Michigan Central Railroad Company v. Rerry Powers
Decision Date | 02 April 1906 |
Docket Number | No. 397,397 |
Parties | MICHIGAN CENTRAL RAILROAD COMPANY, Appt. , v. RERRY F. POWERS, Auditor General of the State of Michigan |
Court | U.S. Supreme Court |
This suit was brought in the circuit court of the United States for the western district of Michigan to restrain the respondent, the auditor general of the state, from enforcing against the appellant the provisions of act No. 173 of the Michigan Laws of 1901, an act to provide for the assessment of the property of railroad and certain other companies, for the levying of taxes thereon by a state board of assessors, and for the collection of such taxes. The taxes involved in the suit are those for 1902, resulting from the first assessment under the statute. Prior to the year 1900 the Constitution of Michigan contained, in art. 14, the following sections applicable to taxation:
In that year §§ 10, 11, and 13 were amended so as to read as follows:
This change in the Constitution was doubtless owing to a decision of the supreme court of the state (Pingree v. Auditor General[Pingree v. Dix] 120 Mich. 95, 44 L. R. A. 679, 78 N. W. 1025), of date of April 26, 1899, holding unconstitutional an act passed in 1881 in respect to the assessment and taxation of telegraph and telephone lines. An act 19 of 1899, passed March 15, 1899, and commonly called the 'Atkinson bill,' was subject to the same objections as the act of 1881, and was evidently regarded as equally unconstitutional. Indeed, though not directly involved in that suit, it was referred to in the opinion of Mr. Justice Montgomery.
The act in controversy (Pub. Acts 1901, act No. 173) provides that the board of state tax commissioners shall constitute a state board of assessors, who are to assess the railroad and certain other corporate property in the state. Section 5 contains the following:
By §§ 6 and 7 the several corporations are required to furnish information as to various matters of fact bearing on the matter of assessment. By § 8 property is to be assessed at its 'true cash value' on the second Monday of April of each year, and, for the purposes of the assessment, the board of assessors is authorized to make personal inspection of the property, to take into consideration the reports filed under the act, and such other evidence as may be obtainable bearing thereon. In respect to the property of railroads running partly within and partly without the state, the board is directed to be guided in respect to the matter of taxation of property within the state by the relation which the number of miles of main tract within the state bears to the entire mileage of the main track, both within and without the state. By § 10 the board is required to meet at the capitol at Lansing on the third Monday of December, and continue in session so long as may be necessary, not later than January 15 next thereafter, for the purpose of reviewing the assessment roll, and any person or company interested has the right to appear during said period and be heard by the assessors, and they are authorized on such application, or on their own motion, to correct the assessment or valuation. Sections 11 and 12 prescribe the method for fixing the rate of tax, the purpose being to impose upon the railroad property the average rate of taxation levied upon other property upon which ad valorem taxes are assessed. This method is accurately described by counsel for the railroad company in these words:
'The new and peculiar feature of the statute lies in the application to corporate property of a special rate of tax, known as the 'average rate,' which is derived by the following process: The total ad valorem taxes for all purposes,—state, county, city township, village, and school district,—paid by property in Michigan which is taxed otherwise than under act 173, are divided by the total assessments of such property, whether made by one or another assessor, and the quotient resulting from this process of division is the rate of tax applied to corporate property under act 173.'
By § 16 the taxes collected from corporations under this act are to 'be applied in paying the interest upon the primary school, university, and other educational funds, and the interest and principal of the state debt, in the order herein recited, until the extinguishment of the state debt other than the amounts due to educational funds, when such taxes shall be added to and constitute a part of the primary-school interest fund.'
After a full hearing upon pleadings and proofs the circuit court entered a decree dismissing the bill (138 Fed. 223), whereupon the plaintiff appealed directly to this court, under § 5 of the circuit court of appeals act.
Messrs. Lloyd W. Bowers, O. E. Butterfield, Benton Hanchett, A. C. Angell, Henry Russell, and Ashley Pond for appellant.
[Argument of Counsel from pages 251-266 intentionally omitted]
Messrs. Charles A. Blair, Roger Irving Wykes, Loyal E. Knappen, John E. Bird, and Charles E. Townsend for appellee.
Statement by Mr. Justice Brewer:
[Argument of Counsel from pages 266-290 intentionally omitted]
The unconstitutionality of a statute may depend upon its conflict with the Constitution of the state or...
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