Court Opinion

ID: 6905561
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:59:48.984968+00
Date Added: 2024-06-11T16:06:20.035068
License: Public Domain

Mr. Justice Harris
delivered the opinion of the court.
1. The plaintiff contends that when the Port of Portland supplies vessels with coal, it conducts a private competitive business, while the defendant argues that under all the surrounding circumstances it accomplishes a public rather than a private purpose when *580it furnishes coal to steamships. The Port of Portland is not claiming that it has a right to exist for the sole purpose of selling coal as a business, but it does insist that there is no constitutional inhibition against granting power to it to furnish coal to ships when that power is considered in connection with the object for which the port was created. In view of the position taken by the defendant, it becomes necessary to refer to the history of the creation and development of the port as we read it in the complaint and answer and in the various legislative enactments.
The Port of Portland was established and incorporated in 1891 by an act of the legislative assembly, in order to provide for the improvement of the "Willamette and Columbia Eivers in the port and between the port and the sea, the declared object being to make and maintain a ship channel to the sea of not less than 25 feet in depth: Laws 1891, p. 791. So far as necessary to carry out the object of the corporation, the port was granted full control of the rivers ‘ ‘ so far and to the full extent that this state can grant the same,” was empowered to exercise the right of eminent domain to do whatever “may be found necessary or convenient in creating or maintaining the channel” at a •depth of 25 feet, and to levy and collect taxes upon all taxable property within its boundaries. In 1899 the authority of the port was enlarged, so that among other things it could make certain rules and regulations: Laws 1899, p. 146. All prior legislation was supplanted by the legislative act of 1901 found on page 417, Laws of 1901, and reproduced in Sections 6076 to 6105, L. O. L., inclusive. By this enactment it is declared that the object of the port is “to promote the maritime shipping and commercial interests of the Port of Portland,” the authority of the defendant was *581again enlarged, and in addition to the rights conferred upon it by previous legislation it was granted other powers among which was the right to erect, own and operate a dry dock, and adequate provision was made for the levying of taxes to defray the expense of the drydock, dredges and work done by the port. In 1908 the legal voters of the port initiated and adopted a measure which provided for the operation of steam tugboats and steam and sail pilot boats, and in 1912 the voters initiated, and a majority voted for, a proposed amendment, which attempts to confer the added power of furnishing ships with coal.
The ultimate aim of all the legislation which has been enacted concerning the Port of Portland is to promote the maritime shipping and commercial interests of the port within whose boundaries is located the City of Portland, the metropolis of the state, and this aim is accomplished by maintaining a ship channel of sufficient depth between Portland and the sea so that ocean-going vessels may enter and discharge cargoes brought from other ports and here receive the grain and timber which contribute in such large measure to the welfare, happiness and prosperity, not only of the Port of Portland, but also of the entire state. The maintenance of an adequate ship channel from Portland to the sea is necessary for the continued well-being of the Port of Portland; and, moreover, a failure to maintain an open channel for sea-going vessels would directly or indirectly affect the entire state. A mere statement of the objects for which the corporation was organized is a demonstration of the fact that it was created for a public purpose. Indeed, the plaintiff concedes that dredging and maintaining a sufficient waterway to the sea is doing a public work, but he does question the right of the port to sell coal to ships.
*5822. The defendant proposes to purchase a site and erect coal-hunkers and maintain a supply of suitable coal for sale to ships, and the expenses of the business would necessarily be paid out of funds raised by taxes. No tax can be imposed for a private purpose, and therefore the port cannot engage in selling coal to ships unless it is promoting a public purpose: People v. Salem, 20 Mich. 452, 474 (4 Am. Rep. 400); Loan Assn. v. Topeka, 20 Wall. 655 (22 L. Ed. 455); Cooley, Taxation (2 ed.), 103; 2 Dillon, Mun. Corp. 1363; 28 Cyc. 1663; 37 Cyc. 719; Gray, Lim. of Taxing Power, §169.
A clear and definite line of distinction cannot be drawn between purposes of a public and those of a private nature, and it is perhaps impossible to enumerate all the characteristics which distinguish a public from a private purpose: Cooley, Taxation (2 ed.), 106; Opinion of the Justices, 150 Mass. 592 (24 N. E. 1084, 8 L. R. A. 487); State ex rel. v. Lynch, 88 Ohio St. 71 (102 N. E. 670, Ann. Cas. 1914D, 949, 48 L. R. A. (N. S.) 720); Opinion of the Justices, 155 Mass. 601 (30 N. E. 1142, 15 L. R. A. 809); Laughlin v. Portland, 111 Me. 486 (90 Atl. 318, Ann. Cas. 1916C, 734, 51 L. R. A. (N. S.) 1143).
3. It has been said that the “public purpose” for which a government may levy taxes “is one which concerns its own people, and not some other people having a government of its own, for whose wants taxes are laid”; and “the purpose must, in every instance, pertain to the sovereignty with which the tax originates”: Cooley, Taxation (2 ed.), 108. Quoting from Opinion of the Justices, 150 Mass. 592 (24 N. E. 1084, 8 L. R. A. 487):
‘ ‘ The essential point is that a public service, or use affects the inhabitants ‘as a community, and not merely us individuals.’ ”
*583The Supreme Court of New York has held that:
l “The true test is that which requires that the work should be essentially public, and for the general good of all the inhabitants of the” government or subdivision of government: Sun Printing Assn. v. Mayor, 8 App. Div. 230 (40 N. Y. Supp. 607), affirmed in 152 N. Y. 257 (46 N. E. 499, 37 L. R. A. 788).
Judge Cooley is authority for the statement that:
“The reason of the case and the settled practice of free governments must be our guides in determining what is or is not to be regarded a public use; and that only can be considered such when the government is supplying its own needs, or is furnishing facilities for its citizens in regard to those matters of public necessity, convenience, or welfare, which, on account of their peculiar character, and the difficulty — perhaps impossibility — of making provision for them otherwise, it is alike proper, useful, and needful for the government to provide”: Cooley, Const. Lim. (6 ed.), p. 655.
The Supreme Court of the United States announced in the much cited case of Loan Assn. v. Topeka, 20 Wall. 655 (22 L. Ed. 455), that:
“It is undoubtedly the duty of the legislature which imposes, or authorizes municipalities to impose, a tax to see that it is not to be used for purposes of private interest instead of a public use, and the courts can only be justified in interposing when a violation of this principle is clear and the reason for interference cogent. And in deciding whether, in the given case, the object for which the taxes are assessed falls upon the one side or the other of this line, they must be governed mainly by the course and usage of the government, the objects for which taxes have been customarily and by long course of legislation levied, what objects or purposes have been considered necessary to the support and for the proper use of the government, whether state or municipal. Whatever lawfully pertains to this and is sanctioned by time and the acquiescence of the people may well be held to belong to the public use, and proper *584for the maintenance of good government, though this may not be the only criterion of rightful taxation”: Gray, Lim. of Taxing Power, § 176; Union Ice & Coal Co. v. Town of Ruston, 135 La. 898 (66 South. 262, Ann. Cas. 1916C, 1274, L. R. A. 1915B, 859).
4. Custom and usage may be important factors in determining whether a tax is for a public or private purpose; but, while recognizing the influence of customs and usages already established, the courts are mindful of the fact that new customs may be formed and new usages may prevail, and that conditions may change as time advances, so that a purpose which was concededly private a decade ago may now be public and so, too, those which to-day are admittedly private purposes, to-morrow may be public in their nature: Sun Printing Assn. v. Mayor, 8 App. Div. 230 (40 N. Y. Supp. 607); State ex rel. v. Lynch, 88 Ohio St. 71 (102 N. E. 670, Ann. Cas. 1914D, 949, 48 L. R. A. (N. S.) 720); Laughlin v. Portland, 111 Me. 486 (90 Atl. 318, Ann. Cas. 1916C, 734, 51 L. R. A. (N. S.) 1143); Holton v. Camilla, 134 Ga. 560 (68 S. E. 472, 20 Ann. Cas. 199, 31 L. R. A. (N. S.) 116); State ex rel. Attorney General v. Toledo, 48 Ohio St. 112 (26 N. E. 1061, 11 L. R. A. 729); 27 Harvard Law Review, 162; 1 Dillon, Mun. Corp. (5 ed.), § 21.
The history of the Port of Portland furnishes an example of material changes wrought within a comparatively few years. When the corporation was created most of the incoming and outgoing ocean trade of Portland was carried in sailing vessels, but now conditions are reversed, and steamships carry the bulk of the commerce. Every power which from time to time has been conferred upon the Port of Portland has been granted in order to further the basal and fundamental objects for which the defendant was created. Cloth*585ing the Port of Portland with the power to sell coal to ships would, under the conditions confronting the defendant, only he granting the right to exercise an additional power in aid and in furtherance of the elemental purposes for which the port exists. The power to sell coal to ships would only be accessorial to the definite public purpose for which the port was created. Exercise of the additional power would tend to preserve the health of the corporate body to the benefit and advantage of all the people within the boundaries of the port, and hence would be so intimately related to the object for which the defendant was created and would be so essential for the future well-being of the port that this added power, when employed in furtherance of the prime object of the defendant, itself takes on the characteristics of a public purpose. Under all the circumstances, the sale of coal to ships would concern all the people of the port; it would affect the inhabitants as a community, and not merely as individuals, and it would be for the general good of all the inhabitants of the port: The George W. Elder (D. C.), 159 Fed. 1005; Farrell v. Port of Portland, 52 Or. 582, 590 (98 Pac. 145).
Even though the defendant may not be governed by the enactment, it is nevertheless worth noting that the legislature has adjudged that selling coal to ships by ports organized under the general law of 1909 is exercising a power for a public purpose: Laws 1915, p. 62, amending Section 6121, L. O. L.
5. Thus far the inquiry has been directed to a consideration of the question of whether or not the port would be carrying out a private or a public purpose if it exercised the power to sell coal to ships, and it now becomes necessary to ascertain whether the defendant does possess that power. The legislature has *586not granted the Port of Portland the right to sell coal; and, moreover, it appears from paragraph 3 of the complaint, and it is admitted by the answer, that the defendant proposes to act under the authority of a purported amendment to the charter or act of incorporation attempted to be passed by the voters of the port at the general election held in November, 1912. The voters of a port, however, cannot, without legislative aid, constitutionally amend their charter or act of incorporation, and since they cannot amend their charter, and neither the legislature nor the people of the whole state have conferred the power to sell coal, the defendant is as yet powerless to engage in that business : State ex rel. v. Port of Astoria, 79 Or. 1 (154 Pac. 399); Rose v. Port of Portland, ante, p. 541 (162 Pac. 498). The legislative assembly possesses ample authority to permit ports to sell coal; and the exercise of that authority, when properly granted, and used in aid of the fundamental objects of a port, is the employment of a power for a public use. The defendant can sell coal to ships whenever the legislature or the voters of the state at large grant that right, but the defendant cannot engage in the coal business until it receives proper authority. The demurrer to the separate defense set forth in the answer should have been sustained. The decree is reversed, and the cause is remanded for such further proceedings as may not be inconsistent with this opinion.
Beversed and Bemanded.