Savannah, Thunderbolt Isle of Hope Railway of Savannah, Georgia v. Mayor and Aldermen of the City of Savannah

• Decision Date: 15 May 1905
• Docket Number: No. 238,238
• Citation: 25 S.Ct. 690,49 L.Ed. 1097,198 U.S. 392
• Parties: SAVANNAH, THUNDERBOLT, & ISLE OF HOPE RAILWAY OF SAVANNAH, GEORGIA, Plff. in Err. , v. MAYOR AND ALDERMEN OF THE CITY OF SAVANNAH
• Court: U.S. Supreme Court

198 U.S. 392

25 S.Ct. 690

49 L.Ed. 1097

SAVANNAH, THUNDERBOLT, & ISLE OF HOPE RAILWAY OF SAVANNAH, GEORGIA, Plff. in Err.,

v MAYOR AND ALDERMEN OF THE CITY OF SAVANNAH.

No. 238.

Argued April 28, May 1, 1905.

Decided May 15, 1905.

Messrs. David C. Barrow and George A. King for plaintiff in error.

[Argument of Counsel from pages 392-395 intentionally omitted] Mr.William Garrard for defendant in error.

Mr. Justice Holmes delivered the opinion of the court:

This is a bill in equity, brought by the plaintiff in error to restrain the collection of a municipal tax by the defendants. The bill sets forth, among other grounds, that the tax impairs the obligation of a contract, and also is an attempt to take the plaintiff's property without due process of law, contrary to the Constitution of the United States. According to the bill and the fifth assignment of error there is no law of the state of Georgia which authorizes the imposition of the tax. Were this true, the foundation of our jurisdiction would be gone, and this writ of error should be dismissed. See Barney v. New York, 193 U. S. 430, 48 L. ed. 737, 24 Sup. Ct. Rep. 502. But although the plaintiff has taken inconsistent positions, and has confused questions for the state court alone with those which may be brought here, still, since it has shown a clear intent to raise the Federal question from the beginning, since the bill, in another place, alleges that the tax is an authority exercised under the state of Georgia, and other assignments of error present the points, and since the state court has decided that the tax was authorized, we shall not stop the case at the outset. See Hamilton Gaslight & Coke Co. v. Hamilton, 146 U. S. 258, 36 L. ed. 963, 13 Sup. Ct. Rep. 90.

The tax imposed under an ordinance of March 22, 1899, providing, by way of amendment to one of the year before, that 'street railway companies, whether under the control of another company or not, in lieu of the specific tax heretofore required, shall pay to the city of Savannah, for the privilege of doing business in the city, and for the use of the streets of the city, at the rate of $100 per mile or fraction of a mile of track used in the city of Savannah by said railroad company.' The plaintiff is a street railroad company, commonly known as such, and the great part of its business and revenue is due to the use of the streets of Savannah by its electric passenger street cars. One of its grounds of attack is that the Central of Georgia Railway Company, a steam railway, is not subjected to the tax, and yet that it also does business in the streets of the city by transporting freights from its regular station to various side tracks, and charges an additional or local price. The plaintiff contends that a classification which distinguishes between an ordinary street railway and a steam railroad making an extra charge for local deliveries of freight brought over its road from outside the city is contrary to the 14th Amendment, and void.

The other ground on which the validity of the tax is denied is a contract made between the plaintiff and respondent on November 4, 1897, amended in April 1898, and on July 27, 1898. It is contended that this contract implies that the plaintiff is to have the use of the streets without further charges than those which it imposes.

The trial court refused a preliminary injunction, and its decree was affirmed by the supreme court (112 Ga. 164, 37 S. E. 393), which decided that this was a business tax, lawfully imposed, and that the plaintiff did not stand like the Central of Georgia Railway, which, as was held in Augusta v. Central R. Co. 78 Ga. 119, is subject to taxation by the state alone. On final hearing a verdict was directed for the defendant, and a decree was entered making the same the decree...