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(199 U. S. 48) them to taxation, while their competitors, | PEOPLE OF THE STATE OF NEW YORK operating under the surfaces of many of the ex rel. BROOKLYN CITY RAILROAD same streets, are to be exempted." COMPANY, Plff. in Err.,
Contracts-exemption from taxation-validity of tax on special franchises-due prooess of law in valuation.
to a municipality of a license fee on each street car, modified as to the amount of such fees under the authority of a statute accepted by the street railway company, stating that such fees should be taken "in full satisfaction for the use of the streets or avenues," does not exempt the company from the tax imposed, under N. Y. Laws 1899, chap. 712, on its franchise.
The first specification is answered by the conclusion that we have reached in respect STATE BOARD OF TAX COMMISSIONto the claim of an impairment of contract obligations; for if there was no such impairment, the fact that the companies have escaped the burden for these many years is their good fortune, and in no manner discharges them from the ordinary burdens of taxation which the present law imposes. With respect to the second, it may be ob- 1. The contract arrangement for the payment served that the lump sum is so obviously a payment for the franchise that it cannot be considered in any just sense as possessing the nature of a tax. It is not even rental. It is like money paid for a tract of land,part of the purchase price. It does not, like a percentage of the gross receipts, vary with the changes of business, has no resemblance to a continuing discharge of the obligation which property is under for contribution to the support of the government. Further, this whole matter of allowing a reduction on account of that which is spoken of as "in the nature of a tax," is a matter of grace on the part of the legislature. The franchises granted were, as we have held, subject to taxation, and the fact that, upon equitable considerations, the state has consented that a certain reduction shall, in some cases, be made, does not entitle every holder of a franchise to a like reduction. It is akin to an exemption, and there is nothing in the Federal Constitution to prevent a state from Argued April 17, 18, 19, 1905. Decided May granting exemptions from taxation. Bell's Gap R. Co. v. Pennsylvania, 134 U. S. 232, 33 L. ed. 892, 10 Sup. Ct. Rep. 533.
With regard to the third contention, it may be said that there is a difference between surface and subsurface street railroads sufficient to justify a diversity in the mode and extent of taxation. In Savannah, T. & I. of H. R. Co. v. Savannah, 198 U. S. ante, 690, 25 Sup. Ct. Rep. 690, just decided, taxation of a street railroad was challenged on the ground that a steam railroad which ran into the city and along its streets, and
there did some of the same kind of work as the ordinary street railroad, was not subject to the same tax, and, referring to this contention, is this declaration by Mr. Justice "The difference between the two railroads is obvious, and warrants the diversity in the mode of taxation." Further, the condition of the title to the only subsurface road in the city of New York clearly puts it in a class by itself.
These are all the questions we deem it important to consider. We find no error in the decision of the Supreme Court of New York, and it is affirmed.
2. A street railway company cannot claim to have been denied due process of law in the valuation of its franchise for the purpose of the special franchise tax imposed by N. Y. Laws 1899, chap. 712, on the theory that it was ascertained by speculation and guesswork, where such valuation is required to be made by the state board of tax commissioners, to which the owner of the franchise is required to furnish a written report, and notice and hearing are accorded such owner, and a review of the assessment by certiorari is afforded.
N ERROR to the Supreme Court of the
State of New York to review a judgment sustaining an assessment of a street railway franchise, entered pursuant to the mandate of the Court of Appeals of that state, which had reversed a judgment of the Appellate Division of the Supreme Court for the Third Department, which had, in turn, reversed the judgment of the Supreme Court entered at a special term held in and for the county of Albany on a writ of certiorari to review the
action of the state board of tax commissioners. Affirmed.
See same case below in Appellate Division of Supreme Court, 79 App. Div. 183, 80 N. Y. Supp. 85; in Court of Appeals, 174 N. Y. 417, 63 L. R. A. 884, 67 N. E. 69.
Statement by Mr. Justice Brewer: This case, like the preceding, involves the special franchise tax law of New York. The facts are these: On December 22, 1853, the relator was authorized by the city of Brooklyn to construct, maintain, and operate street surface railroads railroads upon specified streets, and required to enter into a good
Mr. Justice Brewer delivered the opinion of the court:
and sufficient bond conditioned for the faithful performance of all the terms and stipulations in the resolutions granting the Do these license fees stand as an equivaauthority. On December 30 of that year a lent for property taxes so that a stipulation bond in the sum of $200,000 was duly ex- in respect to them relieves the property from ecuted by the relator, and has ever since | liability to ordinary taxation? This certainbeen kept in force. The terms and stipu-ly would not be the general rule. A license lations as to the construction and operation fee is understood to be a charge for the of the railroad need not be mentioned. The privilege of carrying on a business or ocresolutions contained these further pro-cupation, and is not the equivalent or in visions: lieu of a property tax. Take the vast volume of occupations which are subject to licenses from either the nation or the states. Who supposes that, in the absence of some express stipulation, the fees charged for those licenses operate to relieve the property employed in the business from the ordinary burdens of property taxation? The precise question as to the effect of an ordinance imposing a license fee for cars used on a street railroad was before the court of appeals in New York v. Broadway & S. Ave. R. Co. 97 N. Y. 275, in which, on page 282, the court said:
"The rates of fare for each passenger and the license fee for each car to be paid annually into the city treasury shall be on the respective lines above mentioned:
"1. Furnam street route, fare not to exceed 5 cents, license fee, $50. 2. Court street route, fare not to exceed 4 cents, license fee, $20. 3. Powers street route, fare not to exceed 5 cents, license fee, $20. 4. Flatbush avenue route, fare not to exceed 5 cents, license fee, $20. 5. Fulton avenue route, fare not to exceed 4 cents, license fee, $20. 6. Myrtle avenue route, fare not to exceed 4 cents, license fee, $20. 7. Sands street route, fare not to exceed 5 cents, license fee, $10. 8. Front street route, fare not to exceed 5 cents, license fee, $10."
"The contract of the defendant arises from the provisions of its charter by which it agrees to pay a certain sum reserved therein in consideration of the privileges conThis action of the city of Brooklyn was ferred thereby. It is neither a tax nor is it validated by the state legislature. Other a penalty; and hence the technical rules as contracts were made by the city of Brooklyn to penal actions or suits to recover a tax with other companies. Those companies which are invoked by the appellant have no were subsequently consolidated with the re-application." lator, which, on the 1st of January, 1900, held forty-five similar contracts with the municipalities for the construction, maintenance, and operation of street surface railroads in the present boroughs of Brooklyn and Queens. Some of these contracts required the annual payment of a certain percentage of the gross receipts. Subsequently, under due legislative authority, the contract arrangements between the relator and the city were modified in respect to the amount of the annual license fee. The statute authorizing the modification contains this clause:
Further, in the statute modifying the license fees, which was accepted by the relator, it was expressly stated that they should "be taken in full satisfaction for the use of the streets or avenues." Clearly, therefore, the fees being imposed for a specific purpose, they cannot exempt the relator's property from the tax imposed by the special franchise tax law.
It is further objected that there was a failure of due process of law in that the special franchise tax law did not indicate any principle or method for ascertaining the value of the intangible property included "The said license fees shall be taken in in the special franchise, and that the state full satisfaction for the use of the streets or board did not make any separate valuation avenues, but the same shall not release said of the tangible property, and did not adopt company from any obligations required by or proceed upon any principle or method in law to keep such streets or avenues, or any valuing the totality of the tangible and inpart thereof, in repair, which said obli- tangible property, but necessarily indulged gations and the contracts, laws, or ordi- in mere speculation and guesswork instead nances creating and enforcing the same, are of exercising judgment in making the valuhereby continued in full force and operation. ation."
We are of opinion that this objection is without merit. The sections relating to the
Messrs. Charles A. Collin and William taxation of special franchises were enacted F. Sheehan for plaintiff in error.
as amendments to and part of the general Messrs. Julius M. Mayer and Louis tax law of the state, and are to be construed Marshall for defendant in error. accordingly. By one section the valuation
(199 U. S. 53)
is to be determined by the state board of tax | PEOPLE OF THE STATE OF NEW YORK commissioners. By another the owner of ex rel. TWENTY-THIRD STREET RAILevery such franchise is required to make a WAY COMPANY, Plff. in Err., written report to the state board, containing
ERS. (No. 75.)
PEOPLE OF THE STATE OF NEW YORK ex rel. CENTRAL CROSSTOWN RAILROAD COMPANY, Piff. in Err.,
ERS. (No. 76.)
PEOPLE OF THE STATE OF NEW YORK ex rel. CONSOLIDATED GAS COMPANY, Plff. in Err.,
ERS. (No. 77.)
a full description of the franchise, a copy STATE BOARD OF TAX COMMISSIONof the special grant, ordinance, or contract under which it is held, or, if possessed or enjoyed under a general law, a reference to such law, a statement of any condition, obligation or burden imposed upon the franchise, together with such other information as the state board may require; and that board STATE BOARD OF TAX COMMISSIONis authorized to require, from time to time, further reports containing information upon such matters as it may specify. Not only that; after making the valuation the state board is required to give notice in writing to the owner of the franchise, stating the valuation, and that on a day specified, not STATE BOARD OF TAX COMMISSIONless than twenty nor more than thirty days thereafter, it will meet to hear and determine any complaint against such assessment, and this notice must be served at least ten days before the day fixed for the hearing. At the hearing the owner may file a statement under oath, specifying the respect in STATE BOARD OF TAX COMMISSIONwhich the valuation is incorrect; testimony may be taken and a full investigation had. Another section provides for a review of the assessment by writ of certiorari. These provisions were all complied with. Notice was given to the relator, and on the day STATE BOARD OF TAX COMMISSIONfixed for the hearing it appeared and filed its objections. Thereafter it took out a writ of certiorari to review the proceedings of the tax board. Surely by this due process of law was secured. It will not do to say that the valuation of a piece of property is mere guesswork.
True, it is often largely a matter of opinion, and mathematical exactness is not always possible. Various elements enter into and affect an opinion respecting the value of a given piece of property, and all that can be required is that the assessing board exercise an honest judgment, based upon the information it possesses or is able to acquire. That valuation is of the property as a totality, and it is unnecessary in making an assessment to disintegrate the
various elements which enter into it, and
ascribe to each its separate fraction of value. Oftentimes the combination itself is no inconsiderable factor in creating the value. We are of the opinion that the relator was not denied due process of law in the valuation and assessment of its franchise.
We see nothing else in the record calling for notice, and the judgment of the Supreme Court of New York is affirmed.
PEOPLE OF THE STATE OF NEW YORK ex rel. NEW AMSTERDAM GAS COMPANY, Plff. in Err.,
ERS. (No. 78.)
PEOPLE OF THE STATE OF NEW YORK
ex rel. CONEY ISLAND & BROOKLYN
ERS. (No. 80.)
Contracts-impairment of obligation-valid-
People ex rel. Metropolitan Street R. Co v.
[Nos. 75, 76, 77, 78, 80.]
Argued April 17, 18, 19, 1905. Deo ded May 29, 1905.
IN ERROR to the Supreme Court of the
State of New York to review a judgment sustaining assessments of special franchises entered pursuant to the mandate of the Court of Appeals of that state, which had reversed a judgment of the Appellate Division of the Supreme Court for the Third Department, which had, in turn, reversed the judgment of the Supreme Court entered at a special term held in and for the county of Albany on a writ of certiorari to review the
action of the state board of tax commissioners. Affirmed.
See same cases below in Appellate Division of Supreme Court, 79 App. Div. 183, 80 N. Y. Supp. 85; and in Court of Appeals, 174 N. Y. 417, 63 L. R. A. 884, 67 N. E. 69.
Messrs. William D. Guthrie, Elihu Root, and Frank H. Platt for plaintiffs in
Messrs. Julius M. Mayer and Louis Marshall for defendants in error.
Mr. Justice Brewer delivered the opinion of the court:
While these cases differ in some details from the two preceding, in which opinions have just been announced, there are no such
differences as put them outside the scope of the reasoning of those opinions. Therefore, the judgments in them are affirmed.
(198 U. S. 443)
GIOVANNI LAVAGNINO, Piff. in Err.,
EDMUND H. UHLIG, Alexander McKernan, and The St. Joe Mining Company. Error to state court-Federal question mining claims-conflicting locations effect of forfeiture of senior location.
1. A decision of a state court that the statute of limitations making adverse possession of real property for seven years a bar to its recovery operates to defeat an action brought under U. S. Rev. Stat. § 2326, U. S. Comp. Stat. 1901, p. 1430, to try title to conflicting mining claims, in which the defeated party relied on the relocation, under § 2324 (U. s. Comp. Stat. 1901, p. 1426), of a forfeited claim, necessarily involves a denial of rights asserted by him under the latter section, so as to make a case for a writ of error from the Supreme Court of the United States, where the state court treated as irrelevant and immaterial evidence tending to show that the premises in dispute were embraced in the forfeited location, and that possession of that claim was held and retained from a time at least contemporaneous with the initiation of the conflicting locations almost up to the relocation.
2. An adequate presentation of a Federal ques
tion to a state court to make a case for a
verse successfully the application for a patent by the junior locator, since the latter's right, under U. S. Rev. Stat. § 2326, U. S. Comp. Stat. 1901, p. 1430, to a patent, which would exist in case of the failure of the owner of a subsisting senior location either to adverse the application or to prosecute such adverse if one was made, must also arise from the forfeiture of the claim of the senior locator before the junior locator's application for a patent was made, and the consequent inability of the senior locator to adverse successfully after the forfeiture is complete.
Argued January 11, 12, 1905. Decided May 29, 1905.
IN ERROR to the Supreme Court of the
State of Utah to review a judgment which affirmed a judgment of a District Court in and for the County of Salt Lake, in that state, in favor of defendants in an action to try title to conflicting mining claims. Affirmed.
See same case below, 26 Utah, 1, 99 Am. St. Rep. 808, 71 Pac. 1046.
Statement by Mr. Justice White:
Uhlig and McKernan, two of the defendants in error, by locations alleged to have been made on January 1, 1889, asserted ownership of two adjacent mining lode claims, designated respectively as the Uhlig No. 1 and the Uhlig No. 2, situated in the West mountain mining district, in Salt Lake county, state of Utah. In the month of August, 1898, the parties named filed in the proper land office an application for patent for said claims. During the publication of notice of the filing of the application, Giovanni Lavagnino, plaintiff in error,-as the alleged owner of a mining lode claim called the Yes You Do,-filed an adverse claim to a portion of the land embraced in each of the Uhlig locations, which it was asserted overlapped the Yes You Do. Thereupon, pursuant to the requirements of § 2326 of the Revised Statutes (U. S. Comp. Stat. 1901, p. 1430), this action was brought in a district court of Salt Lake county, Utah, to determine in whom was vested the title and right of possession to the conflicting areas, which, in the case of the Uhlig No. 1, claim, amounted to 6.374 acres and in the No. 2 to 1.441 acres.
writ of error from the Supreme Court of the United States sufficiently appears where the record clearly shows that the trial court considered that the unsuccessful party was spe- In substance, Lavagnino alleged in his cially claiming rights under U. S. Rev. Stat. complaint that, at the time of the location § 2326, U. S. Comp. Stat. 1901, p. 1430, authorizing an adverse of an application for of the Uhlig claims, there was a subsisting a patent to mineral lands, and the high- valid location known as the Levi P. lode est state court necessarily acted upon that claim, which included within its areas the assumption in delivering its opinion. land in dispute in the action; that the neces3. The area of conflict between two mining lo- sary labor required by the statutes of the cations does not, upon the forfeiture of the United States was performed upon the claim senior location, become unoccupied mineral lands of the United States, so as to enable up to and including the year 1896; that no a relocator of the forfeited location to ad-actual labor or improvements were made
upon the claim for the year 1897, and, in | was to be conclusively presumed that there consequence, all the land included within the did not exist any location which in anywise Levi P. location became forfeited, and conflicted with the Uhlig claims sought to acquired the status of unoccupied and be patented. mineral lands of the United States, and that while such was the status of the land, on January 1, 1898, one J. Fewson Smith, Jr., the grantor of Lavagnino,-relocated the Levi P. claim as the Yes You Do, and that thereafter all the requirements necessary to be done had been performed, and the Yes You Do was then a valid and subsisting location.
Subsequently the St. Joe Mining Company was substituted in the stead of Uhlig, as a party defendant.
On the trial it was shown that at the time Smith located the Yes You Do claim he was a deputy mineral surveyor for the district in which such mining claim was situated, and that he made the survey and plat for the protest which had been filed in the land office against the Uhlig application for patent. On the offer, as evidence for the plaintiff, of the notice of location of the Yes You Do claim and the deed from Smith to Lavagnino, objection was made to their admission, and the offered evidence was excluded upon the ground that the asserted location by Smith of the Yes You Do was not valid, because, at the time of the making thereof, Smith was a deputy mineral surveyor, and was prohibited by the terms of § 452 of the Revised Statutes of the United States (U. S. Comp. Stat. 1901, p. 257), from making the location of a mining lode
claim. For the same reason the trial court
sustained an objection to evidence offered on behalf of the plaintiff tending to show that, at the time the Uhlig claims were located, the ground covered by such locations was then covered by prior locations made at an earlier hour on the same day, and was consequently not subject to location as unoccupied mineral lands of the United States.
That one of said locations-the Levi P.embraced the premises in dispute, and was a subsisting location until forfeited by failure to perform the annual work for the year
1897; that the relocation of said claim as the Yes You Do was made on January 1, 1898; and that the annual work and other steps required by law to be done in connection with the claim had been performed. Following the introduction of testimony tending to show the validity of the Uhlig locations, testimony was introduced on behalf of the plaintiff in respect to the location and working of the Levi P. claim; but, on the offer of the Levi P. location notice, the trial court sustained an objection thereto, and ruled that, as the Yes You Do was not a valid location, there were no adverse claims before the court, and as a result it
The court made findings of fact, in which, inter alia, it was recited that the plaintiff at the trial had not introduced any legal or competent evidence to sustain the issues on his part, and consequently that "upon the trial, on motion of counsel for defendants, the said action of the plaintiff against the defendant was, and is hereby, dismissed." The facts were then found in respect to the location and working of the Uhlig claims, and, as conclusions of law, the court held that the action against the defendants should be dismissed with costs, and that the defendant the St. Joe Mining Company, and the defendant Alexander McKernan, were entitled to purchase from the United States of America the said Uhlig claims and the whole thereof, and were also entitled to a decree quieting their title to the premises in dispute. From a decree entered in conformity to these conclusions an appeal was prosecuted to the supreme court of Utah, and that court affirmed the decree. 26 Utah, 1, 99 Am. St. Rep. 808, 71 Pac. 1046. A writ of error was thereupon sued out from this court.
Messrs. Aldis B. Browne, Alexander Britton, and N. W. Sonnedecker for plaintiff
Messrs. D. H. Wenger and Arthur Brown for defendants in error.
Mr. Justice White, after making the foregoing statement, delivered the opinion of the court:
The supreme court of Utah was of the opinion that, by force of § 452 of the Revised Statutes of the United States (copied in the margin†), J. Fewson Smith, Jr., being a deputy mineral surveyor, was disqualified from locating the Yes You Do claim; that in claim was void; and that the plaintiff, consequence the attempted location of such Lavagnino, acquired no rights by the conveyance of the claim to him by Smith. It was next decided that, as the plaintiff had failed to show any right to the disputed premises, he became a stranger to the title, and was without right to contest the claim of the defendant. The correctness of the decree entered by the trial court was also held to result from the terms of § 2332 of the Revised Statutes of the United States (U. + Section 452, Revised Statutes of the United States.
"The officers, clerks, and employees in the General Land Office are prohibited from directly or indirectly purchasing or becoming interested in the purchase of any of the public land; and any person who violates this section shall forthwith
be removed from his office."