20 F. 411 | U.S. Circuit Court for the District of Eastern Virginia | 1884
The petitioners are wholesale grocers in the city of Bichmond. Their petition sets out, by reference and recital, the following facts:
By a recent act of tne assembly of Virginia, that of March 15, 1884, relating to assessments and licenses, petitioners are required to pay to the state a license tax of $504, for the privilege of carrying on their business for the year beginning on the first day of the present month. In pursuance of this law, petitioners paid to the collector of the city of Richmond the aforementioned sum of money, and duly received from the commissioner of revenue in Richmond a license to carry on their business. Under an act of assembly, commonly called the funding act, approved on the thirtieth of March, 1871, the state issued bonds, with coupons attached, which latter bear on their face the declaration of the state, that they shall be receivable, after they mature, for “all taxes, debts, dues, and demands due the state.” See acts of Assembly of 1870 and 1871, e. 282, § 2, p. 379.
Petitioners claim that this was a contract which entitled them to pay their license tax of $504 in coupons. They aver that they endeavored to obtain the benefit of this contract in the manner prescribed bj' the third section of another act of assembly of Virginia, viz., that relating to frauds upon the commonwealth, etc., approved January 14, 1882. See acts of Assembly of 1881-82, c. 7, § 3, p. 10. That is to say, they paid the $504 in money to the collector of taxes for Richmond, and at the same time tendered to that officer an equivalent amount of past-due coupons, coupling this tender with the request that he would take possession of the coupons and deliver the same to the judge of the hustings court of Richmond for identification and verification by a jury, as provided by the third section of the said last-named act, with a view to their being received by the state in payment of petitioners’ license tax, and to the return to them of the money ($504) which they had paid for their license. Petitioners aver that the collector refused to receive the coupons thus tendered, for this or any other purpose, and also refused to give petitioners a certificate in writing of their tender, as required by the third section of the last-named act; justifying his refusal by the terms of section 112 of the aforementioned act of assembly of Virginia, relating to the assessment of taxes and prescribing the mode of applying for licenses, approved March 15,1884, which forbids collectors from receiving aught but gold, silver, United States treasury notes, or United States national bank-notes for license taxes, in any case.
Petitioners, therefore, come into this court, and complain that the act of assembly of Virginia last named is repugnant to the tenth section of the first article of the constitution of the United States, which declares, among other things, that “no state shall pass any law impairing the obligation of contracts,” and is therefore unconstitutional, null, and void; and that by the*413 conduct of the collector of Biclimond, above described, they have been deprived (C a right thus secured to them by the constitution of the United States, ,o-wit, their right to pay the license tax aforesaid duo the state of Virgini i in coupons of the state. They accordingly ask the intervention of this cor efe, and pray that it will grant them the remedy furnished to tax-payers whc wish to pay their taxes in coupons by the aforesaid act of assembly of the ourteenth of January, 1882, by summoning the state before it, and impane ing a jury to identify and verify as genuine the coupons which they tendere I to the collector of Biclimond; and that this court, when such gen-uinene; s is shown, shall certify the fact to the proper officer of the state, and require the acceptance of the coupons in payment of the said tax and the return oi the $50-1 of money which they have paid to the collector.
Upoi motion, this court, by an order of the sixth instant, directed a rule to issue against the state, returnable to-day, reserving all questions of jurisdiction and the state now appears in the persons of the attorney general and of spec al counsel assigned by law for the purpose
On he merits of the case, I do not think there ought to be any different of opinion. Any pecuniary charge imposed by the government, ‘or the privilege of residence, or of holding property, or of exercising a calling, or engaging in a business, within its jurisdiction, is a tax. No refinements in lexicography, nor hypercriticisms upon the purpo-1 of words or phrases, can make such a charge anything else but a ax. There are taxes per capita levied upon persons exercising the pi ivilege of residence in a state. There are taxes ad valorem levied upon persons exercising the privilege of holding property in the st; be. There are license taxes levied upon persons exercising the privih ge of carrying on the business of merchants, or manufacturers, or oth >r callings. They are all essentially the same in their funda-menta l nature; they are a charge imposed by the state for the exercise o privileges, as a compensation to herself .for the protection which she affords by her laws alike to persons, to property, and to hones occupation. It is useless to say that such a charge is only a tax, w íen levied for the purpose of revenue; for there are such things as pr< hibitory taxes, the object of which is the opposite of revenue, which are taxes nevertheless. It is unavailing to refine upon such a subjet t. It is offensive, if not insulting, to the common sense of every candí l citizen to pretend that the charge which the state may see fit to im] ose on merchants for the privilege of carrying on their business is anything else than the commonplace thing which practical men call a tax. The right of residence, of holding property, of conducting a bus ness, may be a natural right, but the enjoyment of it under the prote< tion of law is a privilege granted by the state, and therefore, for si ort, I have called it a privilege. Nor is there any essential different o between a tax per capita, levied for the privilege of residence, a tax ad valorem, levied for the privilege of holding property, and a licent 3 tax, levied for the privilege of conducting a particular calling. And herefore, when a legislature, by statute, singles out the privilege c f carrying on trades, professions, and occupations, as has been done n the act of March 15, 1884, and requires a tax to be paid for
How can there be a rational doubt that the petitioners in this case had a right to pay their license tax in coupons after they had been identified and verified in the manner defined by law? They have been denied that unquestionable right; and therefore, on the merits alone, this case is a plain one for relief. The difficulty is the always important one in federal practice of jurisdiction. By the proceeding resorted to in the present case the state is summoned, in her sovereign character, before a federal court to answer a petition, on a week’s notice. She appears in the persons of her law officers. It matters not how obviously just the prayer of the petitioners may be; that cannot make good the jurisdiction; for the meritorious character of a demand can never cure defects in procedure if that be essentially faulty. The question, therefore, is whether this court has power to administer relief to these petitioners in this proceeding. It will be seen from what follows that this is a difficult question, and involves a necessary, and, I fear, a somewhat tedious, review of the law of jurisdiction as applicable to the federal courts.
The remedy by summary petition, commencing originally with a rule nisi, is exceptional in the practice of the federal courts as an original proceeding, and is anomalous in all systems of judicature. The practice is more questionable when sovereign states are the parties defendant; In general, a sovereign state cannot be sued except in a manner and a forum consented to and chosen by itself. See the opinion of Lord Somers in the great case of The Banker’s Case, 5 Mod. Rep. 29-82. If there be an exception to this general rule it is found in the terms of the second section of the third article of the constitution of the United States, which declares that “the judicial power of the United States shall extend to all cases in law and equity, arising under this constitution, the laws of the United States, and treaties,” etc. This grant is without limitation, in terms, as to parties to such suits, and does not, in terms, except suits brought against the sovereign states of this Union. That the states are contemplated by it is inferred ftom the fact that this section is to be construed in connection with the clause of the constitution before referred to, which forbids a state to pass any law impairing the obligation of contracts. As illustrating the full purport of this grant of jurisdiction in respect to states, it may be mentioned that, further on in the same section of the constitution, jurisdiction is given of controversies between a state and citizens of another state, and that in pursuance of this latter
The ordinary rules of construction would therefore seem to sustain the pi )position that of suits against states by their own citizens for rights arising under any clause of the constitution or laws of the Unitet States, the federal courts have jurisdiction, to be regulated in its exe icise by such laws as congress may proscribe as to practice and forms of procedure; especially in cases in which those citizens are allowe l by state laws to sue their own state in state courts.
Pas ring now to the legislation of congress on this subject, that body in its latest General Statutes relating to the jurisdiction of federal courts lias enacted that the circuit courts of the United States shall have c ognizanee, among other things, of “all suits of a civil nature at comm m law or in equity,” where the matter in controversy exceeds the sun of $500, and “arises under the constitution or laws of the United States.” The language of this statute, so far as it regards partió i to suits, is just as broad as that of the constitution itself. It makes no exception of suits in which states are parties defendant, and ¶ raid seem to leave the citizen of any state at liberty to sue his own s' ate in a federal court for any right secured to him, as petitioners in this case have, by the constitution or laws of the United States of wh: sli his state has deprived him. If, therefore, a citizen’s claim again; t his state involves the value of $500, and is founded on the consti ution or a law of the United States, it would seem that he may bring his suit in a circuit court of the United States, provided it be a “suit at common law or in equity,” in the ordinary acceptation of that † mimical phrase.
Tin next question to be considered is whether the summary proceeds g, by petition now under consideration, is such a proceeding as
In regard to suits in equity, the states have no power, direct or indirect, over the procedure in federal courts; and it is questioned whether congress can confer it to any material extent. ' But the states have been clothed by eongres with a large, though indirect, control oyer the practice of the federal courts in common-law cases. Section 914 of the Revised Statutes of the United States provides, in regard to suits other than those in equity and admiralty, brought in the federal courts; that “the practice, pleadings, and forms and modes of proceeding in civil causes” shall conform as near as may be to the practice, pleadings, and forms and modes of proceeding existing at the time in like causes in the courts of record of the state within which the United States courts are held. This court is therefore authorized to look into the laws of Virginia relating to the practice prescribed to its courts in cases at law, and to determine from those laws whether it has jurisdiction to entertain a proceeding like the one now under consideration.
This proceeding is evidently, and I believe admittedly, founded on the third section of the act of assembly of January 14, 1882, relating to frauds upon the commonwealth, which has already been referred to. That section, as before stated, authorized the method of proceeding which has been pursued in this case to be used in the courts of the state by tax-payers who wished to pay their dues with coupons; and therefore the same procedure, if now admissible in the state courts, would be admissible in this court. The section allowed the tax-payer to sue the state herself, in her own name and person. Accordingly, when this case was first called at bar, and I issued the rule under which the state of Virginia has now appeared, I supposed that the petition could be entertained. But I am confronted to-day by the 114th section of the act for assessing taxes, and for providing a mode of applying for licenses, approved March 15, 1884, heretofore mentioned, which repeals in general terms, as to license taxes, the third section of the act of January 14, 1882, creating this procedure. The conclusion that this 114th section does effect such repeal is inevitable. For section 112 of the same act is in the following words:
“All applications for licenses shall be .made, and all taxes assessed by chapter 1 of this act shall be paid, in lawful money of the United States, in the mode and subject to the provisions of an act to regulate the granting of licenses, approved the seventh of February, 1884, and any act amendatory thereto, before any corporation, firm, or person shall be entitled to receive said license, or to transact any business, profession, or calling for which a license is required by chapter 1 of this act.”
The act to which this section refers, and which it adopts and makes part of itself, is the act for regulating the granting of licenses, etc., approved February 7, 1884, as amended by another act for the same purpose, approved February 25, 1884. This act, as amended, con
The act of March SO, 1884, having m its 112th section adopted the pr< visions of the acts of February just described, then goes on, in its : 14th section, to repeal the general tax law of 1882, and also to repeal “all acts and parts of acts inconsistent with this act,”— that is to say, inconsistent with any of its own provisions; inconsistent wi h its 112th section; inconsistent, as a consequence, with the acts of February, 1884. Can this 112th section, adopting the February aw, stand and be enforced without rendering null and wholly inoperative the third section of the act of January, 1882, which provides i or the verification of coupons and for their reception by the state i i payment of license taxes ? The two laws are utterly repugnant t< i and radically inconsistent with each other. A formal repeal was In rdly necessary, inasmuch as the law of 1882 was already completely nullified as to license taxes. Yet the 114th section of the law of March gives it the coup de grace by repealing it in terms, and thereb r abolishing, as to license taxes, the proceeding by summary petitio i which the law of 1882 gave to license tax-payers who wished to pay their taxes with verified coupons. The law giving this summary i sinedy in the state courts being abolished, it follows that this proced ire, ipso facto, ceases to be admissible in the federal courts.
It m ay be suggested, that a repealing clause, embodied in an un-constit itional act, may itself be unconstitutional by reason of the associf tion in which it is found. The authorities on the subject, howevi r, are to the contrary of this. Judge Cooley says, in his Constitute nal Limitations, (3d Ed. p. 186,) that “where the repealing clause n an unconstitutional statute repeals all inconsistent acts, the repeal! tig clause is to stand and have effect, notwithstanding the in-validit r of the rest.” See, to the same effect, Dwarris, St. (Potter’s Ed. of 1874,) p. 154.
The present proceeding must, therefore, be dismissed for want of jurisdi dion in this court to entertain it; and it is so ordered.
3sTote by Judge Hughes.
The iroposition, stated arguendo in the foregoing opinion, that a citizen may sui his own state in a circuit court of the United States, on a right given him by the constitution of the Union, of which his state has deprived him,
The proposition that a citizen, who has been injured in a constitutional right by his own state, may sue that state in an inferior federal court is a novel if not a startling one.. It is probable that such a suit has never before been' brought. It is certain that it could not have been brought before the passage of the judiciary act of March 3, 1875, (Supp. Rev. St. 173, and 18 St. 470;) yet the language of section 2 of article 3 of the constitution of the United States seems to extend the judicial power of the United States to such suits. That language is that this power shall extend to “all cases in law and equjty arising under this constitution, the laws of the United States, and treaties,” etc. There is not, in the clause itself, or in any other provision of the constitution, an exception from this grant of suits brought against states by their own citizens. It is true that the second paragraph of the same section of the constitution provides that, in cases in which a state shall be a party, the supreme court of the United States shall have original jurisdiction; and Mr. Alexander Hamilton, in the eightv-first number of the Federalist, indicated the belief that the jurisdiction granted by this clause was intended to be an exclusive “original jusisdiction. ” But the first congress, that of 1789, construed the grant otherwise in section 13 of the first judiciary act; and the supreme and circuit courts of the United States have in repeated decisions held that the constitution, in giving original jurisdiction to the supreme court of cáuses in which states are parties, did not intend that that jurisdiction should be exclusive. These decisions are reviewed in the very recent .case of Ames v. Kansas, 111 U. S. 449, and 4 Sup. Ct. Rep. 437, in a decision in which the supreme court of the United States reiterated that proposition.
Section 2 of artiele-3 of the constitution having granted the jurisdiction under consideration, the only question is whether congress by legislation has authorized the federal courts to exercise it. Let it be borne in mind that as to the appellate jurisdiction of the supreme .court, and all the jurisdiction of the circuit and district courts of the United States, the constitution does not, proprio vigore, confer j urisdiction, but has granted a large fund of it which congress may or not bring into exercise. Although congress was slow to utilize all the jurisdiction authorized by the constitution, yet, since 1875, it may be said to have well nigh brought the whole into requisition.
As early as 1789 congress granted appellate jurisdiction to the supreme court in all cases authorized by section 2 of article 3; that is to say, by the twenty-fifth section of the judiciary act of 1789, (now modified into section 709, Rev. St.,) congress authorized the supreme court to review on appeal all judgments and decrees of the courts of highest resort in the states, in cases where is drawn in question the validity of any state statute alleged to be repugnant to the constitution, or to a law or to a treaty of the United, States, in which the decision of such court was in favor of the validity of srrch state statute. ’ This is but the gist of the principal clause of the section, which is very comprehensive in its grant of jurisdiction. The effect and intent of this section, as affecting suits brought against their own states by citizens appealing under it to the supreme court of the United States, was carefully discussed by Chief Justice Marshall in the case of Cohen v. Virginia, 6 Wheat. 378 et seq., extracts from which are given below. The learned chief justice maintained in that case, as early as 1821, that under the section of t-he constitution which we are considering, as put in force by section 25 of the judi
It w is not until tlie passage of the judiciary act of March 3, 1875, that congress í ave to the circuit courts of the United States jurisdiction, as authorized bj section 2 of article 3, of all cases arising under the constitution, or a law or treaty of the United States. In this act such jurisdiction was given witlioi t exception as to the parties to suits, or their character. The act of 1789 h ul given jurisdiction to the supreme court in all cases of this class, withoi t respect to amounts (which might bo ever so small) or as to parties. The je risdiction given by the act of 1875 to the circuit courts is equally without ex -eption as to parties, but as to amounts is limited to suits where the mattei ^ in controversy are not less than ¡i?500 in value. The effect and intent oi the act of 1875, in respect to states or parties, was discussed with care by Chi if Justice Waite in the case, before mentioned as very recently decided, )f Ames v. Kansas, extracts from which are given below.
Fin let ns see what was said on the question whether a citizen could sue his ow i state in a federal court for a federal right of which she had deprived him, ii i the case of Cohen v. Virginia. The state of Virginia had proceeded agains her own citizen in one of her own courts by indictment, and deprived him ol a right given him by a law of congress. Whereupon the citizen sued the st;, t.e by appeal in the suprimís; court of tlie United States, under section 25 of t íe judiciary act of 1789. One of the objections urged against the ju-risdict on was that a state was a party. Chief Justice Marshal!., among other t [lings, said, (page 378:) “The first question to be considered is whether the jiu Lsdiction of this court is excluded by the character of the parties, one of tl'iei i being a state and the other a citizen of that state. The second section ol the third article of the constitution defines the extent of the judicial power of the United States. It gives jurisdiction to the courts of the Union in two classes of cases. In the first their jurisdiction depends on the character of die cause, whoever may he the parties. This class comprehends all cases n law and equity arising under this constitution, the, laws of the Unite; Stales, and treaties made under their authority. This .clause extends the ju isdiction of the court to all cases described, without making in its terms my exception whatever, and without any regard to the condition of the pa, ty. If there be any exception, it is to be implied against the express words if the article. In the second class the jurisdiction depends entirely on the cli; raetor of the parties. ”
Oil] age 391 of the opinion this passage occurs: “It is to give jurisdiction, w here tlio character of the parties would not give it, that the important part oi the clause which extends the judicial power to all eases arising under the coi stitution and laws of the United State's was inserted. If jurisdiction depone <>d entirely on the character of the partios, and was not given where the pai ties have; not an original right to come into court, that clause would bo mere s irplusage.”
Pag< 382: The judicial power of the United States “is authorized to decide all cas, s of every description arising under the constitution or laws of the United Stat es. From this general grant of jurisdiction no exception is made of thof 3 cases in which a state may be a party. When we consider the situation of the government of the Union and of a state, in relation to each other; the nal uro of our constitution; the subordination of the state government to that cc ustitution; the great purpose for which jurisdiction over all cases arising ur ler the constitution and laws of the United States is confided to the judíela department, — are we at liberty to insert, in this general grant, an except: in of those cases in which a state may he a party? Will the spirit of the cor stitution justify this attempt to control its words? We think it will not. 1 7e think a case arising under the constitution or laws of the United
Page 383: “The constitution gives to every person having a claim upon a state a right to submit his case to the courts of the nation. However unimportant his claim may be, however little the community may be interested in its decision, the framers of our constitution thought it necessary for the purposes of justice to provide a tribunal, as superior to influence as possible, in which that claim might be decided. Can it be imagined that the same persons considered a case involving the constitution of our country and the majesty of the laws, questions in which every American citizen must be deeply interested, as withdrawn from this tribunal because a state is a party? Hi °
Page 390: “It has been urged, as an additional objection to the' jurisdiction of this court, that eases between a state and one of its own citizens do not come within the general scope of the constitution, and were obviously never intended to be made cognizable in the federal courts. * * * It may be true that the partiality of the state tribunals, in ordinary controversies between a state and its citizens, was not apprehended, and therefore the judicial power of the Union was not extended to such cases; but this was not .the sole nor the greatest object for which this department was created. A more important and much more interesting object was the preservation of the constitution and laws of the United States, so far as they can be preserved by judicial authority; and therefore the jurisdiction of the courts of the Union was expressly extended to all cases arising under that constitution and those laws. If the constitution or laws may be violated by proceedings instituted by a state against its own citizens, and if that violation may be such as essentially to affect the constitution and the laws, such as to arrest the progress of government in its constitutional course, why should these eases be excepted from that provision which expressly extends the judicial power of the Union to dll cases arising under the constitution and laws? After bestowing on this subject the most' attentive consideration, the court can perceive no reason, founded on the character of the parties, for introducing an exception which the constitution has not made ; and we think that the judicial power, as originally given, extends to all cases arising under the constitution, or a law of the United States, whoever may be the parties.”
This language is .too explicit to admit of doubtful interpretation. So far as the authority of Chief Justice Marshall can establish it, the doctrine is true that the constitution does authorize a citizen to sue his own state in a federal court for a right given him by the constitution or a law of the United States of which his state has deprived him.
The language of the court in the late case of Ames v. Kansas is equally as explicit. It refers to and adopts the language of Judge Marshall in Cohen v. Virginia. That was a case in which Kansas had sued its own citizen (a railway company) in one of its ow-n courts to question a right claimed by the company under a law of congress. The company removed the ease into the circuit court of the United States, under the act of March 3, 1875. On denial by this court of a motion to remand, appeal was taken by the state to the supreme court of the United States. As to the removal, the company was in the relation of actor or plaintiff, and the state in that of defendant. The question was whether the federal court could take cognizance, as against the state and against her will, of a suit in which the state was a party. The supreme court, following the reasoning of Judge Marshall in Cohen v. Virginia, held that the circuit court had, after removal, rightful cognizance of the suit. After discussing at length the question whether, in the second paragraph of section 2, art. 3, of the constitution, which gives “original jurisdiction” to the supreme court of eases in which a state is a party, it was intended that that jurisdiction should be exclusive, and after reviewing section
“Ii viow of the practical construction put upon this provision of the con-stituí :on by congress at the moment of the organization of the government, and o ' the significant fact that from 1789 until now no court of the United State,' has ever, in its actual adjudication, determined to the contrary, we are unab! 3 to say that it is not within the power of congress to grant to the in-ferid courts of the United States jurisdiction in eases whore the supreme court has been vested by congress with original jurisdiction. It rests with the h gislative department of the government to say to what extent such gran! ¡ shall be made. * * * We are unwilling to say that the power does i lot exist.
“11 remains to consider whether jurisdiction has been given to circuit court1 of the United States in cases of this kind. As lias been seen, it was not g ven by the judiciary act of 1789, and it did not exist in 1873, when the case < f Wisconsin v. Duluth, 2 Dill. 406, was decided by Mr. Justice Millisr on ti a circuit J3ut the act of March 8, 1875, c. 137, (18 St.470,) ‘to determine che jurisdiction of circuit courts, and to regulate the removal of causes from ihe state courts, and for other purposes,’ does, in express terms, provide that 1 the circuit courts of the United States shall have original cognizance, couci rrent with the courts of the several states, of all suits of a civil nature, at common law or in equity, * * * arising under the constitution or laws >f the United States; ’ and also that suits of the same nature, begun in a state ;ourt, may be removed to the circuit courts. * * * The only question i e have to consider, therefore, is whether suits cognizable in the courts of tin 1 United States on account of the nature of the controversy, and which need lot bo brought originally in the supreme court, may now be brought in or rei iovod to the circuit courts, without regard to.tlie character of the parties. All admit that the act does give the requisite jurisdiction in suits where a stat ) is not a party; so that the real question is whether the constitution exein: its the states from its operation. The same exemption was claimed in Cohen v. Virginia to show that the appellate jurisdiction of this court did not exten 1 to the review of the judgment of a state court [rendered] in a suit by a s'tíi) e against one of its own citizens; but Chief Justice Marshall said: [here quoting some of the passages already quoted above.] The language of the a< b of 1875, in this particular, is identical with that of the constitution, and t le evident purpose of congress was to make the -original jurisdiction of the ci 'curt courts co-extensive with the judicial power in all cases where the sup re ue court had not already been invested by law with exclusive cognizance * * * The judicial power of the United States extends to all cases arisin r under the constitution and laws, and the act of 1875 commits the exercise of that power to the circuit courts. It rests, therefore, on those who wouh withdraw any case within that power from tlio cognizance of the circuí; courts, to sustain their exception on the spirit and true meaning of the ai b, which spirit and true meaning must be so apparent as to overrule the wordi its framers have employed. To the extent that the words conflict with other laws giving exclusive jurisdiction to this court, this lias been done, but no mi re.”
Tin court accordingly gave judgment sustaining the jurisdiction of the circuícourt of the United States in Kansas to hoar and decide the case.
Caí tliere bo any doubt that this language of Chief Justice "Waite as eon-clusii sly settles the question under consideration as to tlio circuit courts, as that < f Chief Justice Marshall did as to the appellate jurisdiction of the supre ne court? There certainly cannot be. Still, the maxim remains true that a sovereign state cannot be sued except in a manner and in a forum consent'd , to by itself. J3ut let it be remembered that the constitution of the
