Washington University v. Gorman

• Decision Date: 12 June 1941
• Docket Number: 37435
• Citation: 153 S.W.2d 35,348 Mo. 310
• Parties: The Washington University v. H. J. Gorman, City Treasurer of Kansas City, and Frank McCabe, City Assessor of Kansas City, Appellants
• Court: Missouri Supreme Court

153 S.W.2d 35

348 Mo. 310

The Washington University v. H. J. Gorman, City Treasurer of Kansas City, and Frank McCabe, City Assessor of Kansas City, Appellants

No. 37435

Supreme Court of Missouri

June 12, 1941

Rehearing Denied July 25, 1941.

Appeal from Jackson Circuit Court; Hon. Paul A. Buzard Judge.

Affirmed.

William E. Kemp, Roy B. Cunningham, Elmo B. Hunter and Jerry T. Duggan for appellants.

(1) Since the decision of the United States Supreme Court in the case of Erie Railroad Co. v. Tompkins, 304 U.S. 64 the determination of the validity of the tax exemption claimed by the plaintiff and of the effect of the provision which purports to grant this exemption is a matter within the exclusive province of the State court. Erie Railroad Co. v. Tompkins, 304 U.S. 64; Washington University v. Rowse, 42 Mo. 308; Chicago Theological Seminary v. Illinois, 188 U.S. 662; Millsaps College v. City of Jackson, 275 U.S. 129; Ruhlin v. New York Life Ins. Co., 304 U.S. 202; Phillips Exeter Academy v. Exeter, 11 A.2d 569. (2) The charter of the plaintiff did not have the effect of imposing contractual obligations. It was at most a grant of privileges which could be withdrawn by the Legislature or by the people of the State. Washington University v. Rowse, 42 Mo. 308; City of St. Joseph v. Hannibal & St. Jo. Railroad Co., 39 Mo. 476; Phillips Exeter Academy v. Exeter, 11 A.2d 569; Washington University v. Rowse, 75 U.S. 439, 19 L.Ed. 498. (3) It was not within the power of the Legislature to grant a perpetual exemption from taxation. Washington University v. Rowse, 42 Mo. 308; Providence Bank v. Billings, 4 Peters, 514; Phillips Exeter Academy v. Exeter, 11 A.2d 569; Washington University v. Rowse, 75 U.S. 439, 19 L.Ed. 498. (4) The charter of the plaintiff was granted subject to the reserved right of the people of Missouri to change the State Constitution and subject also to the right of the Legislature to alter, suspend or repeal corporate charters. Sec. 2, Art. XIII, Mo. Const., 1820; Sec. 7, Art. I, Ch. 34, R. S. 1845; Swabey v. Boyers, 274 Mo. 332, 203 S.W. 204; Bowers v. K. C. Pub. Serv. Co., 328 Mo. 770, 41 S.W.2d 810; Washington University v. Rowse, 42 Mo. 308. (5) The property involved in this action is subject to taxation by Kansas City, Missouri, not only by virtue of Section 25 of Article IV of the Constitution of the State of Missouri of 1865 and the act of the General Assembly of the State of Missouri enacted pursuant to this constitutional provision and providing for the taxation of all property belonging to eleemosynary corporations not included within the Constitution exemptions of 1865; but also by virtue of Sections 6 and 7 of Article X of the Constitution of the State of Missouri of 1875 and Sections 9742 and 9743 of the Revised Statutes 1929, which said sections were originally enacted in their present form in 1879, all of which provisions were in full force and effect at the time of the acquisition by the plaintiff of the property here involved. Washington University v. Rowse, 42 Mo. 308; Sec. 25, Art. IV, Mo. Const., 1865; General Revenue Act, Laws 1866; Secs. 6, 7, Art. X, Mo. Const., 1875; State ex rel. Ziegenhein v. Mission Free School, 162 Mo. 332, 62 S.W. 998; State ex rel. Waller v. Trustees of William Jewell College, 234 Mo. 299, 136 S.W. 397; Squaw Creek Drainage Dist. No. 1 v. Turney, 235 Mo. 80, 138 S.W. 12; State ex rel. Morgan v. Hemenway, 272 Mo. 187, 198 S.W. 825; Willhite v. Rathburn, 332 Mo. 1208, 61 S.W.2d 708; State ex rel. McKittrick v. Bair, 333 Mo. 1, 63 S.W.2d 64; People ex rel. Eitel v. Lindheimer, 21 N.E.2d 318; Washington University v. Rowse, 75 U.S. 439; Northern Central Ry. Co. v. Maryland, 187 U.S. 258; Secs. 9742, 9743, R. S. 1929. (6) The exemption claimed by the plaintiff should not be extended beyond the express terms of the grant. Washington University v. Baumann, 108 S.W.2d 403; Washington University v. Rowse, 42 Mo. 308; City of St. Joseph v. Hannibal & St. Jo. Railroad Co., 39 Mo. 476.

R. B. Caldwell, Richard S. Bull, H. M. Noble and John W. Oliver for respondent.

(1) Erie Railroad Company v. Tompkins, 304 U.S. 64, 82 L.Ed. 1188, has no effect or bearing upon the determination of the validity of the respondent's tax exemption, nor is this question within the exclusive province of the State court. Erie Railroad Co. v. Tompkins, 304 U.S. 64, 82 L.Ed. 1188; Washington University v. Rowse, 8 Wall. 439, 19 L.Ed. 498; Washington University v. Baumann, 341 Mo. 708, 108 S.W.2d 403; Swift v. Tyson, 16 Peters, 1, 10 L.Ed. 865; Judiciary Act of 1789 (28 U.S.C. A. 725); U.S. Const., Art. VI; U.S. Const., Art. III, Secs. 1, 2; Cohens v. Virginia, 6 Wheat. 264, 5 L.Ed. 257; Ableman v. Booth, 21 How. 506, 16 L.Ed. 169; Const., Art. I, Sec. 10; Trustees of Dartmouth College v. Woodward, 4 Wheat. 518, 4 L.Ed. 629; United States v. Muscatine, 8 Wall. 575, 19 L.Ed. 490; Gelpcke v. Dubuque, 1 Wall. 175, 17 L.Ed. 520; Bridge Proprietors v. Hoboken Land & Improvement Co., 1 Wall. 116, 17 L.Ed. 571; Jefferson Branch Bank v. Skelly, 1 Black, 436, 17 L.Ed. 173; Delmas v. Merchant Ins. Co., 14 Wall. 661, 20 L.Ed. 757; Northwestern University v. People, 9 Otto, 309, 25 L.Ed. 387; Lane v. Vick, 3 How. 464, 11 L.Ed. 681; Williamson v. Berry, 8 How. 495, 12 L.Ed. 1170; Ohio Life Ins. Co. v. Debolt, 16 How. 415, 14 L.Ed. 997; Kuhn v. Fairmount Coal Co., 215 U.S. 349, 54 L.Ed. 228; Taxi Cab Co., 276 U.S. 518, 72 L.Ed. 681; Rogers v. Alabama, 192 U.S. 226, 48 L.Ed. 417; Tampa Waterworks Co. v. Tampa, 199 U.S. 241, 50 L.Ed. 170; Fisher v. New Orleans, 218 U.S. 438, 54 F. 1099; Detroit United Ry. Co. v. Michigan, 242 U.S. 238, 61 L.Ed. 268; Milwaukee Electric Ry. & L. Co. v. Wisconsin, 252 U.S. 100, 64 L.Ed. 476; Appleby v. New York, 271 U.S. 364, 70 L.Ed. 992; Coombs v. Getz, 285 U.S. 434, 76 L.Ed. 866; Phelps v. Board of Education, 300 U.S. 319, 81 L.Ed. 674; Hale v. Iowa State Board of Assessment & Review, 302 U.S. 95, 82 L.Ed. 72; Indiana ex rel. Anderson v. Brand, 303 U.S. 95, 82 L.Ed. 685; New York Rapid Transit Corp. v. New York, 303 U.S. 573, 82 L.Ed. 1024; Higginbotham v. Baton Rouge, 306 U.S. 530, 83 L.Ed. 968; American Toll Bridge Co. v. Railroad Comm. of California, 307 U.S. 486, 83 L.Ed. 1414; Chicago Theological Seminary v. Illinois, 188 U.S. 62; Washington University v. Baumann, 341 Mo. 708, 108 S.W.2d 403. (2) The charter of the respondent imposed contractual obligations and was not a mere grant of privileges withdrawable by the Legislature or by the people of the State. Home of the Friendless v. Rowse, 8 Wall. 430, 19 L.Ed. 495; Washington University v. Baumann, 341 Mo. 708, 108 S.W.2d 403. (3) The Legislature had power to and did grant a perpetual exemption from taxation. Home of the Friendless v. Rowse, 8 Wall. 430, 19 L.Ed. 495; Providence Bank v. Billings, 4 Pet. 514; Washington University v. Baumann, 341 Mo. 708, 108 S.W.2d 403. (4) When the Legislature granted respondent's charter, it did not reserve the right to the Legislature to alter, nor did it reserve to the people the right to change the Constitution and thereby alter the charter. (5) Neither the provision relating to taxes in the Constitution of 1865, nor in the Constitution of 1875, nor Sections 9742 and 9743, Revised Statutes 1929, have any force or effect insofar as respondent's charter granting tax exemption is concerned, even as to property acquired since the adoption of those constitutional and statutory provisions respectively. Home of the Friendless v. Rowse, 8 Wall. 430, 19 L.Ed. 495; Washington University v. Baumann, 341 Mo. 708, 108 S.W.2d 403. (6) The exemption claimed is within the express terms of the grant. Home of the Friendless v. Rowse, 8 Wall. 430, 19 L.Ed. 495. (7) All questions involved in this suit have become res judicata. Stoll v. Gottlieb, 305 U.S. 165, 83 L.Ed. 104; Gibson v. Chouteau, 76 Mo. 38; State v. Bliss, 99 S.W.2d 71; Kansas City Exposition Driving Park v. Kansas City, 174 Mo. 425, 74 S.W. 979; North St. Louis Gymnastic Society v. Hagerman, 232 Mo. 693, 135 S.W. 42; Gymnastic Society v. Hudson, 85 Mo. 32; State ex rel. Blair v. Center Creek Mining Co., 264 Mo. 190, 171 S.W. 356; St. Louis v. United Rys. Co. of St. Louis, 263 Mo. 387, 174 S.W. 78; Washington University v. Rowse, 8 Wall. 439, 19 L.Ed. 498; Washington University v. Baumann, 341 Mo. 708, 108 S.W.2d 403; Ex parte Siemens v. Shreve, 317 Mo. 736, 296 S.W. 416; Kansas City v. Threshing Machinery Co., 337 Mo. 913, 87 S.W.2d 195; State ex rel. Emerson v. Mound City, 335 Mo. 702, 73 S.W.2d 1017; Harrison v. Jackson County, 187 S.W. 1183; State ex rel. Harrison v. Patterson, 152 Mo.App. 264, 132 S.W. 1183.

OPINION

Douglas, J.

This suit was brought to enjoin the treasurer and the assessor of Kansas City from levying and collecting certain real estate taxes on property in that city owned by Washington University of St. Louis under a charter exempting all its property from taxes.

The University's petition alleges that it was incorporated by an Act of the General Assembly on February 22, 1853, as the Eliot Seminary. That Act provided that the incorporators "are hereby constituted a body corporate and politic by the name of 'The Eliot Seminary' and by that name shall have perpetual succession and be capable of taking and holding by gift, grant, devise or otherwise, and conveying leasing or otherwise disposing of any real estate real, personal or mixed, annuities, endowments, franchises and other hereditaments which may conduce to the support of said Seminary, or to the promotion of its objects; all property of said corporation shall be exempt from taxation and the sixth, seventh and eighth sections of the first articles of the Act concerning corporations, approved March 19, 1845, shall not apply to this corporation." The seventh section of the Act...