth General Assembly. Subsequent to this repeal the taxes were levied, having been before voted.
II. This court has held, if money be expended, before the repeal of the statute, upon the faith of the tax, the repeal does not invalidate the tax, and it may be collected. Burges v. Mabin, 70 Iowa, 633. Of course, the expenditure must be for purposes connected with the construction of the road, and must have been made relying upon the tax as a part of the present or future assets of the road. If the expenditure was with the intention of obtaining reimbursement from other sources, as, for instance, from the transfer of the road, and not from assets of the corporation, including the taxes, and there was no actual appropriation of the anticipated taxes themselves, or of the money obtained upon the credit of such taxes, it cannot be said that such expenditure was made in faith of the taxes.
The Chicago, Decorah & Minnesota Bailway Company expended money in surveying the railroad, after the tax was voted, before the repeal of the statute under which it was voted. Some grading had been done before the vote for the tax. Payments were made for right of way, but the amount and time of payments do not clearly appear. The total
In view of these considerations, we think that defendants have no claim to the taxes on the ground of the exjienditure of money in faith of the taxes. The effect of the repealing statute cannot be averted, and the taxes must be held void.
Aeeibmed.