Henderson Bridge Co v. City of Henderson

• Decision Date: 03 April 1899
• Docket Number: No. 32,32
• Citation: Henderson Bridge Co v. City of Henderson, 173 U.S. 592, 19 S.Ct. 553, 43 L.Ed. 823 (1899)
• Parties: HENDERSON BRIDGE CO. et al. v. CITY OF HENDERSON
• Court: U.S. Supreme Court

173 U.S. 592

19 S.Ct. 553

43 L.Ed. 823

HENDERSON BRIDGE CO. et al.

v CITY OF HENDERSON.

No. 32.

April 3, 1899.

Malcolm Yeaman and Wm. Lindsay, for plaintiffs in error.

James W. Clay, for defendant in error.

Mr. Justice HARLANdelivered the opinion of the court.

This case arises out of the taxation by the city of Henderson, a municipal corporation of Kentucky, of a railroad bridge (with its approaches, piers, etc.) extending from a point within that city, on the Kentucky shore, across the Ohio river, to low-water mark on the Indiana shore.

The property subjected to taxation belongs to the Henderson Bridge Company, a corporation of Kentucky, but is under the care, management, and control of the Louisville & Nashville Railroad Company, also a corporation of that commonwealth.

Those corporations insist that the final judgment of the court of appeals of Kentucky, here for review, affirming a judgment rendered in the circuit court of Henderson county, is in derogation of rights secured to them by the constitution of the United States.The grounds upon which this contention rests will appear from the statement presently to be made of the history of the litigation between the city of Henderson and the corporations named, in respect of taxes assessed upon the bridge property in question.

The city contends, not only that the assessment of taxes upon this property was in all respects valid, but that the matters he e in dispute, including the questions of constitutional law raised by the bridge and railroad companies, have been conclusively determined in prior litigation between the parties.

The facts which it seems necessary to state, in order to bring out clearly and fully the various questions raised by the pleadings and discussed by counsel, are as follows:

The Henderson Bridge Company was incorporated by an act of the general assembly of the commonwealth of Ken- tucky approved February 9, 1872, with authority to construct 'a bridge across the Ohio river, extending from some convenient point within the corporate limits of the city of Henderson to some convenient point on the Indiana side of said river, opposite the city of Henderson.'1 Acts Ky. 1871-72, p. 314.

The city's boundary, as defined by its charter granted February 11, 1867, extended 'to low-water make on the Ohio river on the Indiana shore,' and it had the power (with certain exceptions not material to be noticed here) to levy and collect taxes at a prescribed rate upon all property within its limits made taxable by law for state purposes.

In 1882 an ordinance was passed by the common council of the city granting to the Henderson Bridge Company the right 'to construct on or over the center of Fourth street in the city of Henderson, and of the line thereof extended to low-water mark on the Indiana side of the Ohio river, such approaches, avenues, piers, trestles, abutments, toll houses, and other appurtenances necessary in the erection of, and for the business of, a bridge over the Ohio river, from a point in the city of Henderson to some convenient point on the Indiana side of said river, and for such purposes the use of said Fourth street is hereby granted, subject to the terms and conditions hereinafter expressed'; also, the right 'to use the space between Water street, in said city, and low-water mark in the Ohio river, extending one hundred feet below the center of Fourth street extended and three hundred feet above the center of said street extended to the Ohio river for the purpose required by said company.'The company was also permitted to 'erect, or authorize or cause to be erected, grain elevators within said space above high-water mark, and may construct therefrom to the river such apparatus and machinery as may be necessary to convey grain from boats to such elevators, and may have the use of said space for the landing of boats laden with freight for such elevators, and construct floating docks or use wharf boats within such space for the accommodation of such boats and the conduct of the business of such bridge and of the said elevators free of wharfage, subject to the terms and conditions hereinafter expressed.'

The fourth section of that ordinance declared that it should not be construed 'as waiving the right of the city of Henderson to levy and collect taxes on the approaches to said bridge, or any building erected by said bridge company within the corporate limits of said city, the bridge itself, and all appurtenances thereto, within the limits of said city.'

The fifth section provided that, before any of the rights or privileges so granted should inure to the benefit of or vest in the bridge company, the latter should, by proper authority, append to a certified copy of the ordinance their acceptance of, and agreement to abide by and faithfully keep, its terms and conditions, such acceptance and agreement to be acknowledged by the proper authority of the company, as provided in the case of a deed under the laws of Kentucky, and delivered to the clerk of the Henderson city council.

The bridge company duly accepted the ordinance, with its terms and conditions, agreed to abide by, and faithfully keep, the same, and its acceptance was acknowledged and delivered to the city council.

In 1884 an agreement in writing was entered into between the bridge company and the Louisville & Nashville Railroad Company, reciting that the former was about to proceed with the erection of a bridge over t e Ohio river at or near Henderson, and of a railroad connecting the Henderson Division of the Louisville & Nashville Railroad Company at Henderson with the Southeast & St. Louis Railway in or near Evansville, Ind.; that certain railroads, including the Louisville & Nashville Railroad Company, had by agreement guarantied to the bridge company an income from traffic amounting to $200,000 per annum; and that it was deemed for the interest of all parties, and had been requested by the bondholders under the mortgage placed on the bridge, that the Louisville & Nashville Railroad Company should assume the control, management, and care of the track of said railroad so to be constructed, and should effect the usual repairs to such bridge caused by ordinary wear and tear, and pay taxes imposed on said track and the bridge on compensation being made therefor by the bridge company.By that agreement the bridge company undertook to pay the railroad company absolutely and in each year during the continuance of the agreement, in equal quarter-yearly payments, the sum of $10,000 per annum, which amount, or such parts thereof as were required, the railroad company agreed to apply to the maintenance of the track and roadbed of said railroad in good condition and repair, and towards the usual and ordinary repairs of the bridge, and also to pay all taxes imposed on said track or bridge structure and each of them.

On the 8th day of December, 1887, the city, by petition filed in the circuit court of Henderson county, Ky.,—that mode of collecting taxes being authorized by the local law,—brought suit against the Henderson Bridge Company to recover the sum of $44,324 as the amount of taxes, with penalties thereon, due from the bridge company under ordinances passed by the city in 1885, 1886, and 1887, levying and assessing taxes for certain purposes.The petition referred to the above ordinance authorizing the construction of the bridge, and among other averments in it were the following:

'The defendant commenced the construction of said bridge in the year 1883, and completed same in the month of July, 1885, and at a cost of about $2,000,000, and on the ___ day of July, 1885, the first train ran over said bridge.The approach to said bridge is constructed over Fourth street, near the principal portion of said city, commencing at the west line of Main street, and extending to the main structure of said bridge at Water street (though, plaintiff claims, not in accordance with the terms of said ordinance).The rights and privileges granted by the plaintiff to the defendant were of great value, and the plaintiff was influenced and induced to so grant them by the belief in the right on the part of the plaintiff to tax said bridge as other property is taxed within the city limits.By the building of said bridge through the rights and privlieges so granted by the plaintiff, the system of roads north of the Ohio river has been connected with the Louisville & Nashville Railroad south of the river, and the said bridge company's property has become so valuable that its bonds, to the amount of about $2,000,000, are worth a premium of 8 1/2 per cent.'

The assessment against the bridge company on account of the bridge and its approaches was upon a valuation of $600,000 in 1885, and $1,000,000 in each of the years 1886 and 1887.In its petition the city claimed a lien upon the bridge from the beginning of its approach at Main street, in the city of Henderson, to low-water mark on the Indiana side of the Ohio river, for said taxes and the penalties thereon.

The bridge company in its answer denied the material allegations of the petition, and alleged:

That the city had no authority to levy taxes for the purposes indicated in the ordinances referred to;

That the declaration in the ordinance granting the right to construct the bridge within the city's limits meant, and was intended to mean, nothing more than that the city did not waive any right to tax then possessed by i ;

That the bridge was built only for the purpose of laying a single railroad track on which to move locomotives and cars between Kentucky and Indiana over the Ohio river;

That except as to that part of the bridge commencing at the west line of Main street, in the city of Henderson, and extending to the main structure at Water street, the bridge company derived no assistance or protection from the city, and that part between the Kentucky and Indiana shores, upon stone piers and pillars resting upon the bed of...