George Rogers v. County of Hennepin

• Decision Date: 21 February 1916
• Docket Number: No. 104,104
• Citation: George Rogers v. County of Hennepin, 240 U.S. 184, 36 S.Ct. 265, 60 L.Ed. 594 (1916)
• Parties: GEORGE D. ROGERS, A. L. Goetzman, and F. E. Crandall, Representing Themselves and Others Similarly Situated, Plffs. in Err., v. COUNTY OF HENNEPIN et al
• Court: U.S. Supreme Court

240 U.S. 184

36 S.Ct. 265

60 L.Ed. 594

GEORGE D. ROGERS, A. L. Goetzman, and F. E. Crandall, Representing Themselves and Others Similarly Situated, Plffs. in Err.,

v COUNTY OF HENNEPIN et al.

No. 104.

Argued December 6, 1915.

Decided February 21, 1916.

Mr. H. V. Mercer for plaintiffs in error.

Mr. Lyndon A. Smith, Attorney General of Minnesota, and Messrs. William J. Stevenson and John M. Rees for defendants in error.

Mr. Justice Hughesdelivered the opinion of the court:

This is a suit in equity to cancel certain assessments for the year 1912, and to restrain the collection of taxes imposed accordingly upon the plaintiffs and others in like case with respect to their memberships in the Chamber of Commerce of the city of Minneapolis.There were three groups alleged to be represented by the respective plaintiffs: One, of members residing in Minneapolis; another, of those residing within the state, but outside that city; and a third, of citizens and residents of other states.The complaint, among other things, averred in substance that the Chamber of Commerce was incorporated under the laws of Minnesota; that it had no capital stock and transacted no business for profit; that it furnished buildings and equipment for its members, who, under its rules, transacted business with each other (for themselves and their customers) upon the trading floor which was in fact a grain exchange; that the property of the corporation had been fully taxed; that the memberships, in case of winding up, would have actually no value above the assets so taxed; that it had been the practical construction of the tax laws of the state that such memberships were not taxable; that the assessments in question had been laid under the head of 'Moneys and Credits,' and that they were excessive; that memberships in other associations were not taxed 'although standing in a similar position;' that the members of the Chamber of Commerce were 'unlawfully and prejudicially' discriminated against 'by unequally assessing them,' and that their property was taken 'without due process of law, contrary to the state and Federal Constitutions;' that, unless restrained, the attempt to enforce the tax would result in a multiplicity of suits; that in the case of members residing outside of the city of Minneapolis, the certificates of membership were 'kept at their respective residences' and such members did not 'operate' upon the exchange personally except 'at rare intervals,' and that their use of such memberships was practically limited to benefits obtained 'from having other members buy or sell grain for them as commission merchants' at one half the 'regular commission' by reason of 'a privilege extended to the members under the rules.'

The defendants demurred to the complaint upon the ground that it did not state facts sufficient to constitute a cause of action.The trial court denied a motion for temporary injunction and sustained the demurrer, and thereupon judgment was entered in favor of the defendants.The plaintiffs appealed to the supreme court of the state, assigning as error the holding of the trial court that the assessments 'did not deny to the several members in the respective classes the equal protection of the laws' and did not constitute a taking of property 'without due process of law and without compensation,' contrary to the Federal Constitution.The latter objection was stated in various forms, specific complaint being made of the assessment of those members who were said to be outside the jurisdiction of the taxing officers.Another appeal was then pending in the same court in the case of State v. McPhail, 124 Minn. 398, 50 L.R.A.(N.S.) 255, 145 N. W. 108, Ann. Cas. 1915C, 538, relating to the taxation of memberships in the Board of Trade of Duluth, and, by stipulation, the appeals were heard together.In the Duluth Case, the supreme court held that the membership was taxable under the stautes of the state, and, further, sustained the tax there laid as against contentions under the due process and equal protection clauses of the 14th Amendment.The court said: 'We do not sustain the claims that the taxation of memberships in a board of trade or stock exchange would violate provisions of the Federal or state Constitution. . . .We see no improper classification here, nor any lack of equality or uniformity.Nor would it be double taxation.The members of the board are not required to pay taxes on the physical and tangible property of the board, nor does the board pay taxes upon the intangible rights which constitute the value of a membership.And we hold that proceedings to tax such a membership do not deprive the member of his property without due process of law, take property for public use without just compensation, or deny such member the equal protection of the laws, in violation of familiar provisions of the Federal Constitution and Amendments.'State v. McPhail, supra.

At the same time, the decision in the instant case was rendered with an opinion per curiam in which, after a summary statement of the nature of the case, the court ruled as follows: 'The case was submitted on briefs in this court with State v. McPhail.The decision in that case, filed herewith, controls this.Judgment affirmed.'124 Minn. 539, 145 N. W. 112.And this writ of error has been sued out.

The defendants in error insist that the decision of the state court involved no Federal question; that the suit was for injunction and that the plaintiffs had an adequate remedy at law.They invoke the familiar rule that when the decision of the state court rests upon an independent or non-Federal ground, adequate to support it, this court has no jurisdiction.Hammond v. Johnston, 142 U. S. 73, 78, 35 L. ed. 941, 942, 12 Sup. Ct. Rep. 141;Gaar, S. & Co. v. Shannon, 223 U. S. 468, 470, 56 L. ed. 510, 512, 32 Sup. Ct. Rep. 236.But the state court, which alone determines local questions of procedure, did not deny relief because an injunction was sought or because it was considered that under the state law another remedy was appropriate.It said nothing whatever as to the form of remedy, or as to the right to proceed in equity, but considered and decided the case on the merits, including the Federal questions.No other conclusion can be drawn from the fact that the sole reason for the decision is found in the reference to State v. McPhail as authority,—a case in which no procedural question was involved.There, the action was brought by the state itself to recover the tax, and the decision was directly and exclusively upon the validity of the tax, it being sustained first, as one authorized by the state law, and, then, as not repugnant to the Federal Constitution.The fact that there were some objections to the constitutional validity of the tax in the present case that were not urged in the McPhail Case does not affect the matter.They were all grounds for the contention that the tax denied the equal protection of the laws and took property without due process of law.That was the ultimate contention which was overruled with respect to the tax in the McPhail Case, and the allusion to that decision as 'controlling' plainly meant that the court thought that all the reasons urged for a different view were without merit, and that the present tax did not violate the 14th Amendment.It is well settled that where the state court does not decide against the plaintiff in error upon an independent state ground, but, deemed the Federal question to be before it, actually entertains it and decides it adversely to the Federal right asserted, this court has jurisdiction to review the judgment, assuming it to be a final judgment, as it is here.Hancock Nat. Bank v. Farnum, 176 U. S. 640, 642, 44 L. ed. 619, 620, 20 Sup. Ct. Rep. 506;San Jose Land & Water Co. v. San Jose Ranch Co.189 U. S. 177, 179, 180, 47 L. ed. 765, 766, 768, 23 Sup. Ct. Rep. 487;American Exp. Co. v. Mullins, 212 U. S. 311, 313, 53 L. ed. 525, 526, 29 Sup. Ct. Rep. 381, 15 Ann. Cas. 536;Atchison, T. & S. F. R. Co. v. Sowers, 213 U. S. 55, 63, 53 L. ed. 695, 698, 29 Sup. Ct. Rep. 397;Miedreich v. Lauenstein, 232 U. S. 236, 243, 58 L. ed. 584, 589, 34 Sup. Ct. Rep. 309;North Carolina R. Co. v. Zachary, 232 U. S. 248, 257, 58 L. ed. 591, 595, 34 Sup. Ct. Rep. 305, 9 N. C. C. A. 109, Ann. Cas. 1914C, 159;Carlson v. Washington, 234 U. S. 103, 106, 58 L. ed. 1237, 1238, 34 Sup. Ct. Rep. 717;Mallinckrodt Chemical Works...