Court Opinion

ID: 7987382
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:27:09.479397+00
Date Added: 2024-06-11T16:35:14.431674
License: Public Domain

Campbell, C. J.,
delivered the opinion of the court.
It was not known what interpretation would be put on § 13, article 12, of the constitution of 1869, and § 21 of the act to incorporate the Mobile & North-western Railroad Company, approved July 20, 1870 (Laws 1870, p. 255), was a device to meet an assumed view of that section of the constitution. It took the form of an irrepealable (?) agreement by the state with the company, that all taxes to which it might be subject for thirty years should be applied to payment for constructing said road, or debts incurred for that; and that the affidavit of the president or cashier of the company that such application had been made during the year, should be accepted by tax-collectors in lieu of money for such taxes. A proviso is to the effect that, whenever the profits of the company should enable it to pay an annual dividend of eight per cent, upon its capital stock, the foregoing agreement should terminate. Although this was a thin disguise to evade constitutional restraint apprehended to be contained in the section mentioned, it was resolved to secure the benefit of the provision to other railroad companies ; and, on August 8,1870, an act of the legislature ivas approved to extend the provisions of the twenty-first section of the act to incorporate the Mobile & North-western Railroad Compan y to several other companies, and, among them, to the Natchez & Jackson Railroad Company, which after-wards became the Natchez, Jackson &' Columbus Railroad Company, and they were, by said act, declared to be entitled to “all'the lights, privileges, immunities and franchises” granted by said twenty-first section. By act approved Eeb*787ruary 25,1875 (Laws, p. 66), every railroad company in the state was required to pay a privilege tax; and, on March 5, 1878 (Laws, p. 233), an act was approved, which recites the act of August 8, 1870, cited above, and that doubt as to its validity, because of its history, existed, and, to put the matter beyond doubt as to this, the twenty-first section aforesaid ivas re-enacted and applied to the charter of the Natchez, J aekson & Columbus Railroad Company. In 1878 this court interpreted §13, article 12, of the constitution of 1869, to mean that the property of corporations for pecuniary profit could not be placed beyond the i’each of the taxing power; that the legislature could forbear, during pleasure, to tax, but could, at any time, revoke a grant of immunity from taxation contained in any act passed since the adoption of the constitution of 1869. Mississippi Mills v. Cook, 56 Miss., 40.
By the code of 1880, each railroad in the state ivas subjected to taxation ; but, in 1884, by act of March 12 (Laws of 1884, p. 29), the code was amended so as to restore to the Natchez, Jackson & Columbus Railroad Company the exemption from taxation “ provided in its charter, and acts amendatory thereof.” It is worthy' of remark, that this act characterizes the exemption as “ from taxation,” as plainly it'was. The revenue act of 1890 continues this exemption to railroads entitled to it (Laws 1890, p. 6). It was in the power of the legislature at any time to annul the agreement contained, in the twenty-first section aforesaid. It had complete control of the matter, and could revoke the provision for immunity from paying taxes, which is undoubtedly immunity from taxation, for paying is the burden. Instead, it manifested a determination to preserve this immunity, and restored it to the Natchez, Jackson & Columbus Railroad Company in 1878 and 1884, and guarded it against repeal by act of 1890, as shown above, and, by act approved February 19, 1890 (Laws, p. 675), said company was authorized “to sell absolutely all or any part of its railroad and other property, . . . to■gether with all franchises, rights, powers, privileges and im*788munities,” etc.; and, by the second section of said act, the Louisville, New Orleans & Texas Railway Company and the Natchez, Jackson & Columbus Railroad Company were authorized to consolidate with each other, under the name of the former, upon such terms' as they might agree upon.
The question is as to the intent of the legislature as to the continuance of the immunity from taxation it enjoyed after a sale by the Natchez, Jackson & Columbus Railroad Company, or consolidation, as authorized. It is not a question of legislative power, for that is undoubted. Nor are the considerations which justly cause courts to lean against a grant of immunity from taxation, so influential here as they often are, for there can be no danger of tying the hands of the taxing power. It is merely a question of legislative purpose deducible from the language employed, considered in connection with the history of the dealing with the subject by the legislature. Thus considered, we have no hesitation to declare that the intention of the legislature was that a purchaser should get the railroad just as held by the Natchez, Jackson & Columbus Railroad Company, with all franchises, rights, powers, privileges and immunities possessed by it under the previous legislation ; and, in authorizing consolidation’by the two companies named, the purpose was that the united-company should enjoy the franchises, rights, powers, privileges and immunities each had before; and that the State; in consenting thus, must be held to have contemplated that the affidavit to evidence the application of money to pay for construction, which was to be a legal tender for taxes, might be made by the proper officer of the consolidated company; and, as to the, remote contingency on which 'the arrangement to escape the burden of taxation was to cease to be operative, the state may be justly assumed to have intended to waive that condition, or else, to have looked to-its right to claim a cessation of the immunity when the condition mentioned in the proviso of the twenty-first section mentioned, should exist as to the Natchez, Jackson & *789Columbus Railroad as a component part of the consolidated company. But it is to be remembered that the state was not parting with any thing, was renouncing no right, foregoing, nothing, except for the time being, to let matters stand as they were, and by the light of this its act is to be interpreted.
This case is very unlike Railroad v. Maine, 96 U. S., 499. There the right of the State to tax was involved, and important requirements made of the several companies which, by consolidation, made a new company, of which no requirement was made with reference to those duties imposed on the separate companies, having reference to taxation, and the neiv company was held subject to the power of the state to tax. Nothing was required of the Natchez, Jackson & Columbus Railroad Company on this subject, but it had the privilege to pay taxes by a prescribed affidavit, which .could be as well made by an officer of a new company, having control of it, as by one of the Natchez, Jackson & Columbus Company. And, as to the very remote contingency mentioned in the proviso, that could be availed of as well under new control as under the old. The substantial thing aimed at was to free the road from taxation for thirty years by the easy terms of making an affidavit. But, in truth, all knew this was mere grace, and could be withdrawn at will. The delusion that the re-striction of the constitution could be escaped by the circuity employed in the twenty-first section of the charter of the Mobile & North-western Railroad Company had been dispelled by the authoritative utterance of this court, and the legislature was willing for the immunity to stand as before until a future day, when it should see proper to put an end to it. Favor had been shown to the Natchez, Jackson & Columbus Railroad Company, and it was intended that it should be as before in the hands of a purchaser, or in union with the Louisville, New Orleans & Texas Railway Company. It was known the state would lose nothing, and it was supposed that the interest of the state would be promoted by a transfer as authorized.
*790We approve the doctrine so well put in Tennessee v. Whitworth, 117 U. S., 139, and find it much more applicable to -this case than Railroad v. Maine, 96 U. S., 499, is.
If the words “ rights, privileges and immunities,” used in the act of 1890, authorizing sale or consolidation of the Natchez, Jackson & Columbus Bailroad Company, do not include its immunity from taxation, it would be difficult to .pass it, except by an express declaration that exemption from taxation should be among the rights, privileges and immunities to be transferred. Especially must these words be held to include the immunity from taxation when they are the very words used in the act of the legislature by which the immunity granted by the twenty-first section of the charter of the Mobile & North-western Bailroad Company was extended to the Natchez, Jackson & Columbus Bailroad Company and other companies. Laws 1870, p. 327.
We think it clear that the immunity possessed by the Natchez, Jackson & Columbus Bailroad Company was not lost by its sale and consolidation, which was expressly authorized, and that, as to this, every thing remained as before.
By their charters, the Louisville, New Orleans & Texas Bailway Company and the Yazoo & Mississippi Yalley Bail-way Company were empowered to consolidate, and the immunity claimed by the Louisville, New Orleans & Texas Bail-way Company, for the right to pay the taxes on what was the Natchez, Jackson & Columbus Bailroad Company, was not lost by its merger in the Yazoo & Mississippi Yalley Bail-way Company, but it went into that company with all its rights, privileges and immunities as far as could be in the merger, and nothing was lost thereby, except as necessarily resulted from the union.
Section 181 of the constitution of 1890 has no effect as to the exemption claimed. It left the matter as if the constitution had not been adopted. It let it alone, to rest upon legislation, unaffected by the fundamental law.
The plea of former adjudication was bad. The suit in *791which a decree dismissing the bill was rendered and relied on as an adjudication, or as a pending suit, was fatally defective. The complainant could not take any benefit from it. It was founded on an affidavit pleaded as a tender for the taxes of 1891, which had no reference to the Natchez, Jackson & Columbus Bailroad, but to a different one. The demurrer to the bill was rightly sustained on this ground, and the decree sustaining the demurrer and dismissing the bill in that case, now here on appeal, will be affirmed.
We reverse the decrees made in this case sustaining the plea and the demurrer, and dismissing the bill, and remand the case for further proceedings in the court below in accordance with this opinion. The defendant may answer within thirty days after mandate filed in the chancery court.

Reversed and, remanded.