This appeal presents the interesting and important question whether so much of the Act of 1880, ch. 16, as granted to the appellee an exemption from taxation on the gross revenues from its property in Maryland, beyond the *Page 466 annual rate of one-half of one per cent was subject to repeal by subsequent Legislatures. If it is determined that the Act was subject to repeal, then the further question arises whether it was in fact repealed by the Act of 1890, ch. 559, which imposed a tax of one per cent per annum on the gross receipts of all railroads in the State operated by steam.
A proper consideration of the issues thus presented involves the ascertainment of the status of the appellee in reference to liability for taxation prior to the passage of the Act of 1880, the nature and operation of that Act, and the operation and effect of the Act of 1890 as a repeal of so much of the Act of 1880 as granted to the appellee a partial exemption from taxation.
It may assist us in arriving at a clear understanding of the case to review briefly the corporate history of the appellee.
The Act of 1827, ch. 72, incorporated the Baltimore and Susquehanna Railroad Company to operate a railroad from Baltimore to the Susquehanna River, and conferred upon it immunity from taxation.
By the Act of 1854, ch. 250, the stockholders of Baltimore and Susquehanna Railroad Company were authorized to unite and consolidate with three Pennsylvania corporations, which were then operating connecting railroads, so as to form one corporation to be called "The Northern Central Railway Company," on such terms and conditions and in accordance with such regulations and agreements as the several companies might adopt. Similar authority for the consolidation on the part of the Pennsylvania corporations having been procured from the Legislature of that State, articles of union were executed by all of the corporations, by which, among other things, they transferred to the new company the property, rights, privileges and immunities which had theretofore belonged to the several old companies. It is not necessary to state in fuller detail the various terms of this consolidation or the transactions by means of *Page 467 which it was accomplished for the legal operation and effect of it upon the liability to taxation of the new corporation, which is the present appellee, has been carefully considered and passed upon by this Court in the case of the State v. The NorthernCentral Railway Co., 44 Md. 131, which will be referred to more at large hereafter.
The appellee enjoyed the exemption of its property in Maryland from taxation, thus secured to it by the Act of 1854, down until 1866, when the Legislature passed a general assessment law, which provided for the assessment of all property in the State, and also repealed in general terms all laws exempting property from taxation. The Act of 1870, ch. 362, also contained a clause repealing "every provision contained in the charter, or supplements thereto, of every railroad company incorporated by the laws of this State or contained in any law heretofore passed by the Legislature of this State whereby the stock or property, real or personal, of any railroad company * * * is exempted from taxation." Then followed the Act of 1872, ch. 234, which imposed a tax of one-half per centum annually upon the gross receipts of steam railroads.
Under the last-mentioned law a tax was levied on the appellee of one-half per cent of the gross receipts of its Maryland property for part of the year 1872, and all of the year 1873. This tax the appellee refused to pay and the State brought suit to recover it, and the judgment being against the State it brought the case here on appeal, and it is reported in44 Md. 131. This Court held the appellee to be liable for the tax and reversed the judgment of the lower Court. In deciding that case it became necessary for this Court to examine carefully into the corporate history and legal status of the appellee and to consider and pass upon all of the legislation to which we have referred which had then been enacted, as well as the transactions of the four former corporations incident to their consolidation into the Northern Central Railway Company.
The Court in its opinion in that case announced a number *Page 468 of conclusions which have a material bearing upon the case at bar. They are as follows:
First. That the appellee was created and derived its existence from the Act of 1854, ch. 250, and was in no sense created by the articles of union executed by the several consolidating corporations from the union of which it sprung.
Secondly. That the rights and privileges, including exemption from taxation granted to the Baltimore and Susquehanna Railroad Co. by the Act of 1827 were, in the consolidation of the four companies, conferred on the appellee, not by transfer from the Baltimore and Susquehanna Railroad Company, but as new and special grants under the Act of 1854, which created the appellee as the new corporation.
Thirdly. The Constitution of 1850 having been in operation when the Act of 1854 was passed, and the exemption from taxation having been part of the charter granted by that Act to the appellee, the power of the Legislature to repeal or revoke the exemption thus granted, whenever in its judgment the public interest required it, was too clear to be questioned.
Fourthly. The general assessment law of 1866 and the Act of 1870, ch. 362, contained a plain and unambiguous expression by the Legislature of its intention to repeal this exemption, and those Acts in fact accomplished its repeal.
Fifthly. The Act of 1872, ch. 234, imposing an annual tax of one-half per cent upon the gross receipts of steam railways was a valid exercise of the taxing power of the State, and the appellee was liable thereunder to the tax at that rate on the gross receipts from its property in Maryland.
After the case had been remanded by the decision in 44th Md. and before it had been retried in the lower Court the Act of 1880, ch. 16, was passed. This Act is described in its preamble as one to adjust and finally settle by agreement the pending tax controversies between the State and *Page 469 the company by making the latter thereafter liable to taxation to a certain extent and providing for the payment of certain indebtedness claimed by the State from the company, and it is declared to be "An Act supplementary to the Act of eighteenhundred and fifty-four, chapter two hundred and fifty," which was held by this Court in 44th Maryland to constitute the charter of the appellee. No further change in the situation occurred until the State, by the Act of 1890, ch. 559, raised the annual rate of tax upon the gross receipts of steam railroad companies to one per cent. The appellee paid the increased rate of tax, upon the gross receipts of its property in Maryland, under protest, until 1896 when it refused to do so any longer, and the present suit was brought to recover the tax for the year 1896. The case was tried before the Court below without a jury, and the Judge, by his ruling on the prayers, held that the Act of 1880 constituted a contract irrepealable without the consent of the appellee, by which it was exempted from paying more than one-half per cent tax upon its gross revenues, and he rendered a verdict and entered up judgment accordingly, from which the State appealed.
This brings us to the consideration of the most important question presented by this appeal, that is, whether the passage by the Legislature of the Act of 1880 and its acceptance by the appellee constituted a contract between it and the State which it was beyond the power of the Legislature to repeal or impair.
The Act of 1880 is declared upon its face to be supplemental to that of 1854, and it grants to the appellee the partial exemption from taxation in almost the identical words in which the former Act granted the complete exemption. The practical effect of the later Act upon the prior one, which was the charter of the appellee, was to so amend it as to substitute the partial for the complete exemption. The same constitutional provision touching the formation of corporations, which provided that all laws passed in pursuance thereof should be subject to alteration or repeal, *Page 470 was in force when each of the two laws was passed. If by reason of this provision of the Constitution it was not competent for the Legislature to grant to the appellee an irrepealable exemption from taxation by the Act of 1854, which constituted its charter, it cannot be successfully contended that the Legislature could make a valid grant of such an exemption by an Act passed in 1880, which was supplemental to or amendatory of the former Act, unless the feature which we shall hereafter notice in the Act of 1880 so distinguishes it from the laws contemplated by the section of the Constitution to which we have referred, as to take it out of the operation of that section.
This Court in the opinion in the case in 44th Md., in commenting upon the effect of the Constitution of 1851 upon the Act of 1854, say: "In accepting the Act of 1854 and in the execution of the articles of union under the operation of which the Baltimore and Susquehanna Railroad has merged and ceased to exist, the stockholders are presumed to have known that the corporate powers and privileges granted by that Act to the Northern Central Railway Company were subject to the provisions of sec. 47, Art. 3, of the Constitution, and that the exemption from taxation claimed under that Act was liable to be repealed by the Legislature whenever in its judgment the public interests required it. Be that, however, as it may, it was not within thepower of the Legislature under the Constitution of the State togrant to the appellee immunity from taxation or any othercorporate privilege beyond the power of a subsequent Legislatureto repeal or revoke." It is to be observed that the Court does not rest the inability of the Legislature to grant to a corporation an irrepealable exemption from taxation upon the form or character of the particular statute then under consideration, but puts it upon the broad ground of the want of power in the Legislature under the Constitution to make such a grant at all. The Court certainly in effect determines that any form of law which grants to a corporation such a corporate privilege as immunity from taxation is one *Page 471 passed pursuant to the section of the Constitution referred to, and is therefore subject to alteration or repeal by future Legislatures.
If this construction of the Constitution be correct, how can we escape the conclusion that the Legislature of 1880 had no greater power, by the passage of the Act upon which the appellee bases its claim to a partial exemption from taxation, to grant that exemption in an irrepealable form, than the Legislature of 1854 had to grant a total exemption in like form by the Act which it passed, and which this Court has held to be subject to repeal at any time? The appellee attempts to answer this query by calling attention to the fact that the Act of 1880 differs from that of 1854 in the essential particular that it, upon its face and especially in its preamble, professes to have been passed for the purpose of adjusting and settling by agreement the controversies which were then pending between the State and the appellee in reference to the extent and validity of the claims of the latter to exemption from taxation, and that the contents of the Act itself show that the appellee in accepting it and complying with its terms gave up a valuable right of appeal to the United States Supreme Court, and paid a large sum of money to the State, thus supplying a valid consideration which made the action of the State binding and permanent. Without going into the contents of the Act in detail or fully reciting the things done upon the faith of it by the appellee it may be conceded that if there were no constitutional difficulty in the way, the transaction between the State and the appellee, as part of which the Act of 1880 was passed, was one so far in the nature of a contract or agreement that neither party could abrogate it without the consent of the other.
The difficulty with the appellee's contention is that the inability of the Legislature under the Constitution to make in 1880 a valid and irrepealable grant of such a corporate privilege as immunity from taxation, did not rest upon the want of a sufficient consideration for the grant, but upon the *Page 472 fundamental want of power in the Legislature to make it by reason of the provisions of the Constitution which is the supreme and controlling law of the land. It is plain, therefore, that the question of consideration vel non cannot be a controlling one in determining the question now at issue. If, as this Court has decided in 44 Md., the appellee in executing the articles of union, under the Act of 1854, must be presumed to have known that the privileges granted by that Act were subject to the provisions of the Constitution and repealable at any time, so must the appellee in accepting the provisions of the Act of 1880 be presumed to have known that the immunity from taxation granted by that Act was in like manner and for the same reasons subject to repeal by future Legislatures.
If the Act of 1880 had been passed prior to the adoption of the Constitution of 1850, we would, under the decisions of this Court in Tax Cases, 12 G. J. 117; The State v. The B. O.R.R.Co., 48 Md. 71; The State v. The Northern Central R.R. Co., 44 Md. at p. 162, and The County Commissioners v. A. E.R.R.Co., 47 Md. 611, and of the United States Supreme Court inMiller v. The State, 15 Wal. 448, and other cases, have been compelled to uphold its validity beyond the power of subsequent Legislatures to repeal or impair, even though its operation would be to tie the hands of all future Legislatures and practically alienate the sovereign right of taxation, but in view of the language already referred to, used by the Court in 44 Md., the privilege of partial immunity from taxation conferred on the appellee by the Act of 1880 must be held to have been subject to repeal by subsequent Legislatures.
The question remaining for consideration is whether the Act of 1890, ch. 559, repealed the exemption from taxation claimed by the appellee under the Act of 1880. We think that the exemption was so repealed both because the language of the repealing clause contained in the later Act was broad enough to cover it and because of the plain inconsistency of the provisions of the two Acts. The Act *Page 473 of 1890 declares that the tax thereby provided for shall be levied annually upon the gross receipts of "all railroadcompanies whose roads are worked by steam, incorporated by orunder the authority of this State, c., * * and doing businessin this State" and it requires "each and every railroadcompany" to annually make report under oath of its gross revenues and transmit the amount of the tax to the comptroller and provides that "if any officer of any such corporation orcompany" shall make a false statement in such report he shall be guilty of perjury. The repealing clause of the Act repeals "AllActs or parts of Acts in conflict herewith." The language thus used by the Legislature plainly indicates a purpose to apply a uniform rate and method to the taxation of all steam railroads within the State and to repeal, so far as it could, all prior laws which interfered with the consummation of that purpose.
Apart from the express repeal of all inconsistent laws by the Act of 1890, the scheme and purpose of that Act, as gathered from the comprehensive expressions used in describing the subjects of its operation, are entirely inconsistent with those of the provisions of the Act of 1880 which, if they remained in force, would exclude the appellee from the operation of the later Act.
The subject of the implied repeal of an existing law by the enactment of a later one, whose provisions are inconsistent with it, has frequently been the subject of consideration by this Court, and the substance of its conclusions has been well stated by the former CHIEF JUDGE ALVEY in The W.M.R.R. Co. v. TheAppeal Tax Court, 50 Md. 296, as follows: "The general doctrine on the subject of implied repeals is that when there are two Acts on the same subject both are to be given effect if possible. If, however, the two Acts are plainly repugnant to each other in any of their provisions the later Act, without any repealing clause, will operate, to the extent of the repugnancy, as a repeal of the first; and even where the two Acts are not in express terms repugnant, yet if the later Act covers the whole subject *Page 474 of the first and embraces new provisions showing that it was intended as a substitute for the first Act, it will operate as a repeal of that Act."
Tested by the principles thus laid down the Act of 1890, which by its express terms imposes a tax of one per cent upon the gross receipts of all railroads worked by steam within the State, must be held to be so inconsistent with that part of the Act of 1880 which provides that the appellee shall not pay a greater tax upon its gross receipts than one-half of one per cent, as to effect a repeal thereof.
If we were in doubt as to the legal operation of the Act of 1890 upon that of 1880, and thought it equally susceptible of either of the two constructions contended for, it would be our duty to adopt the construction which would tend to effectuate rather than the one which would tend to defeat the intention of the Constitution that taxation should be fair and equal in proportion to the value of the property assessed. Such a construction of the provisions of the later of the two Acts, now under consideration, would require us to hold that they repeal the exemption from taxation granted to the appellee by the former one,
It follows from what we have said that the judgment appealed from must be reversed and the case remanded.
Judgment reversed.
(Decided January 10th, 1900).