Atchison, Topeka Santa Fe Railway Company v. Timothy Connor

• Decision Date: 19 February 1912
• Docket Number: No. 162,162
• Parties: ATCHISON, TOPEKA, & SANTA FE RAILWAY COMPANY, Plff. in Err., v. TIMOTHY O'CONNOR
• Court: U.S. Supreme Court

223 U.S. 280

32 S.Ct. 216

56 L.Ed. 436

ATCHISON, TOPEKA, & SANTA FE RAILWAY COMPANY, Plff. in Err.,

v TIMOTHY O'CONNOR.

No. 162.

Argued January 24 and 25, 1912.

Decided february 19, 1912.

Messrs. Robert Dunlap, H. T. Rogers, and Gardiner Lathrop for plaintiff in error.

[Argument of Counsel from pages 280-283 intentionally omitted] Mr. Benjamin Griffith, Attorney General of Colorado, and Mr. Archibald A. Lee, Deputy Attorney General, for defendant in error.

[Argument of Counsel from pages 283-285 intentionally omitted] 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 2 cents upon each one thousand dollars of the plaintiff's capital stock. Session Laws of Colorado, 1907, chap. 211. The plaintiff is a Kansas corporation. The greater part of its property and business is ouside 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 U. Teleg. Co. v. Kansas, 216 U. S. 1, 54 L. ed. 355, 30 Sup. Ct. Rep. 190; Pullman Co. v. Kansas, 216 U. S. 56, 54 L. ed. 378, 30 Sup. Ct. Rep. 232; Ludwig v. Western U. Teleg. Co. 216 U. S. 146, 54 L. ed. 423, 30 Sup. Ct. Rep. 280. 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 remedy. The rule being established that, apart from special circumstances, he cannot interfere by injunction with the state's collection of its revenues, an action at law to recover back what he has paid is the alternative lift. Of course, we are speaking of those cases where the state is not put to an action if the citizen refuses to pay. In these latter he can interpose his objections by way of defense; but when, as is common, the state has a more summary remedy, such as distress, and the party indicates by protest that he is yielding to what he cannot prevent, courts sometimes, perhaps, have been a little too slow to recognize the implied duress under which payment is made. But even if the state is driven to an action, if, at the same time, the citizen is put at a serious disadvantage in the assertion of his legal, in this case of his constitutional, rights, by defense in the suit, justice may require that he should be at liberty to avoid those disadvantages by paying promptly and bringing suit on his side. He is entitled to assert his supposed right on reasonably equal terms. See Ex parte Young, 209 U. S. 123, 146, 52 L. ed. 714, 723, 13 L.R.A.(N.S.) 932, 28 Sup. Ct. Rep. 441, 14 A. & E. Ann. Cas. 764. If he should seek an injunction on the principle of that case and of Western U. Teleg. Co. v. Andrews, 216 U. S. 165, 54 L. ed. 430, 30 Sup. Ct. Rep. 286, he would run the same risk as if he waited to be sued.

In this case the law, besides giving an action of debt to the state, provides that every corporation that fails to pay the tax shall forfeit its...