This action is brought to recover of the Southern Pacific Bailroad Company, a corporation formed under the laws of California, certain state and county taxes levied upon its property for the fiscal year of 1881 and 1882, alleged to be due to the plaintiff, with 5 per cent, added for their non-payment, and interest. It was commenced in one of the superior courts of the state, and, on application of the defendant, was removed to this court.
The railroad company, besides a general denial of the allegations of the complaint, sets up as a special answer to the action that in the assessment of its property, according to which the taxes claimed were levied, an unlawful and unjust discrimination was made between its property and the property of individuals, to its disadvantage, subjecting it to an unequal share of the public burdens, and that it was not afforded an opportunity of being heard respecting the assessment, and that such discrimination was made and proceeding had under the provisions of the constitution of California, adopted in 1879, which in that respect are in conflict with the fourteenth amendment of the constitution of the United States.
By the constitution of California, all property in the state, not exempt under the laws of the United States, is, with certain exceptions, to be taxed in proportion to its value, to be ascertained as prescribed by law; but in the ascertainment of its value as a basis for taxation, a distinction is made between the property owned by individuals and that owned by railroad corporations. By the thirteenth article, “a mortgage, deed of trust, contract, or other obligation by which a debt is secured,” is treated, for the purposes of assessment and taxa
By the constitution there is also a different system of assessment provided for “the franchise, road-way, road-bed, rails, and rolling stock” of railroads operated in more than one county from that provided for other property. The assessment of other property is to be made in the county, city, or district in which it is situated in the manner prescribed by law; and the supervisors of each county constitute a board of equalization of the taxable property of the county, and must act upon prescribed rules of notice to its owners. A state board of equalization is also created to equalize the valuation of the taxable property of the several counties, so that equality may be preserved between the tax-payers of the different localities, and its action in this respect must likewise be upon prescribed rules of notice.
The assessment of the franchise, road-way, road-bed, rails, and rolling stock of-railroads operated in more than one county in the state is to be made by this state board. And in making it, the board is not required to give any notice to the owners, nor is any provision made for affording them an opportunity to be heard respecting the valuation of their property. The tenth section of the article which confers this power of assessment has been held by the supreme court of the state to be self-executing, requiring no legislation for its enforcement.
The defendant, as already stated, is a corporation formed under the laws of the state, and operates a railroad through several counties. The entire length of its road in the state is a little over 711 miles, of which twenty-five miles and one-tenth of a mile pass through the county of San Mateo. Its principal place of business is at San Francisco. Its stockholders are, and always have been, citizens of the United States, some of whom are residents of this state, and some of other states.' Previously’ to January !, 188!, it'was indebted to different--citizens of the United States, many of them:residents of this
In the fiscal year of 1881 and 1882, the state board of equalization assessed the franchise, road-way, road-bed, rails, and rolling stock of the defendant at $11,739,915,—that is, at the rate of $16,500 per mile,—and apportioned to the county of San Mateo $414,150. Upon the amount thus apportioned the taxes were levied for which the present action is brought. In the assessment no deduction was allowed for the mortgage, but the property was assessed at its entire value independently of the mortgage. Nor was any notice given to the company by the board of its action, nor was any opportunity allowed the company to be heard respecting the assessment. These facts are admitted by the demurrer, and the validity of the defense rests upon the application of the law to them.
The railroad company contends that the taxes are invalid and void on two grounds:
(1) Because the assessment, according to which they were levied, was made in pursuance of the discriminating provisions of the state constitution, in the enforcement of which the company was not allowed any deduction from the valuation of its property for the mortgage thereon, and was thus subjected to an unjust proportion of the public burdens, and denied the equal protection of the laws guarantied by the fourteenth amendment of the federal constitution; and (2) because the assessment was made in pursuance of provisions of the state constitution, which gave no notice to the company, and afforded it no opportunity to be heard respecting the value of the property, or for the correction of any errors of the board, thus depriving it of its property without due process of law guarantied by that amendment.
The plaintiff, on the other hand, contends:
(1) That the power of taxation possessed by the state is unlimited, except by the constitution of the United States, and that its exercise cannot be assailed in a federal court, either for the hardship or injustice of the tax levied; (2) that the classification of property for taxation, and the apportionment of taxes according to such classification, are not forbidden by the constitution of the United States, and that within this principle the taxes on the property of the railroad company were lawfully imposed; (3) that the fourteenth amendment of the constitution of the United States was adopted to protect the newly-made citizens of the African race in their freedom, and
We do not state the positions of the several counsel who argued the case in their precise language, for they were presented in various forms, but we give their substance and purport.
The questions thus presented for our determination are of the greatest magnitude and importance. The answer to them concerns not merely the railroad corporations of this state, but all corporations other than municipal within the United States. It is of the highest interest to them all to know whether their property is subject to the same rules of assessment and taxation to which the property of individuals is subject, or whether it can be separated and distinguished from that of individuals and made liable to such different burdens in the way of taxation as the state may choose to impose. The questions have been argued with great ability and learning by distinguished counsel on both sides, and they have received from the court the most patient and thoughtful examination. Indeed, their examination has been accompanied with a painful anxiety to reach a right conclusion, aware as the court is of -the opinion prevailing throughout the community that the railroad corporations of the state, by means of their great wealth and the numbers in their employ, have become so powerful as to be disturbing influences in the administration of the laws; an opinion which will be materially strengthened by a decision temporarily relieving any one of them from its just proportion of the public burdens. That consideration, however, cannot be allowed to affect the judgment of the court. Whatever acts may be imputed justly or unjhstly to the corporations, they are entitled when they enter the tribunals of the nation to have the same justice meted out to them which is meted out to the humblest citizen. There cannot be one law for them and another law for others.
It is undoubtedly true that the power of taxation possessed by the state may be exercised upon any subject within her jurisdiction, and to any extent not prohibited by the constitution of the United States. As stated by the supreme court: “It may touch property in every shape,—in its natural condition, in its manufactured form, and in its various transmutations. And the amount of the taxation may be de
It is also undoubtedly true that the hardship and injustice of a tax levied by the state, considered with reference to its amount, are not subjects of federal cognizance. Whether a tax upon property, subject to taxation, be 1 per cent, of its value, or 10 per cent., or 20, or more, is a mere matter of state discretion; a question of policy and not of power. So we often find in the reports language to the effect that the state’s power of taxation is without limitation; language which may be correct when applied to the special facts of the cases in which it is used, but which should always be read with a reservation that the exercise of the power does not confiict with any of the inhibitions of the federal constitution.
There are in the very nature of the federal government, and the powers with which it is clothed, many prohibitions upon the taxing power of the states. Within the sphere of its action that government is supreme, and no impediment to the free and full exercise of its power is permissible. The state cannot, therefore, place any restrictions upon the agencies of the federal government; otherwise it might embarrass and even defeat the operations of that government. It was long ago said by Chief Justice Marshall that the power to tax Involves the power to destroy; and that there would be a manifest repugnance in allowing one government to control the constitutional measures of another government in respect to which the latter is declared to be supreme. When, therefore, congress had created a bank of the United States as an agency in the management of the finances of the government, if was held that the states were inhibited from taxing the institution.
“If the states,” said that great judge, “ may tax one instrument employed by the government in the execution of its powers, they may tax any and every other instrument. They may tax the mail; they may tax the mint; they may tax the papers of the custom-house; they may tax judicial process; they may tax all the means employed by the government to an excess which would defeat all the ends of government. This was not intended by the American people. They did not design to make their government dependent on the states.” McCullough v. Maryland, 4 Wheat. 432.
Other illustrations might be given of implied inhibitions of the federal constitution to taxation by the states. The powers of the general government cannot be interfered with, or their exercise embarrassed in any respect, by such taxation; as has often been held with reference to attempted taxation on goods imported, while retaining the character of imports in unbroken packages, and on goods in transit from one state to another. The power to regulate commerce, foreign and interstate, cannot be thus trammeled by state action. Brown v. Maryland, 12 Wheat. 434; Welton v. State, 100 U. S. 275; Webber v. Virginia, 103 U. S. 344.
So in regard to the express prohibitions upon the states contained in the federal constitution; they apply equally to taxation and to any other action of the state. They cannot be evaded under the plea that the state possesses the unrestricted power to tax. Where, for example, a state has stipulated for a valid consideration to exempt certain property from taxation, as it has been repeatedly held that it may do, the stipulation cannot subsequently be withdrawn, and the property subjected to taxation. The provision which secures the inviolability of contracts against state legislation stands as a perpetual interdict against the imposition of the charge. It is to no purpose in such case to speak of the power of taxation as an attribute of state sovereignty which cannot be surrendered; that sovereignty, whatever its extent, must be exerted in subordination to the prohibition of the constitution, which is the supreme law of the land. Many of the attributes of sovereignty which the states would possess if independent political communities, have been in like manner' surrendered to the federal government, such as the power to ’ declare war, to make peace, to enter into treaties of alliance, and to regulate commerce
The fourteenth amendment to the constitution, in declaring that no state shall deny to any person within its jurisdiction the equal protection of the laws, imposes a limitation upon the exercise of all the powers of the state which can touch the individual or his property, including among them that of taxation. Whatever the state may do, it cannot deprive any one within its jurisdiction of the equal protection of the laws. And by equal protection of the laws is meant equal security under them to every one on similar terms,—in his life, his liberty, his property, an’d in the pursuit of happiness. It not only implies the right of each to resort, on the same terms with others, to the courts of the country for the security of his person and property, the prevention and redress of wrongs and the enforcement of contracts, but also his exemption from any greater burdens or charges than such as are equally imposed upon all others under like circumstances.
Unequal exactions in every form, or under any pretense, are absolutely forbidden; and of course unequal taxation, for it is in that form that oppressive burdens are usually laid. It is not possible to conceive of equal protection under any system of laws where arbitrary and unequal taxation is permissible; where different persons may be taxed on their property of the same kind, similarly situated, at different rates; where, for instance, one may be taxed at 1 per cent, on the value of his property, another at 2 or 5 per cent., or where one may be thus taxed according to his color, because he is white, or black, or brown, or yellow, or according to any other rule than that of a fixed rate proportionate to the value of his property.
In the constitution of several states a provision is found requiring “equality and uniformity” in the taxation of property, and this is held to mean that taxes must be levied according to some fixed rate or rule of apportionment, so that all persons shall pay the like amount upon similar kinds of property of the same value. As it seemed to one of the judges of the supreme court of Michigan:
“ To compel individuals to contribute money or property to the use of the public without reference to any common ratio, and without requiring the sum paid by one piece or kind of property, or by one person, to bear any relation*734 whatever to that paid by another, is to levy a forced contribution, not a tax, duty, or impost, within the sense of these terms as applied to the exercise of powers by any enlightened or responsible government.” Woodbridge v. City of Detroit, 8 Mich. 301; Burroughs, Taxation, c. 5.
Absolute equality and uniformity may not be attainable in practice, but an approximation to them is possible, and any plain departure from the rule will defeat the tax.
What is called for under a constitutional provision requiring equality and uniformity in the taxation of property must be equally called for by the fourteenth amendment. The forced contribution from one which would follow taxation of his property without reference to a common ratio, would be inconsistent with that equal protection which the amendment requires the state to extend to every person within its jurisdiction.
The application of the amendment to taxation has been recognized by the legislation of congress. Soon after the adoption of the constitutional amendment, abolishing slavery and involuntary servitude, measures were proposed to give practical freedom to the emancipated race, which resulted in the passage of the civil-rights act. This act gave citizenship to persons of that race, and then declared that citizens of the United States of every race and color, without regard to any previous condition of slavery or involuntary servitude, should have the same right in every state and territory to make and enforce contracts, to sue,- be parties, and give evidence, to inherit, purchase, lease, sell, own, and convey real and personal property, and to the full ' and equal benefit of all laws and proceedings for the security of person and property, as is enjoyed by white citizens, and should be subject to like punishments, pains, and penalties, and to none other. After the adoption of the fourteenth amendment, congress re-enacted this act, and to the clause that all persons within the jurisdiction of the United States should enjoy the same rights as white citizens, and be subject only to like punishments, pains, and penalties, it added, and subject only to like “taxes, licenses, and exactions of every hind, and to no other.” Kev. St. § 1977.
The adjudications as to the meaning of the rule of equality and uniformity to be observed in taxation, may, therefore, be properly referred to in construing the requirement of the fourteenth amendment, when it is invoked with respect to burdens imposed by taxation. In Lexington v. McQuillan’s Heirs the supreme court of Kentucky said that the legislature of the state had no constitutional authority to exact from one citizen the entire revenue of the common
In State v. Township of Readington the supreme court of New Jersey said:
“ Taxation operates upon a community, or a class in a community, according to some rule of apportionment. When the amount levied upon individuals is determined without regard to the amount or value exacted from any other individual or classes of individuals, the power exercised is not that of taxation, but of eminent domain. A tax upon the persons or property of A., B., and 0. individually, whether designated by name or in any other way, which is in excess of an equal apportionment among the persons, or property of the class of persons or kind of property subject to tho taxation, is, to tho extent of such excess, the taking of private property for a public use without compensation. The process is one of confiscation, and not of taxation.” 38 N. J. Law, 70.
As the foundation of all just and equal taxation is the assessment of the property taxed,—that is, the ascertainment of its value,—in order that the tax may bo levied according to some ratio to the value, uniformity of taxation necessarily requires uniformity in tho mode of assessment as well as in the rate of taxation; or, to quote the language of tho supreme court of Ohio expressing the same thought: “Uniformity in taxing implies equality in the burden of taxation, and this equality of burden cannot exist without uniformity in the mode of assessment as well as in the rate of taxation.” Exchange Bank of Columbus v. Hines, 3 Ohio St. 1.
If we now look at the scheme of taxation prescribed by the constitution of California for the property of railroad companies, we shall perceive a flagrant departure from the rule of equality and uniformity so essential to equality in the distribution of the burdens of government. Whenever an individual holds property incumbered with a mortgage he is assessed at its value, after deducting
The case of People v. Weaver, 100 U. S. 539, decided by the supreme court, respecting the taxation of shares of the national banks, may be cited in this connection. Without the permission of congress, the shares of these banks could not be taxed by the states. Congress gave the permission on condition that the taxation should not be at a greater rate than is assessed on other moneyed capital in the hands of individual citizens of the state, and that the shares owned by non-residents of the state should be taxed at the place where the bank is located. Rev. St. § 5219. In the case cited the court held, with regard to such taxation:
(1) That the prohibition imposed by congress against discrimination had reference to the entire process of assessment, and included the valuation of the shares as well as the rate of percentage charged; (2) that a statute of New York which established a mode of assessment by which such shares were valued higher in proportion to their real value than other moneyed capital, was in conflict with the prohibition, although the same percentage on such valuation was levied; and (3) that a statute which permitted a party to deduct his debts from the valuation of his personal property, except so much as consisted of those shares, taxed the shares at a greater rate than other moneyed capital.
The assessment thus held to be a discrimination against the shares of national banks in the taxation system of New York is similar to what we hold to be a discrimination against the property of railroad corporations in the taxation system of California.
It is no answer to this discrimination to say that property in the state may be divided into classes, and different rates prescribed for them. Undoubtedly property may be classified for purposes of taxation. Real property may be subjected to one rate of taxation; personal property to another rate. Property in particular districts may be taxed for local purposes, while property elsewhere may be exempt. Taxation on business in the form of licenses may also vary according to the calling or occupation licensed, and the extent of business transacted, but even then there must be uniformity of charges with respect to the same calling or occupation in the same locality. It is, however, only with the taxation of property that we are concerned in this case, and the whole object of classifying property is that each class maybe subjected to a special rate of taxation. There is no difference in the rate prescribed by the law of the state for the property of railroad corporations, and the rate prescribed for the property of individuals. There is only one rate for all property. There is, therefore, no case presented for the application of the doctrine of classification. The discrimination complained of arises from the different rule adopted in ascertaining the value of the property of railroad corporations as a basis for taxation, not from any different rate of taxation when the value is established. In all_ taxes upon property, whatever its form or nature, the property is taken as representing a pecuniary value; as standing for so much money invested. The tax is the rate per centum of this pecuniary value. The value being ascertained, the law fixes the rate. The ground of complaint here is that the law requires a higher value to be placed upon the defendant’s property than upon the property of individuals similarly incumbered, or rather requires the assessor of the defendant’s property, in estimating its value, to disregard and set aside certain elements materially affecting its amount, which are to be considered in estimating the value of the property of individuals. It is not classifying property to make this distinction in determining its value. It
Is the defendant, being a corporation, a person within the meaning of the fourteenth amendment, so as to be entitled, with respect to its property, to the equal protection of the laws ? The learned counsel of the plaintiff, and the attorney general of the state, take the negative of this question, and assert with much earnestness that the amendment applies, and was intended to apply, only to the newly-made citizens of the African race, and should be limited to their protection.
It is undoubtedly true that the amendment had its origin in a purpose to secure to these newly-made citizens the full enjoyment of their freedom. When the amendment abolishing slavery and involitary servitude was adopted, there were men in congress who believed that it was intended to make every one born within the United States a freeman, and as such to give to him the right to pursue his happiness, in the ordinary vocations of life, subject to no restraint except such as affects others, and to enjoy equally with them the fruits of his labor. They therefore proposed the civil-rights bill, and secured its passage, the substantial provisions of which we have stated. Notwithstanding this expression of the national legislature as to the purpose of the amendment, the newly-made citizens were subjected in several of the states to various disabilities and burdens, and curtailed of their rights to such an extent that their freedom became of little value. To quote from the opinion of Mr. Justice Miller, speaking for the court, in the Slaughter-house Cases:
“They were iu some states forbidden to appear in the towns in any other character than as menial servants. They were required to reside on and cultivate the ,soil without the right to purchase or own it. They were excluded from many occupations of gain and hire, and were nob permitted to give testimony in the courts in any case where a white man was a party. It was said that their lives were at the mercy of bad men, either because the laws for their protection were inefficient, or were not enforced.” 16 Wall. 70.
There was probably much exaggeration in what was reported of their treatment, but the statements made produced a profound impression upon congress. The validity of the civil-rights act was also
Mr. Stevens, of the house of representatives, in presenting the proposition, after stating the provisions of the first section, said:
“ I can hardly believe that any person can be found who will not admit that every one of these provisions is just. They are all asserted in some form or other in our declaration or organic law. But the constitution limits only the action of congress, and is not a limitation on the states. This amendment supplies that defect, and allows congress to correct the unjust legislation of the states so far that the law which operates upon one man shall operate equally upon all.”
In reply do an objection that the first section of the amendment was in substance the civil-rights bill, which congress had passed over the president’s veto, and that by voting to so amend the constitution as to put the bill Into it was to admit that the bill was unconstitutional, Mr. Garfield, then also a member of the house, said:
“We propose to lift that great and good law above the reach of political strife, beyond the reach of plots and machinations of any party, and fix it in the serene sky, in the eternal firmament of the constitution, where no storm of passion can shake it and no cloud can obscure it. For this reason, and not because I believe the civil-rights bill unconstitutional, I am glad to see that first section here.’1'
The argument that a limitation must be given to. the scope of this amendment because of the circumstances of its origin is without force. Its authors, seeing how possible it was for the states to oppress without relief from the federal government, placed in the constitution an interdict upon their action which makes lasting oppression of any kind by them under the form of law impossible.
The amendment prohibiting slavery and involuntary servitude, except as a punishment for crime, had its origin in the previous existence of African slavery. But the generality of its language makes its prohibition apply to slavery of white" men as well as that of black men; and also to serfage, vassalage, villenage, peonage, and every other form of compulsory labor- to minister to the pleasure, caprice, vanity, or power of others.
The provision of the constitution prohibiting legislation by states impairing the obligation of contracts had its origin in the existence of tender laws, appraisement laws, stay laws, and installment laws passed by the states soon after the revolution, when their finances were embarrassed and their people were overwhelmed with debts. These laws, according to Story, prostrated all private credit and all private morals, and led to the adoption of the prohibition, by which such legislation was forever prevented. But in its construction the provision has not been limited to mere commercial contracts. In the Dartmouth College Case it -was urged that the charter of the college was not a contract contemplated by the constitution, because no valuable' consideration passed to the king as an equivalent for the grant, and that contracts merely voluntary were not
“ It is more than possible that the preservation of rights of this description was not particularly in view of the framers of the constitution when the clause under consideration was introduced into that instrument. It is probable that interferences of more frequent recurrence, to which the temptation was stronger and of which the mischief was more extensive, constituted the great motive for imposing this restriction on the state legislatures. But although a particular and a rare case may not in itself be of sufficient magnitude to induce a rule, yet it must be governed by the rule when established, unless some plain and strong reason for excluding it can be given.” And again: “The case being within the words of the rule, must he within its operation likewise, unless there be something in the literal construction so obviously absurd or mischievous, or repugnant to the general spirit of the instrument, as to justify those who expound the constitution in making it an exception.” 4 Wheat. 644.
Following that authority, we cannot adopt the narrow view for which counsel contend, and limit the application of the prohibition of the fourteenth amendment to legislation touching members of the enfranchised race. It has a much broader operation. It does not, indeed, place any limit upon the subjects in reference to which the states may legislate. It does not interfere with their police power. Upon every matter upon which previously to its adoption they could act, they may still act. They can legislate now, as they always could, to promote the health, good order, and peace of the community; to develop their resources, increase their industries, and advance their prosperity; hut it does require that in all such legislation hostile and partial discrimination against any class or person shall be avoided; that the state shall impose no greater burdens upon any one than upon others of the community under like circumstances, nor deprive any one of rights which others similarly situated are allowed to enjoy. It forbids the state to lay its hand more heavily upon one than upon another, under like conditions. It stands in the constitution as a perpetual shield against all unequal and partial legislation by the states, and the injustice which follows from it, whether directed against the most humble or the most powerful; against the despised laborer from China, or the envied master of millions.
The adoption of the federal constitution met, as all know, with most determined opposition from a large class who believed that the exercise of the powers delegated to the general government would erippie and embarrass the states in the administration of their local
“While, therefore,” to quote the language of an admirable writer and eminent jurist, Judge Cooley, “ the first amendments were for the purpose of keeping the central power within duo limits, at a time when the tendency to centralization was alarming to many persons, the last were adopted, to impose new restraints on state sovereignty, at a time when state powers had nearly succeeded in destroying the national sovereignty. Of these amendments it may be safely affirmed that the first ten took from the Union no power it ought ever to have exercised, and that the last three required of the states the surrender of no power which any free government should ever employ.”
It would tend, therefore, to defeat the great purposes of the late amendments, if to any of them we should give the narrow construction for which counsel contend.
Private corporations are, it is true, artificial persons, but with the exception of a sole corporation, with which we are not concerned, they consist of aggregations of individuals united for some legitimate business. In this state they are formed under general laws; and the Civil Code provides that they “may be formed for any purpose for which individuals may lawfully associate themselves.” Any five or more persons may by voluntary association form themselves into a corporation. And, as a matter of fact, nearly all enterprises in this state, requiring for their execution an expenditure of large capital, are undertaken by corporations. They engage in commerce; they build and sail ships; they cover our navigable streams with steamers; they construct houses; they bring the products of earth and sea to market; they light our streets and buildings; they
The ease of the Society for the Propagation of the Gospel in Foreign Parts v. Town of New Haven, 8 Wheat. 464, furnishes an apt illustration of this doctrine. The sixth article of the treaty of peace with Great Britain of 1783 provided that there should be “no future confiscations made, nor any prosecutions commenced, against any person or persons for or by reason of the part which he or they may have taken in the present war, and that no person shall on that account suffer any future loss or damage, either in his person, liberty, or property.” An English corporation claimed the benefit of this article with reference to certain lands in Vermont granted to it before the revolution, which the legislature of that state had undertaken to give to the
The constitution, in defining the judicial power of the United States, declares that it shall extend to “controversies between citizens of different states;” and in the case referred to by Mr. Justice Washington the question arose whether a corporation composed of citizens of one state could sue in the circuit court of the United States a citizen of another state, and it was held that it could. In deciding the question, the court, speaking through Chief Justice Marshall, said:
“ However true the fact may be that the tribunals of the state will administer justice as impartially as those of the nation to parties of every description, it is not less true that the constitution itself either entertains apprehension on this subject, or views with such indulgence the possible fears and apprehensions of suitors, that it has established national tribunals for the decision of controversies between aliens and citizens, or between citizens of different states. Aliens or citizens of different states are not less susceptible of these apprehensions, nor can they be supposed to be less the objects of constitutional provision because they were allowed to sue by a corporate name. That name, indeed, cannot be an alien or a citizen, but the persons whom it represents may be the one or the other, and the controversy is, in fact and in law, between those persons suing in their corporate character, by their corporate names, for a corporate right, and the individual against Whom the suit may be instituted. Substantially and essentially the parties in such a case, where the members of the corporation are aliens or citizens of a different state from the opposite party, come within the spirit and terms of the jurisdiction conferred by the constitution on the national tribunals. Such has been the universal understanding on the subject., Bepeatedly has this court decided causes between a corporation and an individual without feeling a doubt respecting its jurisdiction.”
Tlie same point was presented in another form in the case of Marshall v. Baltimore O. R. Co. 16 How. 326. There the question was whether a citizen of* one state could sue in the circuit court of the United States a corporation of another state, and a similar conclusion was reached. After referring to the clause of the constitution extending the judicial power of the United States to controversies,/be
“A corporation,” observed Mr. Justice Grier, speaking for the court, “it is said, is an artificial person, a mere legal entity, invisible and intangible. This is no doubt metaphysically true in a certain sense. The inference, alsp, that such an artificial entity ‘cannot be a citizen’ is a logical conclusion from the premises, which cannot be denied. But a citizen who has made a contract, and has a controversy with a corporation, may also say, with equal truth, that he did not deal with a mere metaphysical abstraction, but with natural persons; that his writ has not been served on an imaginary entity, but on men and citizens; and that his contract was made with them as the legal representatives of numerous unknown associates, or secret and dormant partners.
“The necessities and conveniences of trade and business require that such numerous associates and stockholders should act by representation, and have the faculty of contracting, suing, and being sued in a ficititious or collective name. But these important faculties, conferred on them by state legislation, for their own convenience, cannot be wielded to deprive others of acknowledged rights. It is not reasonable that those who deal with such persons should be.deprived of a valuable privilege by a syllogism, or rather sophism, which deals subtly with words and names, without regard to the things or persons they are used to represent.”
The fifth amendment to the constitution declares that—
“No person shall be held to answer for a capital or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall he be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property without due process of law; nor shall private property be taken for public use without just compensation.”
From the nature of the prohibitions in this amendment it would .seem, with the exception of the last one, as though theymould apply only to natural persons. No others can he witnesses; no others can be twice put in jeopardy of life or limb, or compelled to b'e witnesses against themselves; and therefore it might be said with much force that the word “person,” there used in connection with the prohibition against the deprivation of life, liberty, and property without due process of law, is in like manner limited to a natural person. But such has not been the construction of the courts. A similar provision is found in nearly all of the state constitutions; and everywhere, and at all times, and in all courts, it has been held, either by tacit assent or express adjudication, to extend, so far as their property is con
The prohibition against the deprivation of life and liberty in the same clause of the fifth amendment does not apply to corporations, because, as stated by counsel, the lives and liberties of the individual corporators are not the life and liberty of the corporation.
Nor do all the privileges and immunities of citizenship attach to corporations. These bodies have never been considered citizens for any other purpose than the protection of the property rights of the corporators. The status of citizenship, entitling the citizen to certain privileges and immunities in the several states, does not belong to corporations. The special privileges which citizens acquire by becoming incorporated in one state cannot, therefore, bo exercised in another state without the latter’s consent, as was held in Paul v. Virginia, 8 Wall. 168, although such consent will generally be presumed in the absence of positive prohibition.
Decisions of state courts, in harmony with the views we have expressed, exist in great numbers. "But it is unnecessary to cite them. It is sufficient to add that in all text writers, in all codes, and in all revised statutes, it is laid down that the term “person” includes, or may include, corporations; which amounts to what we have already said, that whenever it is necessary for the protection of contract or prop
If there were no other objection to the assessment we might, perhaps, order judgment for the amount of taxes due upon the valuation of the property, after deducting therefrom the amount of the mortgage; but there is another objection, of equal significance, which goes to the validity of the whole assessment. No opportunity was afforded to the defendant to be heard respecting it before the state board of equalization. It was made by the board under the tenth section of article 13 of the constitution, which declares that “the franchise, road-way, road-bed, rails, and rolling stock of all railroads operated in more than one county in this state shall be assessed by the state board of equalization at their actual value, and the same shall be apportioned to the counties, cities and counties, cities, towns, townships, and districts in which such railroads are located, in proportion to the number of miles of railway laid in such counties, cities and counties, towns, townships, and districts.”
Other articles of the constitution, and laws supplementing. their directions, provide for the assessment by county officers of all property except “the franchise, road-way, road-bed, rails, and rolling stock” of railroads operated in more than one county, for a hearing by property holders respecting the assessment, and for its equalization by county boards. Ample security is thus afforded to individuals against erroneous and arbitrary assessments. But the assessment of the property mentioned, of railroads operated in more than one county, is placed entirely with the state board.
In People v. Sup’rs of Sacramento County the supreme court of the state said that—
“It is the manifest intent of the constitution that the valuation of the railroad property mentioned in section 10 of article 13 shall be finally fixed and determined by the state board of equalization. The state board has the*749 exclusive power to assess and equalize its value. Thus the constitution furnishes a system for the assessment of railroads operated in more than one county, which is separate and distinct from that provided for the assessment of other property.” And again: “The portion of the section quoted (the portion above) is clearly self-executing. Wo are at a loss to imagine how any statute could make the duty of the state hoard any clearer than does this distinct and positive mandate of the constitution. If any doubt could possibly be built upon the words cited it would be dispelled by the first clause of the same section: ‘All property, except as hereinafter in this section provided, shall be assessed in the county, city, city and county, town, township, or district in which it is situated, in the manner prescribed by law.’ Thus by the very language of the constitution all other but the railroad property mentioned must he assessed by local assessors, in the manner prescribed by statute. The railroad property must he assessed in the manner prescribed by the section of the constitution, that is, by the state board, without the aid of statute.” 8 Pac. Law .1. 103.
The Political Code provides that the assessment shall be made by the state board on or before the first Monday in May of each year; that the president, secretary, cashier, or managing agent, or such officer of the corporation as the board may designate, shall furnish to the board, on or before the first Monday of April of the year, a statement, signed and sworn to by him, showing in detail the whole number of miles of railway owned, operated, or leased in the state by the corporation, and the value thereof per mile, and all its property of every kind located in the state, the number and value of its engines, passenger, mail, express, baggage,'freight, and other cars, or property used in operating or repairing the railway in the state, and on railways which are parts of lines extending beyond its limits, the amount of the rolling stock in use during the year, the annual gross earnings of the entire railway, and the proportionate annual gross earnings of the same in the state, and such other facts as the hoard may in writing require; and that if the officer or officers designated fail to make and furnish such statement, the board sbii.ll proceed to assess the property; and the valuation fixed shall be final and conclusive. The law also provides that the property shall be assessed at its aetuul value; that the assessment shall be made of the entire railway in the state, including the right of way, road-bed, track, bridges, culverts, and rolling stock; that the state board shall transmit to the county assessor of each county through which the railway runs, a statement showing the length of its main track within the county, and its assessed value per mile, as fixed by a pro rata distribution per mile of the assessed value of the whole property;
We have no, doubt that further legislation might have been adopted providing for notice to the company, and a system of procedure by which it might have been heard respecting the assessment. We do not understand that the supreme court of the state intended by the decision cited to hold that the tenth section of the thirteenth article is self-executing, except to the extent that it vests complete power in the state board to make the assessment of the property; not that legislation may not be had providing for the mode in which the powers of the board shall be exercised. Indeed, the concluding section of the article authorizes any legislation necessary to give effect to its provisions. Unfortunately, no such legislation has been had. The attempted legislation failed, because it did not receive in the legislature the constitutional majority, as is clearly shown by the circuit judge in his opinion.' It is unnecessary to go over the ground he has completely covered.
The presentation to the state board by the corporation of a statement of its property and of its value, which it is required to furnish, is not the equivalent to a notice of the assessment made and of an opportunity to be heard thereon. It is a preliminary proceeding, and until the assessment the corporation cannot know whether it will have good cause of complaint. No hearing upon the statement presented is allowed, and when the assessment is made the matter is closed; no opportunity tó correct any errors committed is provided. The presentation of the statement can no more supersede the necessity of allowing a subsequent hearing of the owners, than the filing of a complaint in court can dispense with the right of the suitor and his contestant to be there heard.
There being, then, no provision of law giving to the company notice of the action of the state board, and an opportunity to be heard respecting it, is the assessment valid? Would the taking of the com
In Davidson v. New Orleans the supreme court of the United States assumed this position to -be unquestionable. In that case an assessment levied on certain real estate in New Orleans for draining the swamps of that city was resisted on the ground that the proceeding deprived the owners of their property without'due process of law; and the court refused to disturb it for the reason that the owners of the property had notice of the assessment and an opportunity to contest it in the courts. After stating that much misapprehension prevailed as to the meaning of the terms “due process of law, ” and that it would be difficult to give a definition which would be at once perspicuous, comprehensive, and satisfactory, the court, speaking through Mr. Justice Miller, said that it would lay down the following proposition as applicable to the case:
“Tliat whenever by the laws of a state, or by state authority, a tax, assessment, servitude, or other burden is imposed upon property for the public use, whether it be for the whole statd or of some more limited portion of the community, and those laws provide for a mode of confirming or contesting the charge*753 thus imposed, in the ordinary course of justice, with notice to the person, or such proceeding in regal'd to the property as is appropriate to the nature of the case, the judgment in such proceedings cannot be said to deprive the owner of his property without due process of law, however obnoxious it may be to other objections.” 96 U. S. 104.
In Stuart v. Palmer the meaning of these terms is elaborately con sidered by the court of appeals of New York with reference to numerous adjudications on the subject. In that ease a law of the state imposed an assessment on certain real property for a local ’improvement without notice to the owner, and a hearing oran opportunity to be heard by him, and the court held that it had the effect of depriving him of his property without due process of law, and was therefore unconstitutional. Mr. Justice Earl, speaking for the court, said:
“ I am of the opinion that the constitution sanctions no law imposing such an assessment without a notice to, and a hearing, or an opportunity of hearing, by the owners of the property to be assessed. It is not enough that the owners may by chance have notice, or that they may, as a matter of favor, have a hearing. The law must require notice to them, and give them the right to a hearing, and an opportunity to be heard. It matters not, upon the question of the constitutionality of such a law, that the assessment has in fact been fairly apportioned. The constitutional validity of a law is to be tested, not by what has been done under it, but what may, by its authority, be done. The legislature may prescribe the kind of notice, and the mode in which it shall be given, but it cannot dispense with all notice.” And, again, that “no case, it is believed, can be found in which it was decided that this constitutional guaranty [against depriving one of his property without due process of law] did not extend to eases of assessments; and yet we may infer, from cortain dieta of judges, that their attention was not called to it, or that they lost sight of it in the cases which they were considering. It has sometimes been intimated that a citizen is not deprived of his property, within the meaning of this constitutional provision, by the imposition of an assessment. It might as well be said that he is not deprived of his property by a judgment entered against him. A judgment does not take property until it is enforced, and then it takes the real or personal property of the debtor. So an assessment may generally be enforced, not only against the real estate upon which it is a lien, but, as in this case, against the personal property of the owner also; and by it he may just as much be deprived of his property, and in the same sense, as the judgment debtor is deprived of his by the judgment.” 74 N. Y. 188,195.
Wo concur fully in the views thus forcibly expressed.
It remains to consider the last position of counsel, that the pro visions of article 13 of the constitution of the state, as to the taxa
There are two answers to this argument. In the first place, article 13 is not intended to make any change in the powers or rights of cor- - porations under the laws of the state. It treats entirely of revenue and taxation, and of the rules which shall govern the assessment of the property of individuals, and of railroad and other quasi public corporations. It is in another article that provisions are made for the control of railroad corporations; and the duties and responsibilities of corporations generally, and the power of the state over them, are declared.
In the second place, the state, in the creation of corporations, or in amending their charters, or rather in passing .or amending general laws under which corporations may be formed and altered, possesses no power to withdraw them when created, or by amendment, from the guaranties of the federal constitution. It canhot impose the condition that they shall not resort to the courts of law for the redress of injuries or the protection of its property; that they shall make no complaint if their goods are plundered and their premises invaded ; that they shall ask no indemnity if their lands be seized for public use, or'be taken without due process of law, or that they shall submit without objection to unequal and oppressive burdens arbitrarily imposed upon them; that, in other words, over them and their property * the state may exercise unlimited and irresponsible power. Whatever - the state may do, even with the creations of its own will, it must do in subordination to the inhibitions of the federal constitution. It may confer, by its general laws, upon corporations certain capacities of
The state grants to railroad corporations formed under its laws a franchise, and over it retains control, and may withdraw or modify it. By the reservation clause it retains power only over that which it grants; it does not grant the rails on the road; it does not grant the depots along-side of it; it does not grant the cars on the track, nor the engines which move them, and over them it can exercise no power except such as maybe exercised through its control over the franchise, and such as may be exercised with reference to all property used by carriers for the public. The reservation of power over the franchise,—that is, over that which is granted,—makes its grant a conditional or revocable contract, whose obligation is not impaired by its revocation or change. The supreme court established, in the Dartmouth College Case, that the charter of a private corporation is a contract between the corporators and the state, and that it was, therefore, within the prohibition of the federal constitution against the impairment of contracts. To avoid this result the states have generally inserted clauses in their constitutions reserving a right to repeal, alter, or amend charters granted by their legislatures, or to repeal, alter, or amend the general laws under which corporations are allowed to be formed. The reservation relates only to the contract of incorporation, which, without such reservation, would be irrepealable. It removes the impediment to legislation touching the contract. It places the corporation in the same position it would have occupied had the supreme court held that charters are not contracts, and that laws repealing or altering them did not impair the obligation of contracts. The property of the corporation, acquired in the exercise of its faculties, is held independently of sued reserved power, and the state can only exercise over it the control which it exercises over the property of individuals engaged in similar business.
The case of Detroit v. Detroit & Howell Plank-road Co., in the
“ But [the court added] there is no well-considered ease in which it has been held that a legislature, under its power to amend a charter, might take from a corporation any of its substantial property or property rights. In some cases the power has been denied, where the interest involved seemed insignificant. The ease of Albany, etc., R. Co. v. Brownell, 24 N. Y. 345, is an illustration. It was there decided that although the legislature might require railroad companies to suffer highways to cross their tracks, they could not subject the lands which the companies had acquired for other purposes to the same burden, except in connection with the provision for compensation. The decision was in accord with that in Com. v. Essex Co. 13 Gray, 239, 253, in which, while the power to alter, amend, or repeal the corporate franchises was sustained, it was at the same time declared that ‘ no amendment or alteration of the charter can take away the property or rights which have become vested under a legitimate exercise of the powers granted.’ The same doctrine is clearly asserted in Railroad Co. v. Maine, 96 U. S. 499, and is assumed to be unquestionable in the several opinions delivered in the Sinking-fund Cases, 99 U. S. 700.
“ But for the provision of the constitution of the United States which forbids impairing the obligation of contracts, the power to amend and repeal corporate charters would be ample without being expressly reserved. The*757 reservation of tlie right leaves the state where any sovereignty would he, if unrestrained by express constitutional limitations and with the powers which it would then possess. It might, therefore, do what it would be admissible for any constitutional government to do when not thus restrained, but it could not do what would be inconsistent with constitutional principles. And it cannot be necessary at this day to enter upon a discussion in denial of the right of the government to take from either individuals or corporations any property which they may rightfully have acquired. In the most arbitrary times such an act was recognized as pure tyranny, and it has been forbidden in England ever since Magna Oharta, and in this country always. It is immaterial in what way tlie property was lawfully acquired,—whether by labor in the ordinary avocations of life, by gift or descent, or by making profitable use of a franchise granted by the state; it is enough that it has become private property, and it is then protected by the ‘law of the land.’” 43 Mich. 140-147; [S. C. 5 N. W. Rep. 275.]
We have already extended this opinion to a great length, and we do not think it necessary or important to notice other positions urged by counsel with great learning and ability against the validity of the taxes for which the present action is brought. We are. satisfied that the assessment upon which they were levied is invalid and void, and judgment must be accordingly entered on the demurrer for the defendant, and, by stipulation of parties, the judgment must be made final.
Hote. The number of corporations here stated is much less than th8 number actually existing. There are over 5,000 corporations in California alone.
concurring. The facts of this ease are fully stated by Mr. Justice Field, and need not be repeated here. The questions presented are of the gravest character, and of the utmost importance to the people of California. While I concur, generally, in the conclusions, and in the line of argument adopted by my associate, I shall also state as briefly as I reasonably can, considering the gravity of the questions discussed, my conclusions upon the points involved.
1. In my judgment, the word “person,” in the clause of the fourteenth amendment to the national constitution, “No state shall * * *' deprive any person of life, liberty, or property without due process of law, nor deny to any person the equal protection of the law, ” includes a private corporation. It must, at least, through the corporation include the natural persons who compose the corporation, and who are the beneficial owners of all the property, the technical and legal title to which is in the corporation in trust for the corporators. The fact that the corporators are united into an ideal legal entity, called a corporation, does not prevent them from
“ Whatever be the legal nature of a corporation as an artficial, metaphysical being, separate and distinct from the individual members, and whatever distinctions the common law makes, in carrying out the technical legal conception, between property of the corporation and that of the individual members, still, in applying the fundamental guaranties of the constitution, and in thus protecting the rights of property, these metaphysical and technical notions must give way to the reality. The truth cannot be evaded that, for the purpose of protecting rights, the property of all business and trading corporations is the property of the individual corporators. A state act depriving a business corporation of its property without due process of law, does, in fact, deprive the individual corporators of their property. In this sense, and within the scope of these grand safeguards of private rights, there is no real distinction between artificial persons, or corporations, and natural persons.”
This principle is recognized, and the question settled for all time, in an early case by Chief Justice Marshall, in which he says:
“Aliens, or citizens of different states, are not less susceptible of these apprehensions, nor can they be supposed to be less the objects of constitutional provisions, because they are allowed to sue by a corporate name. That' name, indeed, cannot be an alien or a citizen; but the persons whom it represents may b'e the one or the other; and the controversy is, in fact and in the law, between those persons suing in their corporate character by their corporate name for a corporate right, and the individuals against whom the suit may be instituted. Substantially and essentially the parties in such a case, where the members of the corporation are aliens or citizens of a different state from the opposite party, come within the spirit and terms of the jurisdiction conferred by the constitution on the national tribunals.” Bank U. S. v. Devaux, 5 Cranch, 87.
It is upon this principle that the national courts have ever since entertained jurisdiction on the ground of citizenship of the corpora-tors in cases whqrein corporations are the parties to the record. The cases in the supreme court upon this point are numerous, and too familiar to require further citation.
In Society, etc., v. New Haven, 8 Wheat. 464-489, it was held that a corporation was protected under the sixth article of the treaty with
In Railroad Co. v. Richmond, 96 U. S. 529, the supreme court assumes that a corporation is included in the word “person,” as thus used in the fourteenth amendment.
The word “person” is, unquestionably, much broader in its signification than the word “citizen,” and the change from the word “citizen,” in the first clause of the section, to the word “person” of so much larger import, in the last, must have been well considered, and have been intended to extend the shield of the constitution to all cases which might require the protection of this wholesome and greatly-needed guaranty. There is nothing in the context to indicate a purpose to limit the meaning of the word “person” to a narrower sense than the word ordinarily and naturally imports, or to make the application of the provision partial only. To exclude corporations from its import, would be to leave, perhaps, at this day, the far larger portion of the vast capital of the country employed in great enterprises, either commercial, manufacturing, mining, or otherwise, beyond the pale of its protection. There is no good reason for excluding the property of corporations from the same protection extended to other property. It is subject to all the burdens, and it should be entitled to all the immunities, of other property. It is, at last, the property of natural persons. The provision is protective and remedial, not punitive in character, and should, therefore, be liberally, not strictly, construed. No restriction should be put upon the term not called for by the exigencies of the case, or by the public interest; and it must be manifest that the public interest requires that the broadest signification should be adopted.
Blackstone treats of corporations under the head of “Bights of Persons;” chapter 18 under this head being devoted to the subject. He says: “Persons, also, are divided by law into either natural persons or artificial;” giving a definition of each. Book 1, p. 123. So, also, does Kent, (2 Kent, 316.)
In U. S. v. Amedy, 11 Wheat. 412, wherein a person was indicted, under an act of congress, for destroying a vessel belonging to a cor
In, Ins. Co. v. New Orleans, 1 Woods, 85, it was held on the circuit that a corporation is not embraced in the word “person,” as used in the amendment under consideration, and the supreme court of r California, upon the authority of that case, made a similar ruling in C. P. R. Co. v. State Bd. of Equalization, 8 Pac. Coast Law J. 1155. But notwithstanding their high character for ability, and my respect for the decisions of the judges taking that view, I am compelled to adopt a different conclusion. I think, both upon reason and authority, that the'other is the better view. Again, with respect to corporate property, I adopt the language of counsel, which expresses my view accurately and clearly:
“ The property of the corporation is in reality the property of its individua1 corporators. A state statute depriving a corporation of its property does deprive the individual corporators of their property.1' These clauses of the fifth and fourteenth amendments, and the similar clauses of the state constitution, apply, therefore, to private corporations, not alone because such corporations are ‘ persons,’ within the meaning of that word, but also because statutes violating their prohibitions, in dealing with corporations, must necessarily infringe upon the rights of natural persons. In applying and enforcing these constitutional guaranties, corporations cannot be separated from the natural persons who .compose them. ”
It is upon this principle that the decision in Dodge v. Woolsey, 18 How. 331, rests, which establishes the right of stockholders to maintain a suit against the directors of the corporation and state officers to restrain the payment by the one, and the collection by the other, ‘ of a tax illegally assessed against the corporation. See, also, Mar
2. I shall not spend much time in discussing the question whether the fourteenth amendment applies only to the African race. Undoubtedly, the negro furnished the immediate occasion and motive for adoption of the amendment; but its benefits could not have been intended to be limited to the negro. The protection afforded is as important to others as to him, as is clearly shown by experience under this provision. A whole race, not African, large numbers • of whom came to our shores under the solemn guaranties of stipulations in a treaty suggested and sought, and in a great part framed, by ourselves, to promote our then supposed interests, were among the first to invoke this very provision of the fourteenth amendment to protect them, under the word “person,” in the right to earn an honest living, by honest labor; and its protecting power was not invoked in vain. Parrott’s Chinese Case, 6 Sawy. 349; In re Ah Chong, (Chinese Fisherman Case,) Id. 451. Who, in view of past experience, shall say there was no occasion to extend the signification of the word “person” beyond the negro ? And are all other races, including our own, -to be now withdrawn from its protecting power by so narrow and unnatural a construction. I apprehend not. If the line cannot be drawn at the negro, then no other can be adopted that will not embrace every human being in his individual character, or in his legal association with his fellows, for the more convenient administration of his property, and more successful pursuit of happiness. I apprehend that it would have struck the world with some astonishment, when this amendment -was proposed to the people of the United States for adoption, if it had read: “Nor shah any state deprive any person of the negro race of life, liberty, or property without due process of law; nor deny to any person of the negro race within its jurisdiction the equal protection of the laws.” Yet so it must, in effect, be read if its operation is to he limited to that race. The rights of the negro are, certainly, no more sacred or worthy of protection than the rights of the Caucasian or other races; and the security of the rights of corporations, and, through them, the rights of the real parties,—the corporators,—is as of great public importance as the security of any other private interests»
The provision of the state constitution under which the assessment was made is as follows:
“ The franchise, road-way, road-bed, rails, and rolling stock of all railroads operated in more than one county in this state shall be assessed by the state board of equalization at their actual value, and the same shall be apportioned to the counties, cities and counties, cities, towns, townships, and districts in which such railroads are located, in proportion to the number of miles of roadway laid in such counties, cities and counties, cities, towns, townships, and districts.”
This is the only provision affecting this question.
To take one’s property by taxation is to take or deprive one of his property; and if not taken in pursuance of the law of the land—in some due and recognized course of proceedings, based upon well-recognized principles in force before and at the time this clause was first introduced into the various constitutions, and the legislation of the country—is to take it “without due process of law.” The signification of these words has been the subject of judicial consideration and discussion in a vast number of cases, and their import has been determined to be the same as that of equivalent phrases in Magna Charta, from which the principle adopted was derived.
I shall not attempt to give an accurate definition of the term “due process of law,” applicable to all cases. It is not necessary for the determination of this case to do so. It is enough to say that it has been settled by judicial decision, as I think, that whether the proceeding be judicial, administrative, or executive, if it affects life or liberty, or takes property directly, or imposes a charge which becomes the basis of taking property, some kind of notice, or opportunity to be heard on his own behalf, and to defend his rights, given to the person whose life or liberty is to be affected, or whose property is to be taken, or- burdened with the liability, is an indispensable element—an essential ingredient—of “due process of law.” No one, I apprehend, would for a moment contend that a man’s life, or his liberty, could be legally taken away without notice of the proceeding, or without being offered an opportunity to be heard; or that a proceeding whereby his life or liberty should be forfeited, or permanently
Having stated the principle, which I conceive to he established by an unbroken line of authorities, I shall refer to some of them. One of the latest and most instructive cases upon the subject was recently decided by the court of appeals of the state of New York, from which I shall extract a passage which I adopt as expressing my own views, and presenting the question in a very clear and satisfactory light. It involved the validity of an assessment for a public street improvement, and but one question, which was decisive of the case, was examined or determined. The question was as to the validity of the law under which the assessment was made. The court, by Mr. Justice Earl, says: “The latter assessment could be made without any notice to or hearing of any person. The law requires no notice, and a provision for notice cannot be implied. Upon the assumption that the law was valid, there was ample authority for the commissioners to make the assessment without any notice or hearing.” Stewart v. Palmer, 74 N. Y. 186. The judge proceeds:
“ I am of the opinion that the constitution sanctions no law imposing such an assessment without a notice to and a hearing, or an opportunity of a hearing, by the owners of the property to be assessed. It is not enough that the owners may by chance have notice, or that they may, as a matter of favor, nave a hearing. The law must require a notice to them, and give them a right to a hearing and an opportunity to be hoard. It matters not, upon the question of the constitutionality of such law, that the assessment has in fact been fairly apportioned. The constitutional validity of a law is to bo tested, not by what has been done under it, but what may by its authority be done. The legislature may prescribe the kind of notice and the mode in which it shall be given, but it cannot dispense with all notice. * * * ” Id. 188.
“ The legislature can no more arbitrarily impose an assessment for which property may he taken or sold, than it can render a judgment against a person without a hearing. It is a rule founded on the first principles of*764 natural justice, older than written constitutions, that a citizen shall not he deprived of his life, liberty, or property without an opportunity to be heard in defense of his rights; and the constitutional pz’ovision that no pez-son shall be deprived of these without due process of law, has its foundation in this rule. This provision is the most important guaranty of personal rights to be found in the federal or state constitutions. It is a limitatipn upon arbitrary legislation. Ho citizen shall arbitrarily be deprived of his life, liberty, or property. This the legislature cannot do, nor' authorize to be done. ‘Due process of law’ is zzot confined to aizy judicial proceedings, but extends to every case which may deprive a citizen of his life, liberty, or property, whether the proceedings be judicial, administrative, or executive in its nature. This great guaraizty is always and everywhere present to protect the citizen agaizzst arbitrary interference with these sacred rights. * * *” Id. 190-
“Ho case, it is believed, cazi be found in which it was decided that the constitutional guaranty did not extend to. eases of assessmezzts, and yet we may infer frozn certain dicta of judges that their attention was not called to it, or that they lost sight of it in the eases which they were considering. It has sometimes been intimated that a citizen is not deprived of his property, within the meaning of this constitutional provision, by the imposition of an assessment. It might as well be said that he is not deprived of his property by a judgment entered against him. A judgment does not take property untií it is enforced, and then it takes the real or persozzal property of the debtor. So an assessznent may gezierally be enforced, not only against the real estate upon which it is a lien, but, as in this case, against the personal property of the owner also, and by it he may just as much be deprived of his property, and in the same sense, as the judgment debtor is deprived of his by the judgment.” Id. 195.
Much more is worth quoting, hut it would extend this opinion to an unreasonable length.
Thus, it is determined in the case cited that a party is not only entitled to notice and an opportunity to be heard, but that the law,, or constitution itself, must expressly provide foh notice. This decision vyas approved by the supreme court of California in October last, in Mulligan v. Smith, involving the validity of a tax. 8 Pac. Coast Law J. 499. Said McKinstry, J.: “In my opinion the statute provides no notice or process by means of which the property owners can be subjected to the judgment of the county court. The act is therefore void;” citing Stewart v. Palmer, supra; Cooley, Taxation, 266, and other cases; and McKee, J., in the same case said:
“It is a principle which uzzderlies all forms of government by laws that a citizen shall not be deprived of life, liberty, or property without due process of law. The legislature has no power to take away any man’s property, nor can it authorize its agents to do so, without first providing for personal notice to be given to him, and for a full opportunity of tizne, place, and tribunal to'be heard in defense of his rights. This constitutional guaraizty is not confined*765 to judicial proceedings, but extends to every case in which a citizen may be deprived of life, liberty, or property, whether the proceeding be judicial, administrative, or executive in its nature.”
In Patten v. Green, 13 Cal. 329, Mr. Justice Baldwin, all the justices, including Mr. Justice Field, concurring in the opinion, said: “We think it would be a dangerous precedent to hold that an absolute power resides in the supervisors to tax land as they may choose, without giving any notice to the owner. It is a power liable to great abuse. The general principles of law applicable to such tribunals oppose the exercise of any such power.” The raising of the tax by the board of equalization was held void for want of notice. Mr. Webster, in the Dartmouth College Case, defined due process of law, or “the law of the land,” as “the general law, which hears before it'eondemns, which proceeds upon inquiry, and renders judgment only after trial.” He adds: “Everything which may pass under the form of an enactment is not ‘the law of the land.’”
In Cooper v. Board of Works, 108 Eng. C. L. R. 181, in which was in question the action of the board of public works, in pursuance of a statute which did not require notice, Wittes, J., said: “I apprehend that a tribunal, which is by law invested with power to affect the property of one of her majesty’s subjects, is bound to give such subject an opportunity of being heard before it proceeds; and that that rule is of universal application, and founded upon the plainest principles of justice.” In the samo case, Byles, J., said: “The judgment of Mr. Justice Forteseue, in Dr. Bentley's Case, is somewhat quaint, but it is very applicable, and has been the law from that time to the present.” He says: “The objection for want of notice can never be got over. The laws of God and man both give the party an opportunity to make his defense, if he has any. I remember to have heard it observed by a very learned man, upon such au occasion, that even God himself did not pass sentence upon Adam before he called upon him to make his defense. ‘Adam, where art thou? Hast thou not eaten of the tree whereof I commanded thee that thou shouldst-not eat ?’ ” See, also, Philadelphia v. Miller, 49 Pa. 448; Matter of Ford, 6 Lans. 92; Overing v. Foote, 65 N. Y. 263; Westervelt v. Gregg, 12 N. Y. 209; Cooley, Const. Lim. 355; Butler v. Sup’rs Saginaw, 26 Mich. 22, 29; Sedg. St. & Const. Constr. (Pomeroy’s Ed.) 474 et seq., and notes; Cooley, Taxation, 266, 267.
In Davidson v. New Orleans, 96 U. S. 97, it was not questioned,
In my judgment the authorities establish beyond all controversy that somewhere in the process of assessing a tax under a law, or a state constitution, at some point before the amount of the assessment becomes finally and irrevocably fixed, the statute or the state constititution must provide for notice to be given to the owner of the property taxed, and an opportunity to be afforded to make objections, and to be heard upon them. In some form or manner he must be afforded an opportunity to defend his interests. In this case the constitution makes no provision for notice or a hearing, and the answer alleges that there was none, which is admitted by the demurrer.
4;' On behalf of the plaintiff, /what purports to be a statute passed March 14,1881, (St. 1881, p. 83,) is cited, which, it is insisted, supplements the constitution, and provides for a notice and hearing upon a petition filed within five days after the assessment is made upon a railroad. But it is claimed that, although published in the volume of statutes for the year 1881 as a statute, the bill never constitutionally passed, and that it is consequently no law. Section 15 of article 4 of the constitution of California provides that “on the final passage of all bills they shall be by yeas and nays upon each bill separately, and shall be entered on the journals, and no bill shall become a law without the concurrence of a majority of the members elected to each house.” Under section 5 of the same article the house consists of 80 members,, of whom it would require 41 to constitute a majority of the members elected to the house. Upon reference to the published journals of the legislature it appears that the bill in question passed the house and was sent to the senate, where it was amended by adding a long provision, being the very provision, if any there is, which gives the owners of railroads of the class in question, dissatisfied with the assessment, a right to file a petition, “within five days after the assessment is made and entered of record on the books of the board,” to have the assessment corrected, and providing, for proceedings upon said petition. On March 4th the house considered the senate amendment, and upon a call of the yeas and nays, as required by the constitution, 39 members voted for the amendment and 82 against it, there being four paired and not voting. Thus the votes in favor of the amendment were two less than a majority of members elected to the house, and the bill failed. It does not appear that the bill was “read
The bill, therefore, never was constitutionally passed, and never became a law. Whether the bill became a law is a question of law of which the court will take judicial notice. Sherman v. Storey, 30 Cal. 253; Ottawa v. Perkins, 94 U. S. 268; Gardner v. The Collector, 6 Wall. 509, 510; Post v. Sup’rs, 105 U. S. Under the decisions of the courts upon constitutional provisions in all respects similar to that in the present constitution of California, it is settled that the court, to inform itself, will look to the journals of the legislature. So the supreme court of the United States holds where it is so decided by the state courts in construing their own constitutions and laws. See cases last cited. I am not aware of any decision of the supreme court of California giving a different construction to the state constitution as it now stands. Unless this mode is adopted of resorting to the journals to ascertain whether a statute has been legally passed or not, experience, and the number of cases that have already arisen under similar constitutional provisions, demonstrate that the requirement of the constitution that the vote shall be taken by yeas and nays, and a majority of the members required to vote in the affirmative on the final passage of an act, would be of little avail.
While we think the case of Sherman v. Storey correctly decided under the constitution as, it then was, we are of the opinion that the change in the constitution requires a change in the rule. When California adopted from other states the provision now found in its constitution substantially as found in the constitution of Illinois, it must be deemed to have adopted with' the provision the settled construction put upon it by the courts of the state from which it was taken. The leading cases upon the point are Spangler v. Jacoby, 14 Ill. 278; Prescott v. Board of Trustees, etc., 19 Ill. 326; Osborn v. Staley, 5 W. Va. 89; and the cases cited in Sherman v. Storey, and
Statutory provisions, also, have been adopted, which appear to be designed to give effect to this change in the constitution. Section 255 of the Political Code requires the minute clerks of the senate and assembly to “keep a correct record of the proceedings of their respective houses.” And sections 256 and 257 require the daily proceedings to be recorded in the journals, and that they “must be read by the secretary each day of meeting, and then be authenticated by the signatures of the president and speaker of the respective houses.” Section 1875, Code C. P., provides that “courts take judicial notice of the following facts: * * * Public and private official acts of the legislative, executive, and judicial, departments of this state, and of the United States,” etc. * * * “In all these cases the court may resort for its aid to appropriate books of documents of reference.” Section 1888 provides that “public writings are (1) the written acts or records of the acts of the sovereign authority of official bodies and tribunals, and of public officers, legislative, judicial, and executive, whether of this state or of the United States,” etc. And section 1918 provides that “official documents may be proved as follows: * * * (2) The proceedings of the legislature of this state, and of congress, by the journals of those bodies respectively, or either house thereof, or by published statutes or resolutions.” Thus the journals of the legislature are put upon the same footing as the statutes. We think there can be no doubt, under the constitution of the state and these statutes, that we may look to the journals to see what action was in fact had with respect to any apparent law as published in the volumes of the statutes of the state; and looking to the journals it affirmatively appears that the act upon the statute book in question never did become a law.
Even if the act had passed, it is at least extremely doubtful whether the notice, or time for filing the petition, is sufficiently definite to be of any effect. The assessment, under the provision, might be made, even if the party is bound to notice the state of the record on the first Monday of May, the five days might elapse, and the assessment be transmitted to the county, before the party assessed would know, under the law, that it had been made. All the acts of assessment may have transpired, and the assessment become final, before the first Monday of May. The board, however, is not required to make it before
There being, then, no such statute as is relied on in existence, the validity of the assessment must rest alone upon the constitutional provision quoted, and the act of 1880, adding sections 3664 and 3665 to the Political Code; and neither provides for notice of any kind, or for an opportunity to be heard in any stage of the proceedings. It was therefore made without due process of law, as we understand the meaning of that provision as used in the fourteenth amendment in question.
Section 3664 of the Political Code, as adopted in 1880, requires the president, or some other designated officer of the class of corporations in question, to furnish the state board of equalization, on or before the first Monday of April in each year, a detailed statement of the whole number of miles of road operated, the number of cars, amount of rolling stock, and their value, the gross earnings, and various other particulars; and requires the said board, on or before the first Monday in May, to assess the franchise, road-way, road-bed, rails, and rolling stock. It is urged on the part of the plaintiff that this provision furnishes sufficient notice and opportunity to be heard, to constitute due process of law on this point, within the meaning of the constitutional provision. In our judgment, this position is clearly untenable. This is simply a mode adopted for obtaining information as to the amount and general value of the property of the corporation, as a basis in part, at least, for their future consideration and action in makjng the assessment. It is but a preliminary step and not the assessment, or any part of the assessment. The board is under no obligation to adopt either the statement as to what the property is, or its value. It may reject it altogether and adopt an entirely different basis.. The party interested is entitled, at some point of the proceeding, to know what action the board takes, or proposes to take; and to an opportunity to be heard, as to its propriety,-before the assessment becomes fixed and irrevocable. Other classes of property holders, also, are required to file a statement of their property under oath, yet in the scheme provided for their assessment an opportunity to be afterwards heard is provided for.
The constitutions of the state and nation provide that private property shall not be “taken for public use without just compensation.” When parties cannot agree, there must be some mode provided for
The state supreme court has held the provision in the constitution of California, authorizing the state board of equalization to assess, finally, the railroads of the class in question, to be self-executing, requiring no legislation of any kind to carry it into full effect; also that the provision is mandatory, S. F. & N. P. R. Co. 8 Pac. Coast Law J. 1061.
It is insisted by defendant that, this being so, it is incompetent for the legislature to add to or take from the requirements found in the constitution, and that the additional provision of section 3664, as adopted in 1880, is void. The view already expressed, upon the section renders it unnecessary now to determine that question, although presented by the record and argued by counsel. It would seem, however, that there can be no constitutional objection to legislating upon details for the purpose of more effectually carrying out the scheme of the constitution, so far as the legislation is not inconsistent with any of its provisions. It is a general rule that a state legislature has all legislative power not inhibited by the constitution, state or national. S. P. R. Co. v. Orton, 6 Sawy. 186.
This being so, it would seem that the legislature might supplement the constitutional provision by statutory provisions intended to more perfectly protect the rights of the parties by other safeguards which are not inconsistent with the constitutional provision. But as this is a question more properly belonging to the state courts, we do not deem it desirable to finally determine it now.
“A mortgage, deed o£ trust, contract, or other obligation by which a debt is secured, shall lor the purposes of assessment and taxation, be deemed and treated as an interest in the property affected thereby. Except as to railroad and other quasi public corporations, in case of debts so secured, the value of the property affected by such mortgage, deed of trust, contract, or obligation, less the value of such security, shall be assessed to the owner of the property, and the value of such security shall be assessed and taxed to the owner thereof, in the county, city, or district in which the property affected thereby is situate. The taxes so levied shall be a lien upon the property and security, and may be paid by either party to such security. If paid by the owner of such security, the tax so levied upon the property affected thereby shall become a part of the debt so secured. If the owner of the property shall pay the tax so levied on such security, it shall constitute a payment thereon, and to the extent of such payment a full discharge thereof; provided, that if any such security or indebtedness shall be paid by any such debtor or debtors, after assessment and before the tax levy, the amount of such levy may likewise be retained by such debtor or debtors, and shall be computed according to the tax levy for the preceding year.”
Whatever the property, then, real or personal, mortgaged to secure a debt, the value of the debt so secured, in the case of everybody except “a railroad and other quasi public corporations,” is to be deducted from the value of the property mortgaged; and the value only of the property mortgaged, “less the value of such security, shall be assessed and taxed to the owner of the property, and the value of sueh security shall be assessed and taxed to the owner thereof;” that is to say, that, whatever the property, it shall be taxed to the real owner. But in the ease of “a railroad or other quasi public corporation,” there is to be no reduction of the value of the mortgaged property, and the whole is to be taxed to one party, whether he owns the whole or not. In one case, if property is mortgaged to the extent of half its value, the owner is assessed upon one-half the value, and the owner of the debt secured is taxed upon the other half. But in the other case the owner of the .legal title to the property is assessed and taxed upon the whole value of the property, and the other party, who is interested to the extent of one-half, upon none. A., a natural person, has $50,000 in cash—all the property he has—and purchases of B., another natural person, a piece of real estate for $100,000,
C., “a railroad oj; other quasi public corporation,” also has $50,000 cash, and purchases of B., for its proper use, an adjoining piece of real estate for $100,000, which is also its actual value, paying $50,000, and giving a mortgage to secure the balance of the purchase money. In this case, as in the other, the actual interest of each in the property is $50,000. They stand upon precisely* the same footing in all particulars with reference to the property. G. has only $50,000 in the property,—it not having paid for the other half,—and B. the rest. But in this case the constitution says that G. shall, nevertheless, be assessed for, and pay taxes upon, the whole property, double the amount he owns, and B. shall not be required to pay-anything; that is to say, that C. shall not only pay the tax on its own property,but the tax upon B.’s property; that money, to the amount of the tax assessed upon $50,000 belonging to B., shall be taken by the state or county from G., and appropriated to the use and for the benefit of B., to liquidate B.’s share of the public burdens. This sum, being so much more than G.’s share of the public burdens, and being in fact B.’s share, the result of the operation is not only to take so much property from G. for public use without compensation, but also to arbitrarily take it from C., and apply it to the use and benefit of another private party, B., without compensation. The result would be the same whether the property of A., B., and C., thus situated and mortgaged is land, a railroad operated in one or more counties, or any other kind of property. Does a law which authorizes such proceedings—such discriminations—bear or press equally upon A. and C., or equally upon B. and C. ? Is C. equally protected in his rights of property with A., or equally protected with B. ? Although situated precisely alike with reference to their property, do they feel the pressure of the public burdens equally and alike? The question does not appear to me to admit of argument. Upon the very statement of the proposition it seems to me to be self-
What constitutes the equal protection of the law is well stated in Ah Kow v. Nunan, 5 Sawy. 562; In re Ah Fong, 3 Sawy. 144; Pearson v. Portland, 69 Me. 278; Portland v. Bangor, 65 Me. 120; Missouri v. Lewis, 101 U. S. 22. See, also, Live Stock, etc., Ass’n, v. Crescent City Co. 1 Abb. 398; Parrott's Chinese Case, 6 Sawy. 377. That inequality and different principles of taxation of persons si mi
“All persons within the jurisdiction of the United States shall have the same right in every state and territory' * * * to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.” 16 St. p. 144, § 16; Rev. St. 1977.
The congress which passed this act embraced many of the members who were in the congress which framed and proposed the fourteenth amendment, and they may be supposed to be well informed as to the purpose and scope of that amendment. This act was passed in pursuance of the last clause of the amendment, as a part of the appropriate legislation to enforce its provisions. It is therefore a legislative construction as to the scope of the provision inhibiting the states from denying to any person the equal protection of the law. The United States supreme court gives the amendment a similar construction as to its scope. In Strauder v. West Virginia the court says that sections 1977 and 1978 of the Eevised Statutes “partially enumerate the rights and immunities intended to be granted by the constitution,” and after quoting section 1977, as above set out, adds: “ This act puts in the form of a statute what had been substantially ordained in the constitutional amendment. It was a step towards enforcing the constitutional provision.” 100 U. S. 811.
In Ex parte Virginia the court, referring to Tennessee v. Davis and Strauder v. West Virginia, said:
« We held that the fourteenth amendment secures, among other civil rights, to colored men, when charged with criminal offenses against a state, an impartial jury trial, by jurors indifferently selected, or chosen without discrimination against such jurors because of their color. We held that immunity from any such discrimination is one of the equal rights of all persons, and that any withholding it by a state is a denial of the equal protection of the laws, within the meaning of the amendment. We held that such an equal right to an impartial jury trial, and such an immunity from unfriendly discrimination, are placed by the amendment under the protection of the general government, and guarantied by it. We held, further, that this protection and this guaranty, as the fifth section of the amendment expressly ordains, may be enforced by congress by means of appropriate legislation.” 100 U. 8. 345.
Thus it appears that the supreme court regards the section quoted as within the scope of the fourteenth amendment, and the act provides that every person “shall he subject to like * * * taxes, licenses, and exactions of every kind, and to no other, ” as “white citizens;” and this is held to be appropriate legislation to enforce the amendment. We have already seen that this defendant is subjected to taxes and exactions other than and different from those imposed upon “white citizens.” We have already held that the word “person,” as to property rights, as used in the amendment in question, includes a corporation, and, as used in the provision of the statute cited, it includes a corporation by express definition of the statute itself, which says, in terms: “In determining the moaning of the Eevised Statutes * * * wor(j t person’ may extend and be applied to partnerships and corporations.” Page 1, tit. 1, c. 1, § 1.
The provision of the constitution of the state of California in question, therefore, violates the provision of the fourteenth amendment in denying to defendant the equal protection of the law. “An unconstitutional law is void, and is no law.” Ex parte Siebold, 100 U. S. 376. “The constitution and laws of the United States are the supreme law of the land, and to those every citizen of the United States owes obedience, whether in his individual or official capacity, -s * * The laws of the state, in so far as they are inconsistent with the laws of congress on the same subject, cease to have effect as laws.” Id. 392, 397.
6. It is further urged on the part of plaintiff that, under the state constitution, the legislature is authorized to alter or repeal the laws under which corporations are formed,—they cannot be properly called charters,—and that this mode of taxing corporations, in effect, operates as an amendment of the act authorizing the formation of corporations, and that corporations hold their franchises in subordination to that provision.
The proceeding in question is either taxation or something else; either an exercise of the sovereign right of taxation, or the exercise of some other power; either taxation or not taxation. The provision, in terms, purports on its face to provide for taxation. The convention that framed the article, and the people, when they adopted it,
The provision is found in the chapter entitled “Bevenue and Taxation, ” and the section says: “For the purpose of assessment and taxation,” etc. If the proceeding is taxation, then it provides, and can only provide, for taking from the defendant an amount of money equal to its just share of the public burden relieved by the taxation, and nothing more. Anything beyond that is taking private property for public use without condensation. If the proceeding is taxation, there is no necessity for resorting to any other provision of the con-" stitution. If it is not taxation,—if the amount demanded, or the principle adopted, is imposed as a condition of continued existence, or as a limitation of its rights to exercise its franchises,—then it is an annual bonus demanded for the franchise, or the privilege of existence, such as was formerly often demanded and paid by corporations for the special privileges given by special charters, when there were no restrictions upon the legislative power upon the subject, and is not taxation. If it is a bonus demanded and paid for this right, then, in addition, the corporation is subject to taxation upon its property; for under the constitution all property must be taxed. “All property in the state,” says the constitution, “not exempt under the laws of the United States, shall be taxed in proportion to its value, to be ascertained as provided by law.” Article 13, §§ 1, 6, says that “the power of taxation shall never be surrendered or suspended by any grant or contract to which the state shall be a party.” If, therefore, the provision of section d relative to “railroad or other quasi public corporations” is a term or condition of the contract upon which its existence and further exercise of its franchises depend, then it must still be liable to taxation on its property in the proper mode. By a contract authorizing certain persons to form a corporation and exercise its franchises, however valuable the consideration received, the state cannot, as we have seen, surrender or suspend its right to tax its property besides, as all other property is taxed. Other tax-payers are entitled to have the property of corporations properly taxed. Again, if the, submission to this mode of what is called taxation becomes a valid condition of the continuance of the further existence of the corporation, and the further exercise of its franchises, then a refusal to pay the tax is a violation of the conditions of its being, and the courts, upon a proceeding for the purpose by the state in the nature of a quo ivarranto, would probably adjudge the forfeiture of1 its charter and wind up its affairs. This would be the appropriate rem
“ The end being unlawful and repugnant to the supreme law of the land, it is equally unlawful and equally in violation of constitution and treaty stipulations to use any means, however proper or within the power of the state for lawful purposes, for the attainment of that unlawful end, or accomplishment of that unlawful purpose. It cannot be otherwise than unlawful to use any means whatever to accomplish an unlawful purpose. This proposition would seem to be too plain to require argument or authority. Tet there is an abundance of authority on the point, although, perhaps, not stated in this particular form. Brown v. Maryland, 12 Wheat. 419; Ward v. Maryland, 12 Wall. 431; Woodruff v. Parham, 8 Wall. 130-140; Hinson v. Lott, Id. 152; Welton v. Missouri, 91 U. S. 279-282; Cook v. Pennsylvania, 97 U. S. 573.”
The observations of Mr. Justice Field in Cummings v. Missouri, 4 Wall. 325, are pertinent in this connection. He said:
“ The deprivation is effected with equal certainty in the one case as it would be in the other, but not with equal directness. The purpose of the law-maker in the case supposed would be openly avowed; in the case existing it is only 'disguised. The legal result must be the same; for what cannot be done directly cannot be done indirectly. The constitution deals with substance, not shadows. Its inhibition was leveled at the thing, not the name. It intended that the rights of the citizen should be secure against deprivation for past conduct by legislative enactment under any form, however disguised. If the inhibition can be evaded by the form of the enactment, its insertion in the fundamental law was a vain and futile proceeding.” See, also, Henderson v. Mayor of N. Y. 92 U. S. 268; Chy Lung v. Freeman, Id. 279; Railroad Co. v. Huson, 95 U. S. 472.
The foregoing observations apply equally well to any effort to obtain the property of corporations by irregular means not applicable to natural persons. It seems to me that under our general system •embodied in the constitution, providing for corporations, which for
In my judgment, the state constitutional provisions under consideration, and the laws passed to carry them out, violate the provision of the fourteenth amendment in question in two vital particulars: (1) They assess railroad and other quasi public corporations upon a different basis from' that adopted with respect to the natural persons similarly situated, in the particulars herein pointed out; (2) they provide, with respect to natural persons, notice and an opportunity to be heard in the course of the proceeding to assess their property before the assessment becomes fixed, while they afford no such notice or opportunity to be heard to railroads and other quasi public corporations ; and in both these particulars deny to the latter the equal protection of the law within the meaning of the fourteenth amendment to the national constitution.
Again, this suit is for a tax and nothing else. It proceeds upon that idea, and the idea alone, that a valid tax has been assessed against the defendant, which this action is brought under the statute to recover. The suit cannot be maintained upon a liability imposed under other and different provisions of the constitution. If it cannot be maintained as for a tax it must fail. The recovery, if any is had, must be upon the cause of action alleged.
We do not conceive that a provision for assessing railroads operated in more than one county, by the state board of equalization, while other local property is assessed by the local assessors, would be denying the equal protection of the law, provided the assessment in the former case is, in all respects, made upon the same basis, under the same rules, and upon the same principles as to value, notice, opportunity to be heard, etc., as in the latter. The presumption would be that all the officers would perform their duties justly under the law, and that the assessments so made upon property, differently circumstanced, would operate equally. Nor do we think that the assessment of the “franchise, road-way, road-bed, rails, and rolling stock of all railroads operated in more than one county in the state, ” “by the state board of equalization,” as a unit, and apportioning the amount of the assessed value to the several counties, etc., in proportion to the number of miles in each, is objectionable, on the ground that it denies the equal protection of the law to the owner of the road.
Whatever public inconvenience may temporarily result from our decision,—and it must necessarily be great,—being satisfied, as we are, that the provisions of the state constitution now in question violate the inhibitions of the fourteenth amendment, our duty is plain, and we cannot, if we would, shrink from its performance. There must be judgment for the defendant.
Since the- argument in these cases commenced, apparently in anticipation of what must necessarily be the result, various means, more or less violent, have been suggested, through the public press and elsewhere, to prevent railroad corporations irom escaping the payment of their just share of the public burdens : such as taking away their franchises; seizing and appropriating their property first, and litigating the right afterwards; and punishing by the severest penalties the officers of all such corporations, in all cases where resistance to payment of a tax is made in the courts, however illegal the exaction or whatever the ground of complaint on their part may be. Violent counsels of this character usually result in constitutional and statutory provisions such as those we have been considering and held void, which render it necessary to seek the protection of our national magna charta. It would be idle—utterly futile—to insert a provision in the national constitution guarantying to every person within its jurisdiction his life, his liberty, and his property, if certain classes can be selected out in the subordinate legislation of the country to be visited with condign punishment if they even seek to invoke the protection of this beneficient guaranty against discriminating and wrong
A far wiser and more statesmanlike proceeding would seem to he, to avoid all occasion for resistance to wrong in the guise of void laws, by coolly and calmly re-examining the subject in the light of past experience, and so amending our state constitution and statutes as to bring them into entire harmony with all the guaranties of the fourteenth amendment, “the crowning glory of our national constitution” —that noblest and best written constitution ever devised by the wisdom of man.
If tho life, liberty, property, and happiness of all the people are to he preserved, then it is of the utmost importance to every man, woman, and child of this broad land that every guaranty of our national constitution, whatever temporary inconvenience may be felt, be firmly and rigorously maintained at all timos and under all circumstances. In the language of the supreme court of the United States:
“ Tlie constitution of tho Uuited States is a law for rulers and people, equally in war and in peace, and covers with tlie shield of its protection all classes of men, at all times, and under all circumstances. Ab doctrine involving more pernicious consequences was ever invented by the wit of man, than that any of its provisions can be suspended during any of the great exigencies of government. Such a doctrine leads directly to anarchy or despotism.” Milligan’s Case, 4 Wall. 120.
I concur in the judgment ordered by the circuit justice.
OBDEB STATING PBOCEEDINGS.
As the questions we have considered are of tho greatest- importance, and their correct solution concerns not merely the railroad corporation, which is tho defendant, hut corporations of every kind, other than municipal, we shall order a stay in all the other cases (not decided to-day) now pending in this court involving the same questions, until these cases can be brought before the supreme court of the United States, and the questions involved shall have received by its judgment their final and authoritative determination. If tlie decision now reached be there sustained, the state will he obliged to order a now assessment, in making which the defendant will be allowed a deduction in the valuation of its property for the mortgage thereon, and also a hearing before the state hoard of equalization with respect to the assessment. If, on the other hand, the decision be reversed,
NOTE.
Constitutional Law—Fourteenth Amendment. The fourteenth amendment to the federal constitution contains prohibitions which have exclusive reference to the action of the state government, (Virginia v. Rives, 100 U. S. 313; Ex parte Virginia, I.d. 339; U. S. v. Cruikshank, 92 U. S. 542,) and is a guaranty of protection against state action,' (Id.; Slaughter-house Cases, 16 Wall. 36.) It created no new righfi) but operated upon legal rights as it found them established and declared that such as they were, in each state, they should be enjoyed by all persons alike, (Ward v. Flood, 48 Cal. 36,) and furnished an additional guaranty against any encroachment by the states upon the fundamental rights which belong to every citizen, as a member of society, (U. S. v. Cruikshank, 92 U. S. 543; Virginia v. Rives, 100 U. S. 313; Van Valkenburg v. Brown, 43 Cal. 43; U. S. v. Hall, 13 Int. Rev. Rec. 181,) by preventing states from doing that which will deprive the person of property, and not from regulating the use of property, (Munn v. Illinois, 94 U. S. 134.) The object of the constitution is justness and fairness. Wisconsin Cent. R. Co. v. Taylor Co. 52 Wis. 43. The amendment was designed to secure equal rights to all persons, (Ex parte Virginia, 100 U. S. 339;) and it applies to all persons, whether native or foreign, while within the jurisdiction of the United States, (Ex parte Ah Fong, 3 Sawy. 144.)
Equal Protection of the Laws. The provision as to equal protection of the laws contemplates the protection of persons and classes of persons against unjust discrimination by a state, (Missouri v. Lewis, 101 U. S. 22,) but it does, not relate to territorial or municipal arrangements made for different portions of the state, (Id.;) for a state may establish one system of law-in one portion of its territory and another system in another portion, provided it does not abridge the privileges and immunities of citizens of the United States, nor deprive a person of his rights without due process of law, nor deny any person within its jurisdiction an equal protection of the law, (Id.) Equal protection of the law implies not only equal accessibility to courts for the protection or redress of wrongs and the enforcement of rights, but equal exemption with others of the same class from all charges and burdens of every kind. Ex parte Ah Fong, 3 Sawy. 144. A law which declares that one class of persons shall have no redress, which redress is given to all by the general statutes, is in conflict with this amendment. Pearson v. City of Portland, 69 Me. 281. While the general statute remains in force for the protection of one class of persons within the jurisdiction of the state, it must remain in force for the protection of all others similarly situated. Id. A state constitution is a law in so far that it cannot violate the provisions of the federal constitution ; so held as to the provision relating to the impairment of the obligations of contracts. Dodge v. Woolsey, 18 How. 331; Groves v. Slaughter, 15 Pet. 449; Railroad v. McClure, 10 Wall. 511; Delmas v. Ins. Co. 14 Wall. 667; Gunn v. Barry, 15 Wall. 610; 8 N. B. R. 1; Moultrie Co. v. Savings Bank, 92
Due Process of Law. The principle is universal that no man’s property can be taken from him without his consent, express or implied, except by due course of law. Blackman v. Lehman, 63 Ala. 547. “ Due process of law ” means such an exertion of the powers of government as the settled maxims of the law permit and sanction. Bertholf v. O’Reilley, 18 Am. Law Reg. (N. S.) 119; Ex parte Ah Fook, 49 Cal. 402. It means law in its regular course of administration through courts of justice, (Barker v. Kelly, 11 Minn. 480; Rowan v. State, 30 Wis. 129; State v. Becht, 23 Minn. 413;) the law of the land, (Matter of Meador, 1 Abb. U. S. 331; Murray v. Hoboken, etc., Co. 18 How. 472; James v. Reynolds, 2 Tex. 251;) a present existing rule, and not an ex post facto law, (Hoke v. Henderson, 4 Dev. 15; Taylor v. Porter, 4 Hill, 146; Wynehamer v. People, 13 N. Y. 393; Norman v. Horst, 5 Watts & S. 171;) a law existing at the time of vesting of rights, (Wilkinson v. Leland, 2 Pet. 658; Osborn v. Nicholson, 13 Wall. 662.)
The fourteenth amendment does not employ the phrase “ due process of law ” in any new sense but as employed in the state constitution. Murni v. Illinois, 94 U. S. 118. The term, when applied to judicial procedure, moans a course of legal procedure according to those rules and principles established by our jurisprudence for the protection and enforcement of private rights, (Pennoyer v. Neff, 95 U.S. 714,) and generally implies and includes parties, judge, regular allegations, and a trial according to some settled course of judicial proceedings, (Murray v. Hoboken, etc., Co. 18 How. 272; Huber v. Reily, 53 Pa. St. 112; Rees v. Watertown, 19 Wall. 122; Westervelt v. Greg, 12 N. Y. 202;) a timely and regular proceeding to judgment and execution, (Dwight v. Williams, 4 McLean, 586;) a legal proceeding under direction of a court (Newcomb v. Smith, 1 Chand. 71) intended to secure the right of trial according to the forms of law,' (Parsons v. Russell, 11 Mich. 113.)
The phrase “ due process of law ” does not in all cases necessarily require judicial proceedings, (McMillan v. Anderson, 95 U. S. 37; see, to same effect, Pearson v. Yewdall, Id. 294; Murray v. Hoboken, etc., Co. 18 How. 272; Davidson v. New Orleans, 96 U. S. 897; Greene v. Briggs, 1 Curt. 311; Murray v. Hoboken, etc., Co. 18 How. 272; Hoke v. Henderson, 4 Dev. 15; Taylor v. Porter, 4 Hill, 146; Van Zandt v. Waddel, 2 Yerg. 260; State Bank v. Cooper, 2 Yerg. 599; Jones v. Perry, 10 Yerg. 59.) and does not necessarily import a trial by jury, (Ex parte Meador, 1 Abb. U. S. 317; Petition of McMahon, 22 N. Y. Daily Reg. 881;) but includes summary remedies, (Martin v. Mott, 12
Although differing from proceedings in courts of justice the general system of procedure for the levy and collections of taxes, established in this country, is, within-the meaning of the constitution, due process of law. Kelly v. Pittsburgh, 104 U. S. 78. The revenue laws of a state may be in harmony with the fourteenth amendment, which declares that no state shall deprive any person of life, liberty, or property without due process of law, although they do not provide that a person shall have an opportunity to be present when a tax is assessed against him, or that the tax shall be collected by suit. McMillen v. Anderson, 95 U. S. 37. A statute which gives a person against whom taxes are assessed a right to enjoin their collection, and have their validity judicially determined, is due process of law, notwithstanding he is required, as in other'injunction cases, to give security in advance. Id. An act which makes ample provision for judicial inquiry in matters therein mentioned, is due process of law. Pearson v. Yewdall, 95 U. S. 294. A party is not deprived of his property without due process of law by the enforced collection of taxes, merely because they, in individual cases, work hardships or impose unequal burdens. Kelly v. Pittsburgh, 104 U. S. 78. It is a difficult attempt to give an authoritative definition of what it is for a state to deprive a person of his life, liberty, or property without due process of law, within the meaning of this amendment. The enunciation of the principles which govern each case as it arises is the better mode of arriving at a sound definition. Davidson v. New Orleans, 96 U. S. 97. Neither the unlimited power of a state to tax, nor any of its large police power, can be exercised to such ail extent as to work a practical assumption of the power conferred by the constitution upon congress. Railroad Co. v. Husen, 95 U. S. 465.
Privileges and Immunities of Citizens. The first clause of the first section of the fourteenth amendment applies to the colored race, and its purpose is to establish the citizenship of the negro, and secure to the colored race the benefit of the freedom previously accorded to them. Slaughter-house Cases, 16 Wall. 36. The second clause protects from hostile legislation of the states the privileges and immunities of citizens of the United States, as distinguished from the privileges and immunities of citizens of the state. Slaughter
So a corporation is deemed.a citizen for the purposes of jurisdiction in the courts of tlie United States,—see Desty, Fed. Proc. (2d Ed.) § 629,—and as to the right of removal of a cause into the federal court, see Desty, Kern. Causes, § 10/c. When the legislature provides for taxing the property of individuals, the constitution requires it to tax the property of corporations for pecuniary-profit to the same extent and for the same purposes. Mayor, etc., of Mobile v. Stonewall Ins. Co. 53 Ala. 570; City of Davenport v. C. I. & P. R. Co. 38 Iowa, 633.
State Power of Taxation. The power of taxation is an attribute of sovereignty of every government. Transportation Co. v. Wheeling, 99 U. S. 281. The power of the state to tax is an inherent and indispensa,hie incident to sovereignty, (Western U. Tel. Co. v. Mayer, 28 Ohio St. 53; Dobbins v. Com’rs, 16 Pet. 435;) and exists independent of the constitution of the United States, (McCulloch v. Maryland, 4 Wheat. 316; Lane Co. v. Oregon, 9 Wall. 77; Railroad Co. v. Peniston, 18 Wall. 29; Nathan v. Louisiana, 8 How. 73; People v. Coleman, 4 Cal. 46.) l?y the revolution the powers of government devolved upon the people of the United States. McCulloch v. Maryland, 4 Wheat. 316; Dartmouth College v. Woodward, 4 Wheat. 518; Green v. Biddle, 8 Wheat. 1; Ogden v. Saunders, 12 Wheat. 213; Cherokee Nation v. Georgia, 3 Wall. 585. The power is supreme unless the subject be beyond the borders of the state, or t he property within the state has been ceded to the United States, and within its separate and exclusive jurisdiction; and this supremacy cannot be questioned by the judiciary. See Desty, Fed. Const. 59, and cases cited. The power to tax all property within the jurisdiction, does not include public property; the word “all” in the state constitution applies only to private property. People v. Doe C. 36 Cal. 220. Except as restricted by the constitution, the state lias full power of taxation over all subjects, (Id. note 5;) and to every object of value, except as restricted by the constitutional provisions as to the means and instrumentalities for carrying out the powers of government, and such as are noces
Equality and Uniformity of Taxation. The provision of the constitution of the United States, art. 1, § 8, subd. 1, was designed to secure uni- ' formity as between the states, not as between different kinds of property; in the language of Judge Story, “to cut off all undue preferences of one state over another in the regulation of subjects affecting their common interests.” And the object of the state constitutions was to secure the same equality as between different kinds of taxable property that the other designed to secure as between the states. And this can only be attained by a uniform rule. State v. Winnebago Lake & F. R. P. Co. 11 Wis. 42; Exchange Bank v. Hines, 3 Ohio St. 1. See Western Union Tel. Co. v. Mayer, 28 Ohio St. 592; Waring v. Savannah, 60 Ga. 93; Marsh v. Clark Co. 42 Wis. 502. The object of such constitutional provisions is to regulate the powers of taxation by such limitations and restrictions as will protect against unjust or arbitrary action. West. U. Tel. Co. v. Mayer, 28 Ohio St. 533. See McCulloch v. Maryland, 4 Wheat. 316; Providence Bank v. Billings, 4 Pet. 519; North. M. R. R. v. McGuire, 20 Wall. 46. To be uniform, taxation need not be universal. Certain objects may be made its subjects’and others be exempted, but as between subjects of the same class there must be equality. New Orleans v. Fourchy, 30 La. Ann. 910; State v. Poydras, 9 La. Ann. 165. The legislature has the power to prescribe not only the property to be taxed, but the rule by
The constitutions of some of the states, in terms or by necessary implication, require all private property to be taxed in proportion to its value. O’Kane v. Treat, 25 Ill. 557; Mobile v. Dargan, 45 Ala. 310; Mobile v. Street Ry. Co. Id. 322; Washington v. State, 13 Ark. 752; McGehee v. Mathis, 24 Ark. 40. The constitution of Kansas differs from the constitution of other states, requiring only a uniform “ rale” of taxation and not requiring all property except that which is exempt to be taxed by a uniform rule; hence railroad property in that state may be assessed in one manner and other property in a different manner, and personal property he assessed on different rules, and still all the assessments be held valid. Com’rs of Ottawa v. Nelson, 19 Kan. 238; Gulf R. Co. v. Morris, 7 Kan. 210. Tho constitution of California, art. 13, § 1, providing that all property in the state, not exempted under the laws of the United States, shall be taxed in proportion to its value, to be ascertained as provided by law, requires that the assessor shall proceed to ascertain such value in the manner provided by law. Hyatt v. Allen, 54 Cal. 353. And the provisions requiring that all taxes shall be uniform on the same class of subjects within the territorial authority levying the tax, is merely declaratory of the law before the adoption of the new constitution. Kitty Roup’s Case, 81* Pa. St. 211. Where the constitution requires that tho valuation must he uniform, and in all cases alike and equal, and tho legislature prescribes a different rule, the act is a departure from the constitution and void. Knowlton v. Sup’rs Rock Co. 9 Wis. 410. Equality of taxation means apportioning the contributions of each person towards the expenses of government so that he shall feel neither more nor less inconvenience from his share of tho payment than every other person experiences. Kirby v. Shaw, 19 Pa. St. 258. Perfectly equal taxation is perhaps unattainable, (Grim v. School-dist. 57 Pa. St. 433;) it can never be but approximation, (Allen v. Drew, 44 Vt. 174;) as from the nature of the case there can be no uniform rule for making the assessments, (Coite v. Soc. for Savings, 32 Conn. 173;) and for that reason equality of taxation is not enforced by the hill of rights, (Kirby v. Shaw, 19 Pa. St. 258;) but where a moral obligation exists the legislature may give it legal effect, (Lycoming v. Union, 15 Pa. St. 166.)
An act which fixes absolute liability in a corporation, and which does not provide “due process of law,” is in violation of the bill of rights. Zeigler v. S.&N. R. Co. 58 Ala. 594. See Plumer v. Marathon County, 46 Wis. 163. A statute which atteknpts to make an assessment conclusive evidence of the amount due for taxes is invalid. Plumer v. Marathon Co. 46 Wis. 163. Where a statute establishes a rule for the estimation of the value of railroad
Journals of tiie Legislature as Evidence. By the provisions of the state constitution a bill must bo read at length on three separate days in each house, unless, in case of urgency, two-thirds of the house, by a vote taken by yeas and nays, dispense with the provisions either as to the manner of reading or the reading on separate days. Weill v. Kenfield, 54 Cal. 111. That the journals of the legislature may be examined to ascertain that a bill was constitutionally passed, see Walnut v. Wade, 103 U. S. 683; Perry County v. Railroad Co. 58 Ala. 546; Harrison v. Goody, 57 Ala. 49; Walker v. Griffith, 60 Ala. 361.—[Ed.