bills in equity to compel a street railway | street railway company might apply to the company to repair and maintain the surface board of aldermen of a city, or the selectof the streets through which its tracks ex- men of a town, for the location of the tracks tend, which judgments were affirmed on ap- of the railway company in the streets of the peal by the Supreme Judicial Court of that city or town, and, after hearing, it was proState. Affirmed. Also vided that the board might grant the petition "under such restrictions as they deem the interests of the public may require; and the location thus granted shall be deemed and taken to be the true location of the tracks of the railway, if an acceptance thereof by said directors in writing is filed with said mayor and aldermen or selectmen within thirty days after receiving notice thereof." Mass. Pub. Stat. chap. 113, § 7.

Worcester. Other extensions of locations | foregoing statement of facts, delivered the were applied for and granted during this opinion of the court: time, some of which were upon the condition or restriction that the paving should be between the rails and outside thereof to the street curb, and these conditions were accepted and the acceptance duly filed in the city clerk's office.

Subsequently, and in 1898 (chap. 578 of the Massachusetts Laws of that year), provision was made for a somewhat different system of taxation than that which prevailed at the time these several extensions of locations were granted and accepted by the railroad company. It was provided by § 11 of that act as follows:

"Sec. 11. Street railway companies shall not be required to keep any portion of the surface material of streets, roads, and bridges in repair, but they shall remain subject to all legal obligations imposed in original grants of locations, and may, as an incident to their corporate franchise, and without being subject to the payment of any fee or other condition precedent, open any street, road, or bridge, in which any part of their railway is located, for the purpose of making repairs or renewals of the railway, or any part thereof, the superintendent of streets or other officer exercising like authority, or the board of aldermen or selectmen, in any city or town where such are required, issuing the necessary permits therefor."

The defendant in error makes no objection to the form in which the question to be decided comes before us. Whether one or the other action or proceeding is proper and appropriate need not, therefore, be considered.

The contention on the part of the plaintiff in error is that, by virtue of the restrictions or conditions placed by it upon granting the various extensions of locations of the tracks of the railroad company, and by the acceptance of the same by the company, a contract was entered into between the city and the railroad company, which could not be altered without the consent of both parties; and that as the city had never consented to any alteration of the obligation of the railroad company to make the repairs in the streets, as provided for in those restrictions or conditions, the subsequent legislation contained in the act of 1898 impaired the obligation of that contract, and was therefore void, as a violation of the Constitution of the United States.

In the view we take of this subject it may be assumed, for the purpose of argument, that the city of Worcester had power, under the legislation of the state, to grant the right to extend the location of the railroad company's tracks upon the restrictions or conditions, already mentioned. It may also be assumed, but only for the purpose of the argument, that the restrictions or conditions contained in the orders or decrees of the board of aldermen, upon their acceptance by the company, became contracts between the city and the company.

After the passage of this act of 1898 the railroad company consented and conformed to its requirements, and thereafter omitted to make the repairs in the streets which had been required of it at the time when its extended locations were granted, during the The question then arising is whether the period from 1891 to 1893. The city there- legislature, in the exercise of its general legafter sought by these various actions or pro-islative power, could abrogate the provisions ceedings to compel the street railway company to repair and maintain the surface of the streets as provided for by the law in force when the extended locations were given and accepted. During the time that the railroad company had, since the passage of the act of 1898, omitted to make the repairs provided for as a condition for the granting of its application for extended locations, the city had incurred expenses in renewing and repairing various portions of the pavements, because of the omission and refusal of the railroad company to do so, and one of these actions was brought to recover the expenses thus incurred by the city in making such repairs and renewing such pavement.

of the contract between the city and the railroad company with the assent of the latter, and provide another and a different method for the paving and repairing of the streets through which the tracks of the railroad company were laid under the permit of their extended location. We have no doubt that the legislature of the commonwealth had that power. A municipal corporation is simply a political subdivision of the state, and exists by virtue of the exercise of the power of the state through its legislative department. The legislature could at any time terminate the existence of the corporation itself, and provide other and different means for the government of the district comprised within the limits of the former

Messrs. Arthur P. Rugg and John R. city. The city is the creature of the state. Thayer for plaintiff in error.

Messrs. Bentley W. Warren and Clement R. Lamson for defendant in error.

East Hartford v. Hartford Bridge Co. 10
How. 511, 533, 534, 13 L. ed. 518, 528.

As is stated in United States v. Baltimors & O. R. Co. 17 Wall. 322, 329, 21 L. ed. 597,

Mr. Justice Peckham, after making the 600, a municipal corporation is not only a

In Tippecanoe County v. Lucas, 93 U. S. 108-114, 23 L. ed. 822-824, the question of the validity of an act of the legislature was presented, and Mr. Justice Field, in delivering the opinion of the court, said:

part of the state, but is a portion of its gov- | appears by the best text writers upon the ernmental power. "It is one of its creatures, subject, and the great weight of judicial aumade for a specific purpose, to exercise with- thority." in a limited sphere the powers of the state. The state may withdraw these local powers of government at pleasure, and may, through its legislature or other appointed channels, govern the local territory, as it governs the state at large. It may enlarge or contract its powers, or destroy its existence. As a portion of the state, in the exercise of a limited portion of the powers of the state, its revenues, like those of the state, are not subject to taxation."

In New Orleans v. Clark, 95 U. S. 644, 654, 24 L. ed. 521, 522, it was stated by Mr. Justice Field, in delivering the opinion of the court, that

"A city is only a political subdivision of the state, made for the convenient administration of the government. It is an instrumentality, with powers more or less enlarged, according to the requirements of the public, and which may be increased or repealed at the will of the legislature. In directing, therefore, a particular tax by such corporation, and the appropriation of the proceeds to some special municipal purpose, the legislature only exercises a power through its subordinate agent, which it could exercise directly; and it does this, only in another way, when it directs such corporation to assume and pay a particular claim not legally binding for want of some formality in its creation, but for which the corporation has received an equivalent."

"Were the transaction one between the state and a private individual, the invalidity of the act would not be a matter of serious doubt. Private property cannot be taken from individuals by the state except for public purposes, and then only upon compensation or by way of taxation; and any enactments to that end would be regarded as an illegitimate and unwarranted exercise of legislative power. But between the state and municipal corpora tions, such as cities, counties, and towns, the relation is different from that between the state and the individual. Municipal corporations are mere instrumentalities of the state, for the convenient administration of government; and their powers may be qualified, enlarged, or withdrawn at the pleasure of the legislature."

In Mt. Pleasant v. Beckwith, 100 U. S. 514, 25 L. ed. 699, it was held that, where no constitutional restriction is imposed, the corporate existence and powers of counties, cities, and towns are subject to the legislative control of the state creating them.

In New Orleans v. New Orleans Waterworks Co. 142 U. S. 79, 35 L. ed. 943, 12 In Laramie County v. Albany County, 92 Sup. Ct. Rep. 142, it was also held that a U. S. 307, 23 L. ed. 552, it was held that municipal corporation was the mere agent public or municipal corporations were but of the state in its governmental character, parts of the machinery employed in carrying and was in no contract relations with its on the affairs of the state, and that the sovereign, at whose pleasure its charter may charters under which such corporations are be amended, changed, or revoked without the created may be changed, modified, or re-impairment of any constitutional obligation. pealed as the exigencies of the public service or the public welfare may demand; that such corporations were composed of all the inhabitants of the territory included in the political organization; and the attribute of individuality is conferred on the entire mass of such residents, and it may be modified or taken away at the mere will of the legislature, according to its own views of public convenience, and without any necessity for the consent of those composing the body politic.

It was also therein held that such a corporation, in respect of its private or proprietary rights and interests, might be entitled to constitutional protection. The Massachusetts courts take the same view of such a corporation. Browne v. Turner, 176 Mass. 9, 56 N. E. 969.

Enough cases have been cited to show the nature of a municipal corporation as stated by this court. In general it may be conceded that it can own private property, not of a public or governmental nature, and It was said in that case that "public du- that such property may be entitled, as is ties are required of counties as well as of said, "to constitutional protection." Proptowns, as a part of the machinery of the erty which is held by these corporations upstate; and, in order that they may be able on conditions or terms contained in a grant, to perform those duties, they are vested with and for a special use, may not be diverted certain corporate powers; but their func- by the legislature. This is asserted in Tiptions are wholly of a public nature, and they pecanoe County v. Lucas, 93 U. S. 115, 23 L are at all times as much subject to the willed. 824, and in Mt. Hope Cemetery v. Bosof the legislature as incorporated towns, as ton, 158 Mass. 509, 35 Am. St. Rep. 515, 33

Executors, etc.,

บ.

(196 U. S. 480)

FERDINAND EIDMAN, as United States

Collector of Internal Revenue.

War revenue act-inheritance tax-interest not vested in possession or enjoyment.

N. E. 695, the supreme court of Massachu- | road Company. Mass. Laws, 1861, chap. setts held that cities might have a private 148. These sections simply give the city of ownership of property which could not be Worcester the right, during the continuance wholly controlled by the state government. of the charter of the corporation, and after It seems, however, plain to us that the as- the expiration of ten years from the openserted right to demand the continuance of ing of any part of said road for use, to purthe obligation to pave and repair the streets, chase all its franchises, property, rights, etc. as contained in the orders or decrees of the That right is not affected by the legislation board of aldermen granting to the defendant in question, even assuming (which we do not the right to extend the locations of its for a moment intimate) that the act of 1898 tracks on the conditions named, does not affected the right of the city to make the amount to property held by the corporation, purchase under the sections above cited. which the legislature is unable to touch, We see no reason to doubt the validity of either by way of limitation or extinguish- the act of 1898, and the judgments of the ment. If these restrictions or conditions Supreme Judicial Court and the Superior are to be regarded as a contract, we think | Court of Massachusetts are, respectively, ufthe legislature would have the same right to firmed. terminate it, with the consent of the railroad company, that the city itself would have. These restrictions and conditions WILLIAM K. VANDERBILT et al., as were of a public nature, imposed as a means of collecting from the railroad company part, or possibly the whole, of the expenses of paving or repaving the streets in which the tracks were laid, and that method of collection did not become an absolute property right in favor of the city, as against the right of the legislature to alter or abolish it, or substitute some other method with the consent of the company, even though as to the company itself there might be a contract not alterable except with its consent. If this contention of the city were held valid, it would very largely diminish the right of the legislature to deal with its creature in public matters, in a manner which the legislature might regard as for the public welfare. In Springfield v. Springfield Street R. Co. 182 Mass. 41, 64 N. E. 577, this question was before the supreme judicial court of Massachusetts, and the contention of the city to the same effect as the plaintiff in error contends in this case, was overruled. It was therein held that the city acted in behalf of the public in regard to these extensions of locations, and that the legislature had the right to modify or abrogate the conditions on which the locations in the streets and public ways had been granted, after such conditions had been originally imposed by it. The case at bar was decided at the same time as the Springfield Case (182 Mass. 49, 64 N. E. 581), and the proposition that the legislature had the power to free the company from obligations imposed upon it by the conditions in the grant of the extended locations was adhered to, and the Springfield Case cited as authority for the same. We concur in that view.

1. The interest of a residuary legatee, condltioned on his attaining a certain age, cannot be deemed taxable under the war revenue act of June 13, 1898 (30 Stat. at L. 464, chap. 448, U. S. Comp. Stat. 1901, pp. 2307, 2308), §§ 29, 30, before the happening of the contingency, in view of the express provisions of those sections as to "possession or enjoyment" and "beneficial interest" and "clear value," and of the absence of any express language exhibiting an intention to tax a mere technically vested interest in a case where the right to possession or enjoyment is subordinated to an uncertain contingency.

2.

A legacy not capable of being immediately possessed or enjoyed, and therefore not taxable under the war revenue act of June 13, 1898 (30 Stat. at L. 464, chap. 448, U. S. Comp. Stat. 1901, pp. 2307, 2308), §§ 29, 30, as construed by the administrative officers prior to the amendatory act of March 2, 1901 (31 Stat. at L. 946, chap. 806, U. S. Comp. Stat. 1901, p. 2307), cannot be deemed to have been subjected to such taxation by the provision of the later act making the inheritance tax due and payable one year after the death of the testator, and requiring the executor to make return of the estate in his control within thirty days after taking charge thereof, especially in view of the legislative affirmance in the subsequent act of June 27, 1902 (32 Stat. at L. 406, chap. 1160),* of the construction given to the original statute before the amendment.

[No. 206.]

There is no force in the contention that Argued October 13, 14, 1904. Decided Febthe city of Worcester has a proprietary right in the property of the defendant in

ruary 20, 1905.

error, reserved to it under the original stat.ON A CERTIFICATE from the United

ute incorporating the Worcester Horse Rail

States Circuit Court of Appeals for the *U. S. Comp. St. Supp. 1903, p. 281.

Statement by Mr. Justice White: Cornelius Vanderbilt died in the city of New York on September 12, 1899, leaving a will, which was admitted to probate, the seventeenth clause of which provides as follows:

Second Circuit, presenting questions as to | said residuary estate stand in the place and the taxability, under the war revenue act, stead of his brother Alfred G., and that if of the interest of a residuary legatee, con- Alfred G. shall die without issue before he ditioned on attaining a certain age. An- attains the age of thirty years, then Regswered in the negative. inald C. shall receive the income from said estate until he attains the age of thirty years, when he shall be put in possession of one half of the residuary estate, and thereafter Reginald C. shall receive the net income of the remaining one half of my estate, and on arriving at the age of thirty-five years he shall be put in possession of the whole of said estate, and my said executors shall hold said estate upon such trust, and I give and devise the same accordingly. If Alfred G. and Reginald C. shall both die before being put into possession of said estate, and without issue, I give whatever then remains of my residuary estate to my daughters Gertrude and Gladys Moore, share and share alike; and if either of my said daughters be then dead leaving issue, her issue to take his or her mother's share, per stirpes and not per capita; and in default of issue, the survivor shall take the principal."

"Seventeenth: All the rest, residue, and remainder of all the property and estate, real, personal, and mixed, of every description, and wheresoever situated, of which I may die seized or possessed, or to which I may be entitled at the time of my decease, including all lapsed legacies and the principal of any annuities which may terminate, and any part of my estate which may not have been effectually devised or bequeathed, or from any other source, I give, devise, and bequeath to my executors, hereinafter named, and the survivors and survivor of them, IN TRUST, to hold said estate, and invest and reinvest the same, and to collect the rents, issues, income, and profits therefrom for the use of my son Alfred G., and to apply so much of said net income as may be in their judgment advisable, to his support, maintenance, and education, and for the care and maintenance of his property during his minority, and to accumulate any surplus income, such accumulations to be paid to him when he arrives at the age of twenty-one years, and thereafter to pay the net income of said estate to him as received until he arrives at the age of thirty years, when he shall be put in full possession of one half the portion of said estate to be set apart for that purpose by my executors and survivors of them. And upon further trust thereafter to pay to my said son, Alfred G., the income from the balance remaining of said estate until he shall arrive at the age of thirty-five years, when he shall be put in possession of the balance of said trust estate, and the said trustees shall be discharged from any and all liability and responsibility in respect thereof. If my son Alfred G. should die before attaining the age of thirty-five years, leaving issue, such portion of the estate as shall not then have come into his possession shall be divided by my executors into as many equal shares as he may leave children surviving, and one share shall be held by my executors to the use of each such child or children until he or she shall attain the age of twenty-one years, when it shall be paid to such child; but if he shall die without child or children, or if none of his children shall attain majority, then it is my will that my son Reginald C. shall in all respects, as to

This clause contains the only provisions in the will relating to or in any manner affecting the disposition of the residuary estate of the testator, and determining the extent and character of the interests therein.

All of the children of Cornelius Vanderbilt, named in the seventeenth clause of his will, were living at the time this suit was brought. At the time of the death of Cornelius Vanderbilt his son Alfred G. Vanderbilt was between twenty-two and twentythree years of age, and his son Reginald C. Vanderbilt was between nineteen and twenty years of age, and both were unmarried.

The appraised value of the residuary personal estate at the time of the testator's death was $18,972,117.46.

The right of Alfred G. Vanderbilt to the beneficial enjoyment, as provided in the will until he became thirty years of age, was appraised at $5,119,612.43, and upon this sum the executors paid a death duty under §§ 29 and 30 of the act of June 13, 1898 (30 Stat. at L. 464, chap. 448, U. S. Comp. Stat. 1901, pp. 2307, 2308), at the rate of 21 per cent, the tax amounting to $115,191.28. After payment of this amount, and subsequently to the passage, on March 2, 1901 (31 Stat. at L. 946, chap. 806, U. S. Comp. Stat. 1901, p. 2307), of an amendment to the war revenue act of 1898, the commissioner of internal revenue, considering that by that amendment Alfred G. Vanderbilt had become immediately liable for a tax on his right to succeed to the whole residue if he lived to the ages of thirty and thirty-five years respectively, assessed a death duty based upon that hypothesis. In making this assessment, as by the mortality tables it was