Argument for Ratterman.

because it was interstate commerce, and the State could lay no tax upon it."

In the case of the Telegraph Co. v. Texas, 105 U. S., on page 465, the court say: "The present case, as it seems to us, comes within this principle. The tax is the same on every message sent, and because it is sent, without regard to the distance carried or the price charged. It is in no respect proportioned according to the business done. If the message is sent, the tax must be paid, and the amount determined solely by the class to which it belongs. If it is full rate, the tax is one cent, and if less than full rate, one half cent. Clearly, if a fixed tax for every two thousand pounds of freight carried is a tax on the freight, or for every measured ton of a vessel a tax on tonnage, or for every passenger carried a tax on the passenger, or for the sale of goods a tax on the goods, this must be a tax on the messages. As such, so far as it operates on private messages sent out of the State, it is a regulation of foreign and interstate commerce, and beyond the power of the State. That is fully established by the cases already cited. As to the government messages, it is a tax by the State on the means employed by the government of the United States to execute its constitutional powers, and therefore void. It was so decided in M'Culloch v. Maryland, 4 Wheat. 316, and has never been doubted since. It follows that the judgment, so far as it includes the tax on messages sent out of the State, or for the government, on public business, is erroneous."

In that case a judgment was rendered by the state court against the telegraph company for the tax on the messages within the State, and for the messages which were wholly interstate commerce. And this court held that, so far as the judgment included the tax on messages sent out of the State, or for the government, it was erroneous, and reversed the judgment, and remanded the case for proceedings in accordance with the opinion. In the case at bar the court's attention is called to what constituted the sum of $5206.90, which was the amount of the tax sought to be enjoined by the bill of the telegraph company. A part of that sum consisted of

Argument for Ratterman.

the tax levied on the personal property, the wires, batteries. and poles of the company within the county of Hamilton. The remainder of the tax was what was assessed, as we claim, on the moneys received from the business, and treated as other personal property for taxation. There was no practical difficulty in the way of separation. There was no such intermingling of the receipts as made it impossible to separate the one class from the other. They were in fact separated by the court below. And yet it is claimed, though the separation is practicable, and has been made by the court below, though the amount can be ascertained to a cent of what was received from each class of business, yet the telegraph company has a right to perpetually enjoin, and thereby be released from the tax on the whole gross receipts, notwithstanding the admitted fact that the State may tax the gross receipts for the business done within the State. We know of no rule of construction of a statute that authorizes the holding of the whole tax invalid, because it was levied on property a part of which it is claimed the State had no right to tax. It will be remembered by this court that the tax laid on railway gross receipts, held to be valid in 15 Wall. included the receipts of both classes, and that in that case, as in the case of Fargo v. Michigan, 121 U. S., the receipts were separated, although the law in one of the cases was general in its terms, as in the case at bar.

The rule applicable to the granting of relief by way of injunction, which was what was sought in the case at bar, is to be found in the case of Frazer v. Seibern, 16 Ohio St. 614. In that case, on page 624, the court say, after finding that the act itself, to the extent that it taxed banks in excess of the taxation levied on the state banks, was unconstitutional : "It by no means follows, however, that the plaintiffs are entitled to an unconditional injunction against the collection of the tax. They ask equity, and must do equity. They invoke the exercise of an extraordinary power of the court for their relief, and the court, in its discretion, should refuse that relief, except upon conditions that are equitable and just. We think, therefore, that the injunction should only be granted upon the condition that the plaintiffs, or their bank, shall first pay

Opinion of the Court.

to the treasurer of Hamilton County a sum that will be a pro rata equivalent for the tax imposed upon the State and independent banks under the act of 1861; that is to say, such sum as might lawfully have been assessed upon the plaintiffs, or their bank, under said act, had it been one of said state banks. If the parties cannot agree upon this sum, proceedings can be adopted to ascertain it by the court; and, if found necessary, the bank itself can be made a party."

We submit, therefore, that should this court hold the law of the State of Ohio unconstitutional, it can only do so to the extent that it taxes the moneys received from the interstate commerce business of the Western Union Telegraph Company.

MR. JUSTICE MILLER, after stating the case, delivered the opinion of the court,

The case has been fully argued before us upon all the matters properly presented by the record, and it seems probable from the amicable nature of the proceedings and the agreement as to a statement of facts upon which the case was to be tried, without any answer being filed to the bill, that the purpose was to obtain the judgment of this court upon the general subject of the liability of the corporation to taxation upon the amount of its receipts, and that the certificate of a difference of opinion has been used for that purpose.

With regard to the question which is certified to us as dividing the opinions of the judges of the Circuit Court, we do not think that there is any difficulty, and can hardly see how it arose in the present case. That question is "whether a single tax, assessed under the Revised Statutes of Ohio, § 2778, upon the receipts of a telegraph company, which receipts were derived partly from interstate commerce and partly from commerce within the State, but which were returned and assessed in gross and without separation or apportionment, is wholly invalid, or invalid only in the proportion and to the extent that said receipts were derived from interstate commerce." We do not think this particular question is material in

Opinion of the Court.

this case, because the state of facts agreed upon by the parties makes this separation and presents the matter to the court, freed from the point raised by the question that the tax was not separable. Nor do we believe, if there were allegations either in the bill or answer setting up that part of the tax was from interstate commerce and part from commerce wholly within the State, that there would have been any difficulty in securing the evidence of the amount of receipts chargeable to these separate classes of telegrams, by means of the appointment of a referee or master to inquire into that fact and make report to the court. Neither are we of opinion that there is any real question, under the decisions of this court, in regard to holding that, so far as this tax was levied upon receipts properly appurtenant to interstate commerce, it was void, and that so far as it was only upon commerce wholly within the State it was valid.

This precise question was adjudged in the case of The State Freight Tax, 15 Wall. 232. That was a case in which a statute of the State of Pennsylvania was examined which provided for a tax upon every ton of freight transported by any railroad or canal in that State at certain rates, two cents for one class of freight, three cents for another, and five cents for still another class. The payment of this tax was resisted by the Reading Railroad Company upon the ground that it was levied on interstate commerce. The company made returns to the accounting officers of the commonwealth, in which they stated separately the amount of freight whose transportation was wholly within the State, and also the amount of the transportation of freight brought into or carried out of that State. This court held that the tax upon the former class, being upon commerce wholly within the State, was valid under the law of Pennsylvania by which it was imposed, but that the latter classes, being commerce among the States, were not subject to such taxation.

This ruling shows that where the subjects of taxation can be separated so that that which arises from interstate commerce can be distinguished from that which arises from commerce wholly within the State, the court will act upon this distinc

Opinion of the Court.

tion, and will restrain the tax on interstate commerce while permitting the State to collect that arising upon commerce solely within its own territory.

In Pensacola Telegraph Company v. Western Union Telegraph Company, 96 U. S. 1, it was decided by this court that the telegraph was an instrument of commerce; that telegraph companies were subject to the regulating power of Congress in respect to their foreign and interstate business, and that such a company occupies the same relation to commerce, as a carrier of messages, that a railroad company does as a carrier of goods.

In Telegraph Company v. Texas, 105 U. S. 460, the same question presented in this case was before the court, that of the power of the State to tax telegraphic messages received and delivered by the same corporation which is now before us. In that case no distinction was made by the statute between what we now call interstate messages and those exclusively within the State. This court, therefore, in reviewing the decision of the Supreme Court of the State of Texas, which had allowed no deduction for taxes on messages sent out of the State, or by government officers on government business, said: "It follows that the judgment, so far as it includes the tax on messages sent out of the State, or for the government on public business, is erroneous. The rule that the regulation of commerce which is confined exclusively within the jurisdiction and territory of a State, and does not affect other nations or States or the Indian tribes, that is to say, the purely internal commerce of a State, belongs exclusively to the State, is as well settled as that the regulation of commerce which does affect other nations or States or the Indian tribes belongs to Congress. Any tax, therefore, which the State may put on messages sent by private parties, and not by the agents of the government of the United States, from one place to another, exclusively within its own jurisdiction, will not be repugnant to the Constitution of the United States. Whether the law of Texas, in its present form, can be used to enforce the collection of such a tax is a question entirely within the jurisdiction of the courts of the State, and as to which we have no power of review."