Dodge v. Mission Tp., Shawnee County, Kan.

• Decision Date: 11 April 1901
• Docket Number: 1,449.
• Citation: 107 F. 827
• Parties: DODGE v. MISSION TP., SHAWNEE COUNTY, KAN.
• Court: U.S. Court of Appeals — Eighth Circuit

107 F. 827

DODGE v. MISSION TP., SHAWNEE COUNTY, KAN.

No. 1,449.

United States Court of Appeals, Eighth Circuit.

April 11, 1901

Syllabus by the Court.

The power of a legislature to levy or to authorize the levy of a tax, and to create or authorize the creation of a public debt to be paid by taxation, is limited to its exercise for a public purpose.

The decision of the question whether a tax or a public debt is for a public or private purpose is not a legislative, but a judicial, function. A legislature cannot make a private purpose, or draw to itself or create the power to authorize a tax or a debt for such a purpose, by its mere fiat.

The promotion of the construction and operation of mills and factories to manufacture sorghum cane into sugar or syrup is a private, and not a public, purpose.

Township bonds issued for this purpose, and the act of March 1, 1889 authorizing their issue, are beyond the powers of the legislature and the township, and are void.

This is an action on 359 coupons cut from 22 township bonds issued by the township of Mission, in Shawnee county, in the state of Kansas, under an act of the legislature of that state passed on March 1, 1889, and entitled 'An act to encourage the erection of mills and the manufacture of sugar and syrup out of sorghum cane, and authorizing townships and cities of the second and third class to subscribe for stock in sugar factories, and to vote bonds therefor.

' This act by its terms empowered any township or city named in its title to subscribe to capital stock of any incorporated company organized to erect and operate public mills or factories for the purpose of manufacturing sugar and syrup from sorghum cane upon a favorable vote of its electors, to issue its bonds to pay the subscription, and to levy taxes to pay the principal and interest of the bonds. It required every company and association which received the benefit of any bonds issued under it to retain 10 cents from the purchase price of every ton of sorghum cane which it bought for use in any mill, and to pay this sum over to the treasurer of the proper township, to be applied in payment of the bonds. It declared that all sugar mills which received aid under it were public mills, that they should manufacture sugar or syrup for customers who furnished cane, that they might charge toll therefor, that no factory should be required to receive more cane than it could manufacture into sugar or syrup, and that the amount of toll to be paid should be agreed upon between the company and the persons raising and delivering the cane prior to the time of planting the cane. Each bond contained the following recital: 'This bond is one of a series of thirty bonds, of five hundred dollars each, amounting in the aggregate to the sum of fifteen thousand dollars, issued by the township of Mission of the county of Shawnee, in the state of Kansas, for the purpose of encouraging the erection of a public sugar mill and the manufacture of sugar and syrup from sorghum cane, in the township of Mission, Shawnee county, Kansas, pursuant to and in accordance with the provisions and requirements of an act of the legislature of the state of Kansas for the year A.D. 1889, the same being an act entitled 'An act to encourage the erection of mills and the manufacture of sugar and syrup out of sorghum cane, and authorizing townships and cities of the second and third class to subscribe for stock in sugar factories, and to vote bonds therefor,' approved March 1, A.D. 1889. And it is hereby certified and recited that all acts, conditions, and things required to be done precedent to and in the issuing of said bonds have been properly done, happened, and performed in regular and due form as required by law. ' Each coupon contained the statement that it represented 'interest on public sugar mill bond . No.-- .' The plaintiff in error, W. S. Dodge, filed a complaint in this action, in which he made the necessary jurisdictional allegations and then averred that on September 15, 1890, the defendant in error, the township of Mission, issued and delivered 30 bonds, for $500 each, payable on September 15, 1910; that these bonds were registered by the auditor of the state of Kansas; that a copy of one of them was attached to the complaint; that each of the bonds of 359 of these coupons, which were past due and had not been paid. A demurrer was interposed to this complaint which was sustained by the court below, and thereupon a judgment was rendered in favor of the defendant, which is now presented for review by the writ of error.

Henry Keeler and D. R. Hite, for plaintiff in error.

D. M. Valentine, A. A. Godard, and H. E. Valentine, for defendant in error.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

SANBORN Circuit Judge, after stating the case as above.

It is a fundamental principle of a republican form of government that no man shall be involuntarily deprived of his life, liberty, or property without due process of law. The prohibition of such a deprivation by the states is found in the fourteenth amendment to the constitution of the United States. But it lies deeper, and limits the conditions every grant of legislative, executive, or judicial authority. The proposition was announced in the early history of the republic, and it has been constantly affirmed. The supreme court said in Calder v. Bull, 3 Dall. 386, 388, 1 L.Ed. 648, 649: 'A law that punishes a citizen for an innocent action, or, in other words, for an act which, when done, was in violation of no existing law; a law that destroys or impairs the lawful private contracts of citizens; a law that makes a man a judge in his own cause; or a law that takes property from A. and gives it to B.,-- it is against all reason and justice for a people in intrust a legislature with such powers, and therefore it cannot be presumed that they have done it.'

A legislative act which takes, or undertakes to authorize the taking, of private property for a private object, either by taxation, or by the exercise of the power of eminent domain, or by any other means, is not a law, but an arbitrary decree, whereby the property of one citizen may be transferred to another. Such an act is beyond the limits of the powers granted by the people to the legislatures of the states, and is without legal force or effect. The legislative power of taxation and power of eminent domain are alike limited to the exercise thereof for public objects, and they cannot be successfully prostituted for private purposes. For the same reasons the power of a legislature to create or to authorize the creation of a public debt, and the issue of public bonds to be paid by taxation, is subject to the same limitation. The clear and forcible declarations of Chief Justice Black in 1853 in Sharpless v. Mayor, etc., of Philadelphia, 21 Pa. 147, 169, have long since become the settled law of the land, He said:

'Neither has the legislature any constitutional right to create a public debt, or to lay a tax, or to authorize any municipal corporation to do it, in order to raise funds for a mere private purpose. No such authority passed to the assembly by the general grant of legislative power. This would not be legislation. Taxation is a mode of raising revenue for public purposes. When it is prostituted to objects in no way connected with the public interests or welfare, it ceases to be taxation, and becomes plunder. Transferring money from the owners of it into the possession of those who have no title to it, though it be done under the name and form of a tax, is unconstitutional for all the reasons which forbid the legislature to usurp any other power not granted to them.'

See, also, Cole v. City of La Grange, 113 U.S. 1, 6, 5 Sup.Ct. 416, 28 L.Ed. 896.

A necessary corollary to these propositions is that a legislature, which has no power to authorize the levy of a tax or the creation of a public debt for a private purpose, has no power to draw that authority to itself, or to create it by its mere declaration that a private purpose is a public one. Any other theory would destroy the limitation. A legislature cannot make a private purpose a public one by its mere fiat, and the determination of the question in any case whether or not a given object is public or private is a judicial, and is not a legislative, function. Allen v. Inhabitants of Jay, 60 Me. 124, 139, 11 Am.Rep. 185; Tyler v. Beacher, 44 Vt. 648, 651, 8 Am.Rep. 398; In re Eureka Basin Warehouse & Mfg. Co., 96 N.Y. 42, 47, 48.

If the bonds and coupons upon which this action is founded are ever paid, the money to discharge them must be raised by the levying of taxes upon private property situated in the township of Mission. Their validity, therefore, must depend upon the answer to the question whether they were issued for, and their proceeds were applied to, a public or a private purpose. They were issued to raise money to pay a subscription made by the township to the stock of a private corporation organized to erect and operate mills to make sugar and syrup from sorghum cane, and their proceeds were applied to that purpose. The question, then, is whether or not the construction and maintenance of factories owned by private corporations to manufacture sugar and syrup from sorghum cane is a public or a private purpose. The true answer to the question seems to be plain and certain. Speaking generally, a public purpose is a governmental purpose, one of the purposes for which governments are instituted and maintained of the purposes for which governments are instituted and maintained among men, such as the maintenance of order, the prevention and punishment of...