Court Opinion

ID: 8300910
Source: CourtListenerOpinion
Date Created: 2022-10-17 11:12:40.775803+00
Date Added: 2024-06-11T16:44:19.294960
License: Public Domain

Mr. Chief Justice Neil
delivered a concurring opinion as follows:
No power can be implied in, ascribed to, or exercised by the legislature, which is contrary to any express inhibition of the constitution. I deem this principle self-evident, and believe that its maintenance is essential to the preservation of constitutional government.
If I correctly understand the dissenting opinion of Mr. Justice Lansden, it is based on the fundamental error that there is a higher power than the constitution, resting on the theory of the inherent sovereignty of the State, acting through the legislature, as its organ, in the making of contracts deemed essential to the public good. It is said that, when the soverign power'of contracting is exercised through the instrumentality of bonds issued on the faith and credit of the State, the exemption of these bonds' from taxation is a mere incident, and that such exemption is essential, in order that the State may enter the marts of the world on a parity with other States, in the sale of its securities for the purpose of obtaining money to carry on its governmental activities. It is a *473necessary inference from this position that, whenever the legislature may find it essential to make a contract of any kind to obtain money for urgent State purposes, no restriction upon the legislative power can be recognized. Charters are contracts. According to the principle insisted on, the legislature, for a sum of money to be paid to the State, deemed an adequate consideration, might grant charters to any number of corporations, exempting their property from taxes for a long term of years, or even perpetually; also, as a consequence of the same principle, the legislature might issue bonds,' making the coupons receivable for taxes, sell them in, the marts of the world, allow them to thus become contracts which could not be altered, in -view of the restrictions in the federal constitution against impairing the obligation of contracts, and the State’s revenues, its life blood, might thereby be mortgaged for generations, and the practical control of its finances taken out of its hands by the national courts. It is true that the decision in Lynn v. Polk, 8 Lea, 121, would be an apparent obstacle in the way of such result; but if the direct inhibitory provisions of the constitution do not afford an effective barrier under the doctrine we are considering, a former decision of the court in opposition to such doctrine would, not be permitted to stand.
There is a section of the constitution (article 1, section 22) which provides: “That perpetuities and monopolies are contrary to the genius of a free State, and shall not be allowed.” But a large fund might be raised for the use of the State by means of laws granting *474monopolies, fixing their price at great sums, under the operation of the destructive principle which we are combating — a favorite means of raising money in ancient times by the kings of England. Section BO of the same article reads: “That no hereditary emoluments,' privileges, or honors shall ever be granted or conferred in this State.” But this, also, under the same principle, might be disregarded, and money raised by the sale of such honors, privileges, and emoluments. The effect of the violation of these two sections would, in a few years, bring upon the State all of the evils suffered in former times by the mother country from monopolies, and now from hereditary privileges.
There is another provision of the constitution (article 2, section 31) which provides: “The credit of this Stale shall.not be hereafter loaned or given to or in aid of any person, association, company, corporation, or municipality; nor shall the State become the owner in whole or in part of any bank, or a stockholder with others in any association, company, corporation, or municipality.” But much money might be obtained by the State through disregard of this section. The bonds of the State, containing a clause exempting them from taxation, for a great consideration in money, might be sold, or lent, to or in aid of corporations; likewise the State might become, with the expectation of great profit, a stockholder in banks and other corporations. Under the principle stated that the credit of the State may be used to raise money in the most available form when it is. needed, these abuses and others already mentioned. *475might be repeated, and all of the terrible evils which the State suffered just before and just after the Civil War would again be visited upon her. It was urged then, as now, that the welfare of the State required the action taken. As a result of the policy then adopted, not only was a vast indebtedness loaded on the State, but in addition it was found that most of the railroads had' been exempted from taxation and many of the banks. A large part of the most valuable property in the State was relieved of taxation, and the burden^ of government cast upon other property, principally land, with these ordinary burdens augmented by a gigantic debt.
I need not go into 'the details of the history of that period. Upon reflection,' these will occur to any one who desires to consider the .subject; „ Fresh from these evils, the members of the Convention of 1870 prepared an instrument under which it was hoped and believed that they could never be repeated. For. more than forty years that expectation has been justified, and we trust will continue to be justified. Up until within the last few weeks no one, so far as I know, ever supposed that any property could be exempted from taxation, except that specifically permitted under article 2, section 28.: In that instrument the convention spoke deliberately and advisedly, and in the light of a then recent history, and in the' presence of enormous public evils, when it was said that “all property, real, personal and mixed, shall be taxed.” The next clause shows that the members of the convention had in mind and intended to specifically .limit the power of granting exemptions. If the language we *476have just quoted had stood alone, it might have been construed under the principle that the sovereign is excepted from all laws by implication unless specifically mentioned therein. To avoid this implication the convention added: “But the legislature may except such as may be held by the state, by counties, cities or towns, and used exclusively for public or corporation purposes, and such as may be held and used for purposes purely religious, charitable, scientific, literary, or educational, and shall except $1,000 worth of personal property in the hands of each taxpayer and the direct product of the soil in the hands of the producer and his immediate vendee.” The exceptions, couched in the language used, strengthen the original command that “all property” shall be taxed. By the exception, taken in connection with the general command, it was intended to say, and it was said, as it seems .to me, in a manner that ought to beyond misconception, that all property shall be taxed by the legislature, except the particular items specifically mentioned in the language which we have last quoted.
But it is further said in the opinion of Mr. Justice Lansden that it was meant only that all property held and owned by the citizens or taxpayers of the State should be taxed, with the exceptions mentioned, and that the section had no reference to property created by the,State on its credit; that is to bonds issued for the purpose of sale based on the credit of the State. This distinction is without foundation. Besides, going far beyond the language used in the constitution, it overlooks the fact that bonds are not property until issued *477and sold. When issued and sold to the people of the State, they are then the property of those people, and not the property of the State itself. An exemption of property so held and not included within the exception of the constitutional provisions would be a violation of the constitution. That instrument exempts only the specific items mentioned in the language quoted from article 2, section 28. This result cannot be escaped by the contention that the exemption clause in the funding act is only an incident to the power to issue bonds, and that the legislature, as the organ of the sovereign power, has the right to provide for the issuance of bonds. The constitution cannot be violated incidentally, any more than it can be violated directly. Morever, I do not think that a direct enactment to t&e effect that bonds shall be exempted from taxation can be called an incident. It is insisted in the opinion of Mr. Justice Green that the bonds are only instrumentalities of the government, and, as such, they do not fall within the inhibitions of article 2, section 28. Aside from what seems to me the inevitable construction of that section, to the effect that it was intended to cover the whole ground, it is clear that bonds issued by a State are no more instrumentalities of government than the buildings which the State uses for the transaction of its business; for example, the State Capitol, and the ground on which it rests and the furniture employed therein. Still there can be no doubt that, on failure of the legislature to exempt this property under the authority given in article 2, section 28, it would have to go on the tax list just as *478the property of any citizen of the State. In addition, it must be’conceded that the only property of this: State which can be rendered exempt by the legislature,, under the permission given, is that which is “held and used;” not only property “used” by the State, but “held” — held and used. This precludes any idea that the State can create, sell, or grant property for a consideration, or without a consideration, and make it nontaxable in the hands of the vendee or donee, whether that property be stocks and bonds or lands, or in whatsoever form property may exist. The words “held and used,” it seems to me, indicate beyond controversy that, after any property which the State owns passes out of its possession and ownership, it ceases to be “held and used” by the State, and must be liable to taxation. ■'
The erroneous theories which I have been .combating, and which have been combated in the opinion of Mr. Justice Williams, and in the concurring opinion of Mr. Justice Buchanan, are based, I think, upon a misconception of the power of the legislature. It is supposed to possess almost unlimited legislative power. It is true that the principle of constitutional construction recognized in téxt-books on constitutional laAv is that the legislature of a State has all of the powers of the people, except in matters wherein that power is limited expressly or impliedly by the constitution of such State, or by the constitution of the United States; that is to say, that the powers of a State legislature are not derivative but original ; not delegated, but inherent. In contrast, it is said that the powers exercised by the federal government are derivative or delegated powers. Such is the general *479statement occurring in many of, the decisions*, of this court. In none of these decisions, however, so far as I can recall, was any consideration given to article 11, section 16, which speaks of the powers as delegated .ones. That section reads: “The declaration of rights hereto ■prefixed is declared to be a part of the constitution of this State, and shall -never he violated pmanv pretense whatever. And" to guard against transgression. of the high powers we have delegated, we declare that everything in the bill of rights contained is', excepted out of the general powers of the government and shall forever remain inviolate.’’
The provisions with rererence to legislative power, and the distribution of powers, are found in article 2, as follows :
“Section 1. The powers of the government shall be divided into three distinct departments: The legislative, executive and judicial.
“Sec. 2. No person or persons belonging to one of these departments shall exercise any of the powers properly belonging to either of the others, except in the cases Herein directed or permitted.
“Sec. 3. The legislative authority of this State shall be vested in a general assembly, which shall consist of a senate and house of representatives, both dependent on the people, who shall hold their offices for two years from the day of the general election.”
In this same article follows section 28, which contains the limitations on the taxing power of the legislature, and the limitation on its exempting power. Perhaps it does not matter practically whether, taking article 2, *480section 3, in connection with article 11, section 16, it shall be held that'legislative powers are delegated, or, adopting the principle of general constitutional construction, that they are inherent; since it is clear that, whether delegated or inherent, the constitution saddled upon the legislative power certain specific restrictions,- and that in addition there are other restrictions to be' implied from various sections of the constitution which need not be here referred to. It seems to me, therefore, bootless to inquire whether there can be any restrictions on inherent power. The power which our legislature possesses, no matter how described, must be held as restrained bv every positive limitation imposed upon it in the constitution, to say nothing of implied restrictions. x\ny principle of construction which goes beyond this makes the'constitution nothing more than blank paper, or at least nothing more than an instrument that can be whittled and carved at the will of the legislature, with the sanction of the courts. Our only safety lies in adhering to a strict construction. It is only thus that we can avoid the dangers against which the people intended to protect themselves. It is only thus that our feet can be guided by the lamp of experience. There is sometimes manifested a tendency to a latitudinous construction, in order to obtain what at the time seems a great present benefit to the State. Such tendency influences, occasionally, even the minds of wise and patriotic men ; but others, we shall hope equally as wise and patriotic, feel that it is best to stand by the ancient landmarks, and profit by (.lie wisdom garnered from the past by tito experience of tito people of the State, as formulated *481and preserved in the venerable instrument whose terms we are copsidering today.
On the grounds stated, I concur in the opinion of $[r. Justice Williams. I believe that opinion is one bas<*|[ on sound principles, and it is strongly fortified by reasoning and authority.