Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1901-02-07

, John Biggs. solicitor for the p. W
a. H., Railroad Co., Delaware RaiIroa
70. and D., M. q v. X. r. 90. has sen
the following letter to mem hers of IA
Legislature apropos Of the prorose,
bills to increase the taxation OF thes
railroads: s'
Wilmington, DEL, Feb. 9Th, 1g01-To N,
Chairman and Members COMMITTEES Prlyat
corporations, House of Representative yes
lover, peI.-Gentlemen: IL connection
with the bills now under consideration b,
your committee which propoee large In
crease In the annual payments by IN,
fhllauelphia, Wilmington q Bnltimor,
hailroad Co., the Delaware Railroad Co
and the Delaware, Maryland n VlrRlnj,
hallroad Co, respectively, IL Communication
OF taxes provided for by act OF August lltb,
1854, Imposing tax of 10 cents Der can't,
on passengers) an act of April 9Th. is6l
| imposing tnxes on net earnings and On MIN
stock beg, on behalf Of each of said com.
panles, to invite your attention to the cir.
cunstances and conditions connected with
enactnent OF the statute OF April 18th. 1873,
authorizing communication of State taxes by
me Philadelphia, Wilmington & Baltimore
haiiruad Co., which statute furnishes tbe
nnsis ald predicate for tho statute of Anril
9th, ise6' aid April Goth. 1887, authorizing
communication by tho other above named
eonipanles; respectively. Statements and
ctl.lclsins nave been made respecting the
delaware Railway Co. g communication.
which are apparently referuble TO lack of
knowledge or Information concernin0 ths
conditions above alluded to-. ana which in
dnred the passage OF the act of 1873.
IL must be well understood that during
tne whole period between May, 1856, and
May, 1897, the Philadelphia, Wilmington
baltimore Railroad 90. was In nos
session and operation of the Delaware
hniiroad Co.'s railroad and property,
under tense providing a fixed annual
rental; md that there were frequently,
and after 1s7s, years IN which The revenues Venues
derived from the leased property were
largely inadequate to pay the Operating en-
penses and said fixed rental.
:, IL will be noted that the provisions OF
s sne act OF 1854, imposing tax upon pas
transported wholly within the State. but
included as well passengers whose carriage
involved Interstate Transportation,
Immediately after the enactment of this
seatlte, tne railroad company was advised
Dy counsel that, es to passengers "entering
into. departing from, or passing tbrouab
tho State, 1t was an attempted regujation
Oh Interstate commerce, aud, therefore, uni
constitutional and void; and that, as to al
returns and payment of tax that might be
made by the railroad company with
reference to such Interstate passengers, they
should be made under protest. The first re-.
turn and payment made by the railroad
company was 81 1926 for the month al |
december, 1864, and like monthly returns
including as well intentate passengers n
those transported wholly within the Statel |
were were. thereafter regularly made to and In.
the taxes paid In conformity Herewith; but |
al such payments OF taxes as TO interstate |
passengers were made under protest. and |
with the express reservation of the railroad |
ccoinpany's right to demand and recover
the same.
Tie aggregate amount Of taxes on all
passengers paid by the railroad company
1urlng said last mentioned period, as
snown by Its report was $368, 039. 40.
Inc aggregate amount paid on passengers
carried wholly within the State, ascertained
% accurately as possible from the COM
pany's records and other data is, $50, sea, 10.
Showing aggregate payment on account
If s307, 345. 20. y ''o sum
After the month OF October, 1868. the
abroad company declined TO make return
y Interstate passengers, and thereafter suit
vas incepted against the railroad compapy
~ the State treasurer, by case stated in
ne Superior Court of New Castle county. |
which, on the application Of both PARTIES |
vas ordered to be heard in the Court OF
.rrors and Appeals; and having been so
euro, it was unanimously held and decided
y said court that the statute $50 far as IL
perates upon persons entering into, de-
artlng from, or passing through the /
tate Is imperative and invalid. ~ 1
nder the commercial clause OF the Federal ,
9,nstitution tsee Houston, pp. 189-199). :
ms Judgment fully sustained the con- !,
sntiOn OF the railroad Company. and the !
fectiveness OF its protest as TO tax on c
lterstate passengers, and as the result q
lereof the company became eQuitably en- q
Tied 10 demand and receive the said sum q
S3OI ,5lo.7O payment whereof had been i
nlawtully exacted under color of said !,
atute by the. State authorities, but nada y
lder protest as aforesaid.
meanwhile, the act OF 1869 having been =
Used, it Immediately became the subject d
litigation IN the United States Circuit
ourt, and was finally passed upon by the a
lpreme Court in October, 1873. r
Pending this litigation, however, the !,
hole matter OF State taxes, under both VI
Is, were made the subject of careful in p
stigation and consideration between the u
representatives. of the railroad companv VI
ID the General Assembly at Its session 81 /,
%. and an agreement considerably h
ached fixing a fair and lust sum 10 be a.
id by said railroad company in COM y
ltatlon OF taxes; and the act of 1873 pro- =,
ilng Tor the Communication and producinu Il
sum OF $4,000, the amount agreed on &C
8 passed accordingly. al
ne cnhrter Vi tne Delaware Railroad Co | al
s!nptea its property from all taxes for a nj
N 1885. "-' '"o &C
although In the discussion and neQo- re-
ZION between the representatives OF the ~
lroad company and the committee of the tit
neral Assembly, which resulted In the la
reement and adjustment evidenced Inv js
act of 1873, 1t was well understood thar NJ
muse OF its charter exemption, the Della, a.
re Railroad Co. g property could not be % %'
ectly taxed under either act; this was. W
'eitheless, taken into consideration ia
ng and prescribing the annual pay an
ny OF saU.uUO, and u was then we'll under ah
~ Us contemplated and designed that Re
sum In. fact represented what was re- wi
ueu as a fair and Just contribution from | ~,
property OF both companies; aud as 49,,
Phiihdelphia, Wilmington q Baltimore ar'
iiroag 20. was lessee of the Delaware rul
Iroad TO-, and In receipt of all proceeds al
n its operation, as well as the owner of of
lges proportion of its capital stock, the tri
ultions were such as tu render the shi
perty OF the Delaware Railroad Go IL.
e TO contribute to such payment, and ~. ~.
eby accomplish Indirectly that which ~
d not be, accomplished directly. shi
was, OF course. understood and stipu- the
between the railroad coDpany's repre- ter
alive and the General Asseinbly's COM IN
ices that the company should relinquIsh \ m
lain for payment of the above men. ~
ed sum Of 500, 846.70, and this consti- ~
an important feature and elerent In iih
lucing the agreement and adjustment or
ih prescribed SAC, 600 as the amount Of Gri
annual payment. nor
hen the act OF 1887, authorizing pay ,1is
{ by Delaware Railroad Co. or the
ial sum Of $1,000, in Communication Of
axes, was under consideration, all the II
instances and conditions as herein &C
re set forth, were fully presented and 40 40.
e known ~ the committees of the ihs'
sral Assembly having charnn tharenf. the