Chicago, B. & QR Co. v. Babcock

• Decision Date: 25 February 1907
• Docket Number: 341.,No. 215,215
• Parties: CHICAGO, BURLINGTON & QUINCY RAILWAY COMPANY v. BABCOCK, TREASURER OF ADAMS COUNTY, NEBRASKA. UNION PACIFIC RAILROAD COMPANY v. FINK, TREASURER OF DOUGLAS COUNTY, NEBRASKA.
• Court: U.S. Supreme Court

204 U.S. 585

CHICAGO, BURLINGTON & QUINCY RAILWAY COMPANY v. BABCOCK, TREASURER OF ADAMS COUNTY, NEBRASKA.

UNION PACIFIC RAILROAD COMPANY v. FINK, TREASURER OF DOUGLAS COUNTY, NEBRASKA.

Nos. 215, 341.

Supreme Court of United States.

Argued January 21, 22, 1907.

Decided February 25, 1907.

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APPEALS FROM THE CIRCUIT COURT OF THE UNITED STATES FOR THE DISTRICT OF NEBRASKA.

Mr. Charles J. Greene, with whom Mr. James E. Kelby and Mr. Charles F. Manderson were on the brief, for appellant, Chicago, Burlington & Quincy Railway Company.

Mr. John N. Baldwin and Mr. Maxwell Evarts, with whom Mr. Robert S. Lovett was on the brief, for appellant, Union Pacific Railway Company.

Mr. William T. Thompson, Attorney General of the State of Nebraska, and Mr. Norris Brown, with whom Mr. M.F. Stanley was on the brief, for appellee.

MR. JUSTICE HOLMES delivered the opinion of the court.

These are bills to declare void assessments of taxes made by the State Board of Equalization and Assessment for the year 1904, and to enjoin the collection of the same beyond certain sums tendered. The bills allege that the Board, coerced by political clamor and its fears, arbitrarily determined in advance to add about nineteen million dollars to the assessment of railroad property for the previous year, and then pretended to fix the values of the several roads by calculation. They allege that the assessments were fraudulent, and void for want of jurisdiction, and justify these general allegations by more specific statements. One is that other property in the State, especially land, was valued at a lower rate than that of the railroads. Another, of more importance, is to the effect that the Board adopted a valuation by stock and bonds and then taxed the appellants upon the proportion of the value so reached that their mileage within the State bore to their total mileage, without deducting a large amount of personal property owned outside the State, or specially valuable terminals, etc., east of the Missouri River. The principle of this last objection was sanctioned in Fargo v. Hart, 193 U.S. 490, under the commerce clause of the Constitution, Art. I, Section 8, but later cases have decided that tangible property permanently outside the jurisdiction is exempted from taxation by the Fourteenth Amendment, Delaware, Lackawanna & Western R.R. v. Pennsylvania, 198 U.S. 341; Union Refrigerator Transit Co. v. Kentucky, 199 U.S. 194, and the Fourteenth Amendment alone, somewhat inadequately referred to, is the foundation of these appeals. Demurrers to the bills were overruled, mainly, if not wholly, on the ground of the charges of duress and fraud. Answers then were filed denying the material allegations and after a hearing on evidence the bills were dismissed.

The dominant purport of the bills is to charge political duress, so to speak, and a consequent scheme of fraud, illustrated by the specific wrongs alleged, and in that way to make out that the taxes were void. As the cases come from the Circuit Court, other questions beside that under the Constitution are open, and, therefore, it is proper to state at the outset that the foundation for the bills has failed. The suggestion of political duress is adhered to in one of the printed briefs, but is disposed of by the finding of the trial judge, which there is no sufficient reason to disturb. The charge of fraud, even if adequately alleged, Missouri v. Dockery, 191 U.S. 165, 170, was very slightly pressed at the argument, and totally fails on the facts. Such charges are easily made and, it is to be feared, often are made without appreciation of the responsibility incurred in making them. Before the decree could be reversed it would be necessary to consider seriously whether the constitutional question on which the appeals are based was not so pleaded as part of the alleged fraudulent scheme that it ought not to be considered unless that scheme was made out. Eyre v. Potter, 15 How. 42, 56; French v. Shoemaker, 14 Wall. 314, 335; Hickson v. Lombard, L.R. 1 H.L. 324.

When we turn to the evidence there is equal ground for criticism. The members of the Board were called, including the Governor of the State, and submitted to an elaborate cross-examination with regard to the operation of their minds in valuing and taxing the roads. This was wholly improper. In this respect the case does not differ from that of a jury or an umpire, if we assume that the members of the Board were not entitled to the possibly higher immunities of a judge. Duke of Buccleuch v. Metropolitan Board of Works, L.R. 5 H.L. 418, 433. Jurymen cannot be called, even on a motion for a new trial in the same case, to testify to the motives and influences that led to their verdict. Mattox v. United States, 146 U.S. 140. So, as to arbitrators. Duke of Buccleuch v. Metropolitan Board of Works, L.R. 5 H.L. 418, 457, 462. Similar reasoning was applied to a judge in Fayerweather v. Ritch, 195 U.S. 276, 306, 307. A multitude of cases will be found collected in 4 Wigmore, Evidence, §§ 2348, 2349. All the often repeated reasons for the rule as to jurymen apply with redoubled force to the attempt, by exhibiting on cross-examination the confusion of the members' minds, to attack in another proceeding the judgment of a lay tribunal, which is intended, so far as may be, to be final, notwithstanding mistakes of fact or law. See Coulter v. Louisville & Nashville R.R. Co., 196 U.S. 599, 610; Central Pacific R.R. Co. v. California, 162 U.S. 91, 107, 108, 117; S.C., 105 California, 576, 594; State Railroad Tax cases, 92 U.S. 575; Cleveland, Cincinnati, Chicago & St. Louis Ry. Co. v. Backus, 133 Indiana, 513, 542. In Fargo v. Hart, 193 U.S. 490, 496, 497, there was no serious dispute as to what was the principle adopted.

Again, this Board necessarily kept and evidently was expected by the statutes to keep a record. That was the best evidence, at least, of its decisions and acts. If the roads had wished an express ruling by the Board upon the deductions which they demanded, they could have asked for it and could have asked to have the action of the Board or its refusal to act noted in the record. It would be time enough to offer other evidence, when such a request had been made and refused. See Fargo v. Hart, 193 U.S. 490, 498; Cleveland, Cincinnati, Chicago & St. Louis Ry. Co. v. Backus, 133 Indiana, 513, 542; Havemeyer v. Board of Review, 202 Illinois, 446. However, as the foregoing objections were not urged, and as the cases were discussed upon all the testimony, we shall proceed to consider them in the same way.

The facts that appear from any source are few. The Board voted first, as a preliminary step toward ascertaining the actual value of all property to be assessed, to make an estimate of the tangible property of the railroads, to be taken as one of the factors in making up the total assessment of the roads. Schedules were prepared, and it is objected that the Board added twenty-five per cent to certain items as furnished by the companies. If this be true, and it is not admitted that any figures were more than tentative, the addition seems to have been made on personal judgment and on a theory that the values given were the values the property was insured for. If mistaken, a mistake does not affect the case. The main point comes on the final assessment, to which we turn at once.

The Board expressed its result in another vote. "Having given full and due consideration to the returns furnished said Board by the several railroad companies, and having taken into consideration the main track, side track, spur tracks, warehouse tracks, roadbed, right of way and depot grounds, and all water and fuel stations, buildings and superstructures thereon, and all machinery, rolling stock, telegraph lines and instruments connected therewith, all material on hand and supplies, moneys, credits, franchises and all other property of said railroad companies, and having taken into consideration the gross and net earnings of said roads, the total amount expended in operation and maintenance, the dividends paid, the capital stock of each system or road and the market value thereof and the total amount of secured and unsecured indebtedness we do hereby ascertain and fix for the purposes of taxation the full actual value, the average value per mile, and the assessable value per mile of the several roads as follows:" with a list.

The roads supplement the record by...