City of St. Louis v. Sheilds

• Decision Date: 31 March 1873
• Citation: 52 Mo. 351
• Parties: CITY of ST. LOUIS, Respondent, v. THOMAS W. SHEILDS, Appellant.
• Court: Missouri Supreme Court

52 Mo. 351

CITY of ST. LOUIS, Respondent,

v.THOMAS W. SHEILDS, Appellant.

Supreme Court of Missouri.

March Term, 1873.

Appeal from St. Louis Circuit Court.

Spencer & Hatch, for Appellant.

I. It does not belong to the complainant vicariously to enforce the contract of other persons or protect their rights. (Gilman vs. City of Sheboygan, 2 Black, 513.)

II. The burden of proof that the act in question is unconstitutional rests upon the complainant, and that proof must be so clear and convincing that not a doubt remains. (Fletcher vs. Peck, 6 Cranch., 87; 48 Mo. pp. 470 and 471.)

III. All Legislative enactments containing a delegation of power to municipal corporations exist here “ bene placitum,” and are revocable at pleasure. (Debolt vs. Ohio Life Ins. & Trust Co., 1 Ohio State 568; East Hartford vs. Hartford Bridge Co., 10 How, 535.)

IV. “The imposition, modification and removal of taxes, and exemption of property from such burdens, is an ordinary exercise of the power of State sovereignty. There is no pledge expressed or implied that this power should not thereafter be exercised.” (Gilman vs. City of Sheboygan, 2 Black, 513.) The unlimited power of the State over municipal corporations is also fully considered in Kent's 2 Com., pp., 305 and 306; Mechanics and Traders, Bank vs. Debolt, 1 Ohio State R., 591; 2 Parson, Cont. p., 681. Dartmouth College vs. Woodward, 4 Wheaton, 697; 13 Mo., 400; 34 Mo., 546; Knoup vs. The Piqua Bank, 1 Ohio State R., 603.)

N. A. Mortell, for Respondent.

I. If the contract between the City and the purchasers of its harbor bonds when made, was valid by the laws of the State, its validity and obligations cannot be impaired by any subsequent legislative action or decision of its courts altering the construction of the law. (4 Wallace, 206; 16 Howard, 432; 1 Dillon Cir. Ct. R., 528.)

II. Where a State has authorized a municipal corporation to contract and exercise the power of local taxation to the extent necessary to meet its engagements, the power thus given cannot be withdrawn until the contract is satisfied. The State and corporations in such cases are equally bound. The power given becomes a trust which the State cannot annul and the corporation must execute. (Von Hoffman vs. City of Quincy' 4 Wallace, 535; 1 Dillon Cir. Ct. Report, 526; 2 Am. Law Register; 4 Wright, Pa., 348; 4 Peters, 514; 3 Howard, 133.)

III. This act of 1872 repealing the wharfage tax, is an exercise of judicial power by the Legislature which the United States Constitution has expressly forbidden. (Cooley Constitutional Limitation, 87, 114, 392.)

McCarty, for Respondent.

I There was an express agreement that this power of taxation should not be withdrawn. The revenues of the wharf were pledged as security, and a security cannot at the same time be pledged and withdrawn.

II. The City of St. Louis appears as a party to the contract that is impaired; it is in the enforcement of that contract that this question arises.

III. Where a State has authorized a municipal corporation

to contract and to exercise the power of local taxation to the extent necessary to meet its engagements, the power thus given cannot be withdrawn until the contract is satisfied. (4 Wallace, 534-5.)

WAGNER, Judge, delivered the opinion of the court.

The question presented for determination is the constitutionality of the act, approved March 28, 1872, prohibiting the collection of wharfage from steamboats, so far as the same applies to the city of St. Louis.

It seems that in 1865 (Sess. Acts 1865, p. 440,) the Legislature passed an act for the improvement of the harbor of the city. By the provisions of that act, the city was authorized, for maintaining and improving the wharf, to apply all the net receipts from wharfage, and all the money at that time in the Treasury to the credit of the wharf funds; also, for the ame purpose to borrow $500,000 by an issue of bonds, running for the term of twenty years, for the payment of the principal and interest of which the revenues of the wharf were to be pledged; and the City Council was further authorized, in its discretion, to levy a harbor tax of not exceeding one-tenth of one per cent. upon all property made taxable by law for State purposes within the limits of the city, the proceeds of which tax was to be held sacred for the purpose of paying the principal and interest of the wharf and harbor debt.

In pursuance of this authority, the City Council passed an ordinance directing the Mayor and Comptroller to sell the bonds, wherein they pledge the faith and credit of the city for the payment of the principal and interest, and the revenue derived from wharfage is likewise pledged for the same purpose.

By the act of 1872, all acts which in any manner authorized a municipal corporation to collect a wharfage or tonnage tax were repealed.

The court below held the act unconstitutional, as impairing the obligations of a contract, and gave judgment for the plaintiff, who sued the defendant for refusing to pay wharfage.

As this case now stands, it is difficult to perceive how any question as to the constitutionality of the law can be raised. In the passage of the law it cannot be pretended, that the State made a direct and irrevocable contract with the city. The city possesses no power which is not delegated by the severeign authority of the State. The State, in the enactment of the law, granted to the city a privilege, but it did not divest itself of the power of repealing or withholding that privilege at pleasure. The city can only raise money and apply it to a particular purpose by virtue of delegated authority, and the same authority that grants the power may alter the law and divert it to a different object.

In the case of the State ex rel., The Police Commissioners, etc., vs. The St. Louis County Court (34 Mo., 546), it was held that the acts of the Legislature providing the objects for which county funds can be appropriated, are at all times subject to repeal or alteration, so as to appropriate the funds in a manner or to objects different from those before provided; and that, while the Legislature cannot take from the county its property, it has full power to direct the mode in which the property shall be used. If this proposition is conceded as to property already possessed by a corporation or minor subdivision of the State, it is certainly stronger when applied to a case where nothingis reduced to possession and only exists in the future.

Gilman vs. The city of Sheboygan (2 Black, 510,) is a case very nearly parallel with the one at bar. There the Legislature of Wisconsin passed an act, authorizing the city of Sheboygan to borrow money upon the credit of the city, to be invested in the capital stock of a railroad company. The act further provided, that the city should annually levy a tax upon all taxable property of the city, sufficient, in addition to the dividends upon the shares of its stock in the company, to pay the interest upon the bonds.

Under the act in question, the city made loans and issued its bonds therefor....