The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1890-09-27

intended what is of large or general
character. There are public places
of amusement, open to the public ON
payment of the admission price.
Says Chancellor Kent. Com. 2, d.
276: Every charity which is extern
sive in its object may in a certain
sense be called a public charity. A
charity may be public though admin
lstered by private corporation. To
hold a corporation to be public be-
cause the charity was public would
be to confound the popular with the
strictly legal sense of the terms, and
to jar with the whole current Of de-
cisions since the time Of Lord Coke"
In Hall vs.. County Com'rs of Middle.
sex, 10 Allen, 100, the Court say:
Since the Legislature has not defined
public stocks and securities, the
court must ascertain, as best they
can, what are such as cases arise.
And found that bonds issued under
special Legislative authority by
state or city for aiding in the con-
structing of railroads are public
stocks.
Upon referring to the statute,
which is Chapter 62 of the laws of
1888, we find that the Minister Of the
Interior is authorized to contract
with B. +. Dillingham;, his associates,
ETC., or such corporation as shall be
formed under the general laws Of the
Kingdom, or failing this corporation
with any Hawaiian corporation for
the construction of steam railroads
on the island of Oahu, and to confer
such rights of way and ether privi-
leges, etc., as are provided for by
certain railway acts of 1878 and 1880.
Under this act the Minister has con-
tfacted with this corporation, which
is organized to build railways and
improve and deal in land on Oahu.
Section Is prohibits the Minister
from contracting to pledge the Gov.
eminent to the payment of any sub
sidy, but under section IL the con-
tract may remit for twenty years
taxes on the railroad property of the
company.
The company has issued these
bonds secured by mortgages on its
railroad property. The Government
has not guaranteed the payment of
principal or interest.
We do not regard the exemption
claimed by the corporation to be
supported by the provision of the
statute authorizing an exemption of
its property from taxation; for the
debts owing by corporations reNnot
the property of the corporation but
of its creditors. State Tax on For
eign- held Bonds, IA Wall, 800. On
the other hand, it is contended on
behalf of the Tax Assessor that these
bonds may be considered as con-
tracts, and 80 be taxable, contracts
being enumerated as taxable per.
sonal property.
This construction appears TO us to
be a forced one, and not supported
by rules of construction. The instru-
ment has all the forms and charac-
teristics of bond. It is entitled a
mortgage bond. It is payable to
bearer and furnished with series of
coupons for the semi-annual interest,
payable to bearer. In the sense claim
ed, every species of Indebtedness.
such as notes, mortgages, could be
characterized as contracts, and taxed
although the statutes exempt debts
and evidences Of Indebtedness.
1t was further submitted that the
power vested in this corporation to
condemn private property for its
uses endued it with a public char
acter. This is an extension of the
law Of eminent domain. In q sense
of the word it is in aid of pub
lie purpose. 1t fails, however, to re-
move the property of the company
from the class of property held in
private ownership, viz, the owner
ship of the stockholders, and this
obvious result may distinguish the
private character of the property,
and mortgages and bonds of such
corporation from those which are
public in the legal sense. Instances
of public property which might, if
so constituted, have been private,
although for public, that is, general
uses, are the water works system of
Honolulu, and its electric light sys-
tenn.
With our view that the question is
determined by the determination
that these bonds are not contracts
and are not public bonds. it will be
unnecessary to discuss some other
matters presented in the submission.
Our judgment is in favor of the
Railway and Land Company.
w. X. Castle for the Company:
Attorney General Peterson and w.
A. Whiting, for the Assessor.
Honolulu Ang. ~, 1890.
QUALIFIED OPINION OF DOLE, J.
1 agree with the general conclu
sions of the foregoing opinion, but
am not ready to discuss the dictum
that "the exemption claimed by the
corporation is not supported by the
provision of the statute authorizing
an exemption of its property from
taxation"
As the issue is disposed of on
other points, it is unnecessary to go
into this particular question, but it
might well be argued that tax upon
bonds whereby funds are raised for
the construction, maintenance or
operation of the railroad OF the COM
pany would be inconsistent with a
statutory exemption from taxes upon
any property fairly necessary to
the reasonable construction, main
| 4ooonoa and oparatiOn of snch rail-