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lina. That court affirmed the conviction. , ufacturers or wholesale merchants from the The reasoning by which the action of the prohibitions of the act of 1889, concerning court was controlled was stated as follows: the making of gambling contracts for future "Upon the authority of State v. McGinnis, delivery. Considering this subject, the court, at this term, there is no error.” And in the in express terms, decided that the 7th secjudgment of affirmance there was embodied tion did not have that effect, since the dealthe record and opinion in State v. McGinnis, ings which were prohibited by the acts of and such record and opinion are contained 1889 were alike prohibited as to all, includin the transcript before us.
ing manufacturers and wholesale merchants. The assignments of error and the argu- The court said: ment in support thereof involve three gen- “Section 7 does not confer any exclusive eral contentions, viz.: the asserted repugnan- right or privilege upon manufacturers or cy of the statute to the equal protection of wholesale merchants. It does not authorize the law clause of the 14th Amendment, and them to engage in any business prohibited the alleged want of power of the state to by the act of 1889. It does not authorize enact the statute, because its provisions not them to speculate in cotton or other comonly abridge the privileges and immunities modities. It simply provides that the of the plaintiff in error as a citizen of the courts shall not construe the act of 1905 United States, but also deprive him of his to have the effect of preventing. properly without due process of law, in vio- [manufacturers or wholesale merchants) ] lation of the same Amendment. The con- from buying and selling for future delivery tention that the statute denied the equal the necessary commodities required in their protection of the laws rests upon the terms ordinary business.” of the 7th section, reading as follows: "But a purchase for actual future delivery
“Sec. 7. That this act shall not be con- of necessary commodities, required in the strued so as to apply to any person, firm, ordinary course of business, and not for corporation, or his or their agent, engaged 'wagering or gambling on the fluctuations in the business of manufacturing or whole of the market, would not be against the sale merchandising, in the purchase or sale statute. The statute of this state does not of the necessary commodities required in prohibit all purchases or sales for future the ordinary course of their business." delivery, but only such dealings as are in
The alleged repugnancy of g 7, and conse- the nature of gambling or wagering conquently of the entire act, to the equality tracts. Though § 7 mentions only manuclause of the 14th Amendment, is sought to facturers and wholesale mercantile estabbe sustained upon two grounds: First, be- lishments as authorized to make bona fide cause it is asserted that those engaged in dealings in ‘futures, this was done unnecthe business of manufacturing or wholesale essarily, we think, and only out of abunmerchandising are permitted to commit dant caution. It is not a discrimination, without offense the act or acts which are for there is no prohibition upon anyone else made criminal by the laws of 1889 and 1905, or any other business to buy commodities when done by any other person; and, sec- for future delivery bona fide in the ordinary ond, because, even if the terms of the 7th course of such business,' when not for specusection do not effect such a result, the sec-lative or gambling purposes. That no other tion nevertheless operates to produce an un-businesses or persons are mentioned as aulawful inequality, since it creates a prima thorized to deal bona fide for the purchase of facie presumption of guilt from the proof commodities on 'margin' is not an implied of certain acts as against all persons but restriction upon others to do an act not those engaged in the business of manufac- forbidden by any statute.” turing and wholesale merchandising.
In the argument it is insisted that the It suffices to say, as to the first of these construction given by the supreme court of propositions, that the supreme court of the North Carolina to the statute is wrong, state, in the case upon the authority of which it placed its decision in this, express of $ 7, and it is urged that it is the duty
since, in effect, it reads out the provisions ly decided that the statute did not operate of this court to disregard the interpretathe asserted discrimination. Thus, after expressly holding that the effect of $ 7 was tions affixed by the state court, thereby not to relieve those engaged in manufac- bringing the statute within the prohibitions turing and wholesale merchandising from of the 14th Amendment. But it is elementhe operation of the provisions of g 1 of the tary that, under the circumstances, we must act of 1905, prohibiting the opening and follow the construction given by the state keeping of a place for gambling dealings in court, and test the constitutionality of the futures, denominated by the court a "bucket statute under that view. Armour Packing shop,” the court came to consider whether Co. v. Lacy, 200 U. S. 226, 50 L. ed. 451, 26 the provisions of 8 7 operated to relieve man- Sup. Ct. Rep. 232; Smiley v. Kansas, 198 U. S. 447, 455, 49 L. ed. 546, 550, 25 Sup. I business indictable. Booth v. Illinois, 184 Ct. Rep. 289, and cases cited.
U. S. 425, 46 L. ed. 623, 22 Sup. Ct. Rep. As to the second proposition, viz., the as- 425, and other cases cited, supra. The facts gerted discrimination, because of inequality found are that the defendant was carrying produced by the engendering a prima facie on the forbidden business. It can in no presumption of guilt from the proof of cer- wise affect the validity of the statute maktain acts when done by persons generally, ing such business indictable that the purand not raising such prima facie presump-chase of commodities by others upon ‘martion from the same acts when done by those gin' shall, under certain circumstances, raise engaged in manufacturing or wholesale mera prima facie case that such purchases were chandising, we think the question is not void, and under other circumstances shall open on this record. As we have stated, the not constitute such prima facie evidence. A indictment distinctly charged the commis- statute may be void in part and valid in sion of the offense prohibited by the 1st part. If the provision as to prima facie evi- . section of the act of 1905, viz., the keeping dence, as to certain purchases upon ‘margin,' a place for gambling in futures, and at the were null, because not applying to all pursame time in a separate paragraph charged chases upon 'margin,' this would in no wise the doing of acts from which the presump- invalidate that part of the statute which tion of guilt was authorized by certain sec- forbids carrying on the business of running tions of the act of 1905. Upon the indict- a 'bucket shop.' The defendant is not inment so framed a special verdict was re- dicted for buying commodities for future deturned, finding that the prohibited place of livery upon a 'margin;' nor are manufacbusiness had been opened and kept as turers and wholesale merchants, nor anycharged, and that the other acts separately one else, exempted from the prohibition of charged in the indictment had been com- carrying on the 'bucket shop' business. Upmitted. Now, as the evidence upon which on the special verdict the defendant was the jury acted is not in the record, and as properly adjudged guilty.” there is nothing in the verdict tending to This ruling as to the separability of the show that the separate conclusion as to the statute is conclusive, and refutes the concommission of the act forbidden by $ 1 of tention that the entire law is void, even the statute of 1905, viz., the keeping of a upon the hypothesis that the creation of place for gambling in futures, was found by presumptions as to one class, not applicathe jury because of the presumptions au- ble to another class or classes, was repugthorized by the statute, it cannot be af- nant to the 14th Amendment. firmed that the finding of the jury as to It remains only to consider the contenthe keeping of the place for gambling in tions that the statute upon which the confutures was not based upon independent viction was had was repugnant to the due evidence, wholly irrespective of any pre- process clause of the 14th Amendment, and
, sumption authorized by the act of 1905. was, moreover, void because it abridged the And this conclusion becomes irresistible privileges and immunities of the plaintiff when it is considered that there is nothing in error as a citizen of the United States. in the record disclosing any request made to As the first rests solely upon the proposithe trial court for instructions concerning tion that there was a want of due process the effect of the presumption created by the of law, because the state was without power act of 1905, or that any express rulings on to authorize a presumption of guilt on proof that subject were made by the court. of the doing of certain acts specified in the
The contention that the judgment of con- statute, it is disposed of by what we have viction should be reversed, even although already said. And as the second was not it does not appear that the same was based pressed in argument, and is not shown by upon the presumptions authorized by the the record to have been raised or even sugact of 1905, because of the inseparability of gested in the court below, we need not furthe alleged unequal presumptions, is with ther consider it. out merit. In State v. McGinnis, supra, Affirmed. after expressing an opinion as to the right of a state under its police power, without BOARD OF EDUCATION OF THE KENviolating the 14th Amendment, to create
TUCKY ANNUAL CONFERENCE OF presumptions of guilt as to some classes of
THE METHODIST EPISCOPAL persons which would not be applicable to CHURCH, Piff. in Err., the same acts when done by other classes, the court said:
PEOPLE OF THE STATE OF ILLINOIS. “But, aside from what we have already constitutional law-privileges and immunisaid, the defendant is indicted for carrying ties-equal protection of the laws-state on a bucket shop' business. The legisla'
inheritance tax. ture had unquestionably power to make such Excluding foreign corporations from
the exemption from an inheritance tax in From the action of the county judge imfavor of property devised for educational or posing the tax, plaintiff in error appealed to religious uses, which is made by Ill. act May the county court of Cook county and as10, 1901, amending Ill. Laws, 1895, p. 301, signed as grounds of appeal: (1) That by does not abridge privileges or immunities of citizens of the United States or deny the reason of its organization and the purposes
of its organization, as shown by the record, equal protection of the laws.
it was exempt from such tax under the [No. 103.]
act of May 10, 1901, amending the act of
June 15, 1895. (2) For that the imposition Argued November 14, 1906. Decided Decem- of such tax upon it (the plaintiff in error), ber 24, 1906.
when corporations organized for like purIN N ERROR to the Supreme Court of the poses under the laws of the state were ex
State of Illinois to review a judgment empt therefrom, was in conflict with the which affirmed a judgment of the County Constitution of the state of Illinois, and renCourt of Cook County, in that state, im- dered said act void as to plaintiff in crror, posing an inheritance tax on property de- as in conflict with the 14th Amendment of vised to a foreign corporation for educa- the Constitution of the United States, in tional and religious purposes. Affirmed.
that it abridged the privileges and immuni. See same case below, 216 Ill. 23, 74 N. E. ties of plaintiff in error, who was a citizen 809.
of the United States, and denied to it the The facts are stated in the opinion. equal protection of the laws. The county
Messrs. Charles H. Aldrich, Henry S. Mc-court sustained the tax and the supreme Auley, and Lawrence Maxwell, Jr., for plain court affirmed the judgment. This writ tiff in error.
of error was then sued out. Messrs. Edwin M. Ashcraft and William The assignment of errors in this court, H. Stead for defendant in error.
omitting the specification of error based on
the Constitution of the state, is the same Mr. Justice McKenna delivered the opin- as that in the state courts. ion of the court:
It is enough for our purpose to say that This writ of error is directed to a judg- $ 1 of the act of 1895 subjects to a tax all ment of the supreme court of the state of property situated within the state, which Illinois sustaining a tax assessed against shall, by will or by the intetsate laws, pass
, plaintiff in error under the inheritance tax from any person who may die seised or law of that state, passed June 15, 1895, possessed of the same. The act was amend. entitled "An Act to Tax Gifts, Legacies, and ed in 1901 by adding thereto the following Inheritances in Certain Cases, and to Pro- section: vide for the Collection of the Same." Laws “When the beneficial interest of any propof 1895, p. 301.
erty or income therefrom shall pass to or for The facts are as follows: Fanny Speed, the use of any hospital, religious, educationa citizen and resident of Kentucky, died al, Bible, missionary, tract, scientific, benevseised of certain real estate in the city of olent, or charitable purpose, or to any Chicago. She devised a one-half interest trustee, bishop, or minister of any church to plaintiff in error, to be used as part of or religious denomination, held and used exits educational fund, "to be held, invested, clusively for the religious, educational, or and administered” as other properties form- charitable uses and purposes of such church ing a part of that fund. The will was pro- or religious denomination, institution, or bated in the probate court of Cook county, corporation, by grant, gift, bequest, or otherstate of Illinois. An inheritance tax of wise, the same shall not be subject to any $6,280.50 was assessed by the county judge such duty or tax; but this provision shall against plaintiff in error, based on the value not apply to any corporation which has the of the interest devised.
right to make dividends or distribute profits Plaintiff in error was incorporated by an or assets among its members." act of the legislature of the state of Kentuc- The supreme court decided that this ky to form an educational fund for the pro- amendment did not apply to "corporations motion of literature, education, art, moralcreated under the laws of a sister state." ity, and religion. Its funds are held and And also decided, as so construed, the used exclusively for such purposes, and are amendment was not repugnant to the Conrequired to be wholly expended within the stitution of the United States. The court state of Kentucky. It is not permitted to said: make dividends or distribution of profits or "A clear distinction exists between domesassets among its members or stockholders. tic corporations and corporations organized It does not have or maintain an office in under the laws of other states. the state of Illinois, or engage in education. porations fall naturally into their respective al or religious work therein.
classes. Over the one--that which the state
*Ed. Note.-For cases in point, soo vol. 10, Cent. Dig. Constitutional Law, 88.627, 685
has created—the state has certain powers of, cluded? The questions raise important concontrol; and the other is beyond its juris- siderations, but we may pass them, because diction. Those of its own creation have the contention that the act of 1901 is inbeen endowed with corporate powers for valid encounters an insuperable obstacle in the purpose of subserving the interests of the power of the state to classify objects the state and its people; those which have of legislation and discriminate between been given life by the laws of a sister state classes. This power is not unconstitutionalhave entirely different ends and objects to ly exercised by legislation which exempts accomplish. The lawmaking power would the religious and educational institutions of find many weighty considerations authoriz- the state from an inheritance tax and subing the classification of foreign and domestic jects educational and religious institutions corporations into different classes and justi- of other states to the tax. Regarding alone fying the creation of liability on the part of the purposes of the institutions, no differforeign corporations to pay a tax on the ence may be perceived between them, but reright to take property by descent, devise, or garding the spheres of their exercise, and bequest, under the laws of the state, and at the benefits derived from their exercise, a the same time leaving the right of a domes- difference is conspicuous. It is this benefit tic corporation so to take free of any such that may have constituted the inducement exaction.” [216 Ill. 28, 74 N. E. 811.] of the legislation.
It will be seen by a reference to the as- Plaintiff in error contests the classificasignment of errors that the ground of the tion of the act of 1901 and the conclusions attack by the plaintiff in error on the va deduced from it in an able argument. We lidity of the tax assessed against it is that do not reply to the argument in detail, bethe imposition of the tax upon it, while cause we have defined so often the princi. other corporations organized for like pur- ples of classification that we must regard poses under the laws of Illinois are exempt, repetition as unnecessary. An observation renders the act of May 10, 1901, void, as or two, however, may be worth while. It to plaintiff in error. And, in their argument, is contended that the exemption of the counsel say: "It is the effect given by the amendment of 1901 “is not limited by the supreme court of Illinois to this amendment decision of the supreme court to corporate (the act of 1901) that violates the rights takers or users,” and that the decision, by claimed by the plaintiff in error under the treating the act "as a grant of privileges Constitution of the United States.” The and immunities to corporations," ignored construction of the act by the supreme court "the test of use found in the inquiry 'To we must accept as determining the meaning what purpose is the beneficial interest in of the act. In other words, we must re- the property devoted ?!” and the consideragard the act as if the legislature had, in tion that there was no necessity for corpoexplicit language, excluded from its pro-rate agency in that connection. The result visions foreign corporations. If this ren of this is, it is urged, that the court made ders the act void, plaintiff in error, whether the power of state visitation and control” its argument be tenable or untenable, seems over corporations "the test of taxability or to be put in the dilemma urged by the de- nontaxability upon the right of succession." fendant in error, and an affirmance of the Denying this to be the test, and contending judgment is required. If the act of May 10, that the test should be the use to which 1901, is invalid, it cannot give exemption the property is devoted, and the question from taxation to either domestic or foreign of tax or freedom from tax determined corporations, and plaintiff in error was right thereby, and asserting that plaintiff became ly taxed under the act of June 15, 1895. a person within the jurisdiction of the Plaintiff in error, of course, does not desire state by going there to take title to propto take exemption from domestic corpora- erty there situated, and by probating the tions. It desires to remove the discrimina- will of Mrs. Speed as evidence of such title, tory effect of the amendment of May 10, it is deduced that it was not competent for 1901, by including in its bounty foreign cor- the state to tax the property of plaintiff in porations. Can this be done? May a court error at one rate and the property of corpoby construction put into a law that which rations, organized under her laws, at anoththe legislature has left out? There is a er rate. difference
between burdens and benefits, It must be kept in mind that the controand it may well be that a law which con- versies in this case depend upon the power fers the latter upon some persons, and of the state over inheritances, and the conthereby increases burdens on others, may be ditions she may put upon them in the everdeclared invalid by the courts. But if the cise of that power. And this is prominent courts may strike down privileges, may in the decision of the supreme court. In they extend favors and make objects of considering this power, and classification bounty those whom the legislature has ex-l in the exercise of this power, the court took
into account the greater control and direc- rendering such statute void as making an tion the state had over domestic than over arbitrary classification which amounts to a foreign corporations. It did not put out of denial of the equal protection of the laws, view the uses of property expressed in the where the highest state court makes the act of 1901, nor ignore the consideration fication by deciding that the state can tax
validity of the tax depend upon this classithat there was no necessity for a corporate the property until it has passed out of the agency to execute those uses. The case succession of the testator. presented especially a comparison of the rights of corporations, but the decision was
[No. 91.] broad enough to consider natural persons. “In laying such a tax” (an inheritance tax), Argued November 9, 1906. Decided Decemthe court said, “the legislature may con
ber 24, 1906. sider the relation which the person or corporation given the right of succession sus-TN ERROR to the Supreme Court of the tains to the deceased, to the property, or
State of Louisiana to review a judgment to the state, and may regulate the amount which affirmed a judgment of the Civil Disof the tax to be required in view of such trict Court for the Parish of Orleans, in relation, and in exercising this power may that state, imposing an inheritance tax. lay a tax on the right of one class of persons Affirmed. or corporations to take, and may deem it
See same case below, 115 La. 377, 39 So. wise to impose no tax upon the right of 37. other classes of persons or corporations to The facts are stated in the opinion. take.” A Federal court would hesitate in
Messrs. Charles Rosen and Gustave Lemle deed to put impediments on this power or for plaintiffs in error.' declare invalid any classification of persons Mr. F. C. Zacharie for defendants in error. or corporations that had reasonable regard to the purposes of the state and its legisla- Mr. Justice McKenna delivered the opintion. And it cannot be said that if a state ion of the court: exempt property bequeathed for charitable
The case involves the validity, under the or educational purposes from taxation it is constitution of the United States, of a burunreasonable or arbitrary to require the den imposed under the inheritance tax law charity to be exercised or the education to of the state of Louisiana, passed June 28,. be bestowed within her borders and for her 1904. people, whether exercised through persons Mathias Levy, a resident of New Orleans, or corporations.
died in that city May 26, 1904. He was unJudgment affirmed.
married and left no ascendants, and was, therefore, without forced heirs. He left a last will and testament of the date of
December 23, 1903, in which he named execMRS. CAMILLE CAHEN, Mrs. Julie Kahn, utors and made sundry particular bequests Eva Cahen, et al., Piffs. in Err.,
to charitable institutions. He bequeathed
the balance of his estate, in equal shares, to JOHN BREWSTER, Tax Collector for the his two nieces, Camille Cahen and Julie
Second District of the City of New Or- Kahn, constituting them thereby his unileans, State of Louisiana, and Andrew H.versal legatees and instituted heirs. Wilson, President School Board of the
The will was duly probated in the civil City of New Orleans, State of Louisiana. district court for the parish of Orleans, May
30, 1904. An inventory of his estate was Constitutional law-due process of law-taken June 9, 1904, and a supplementary instate inheritance tax.
ventory August 3, 1904. The inventories 1. Universal legatees under the will of a person who died before the enactment of the showed the total appraised value of the esLouisiana inheritance tax law of June 28. tate to be $64,676.05. Of this amount, after 1904, are not deprived of their property deducting the debts and charges of the eswithout due process of law by subjecting tate and particular legacies, there was left, their shares to the tax imposed by that as the portion going to the universal legastatute, although, under the Louisiana Civil tees, $42,927.94. Code, the ownership of the property passed
The final accounting and tableau of disto such legatees upon the death of the testribution was filed August 3, 1904, and aptator. Constitutional law-equal protection of the must 16, and the funds ordered to be dis
proved and homologated by judgment Aulaws-state inheritance tax.
tributed. 2. Successions which have been finally closed and administered upon may be ex
October 16 a motion was made for a rule empted from the inheritance tax imposed by on the executors to show cause why they the Louisiana act of June 28, 1904, without should not pay over the legacies as ordered.