Savannah morning news. [volume] (Savannah) 1868-1887, 1882-12-22
San Mateo vs.. southern Pacific.

san N1dteO VS.. southern RACINE.
One of the most important cases that
have ever engaged the attention of the
Federal Supreme Court is now being
argued before that tribunal. The title of
the case is g The County of San
Mateo versus the Southern Pacific Rail-
road Company. Appealed from the United
States Circuit Court of California"
The suit was brought originally by the
county of San MateO to recover taxes
claimed to be due from the Southern Pa
cific Railroad Company. In the Circuit
Court for California the case was heard
before Judge Sawyer and Associate JUS
tice Field, of the Supreme Court Of the
United States, and was decided in favor
of the defendant. The points in the case,
in brief, are the following:
The State Board of Equalization in May,
1881, assessed for the year 1881 the South
ern Pacific Railroad Company for its fran
roadway ,roadbed, rails and rolling
stock in the State. The board failed to
deduct from the railroad property in max
ing the assessment the value of mortgage
upon that property. Under the State con-
stitutiOn, in assessing property not held
by railroad or other corporations where
mortgage exists, the assessment
is divided, the owner of the property
being assessed for the value of the proper
ty without the mortgage, and the owner
of the mortgage being assessed for the
value of the security. The railroad com
pany AYERS that the act of the Board of
Equalization in assessing the corporation
for the entire value of the property ,includ-
ing the mortgage, is a discrimination be-
tween persons, contrary to the fourteenth
amendment.
The question is whether railroad cor
pOratiOns can be assessed for State taxes
on the full value of their property, includ-
ing the value of any mortgages that are
upon it, and the decision in this case is
awaited with interest by railroad compa-
MES and State authorities in many of the
! States. Among the counsel, besides emil
nent members of the California bar, Sena-
tor Edmunds and ex-senator COnkling
appear for the defendants, and also, it is
| said. Senators Bayard and Beck.
The argument of Judge Rhodes on
| Tuesday for the county was directed as
to this particular point, to showing that
| the object of the fourteenth amendment
was to prevent discrimination between
! persons on account of color, in illustra-
| ton of which he quoted the language OF
the civil rights bill, on which the amend
ment was based, to show that it proposed
to secure to all citizens the same rights
and privileges as were accorded white
! persons. He held that the power of the
State as to the method of raising revenue
was Supreme, and that the State Legisla-
ture was competent to establish certain
rules for assessment of property of in
dividuals, and other rules for the assess
ment of the property of corporations.
The plea of the defendant, it will strike
the average layman, is specious in the eX-
IRENE. However unjust the law of Cali
fOrnia, or the action of the Board OF
Equalization may have been to the cOrpo-
ration in question, it is manifestly outside
the purview of the fourteenth amendment,
which is relied upon to negative the stat
ute of the State. The plain letter of the
amendment might by legal deXterity be
twisted into a meaning such as the
defendant would have attached to
it. But the amendment is of too
recent origin to permit of a doubt as
to its spirit and intent. 1t was a purely
political measure, and had no cOntempla-
ton of corporations further than to enjoin
them from wrongful treatment of the late
Iy freed slaves when brought into relations
with them. However strong a case the
defendant might make out upon the equi-
ties of the question at issue, it con-
| cedes its lack of a remedy upon such a
| basis by raising a question which, if set
tied in its favor, can only be so settled by
! the finest judicial jugglery. So far as it
appears the Board of Equalization acted
in conformity with the law of the State,
and in the absence of any higher law the
| statute of the State is the absolute rule in
| the premises.
That mortgages as sources of income
| should be taxed is only just. Who shall
pay the tax on them, is another question.
| 1t is much the same, whether mortgage
or mOrtgagor. Whichever of the two pays
| the tax. he will guard himself before re-
| ceiving or executing such an instrument
| The State of California has elected that
corporations shall pay the taxes on mort
cages upon their property within her Dor
ders. That. in the absence of any
| express, or for that matter, perceptibly
\ implied, prohibition by the United States,
she has a clear right to do. But one may
| ask, "Why would the corporation
aggrieved rely upon the fourteenth amend
ment, if its terms promised no remedy?"
The only answer that occurs to us is that
the Republican party has been the stout
ally of our great corporate interests, and
that it is charged that the Supreme Court
has been of late years recruited from the
ranks of jurists reckOned to be friendly
to the same interests.
Whatever may be said of the wisdom or
Justice of the State of California or any
other State in dealing as she has with cor
pOratiOns as to the matter of taxation, she
unquestiOnably, in the mind of every in
telligent citizen, can do so, since the Fed
eral Constitution is silent upon the subject.
Whether in deciding the issue raised by
the appeal in question the Judges of the
Supreme COurt,Or majority Ofthem, may
take occasion to suggest the propriety of
disposing of the subject by Constitutional
provision made by the entire people of
the Republic or not, they should look well
ere they assume to allow the defendants
plea. The Supreme Court has suffered in
the estimation of the public of late, and
cannot afford to lose the responsibility
left it.
The outcome of the question is regarded
with a lively interest by those interested
in corporations, statesmen and publicists,
and the intelligent public in general.
CURRENT COMMENT.