Chicago Great Western Ry Co v. Kendall Chicago Ry Co v. Same, s. 22

• Decision Date: 17 November 1924
• Docket Number: Nos. 22,23,s. 22
• Parties: CHICAGO GREAT WESTERN RY. CO. v. KENDALL, Governor of lowa, et al. CHICAGO, R. I. & P. RY. CO. v. SAME
• Court: U.S. Supreme Court

266 U.S. 94

45 S.Ct. 55

69 L.Ed. 183

CHICAGO GREAT WESTERN RY. CO.

v KENDALL, Governor of lowa, et al.

CHICAGO, R. I. & P. RY. CO.

v. SAME.

Nos. 22, 23.

Argued Oct. 7, 1924.

Decided Nov. 17, 1924.

Messrs. Donald Evans, of Des Moines, Iowa, and Thos. P. Littlepage, of Washington, D. C., for appellant Chicago Great Western Ry. Co.

Messrs. J. G. Gamble, of Des Moines, Iowa, and Thos. P. Littlepage, of Washington, D. C., for appellant Chicago, R. I. & P. Ry. Co.

Mr. Ben J. Gibson, of Des Moines, Iowa, for appellees.

Mr. Chief Justice TAFT delivered the opinion of the Court.

These two bills in equity, one by the Chicago Great Western Railway Company, a corporation of Illinois, and the other by the Chicago, Rock Island & Pacific Railway Company, a corporation of Illinois and Iowa, were brought against the Governor, the Secretary of State, the Auditor, and the Treasurer of Iowa, and another, constituting the Executive Council of the state, to enjoin the assessments for taxation of the railway properties of the complainants in Iowa as fixed by the Council. The injunction was sought on the ground that although under the laws and Constitution of Iowa, all property, real and personal, including railways must be assessed at its actual value, there was an intentional discrimination by the Executive Council against complainants, in that farm lands in the state were assessed at slightly over 38 per cent. of their actual value, while the railway of the Great Western Railway Company in the state was intentionally assessed at 111.5 per cent. of its actual value, and that of the Rock Island at 75 per cent. There were averments that the amounts involved in the cases were more than $3,000 in each. It was charged that such action was a denial to the railroad companies of the equal protection of the laws, in violation of the Fourteenth Amendment. The complainants asserted their right to relief in equity by injunction, because if the Executive Council certified their assessments and distributed them to all the counties through which the railways ran, it would entail on the companies a multiplicity of suits to vindicate their constitutional rights. Complainants moved for temporary injunctions under section 266 of the Judicial Code (Comp. St. § 1243). The court, consisting of a circuit judge and two district judges, on the evidence adduced found that it did not disclose intentional discrimination by the state taxing tribunals, and denied the motions. Appeal was taken in both cases to this court under section 266, and a continuance of the restraining orders originally granted on the filing of the bill was asked pending a hearing of the appeal. This was resisted, but was finally allowed to the extent of enjoining upon a proper bond the Executive Council from certifying for collection, to the taxing officials of the counties through which the railways ran, assessments more than 92 per cent. in value of the assessments the subject of complaint. When these causes were called for hearing in this court, application was made for a continuance, on the plea that since November, 1922, when this appeal was allowed, the issue on the complete pleadings in the District Court had been referred to a master who had found that there was intentional discrimination, and an early final hearing on the merits was probable. It was suggested that this court would save time by awaiting the coming of a second appeal on the merits. The counsel for the state resisted continuance and insisted that the state was embarrassed by withholding taxes due it and that it should not be delayed longer. Considering the fact that the railroad companies had succeeded in stopping the state from collecting part of the taxes for now more than two years in the face of a full preliminary hearing and adverse ruling by three judges, and nothing the evident purpose of Congress in the enactment of section 266 to prevent undue delay in enforcing state legislation and action through federal judicial intervention, this court has denied this request for a continuance and has heard the case.

In the cases before us, we are relieved from considering and deciding the alleged infringement of the federal Constitution because in view of the basis for jurisdiction of the District Court, the cases can be disposed of as a question of state law.

Jurisdiction of the bill in the Great Western Case exists because of the diverse citizenship of the parties. The District Court therefore has jurisdiction to enforce the rights of the complainant under the state Constitution and laws and prevent their violation.

Jurisdiction of the bill in the Rock Island Case depends on the averment that the attempted assessment of complainant's railroad property in Iowa complained of was at a rate and upon a basis greater than the assessment of other property of the same class subjected to taxation in Iowa, and that the suit arises under the Fourteenth Amendment of the federal Constitution forbidding any state to deprive any person of his property without due process of law or to deny him the equal protection of the laws. We think this averment in view of the allegations of the bill invoked a substantial controversy under the federal Constitution and gave the District Court jurisdiction. Its jurisdiction thus established gave the District Court the authority to determine all questions involved including questions of state law, irrespective of the disposition of the federal question, and as the relied to which the complainant might be entitled would be the same as that which should be allowed him by the federal court upon a construction of the state Constitution and laws such as he contends for, the question whether the acts complained of violated the federal Constitution need not be decided. Greene v. Louisville & Interurban R. Co., 244 U. S....