#### The State ex rel. Consolidated Stone Company and another, Respondents, vs. Houser, Secretary of State, Appellant

*April 10*

June *23, 1905.*

*Constitutional law: Statutes: Appropriation for private purpose.*

Ch. 337, Laws of 1903, appropriated a sum of money to relators, who, as subcontractors, furnished- material to the principal contractor engaged in building a state institution. Th’e principal contractor fully performed his contract and was paid in full for all the work and materials covered thereby, hut failed, to-the extent of the appropriation, to pay relators, and became-bankrupt. *Held:*

(1) Ch. 337 did not come within the letter of the prohibition of sec. 26, art. IV, Const.

(2) The appropriations made by said ch. 337 were for purely private purposes and hence unconstitutional and void.

[(3) Whether relators were public officers, *agents,*servants, or contractors of the state, not decided.]

Appeal from a judgment of the circuit court for Dane-county: E. Ray Steveks, Circuit-Judge.

*Reversed.*

This is an appeal from a judgment granting a peremptory writ of *mandamus*compelling the defendant, as secretary of state, to issue his warrant to the relators separately for the respective amounts appropriated to them respectively by ch. 337, Laws of 1903. The petition for the writ alleged, in effect, that the act appropriated to the relator the *Consolidated Stone Company*$3,503.52, and to the relator *David Stephens*$1,563, making altogether $5,066.52;- that the defendant, acting upon the advice of the attorney general, had refused to audit and allow the said claims, or either of them, or issue warrants therefor, as he was in duty bound to do under said chapter; that the attorney general had given his opinion in writing that said act was unconstitutional and void; that the petitioners had furnished and delivered stone, crushed' stone, and brick for the construction of the State Historical’ Library building at Madison; that such construction was-*257done under contract between tbe state and Tbomas B. Bentley, wbo received from tbe state tbe pay for sucb stone, crushed stone, and brick, but tbe petitioners bave never been paid for sucb stone, crushed' stone, and brick, nor any part thereof; that Tbomas E. Bentley went through insolvency under tbe laws of this state and turned over all bis property to bis assignee; that tbe petitioners presented and proved up their claims against bis estate in sucb proceedings, but only received thereon the amounts hereinafter stated; that tbe respective amounts so appropriated were tbe amounts remaining due to them after tbe application thereon of sucb dividends; that Tbomas E. Bentley was discharged from Ms debts in sucb insolvency proceedings; that said chapter in’ no way increased or diminished tbe compensation of said Bentley as public contractor or otherwise, and be is in no way interested in said appropriation; that tbe petitioners bave no remedy against Bentley; that the petitioners, in furnishing and delivering sucb stone, crushed stone, and brick, were acting as subcontractors under Bentley; 'that sucb stone, crushed, stone, and brick were actually used in tbe erection and construction of said building, and now constitute a part thereof; that tbe petitioners must lose tbe entire amount and value of sucb materials and get no pay for tbe same,,or any part thereof, unless the legislature bad power to make said appropriations; that in making sucb public contract with Bentley for’ such construction tbe state exacted no bond or security from him for tbe payment of claims of subcontractors and others wbo furnished materials or performed labor in said building; that such materials were so furnished and delivered between July 1, 1896, and January 1, 1897; that tbe petitioners respectively presented a bill to tbe legislature of 1901 for said materials, which was disallowed by such legislature prior to May 1,1901; that in tbe appropriations made by said chapter interest was included, to wit, on tbe *Stephens*claim, $372.24, and on tbe claim of the *Consolidated Stone Company**258$1,019.34; tbat tbe assignee in tbe insolvency proceedings on January 10, 1900, paid to *Stephens,*as dividend on bis claim, $365.92, and to tbe stone company, as dividend on its claim, $828.02, and tbat only one dividend was ever made in said insolvency proceedings. Upon sueb petition an alternative writ of *mandamus*was issued against tbe defendant ■June 23, 1903. On tbe day said alternative writ was made returnable tbe attorney general moved to quasb tbe writ on tbe grounds (1) tbat the petition does not state facts sufficient to constitute a cause of action or to sbow tbat tbe re-lators were entitled to tbe writ; (2) tbat it appears on tbe face of tbe petition tbat the claims of tbe relators were not filed within sis years after they accrued. December 8, 1904, tbe motion to quasb was denied by tbe court with $10 costs of motion, and with leave to tbe defendant to serve bis answer within twenty days. Thereupon, and on December 8, 1904, tbe attorney general, in writing, duly filed, waived bis right to serve and file an answer therein, and thereby elected to stand upon bis motion to quasb tbe alternative writ. Thereupon, and upon motion of tbe attorneys for tbe relators, and on December 9, 1904, it was “ordered tbat judgment be entered granting petitioners the peremptory writ of *mandamus,*and tbat said writ issue forthwith upon tbe entry of said judgment directing and commanding said defendant, *Walter .L. Houser,*secretary of state of tbe state of Wisconsin, upon .-the pain and peril tbat shall fall thereon for refusal, tbat be -audit and allow said claims and issue bis warrant to said petitioners ■ separately for tbe respective amounts appropriated to each in cb. 331, Laws of 1903, as prayed for in said petition; it is further ordered tbat petitioners have and recover by said judgment their costs and disbursements in this action;” and ordered judgment to be entered therein accordingly. From tbe judgment entered thereon accordingly tbe defendant appeals.

*259The *Attorney General,*for tbe appellant.

For the respondents there was a brief by *Ghynoiveth &*Mason, and oral argument by *H. W. Ghynoiveth.*

Cassoday, C. J.

1. The question for determination is whether the legislature had power to make the appropriations mentioned in the chapter of the statute cited (ch. 3&7, Laws of 1903). The attorney general contends that the. act is void upon either of two grounds. The first is that it is in violation of the provision of the constitution which declares that “the legislature shall never grant any extra compensation to any public officer, agent, servant, or contractor, •after the services shall have been rendered or the contract ■entered into.” Sec. 26, art. IV, Const. The case made certainly does not come within the letter of such prohibition, since neither of the relators was the “public officer, agent, ■servant, or contractor” of the state. Mr. Bentley was the ■only person entering into any contract with the state, or who placed himself under any obligation to the state, or who had any contract relation with the state. The relators were each subcontractors under Mr. Bentley, and to him alone were they answerable. Counsel for the relators state in their brief that “the subcontractor was *agent*under the contractor to do work for the state.” If this were true there would be much force in the claim of thé attorney general that the appropriation was expressly prohibited by the provision of the constitution quoted, or at least that it was within the spirit of that prohibition and the mischief thereby sought to be prevented. But the view we have taken of this case makes it unnecessary to determine that question.

2. The second ground upon which the attorney general claims that the appropriations are unconstitutional is that they were not either of them made for a public purpose, but that each' was made for a private purpose. It must be con*260ceded that the Staté Historical Library building, in the erection ánd construction of which the materials furnished and delivered by the relators were actually used, was a public institution. It appears that the state entered into a contract with Mr. Bentley for the erection and construction of a portion of that building. That contract required him to furnish the materials and perform the labor. In making that contract the state did not require Mr. Bentley to give any bond or security for the payment of claims of subcontractors or others who furnished materials for or performed labor in or upon the building. It is conceded that Mr.. Bentley fully performed his contract and that the state paid him in full for all the work and materials covered by his contract. The state was only concerned in having its contract with Mr. Bentley performed, and when it was SO' performed and paid for the public purpose of that contract was satisfied. The state made no contract with the re-lators or either of them, and had no dealings with them or either of them. It was no concern of the state, nor of the people of the state, nor of the public, whether Mr. Bentley procured such stone, crushed stone, and brick from the rela-tors or some one else; nor whether he paid for them on delivery or obtained them on credit. In no event was the state liable for such material so furnished by the relators. This is conceded. The contracts for such materials between Mr. Bentley and the relators, respectively, were personal and private contracts. Stripped of all verbiage, the act in question was merely an attempt to donate from the public treasury the amounts therein mentioned to the private persons therein named in payment of Mr. Bentley’s private indebtedness to them. Its only purpose was to pay the indebtedness-of one private person who had failed in business to the other private persons therein named. In other words, the purpose of the act was to appropriate the public moneys of the state to the payment of private debts. The question recurs-*261whether the legislature had the power to make such contributions from the public treasury to pay such priyate debts. Certainly the power of the legislature to appropriate moneys out of the public treasury is not unlimited. “It can only be •so appropriated ‘by law/ and that means a valid law.” Sec. 2, art. VIII, Const.; *State ex rel. New Richmond v. Davidson,*114 Wis. 563, 513, 88 N. W. 596, 90 N. W. 1067. “No •construction is permissible which defeats the obvious purpose and object of constitutional restrictions.” Id. In the ease last cited it is said by way of quotation from standard text-writers: ,

> “The power of the government to embark in enterprises of public charity and benefit can only be limited by the restrictions upon the power of taxation, and to that extent alone can these subjects in American law be said to fall within the police power of the state. ... It is implied in all definitions of taxation that taxes can be levied for public purposes only. - •. . It may be regarded as a settled doctrine of American law that no tax can be authorized by the legislature for any purpose which is essentially private; or, to state the proposition in other words, for any but a public purpose.” Id.

It was held by this court forty years ago, in the language of Chief Justice DixoN, that:

> “The legislature cannot create a public debt, or levy a tax, or authorize a municipal corporation to do so, in order to raise funds for a mere private purpose. It cannot, in the form of a tax, take the money of the citizens and give it to an individual, the public interest or welfare being in no way connected with the transaction. The objects for which money is raised by taxation must be public, and such as sub-serve the common interest and well-being of the community required to contribute.” *Brodhead v.*Milwaukee, 19 Wis. 624, 652.

In a later case Chief Justice RyaN said: “Taxation is the absolute .conversion of private property to public use; and its validity rests on the use.” *Att’y Gen. v. Eau*Claire, 37 Wis. 400, 438. But it is unnecessary to cite authorities to propo*262sitions which have repeatedly been sanctioned by this court, and from which this court has recently and repeatedly drawn the conclusion that no apjDropriation can be made and no tax can be levied for a mere private purpose. *Wis. Neeley*Inst. *Co. v. Milwaukee Co.*95 Wis. 153, 159—161, *70*N. W. 68 and cases there cited, particularly *Lowell v.*Boston, 111 Mass. 454; *State ex rel. Griffith v.*Osawkee, 14 Kan. 418; *Wis. Ind. School v. Clark Co.*103 Wis. 651, 666-668, 79 N. W. 422; *Putney Bros. Co. v. Milwaukee Co.*108 Wis. 554, 84 N. W. 822; *State ex rel. New Richmond v. David*son, 114 Wis. 563, 573-578, 88 N. W. 596, 90 N. W. 1067, and cases there cited; *State ex rel. Garrett v.*Froehlich, 118 Wis. 129, 134-144, 94 N. W. 50, and cases there cited. As already indicated, the appropriations in question were purely for private purposes and hence were unconstitutional and void.

*By the Gourt.*— The judgment of the circuit court is reversed, and the cause is remanded with directions to dismiss the relation.