223 U.S. 280 (1912), 162, Atchison, Topeka & Santa Fe Railway Company v. O'Connor

Docket NºNo. 162
Citation223 U.S. 280, 32 S.Ct. 216, 56 L.Ed. 436
Party NameAtchison, Topeka & Santa Fe Railway Company v. O'Connor
Case DateFebruary 19, 1912
CourtUnited States Supreme Court

Page 280

223 U.S. 280 (1912)

32 S.Ct. 216, 56 L.Ed. 436

Atchison, Topeka & Santa Fe Railway Company



No. 162

United States Supreme Court

February 19, 1912

Argued January 24, 25, 1912




One denying the legality of a tax should have a clear and certain remedy, and where he cannot interfere by injunction, an action to recover back is the alternative unless he waits until the state commences an action and subjects himself to penalties and risks.

Courts have been too slow to recognize implied duress, in payment of taxes, where payment thereof would result disadvantageously.

Where, in addition to money penalties for delay in payment of a tax, there is forfeiture of right to do business and risk of having contracts declared illegal in case of nonpayment of disputed tax, the payment is made under duress.

Where a state officer receives money for a tax paid under duress with notice of its illegality, he has no right thereto, and the name of the state does not protect him from suit.

Where a state statute provides for refunding taxes erroneously paid to a state officer, it contemplates a suit against such officer to recover the taxes paid under protest and duress.

The facts, which involve the right to recover payments for taxes paid under duress and what constitutes duress, are stated in the opinion.

Page 285

HOLMES, J., lead opinion

MR. JUSTICE HOLMES delivered the opinion of the Court.

This is an action to recover taxes paid under duress and protest, the plaintiff contending that the law under which the tax was levied is unconstitutional. A demurrer to the declaration was sustained by the circuit court. The tax is a tax of two cents upon each one thousand dollars of the plaintiff's capital stock. Session Laws of Colorado, 1907, c. 211. The plaintiff is a Kansas corporation. The greater part of its property and business is outside of the State of Colorado, and of the business done within that state but a small proportion is local, the greater part being commerce among the states. Therefore it is obvious that the tax is of the kind decided by this Court to be unconstitutional, since the decision below in the present case, even if the temporary forfeiture of the right to do business declared by the statute be confined by construction, as it seems to have been below, to business wholly within the state. Western Union Telegraph Co. v. Kansas, 216 U.S. 1; Pullman Co. v. Kansas, 216 U.S. 56; Ludwig v. Western Union Telegraph Co., 216 U.S. 146. The defendant did not argue that the tax could be maintained, but contended only that the payment was voluntary, and that the defendant is not the proper person to be sued.

It is reasonable that a man who denies the legality of a tax should have a clear and certain...

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