People v. Central Pacific Railroad

By the Court,

Wallace, C. J.:

This action is brought to recover of the railroad company the taxes upon some ninety-two miles of railroad and telegraph line, the property of the company, lying within two of the several revenue districts into which the County of Placer is divided.

The complaint, which is in the form usual in such cases, avers, among other matters, that the railroad company is a corporation duly organized and acting under the laws of the State of California, and is engaged in the business of constructing, operating, and running therein its railroad and telegraph line; that ninety-two and one fourth miles of the road and telegraph line are situated in the County of Placer, and are subject to taxation therein for both State and county pui’poses; that a tax was duly levied upon all the property in the county subject to taxation—a State tax of one dollar, and a county tax of one dollar and ten cents upon each one hundred dollars worth of property; that there was thereby duly assessed to the railroad company, upon so much of their road and telegraph line as lay within the First Revenue District of the county, upon a valuation of twelve thousand dollars per mile, a State tax of one thousand nine hundred and fifty dollars and a county tax of two thousand one hundred and forty-five dollars; and upon so much of their road *422and telegraph line as lay within the Second Revenue District in said county, upon a like valuation per mile, a State tax of nine thousand one hundred and twenty dollars, and a county tax of ten thousand and thirty-two dollars—all which several sums are alleged to be due and unpaid, and judgment is demanded therefor, with the percentage, damages, and costs in such cases provided by statute.

The answer of the company does not deny that it is a corporation deriving its existence from the State laws, but, among other defenses set up, denies the validity of the alleged tax; denies that the valuation really fixed upon the road and telegraph line by the Assessor and Board of Equalization exceeded six thousand dollars per mile thereof, but alleges that there was added to this valuation of six thousand dollars per mile another sum of six thousand dollars per-mile, by which the gross valuation of the road and telegraph fine purported on its face to have been fixed at twelve thousand dollars per mile, but that this additional six thousand dollars per mile was, in truth, the imposition of a tax upon the value of the business of the company transacted upon the road in the transportation of passengers, freight, etc., and that the Board of Equalization of Placer County, in dealing with the taxation of the road and telegraph line, received and considered certain evidence brought before them as to the mere business done and profit realized by the company in the use of the road and the telegraph line.

A trial was had in the District Court for Placer County, where judgment having been rendered in favor of the people, as prayed for in their complaint, and a motion of the defendant for a new trial having been denied, this appeal is brought from the judgment and the order denying the new trial.

Ho point can be considered here which is rested upon the refusal of the motion for a new trial. There is found in the record no sufficient specification of the grounds of the mo*423tion, in accordance with the prescribed practice. The statement, as filed and settled, purports, it is true, to set out in the body of it the several proceedings had at the trial—the proffers of evidence, the rulings of the Court, and the exceptions reserved; the only attempted specifications of the grounds of the motion, however, are as follows:

“First—Errors in admitting the evidence offered by plaintiff, as set forth in the foregoing statement, objected to and excepted to at the time.

“Second—Errors in excluding the evidence offered by defendant, as stated in the foregoing statement, and to which refusal and exclusion defendant then and there excepted.”

It has been repeatedly determined here that, in support of a motion for a new trial, the specifications of the particulars in which the evidence is insufficient, or of the particular errors of law upon which the moving party will rely, is indispensable under section one hundred and ninety-five.

The specification required, though found in, and, therefore, in one sense a part of the statement, is nevertheless distinct practically from the statement—it must, of course, be supported by the statement—but it may be and usually is narrower than the statement in its scope. It cannot, indeed, be broader; it cannot point to anything which is not to be found in the statement by which it is supported, but it may, and in practice usually does, omit many matters of alleged error and insufficiency which are to be found in the statement, and which, by thus omitting, it definitively repudiates and abandons. Its office is to select out of the mass of these, and by this selection to preserve such and only such of the matters appearing in the statement itself, upon which it is the purpose of the party to finally rely and insist in support of the motion. It would be unprofitable in this connection to go over the numerous cases in this Court in which this rule has been applied and the statement disre*424garded; it is sufficient to say that in more than one of them the rule referred to was much more nearly complied with than has been done in this case. (Beans v. Emanuelli, 36 Cal. 117; Butterfield v. C. P. R. R. Co., 37 id. 381.) This view disposes of several questions argued by counsel, but there are others made and not depending upon the motion for a new trial, which we proceed to consider.

First—It is claimed that the railroad and telegraph line in question are not subject to taxation under State laws. An elaborate argument has been submitted on the part of the raihoad company, in which it is urged that the road and telegraph were established by the Federal Government in the exercise of its constitutional powers “ to establish Post Offices and post roads;” “ to provide for the common defense and general welfare of the United States;” “to suppress insurrections and repel invasion,” and “to raise and support armies.” That the taxing power of the State Government, otherwise extending generally to ail subjects found within the borders of the State, is to some degree qualified and restrained by the provisions of the Federal Constitution and by Acts of Congress passed in pursuance thereof, is undeniable. The question in this respect has always been, as to the mere degree or extent of the restraint imposed. When the Federal Constitution was before the States for ratification, the question of the respective powers of taxation to be thereafter exercised by the individual States upon the one hand, and the Federal Government upon the other, in the event of-the proposed ratification, was a subject of the most anxious consideration. The opponents of the proposed system which was to be established under the Federal Constitution held this language: “Bevenue is as requisite to the purposes of the local administration as to those of the Union, and the former are at least of equal importance with the latter, to the happiness of the people. It is, therefore, as necessary that the State Governments should be able to *425command the means of supplying their wants as that the Rational Government should possess the like faculty in respect to the wants of the Union. But an indefinite power of taxation in the latter might, and probably would in time, deprive the former of the means of providing for their own necessities, and would subject them entirely to the mercy of the Rational Legislature.”

To this objection, Mr. Hamilton, the recognized champion of the proposed new system, and who lent the force of his unrivaled abilities and the weight of his high personal character to its adoption, replied in this language: “Yet I am willing here to allow in its full extent the justness of the reasoning which requires that the individual States should possess an independent and uncontrollable authority to raise their own revenues for the supply of their own wants. And making this concession, I affirm that (with the sole exception of duties on imports and exports) they would under the plan of the Convention retain that authority in the most absolute and unqualified sense; and that any attempt on the part of the Rational Government to abridge them in the exercise of it, would be a violent assumption of power unwarranted by any article or clause of its Constitution.” (Fed. No. 32.)

“ Though a law, therefore, laying a tax for the use of the United States, would be supreme in its nature and could not legally be opposed or controlled, yet a law abrogating or preventing the collection of a tax laid by the authority of a State (unless upon imports and exports) would not be the supreme law of the land, but an usurpation of a power not granted by the Constitution.” * * * “The inference from the whole is that the individual States would, under the proposed Constitution, retain an independent and uncontrollable authority to raise revenue to any extent of which they *426may stand in need by every kind of taxation, except duties on imports and exports.” (Fed. No. 33.)

This was the theory upon which the Constitution was ratified, but when it subsequently came to be applied in practice, it was determined in the Supreme Court of the United States that “imports and exports ” were not the only subjects which had been withdrawn from the operation of the taxing power of the States. In the case of McCullough v. The State of Maryland, 4 Wheaton, 316, there was brought in question the validity of an Act of the Legislature of the State imposing a tax upon all banks established and doing business as banks of discount and deposit in that State, without first obtaining a charter from the Legislature. Among the other provisions found in the State law was one which imposed a duty upon all such banks to procure from the State office, by payment of a designated stamp tax, stamped paper of graduated value whereon to issue their notes. The Bank of the United States, chartered in the year 1816, having established one of its branches in the City of Baltimore, an attempt was made to subject its business to taxation under the State law.

The opinion of the Court, delivered by Mr. Chief Justice Marshall, utterly and pointedly repudiated the views we have already referred to as having been enunciated in the Federalist; that opinion declared in effect that the State power to tax had been taken away, not only as to “imports and exports,” but as to all other subjects constituting the means provided by the Federal Government for the exercise of its constitutional powers. It was admitted that this view found no direct support in any particular clause or express provision of the Federal • Constitution. It was, however, declared to result from an asserted principle upon which the Federal Government had itself been founded—the principle of supremacy—and it was said that it was “ of the very essence of supremacy to remove all obstacles to its action *427within its own sphere,” and that this principle (to quote further the language of the Chief Justice) “so entirely pervades the Constitution, is so intermixed with the materials which compose it, so interwoven with its web, so blended with its texture, as to be incapable of being separated from it without rending it into shreds.”

The bank being, in the opinion of the Court, a means “ necessary and proper ” to conduct the fiscal operations of the Government, it was accordingly held that its business, though carried on• within the State, was not the subject of taxation by State laws.

Several years subsequently the same question arose before the same Court in the case of Osborn v. The Bank of the United States, 9 Wheaton, 738. In that case a statute had been passed by the State of Ohio similar in its general scope to that of Maryland, and under its provisions an attempt had been made to enforce the payment by the branch of the United States Bank, located at Chillicothe, of a State tax upon its banking business. The Court reviewed to some extent the position taken in the ease of McCullough v. The State of Maryland. “ The whole opinion of the Court ” (in that case, said the Chief Justice), “is founded on and sustained by the idea that the bank is an instrument which is necessary and proper for carrying into effect the powers vested in the Government of the United States.’ It is not an instrument which the Government found ready made and has supposed to be adapted to its purposes; but one which was created in the form in which it now appears for national purposes only.” The same general views were subsequently reasserted and applied by the Court in Weston v. The City Council of Charleston, 2 Peters, 449, in which a municipal tax had been imposed by ordinance of the City of Charleston upon certain loan stock issued by the Federal Government, and also in other eases.

But we are of opinion that the case under consideration *428does not fall within the principle announced in any of these cases, for several reasons.

The corporation here was not in the first instance created by the Government of the United States, but by the State; and even if it be conceded that the corporation thus created under State law has been subsequently adopted by the Federal Government, and availed of by that Government as a means of carrying into effect its constitutional powers, such adoption would not, upon the principles adverted to, exempt it from the operation of the State revenue laws. But there is another reason which we think conclusive upon this point, and that is, that the tax in question is not a tax imposed upon the business of the corporation defendant, but only upon its real property situate within the State. The principle upon which mere means created by the Federal Government, as agencies in the execution of its powers, are to be exempted from State taxation, has never been applied to the exemption of real property within the Sfate, even when occupied or used exclusively in connection with the business which is itself exempted. Hence, in McCullough v. The State of Maryland, supra, the Chief Justice observed: “ This opinion does not deprive the States of any resources which they originally possessed. It does not extend to a tax paid by the real property of the bank, in common with the other real property within the State,” etc. It is said, however, by the counsel for the railroad corporation, that this was a mere dictum of the Chief Justice—that the only question before the Court in that case was as to the authority of the State to tax the business of the bank, and that its authority to tax the real estate belonging to the bank was not a point in judgment. But the Court having announced. a principle, by the application of which the extent of the State authority to impose taxes was to be measured and defined, it of course became necessary to indicate the limits of the operation of that principle—to point out the general *429subjects to which it did not—as well as those to which it did apply. The counsel for the State of Maryland had urged that the principle itself was purely arbitrary, and one which, if sanctioned by the Court, was utterly incapable of limitation. “We have not been told,” he said, “whether the banking houses of this corporation, and any other real estate it may acquire for the accommodation of its affairs, are also of this privileged order of property. In principle it must be the same; for the privilege, if it exists, belongs to the corporation, and must cover equally all its property.” These views had been urged upon the attention of the Court in the discussion at the bar—a discussion characterized, as the Chief Justice declared, by “a splendor of eloquence and strength of argument seldom, if ever, surpassed.” It was in response to this position, and in answer to the reasoning by which it had been supported, that the opinion of the Court undertook to expound and apply the principle which it had asserted; and we think that, when in order to distinctly define the scope of its operation, the Court declared that the principle of exemption did not extend to real property within the State, it was the authoritative determination of a question of surpassing importance in itself—one which had been distinctly presented, elaborately argued by counsel, and deliberately considered by the Court.

But whether the case of McCullough v. The State of Maryland is to be considered as an authoritative adjudication upon this precise point or not, becomes comparatively unimportant, in view of the much later case of Thomson v. Pacific Railroad, 9 Wallace, 579, determined by the Supreme Court of the United States in the year 1869. In that case, certain stockholders in a railroad corporation filed a bill in the Circuit Court of the United States for the District of Kansas, to enjoin the collection of taxes assessed upon the railroad and telegraph property of the company under the revenue laws of the State of Kansas. It was there distinctly claimed *430that the principle of exemption from State taxation was applicable to that property—and this was the principal issue, indeed the sole question presented. The argument by which the claim was supported was much the same in its general scope as that submitted for our consideration. The Court was, however, unanimously of the opinion that such a claim was without support. After a review of the authorities, it expressed its views as follows: “But we are not aware of any case in which the real estate or other property of a corporation not organized under an Act of Congress has been held to be exempt, in the absence of express legislation to that effect, to just contribution, in common with other property, to the general expenditure for the common benefit, because of the employment of the corporation' in the service of the Government.” Further, speaking of the principle upon which such exemption is rested, it said: “ We cannot apply it to the case of a corporation deriving its existence from State law, and holding its property witljin State jurisdiction and under State protection.”

We have not overlooked the argument of the counsel for the defendant here, in which it is asserted that there is a distinction to be taken between the case of Thomson v. Pacific Railroad, and the one now under consideration. It is said that in the former case it was admitted in the pleadings that the corporation was “ a local or State corporation,” but we have already had occasion to observe that it is also admitted by the pleadings in this case “ that the said defendant, the Central Pacific Railroad Company of California, is a corporation duly organized and acting under the laws of the State of California.” In this respect, therefore, the two cases are substantially identical. It is also urged that in the former ease “ there had been no legislation on the part of Kansas by which that State could be said to have relinquished any of its sovereign rights over the railroad company;” while it is insisted that upon the part of the State of *431California such laws have been enacted as amount to a renunciation of State power in the premises. Without pausing at this point to consider whether under our constitutional system of government it is or would be competent to either the State or Federal Government to abdicate in favor of the other its rightful authority, constitutionally vested in it, over such a subject as this, so as to destroy the uniformity of the relations existing between the several States upon the one hand and the Federal Government upon the other, we are of opinion that there is nothing to be found in the legislative enactments of this State which imports a renunciation upon its part of the sovereign power of taxation over the railroad and telegraph line in question. On the contrary, we find that in the statute of April 4th, 1864 (Stats. 1863-4, p. 471), enacted for the purpose of enabling the railroad company to comply with and perform the provisions and conditions of the Act of Congress of July 1st, 1862, it is distinctly provided as follows: “Said company to be subject to all the laws of this State concerning railroad and telegraph lines, except that messages and property of the United States, of this State, and of the said company, shall have priority of transportation and transmission over said line of railroad and telegraph.” The exception points out, and was obviously intended to point out, the only particulars in which the assent of the State there accorded to the provisions of the Act of Congress should change in any respect the conditions theretofore existing between the railroad corporation upon the one hand and the State of California upon the other, and the liability to State taxation was not one of these. For these and many other reasons which we need not here stop to enumerate, we are of opinion that the authority of the State to impose taxation upon the railroad and telegraph line, in common with all other subjects of taxation within its limits, is clear and unquestionable, and *432the objection of the defendant in that respect must be overruled.

Second—It is next objected that the revenue laws of the State are unconstitutional—null and void—as not being uniform in their operation, and in this connection Article 1, Section 11, of tire State Constitution is cited in the following words: “All laws of a general nature shall have a uniform operation.”

It is not denied that the mere taxation imposed by the revenue laws is equal and uniform, nor is it pretended that property is taxed otherwise than in proportion to its value; but it is said that although these cardinal constitutional rules are observed in the structure of the revenue laws of the State, yet there is a want of uniformity between the particular laws prevailing in several localities of the State in respect to the enforcement of the payment of delinquent taxes; that in some counties this payment is enforced by means of a levy upon the property of the delinquent, and a sale thereof made by the Tax Collector to the bidder who will pay the tax for the least amount of property, while in other counties an action at law, judgment, execution, and Sheriff’s sale are resorted to; that where the sale is made by the Sheriff, under judgments rendered, the deed delivered to the purchaser is conclusive, while in case the sale be made by the Tax Collector, it is only prima facie evidence of title, etc.

That the legislative power is restrained only by the limitations of the Constitution, clearly imposed upon its exercise, and that a statute enacted is not to be put aside by the Courts, unless its conflict with the fundamental law be manifest, are the rules of familiar application. The deference we owe to the legislative will is only second to that which we owe to the commands of the' Constitution, which both the Legislature and the Court are sworn to obey.

The particular section of the Constitution supposed to *433have been infringed by the Eevenue Law in force in the County of Placer concerns “ laws, of a general nature,” and declares that such laws shall have a uniform operation. /The Constitution, it will be observed, has not undertaken to declare that all laws shall have a uniform operation—uniformity in that respect is made requisite only in case the law itself be one of a general nature, and if it do not purport to be such an one, no objection as to uniformity or want of uniformity in its operation can be interposed. The nature of a given statute as being general or special must depend in a measure upon the legislative purpose discernible in its enactment. We are not to say that a statute, plainly special in its scope, must either have a uniform operation or not operate at all—for this were to add another to the limitations which the Constitution has imposed upon the legislative power, and to hold in effect that no special Act could be passed at all—at least if “ uniform ” operation means universal operation, as the argument of the defendant’s counsel would apparently maintain. Nor are we to say that a special statute—special in its aim and in the object it has in view, is by mere construction to be converted into a general statute, because the subject with which it deals might have been made the subject of a general law. It is obvious that every law upon a general subject is not per se, nor by constitutional intendment, necessarily a law of a general nature. The subject may be general, but the law and the rule it prescribes may be special. Fees of office, for instance, constitute a general subject—one which pervades the length and breadth of the State, and extends into every political subdivision of which it is composed—yet a statute may prescribe what these fees of office shall, be in a particular county, and may declare that they shall differ from fees established for the same official duties performed in another county. Such a law would *434not be a law of a general nature, involving the constitutional necessity of uniform operation, but it would be a special law upon a general subject, and at an early period in our judicial history the constitutionality of such a statute was unhesitatingly sustained by this Court./ (Ryan v. Johnson, 5 Cal. 85.) The legislation of the State has since then proceeded upon the assumed correctness of the construction given to the Constitution in that case. The views there announced have never since then been seriously questioned by any case in this Court to which our attention has been called, and as an exposition of the clause of the Constitution under consideration, in point of time almost contemporaneous with the adoption of the Constitution itself, and, ever since its enunciation, observed and followed in the legislative proceedings of the State, it must be considered as conclusive upon the point of constitutional law involved in this objection.

Third—It is claimed that the tax in question was illegally assessed, because not assessed by a County Assessor for Placer County—the point being that the record shows that the assessment of a portion of this road and telegraph line was made in Eevenue District Humber One, by the Assessor of that district, and the assessment of the remainder of the road and telegraph line in Placer County was made in Revenue District Number Two, by the Assessor of that district. It is argued that such an officer as a District Assessor—at least of a district less in its territorial extent than an entire county—is unknown to the Constitution. That instrument (Art. II, Sec. 13,) provides as follows: “ Section 13. Taxation shall be equal and uniform throughout the State. All property in this State shall be taxed in proportion to its value, to be ascertained as directed by law; but Assessors and Collectors of town, county, and State taxes shall be elected by the qualified electors of the district, county, or town in which the property taxed for State, county, or town purposes is situated.” It is obvious that *435the " district ” for which an Assessor.is to be chosen is not necessarily coterminous with the boundaries of a single county, for a county being also named in the clause, the expression would become thereby merely tautological, and, so far, without the precision which is to be looked for in every word of the organic law. A county is one territorial division, expressly recognized by the Constitution for revenue purposes, in the clause already cited; a district is another, and these were obviously not intended to designate the same or an identical extent of territory. Obviously, then, a revenue district may be less in extent than a county, of which it is a part. There is nothing in the Constitution which expressly forbids it to be so, or presents a substantial difficulty in that construction of its several provisions.

Fourth—The fourth and last objection to be noticed is also rested upon section thirteen, Article II, of the Constitution, already recited. It is argued that the statute authorizing an action to be brought by the District Attorney, for the collection of taxes, is not warranted by this section of the Constitution—that if such an action is to be brought at all it must be brought by the Tax Collector. The action is brought not by the Tax Collector, nor by the District Attorney, but by the people of the State of California, and is conducted -by their District Attorney for the County of Placer. The money sued for is claimed by the people as due to them for taxes delinquent and owing by the defendant to them. The office of District Attorney is one created by the Constitution (Art. VI, Sec. 11); and the Legislature is therein required to fix by law his duties and his compensation. By the Act of April 29th, 1851 (Hitt. General Laws, Sec. 2402), it is made the general duty of that officer to prosecute actions accruing to the State or his county; and by the Act of May 17th, 1861 (Hitt. General Laws, Sec. 6188), it is especially made his duty to commence actions in the name of the people of the State of California for the *436recovery of delinquent taxes. This legislation is directly authorized by section eleven, Article VI, of the Constitution, already referred to. It is the duty of the Tax Collector to receive taxes from those offering to pay them; and the law might have made it his duty to take steps to enforce their collection when delinquent, but it has not done so in this instance, but has assigned that duty to the District Attorney; and we do not find in the Constitution that where the taxpayer has neglected and refused to pay the taxes, though due, the Legislature may not authorize judicial proceedings to be instituted, and may not, in case of such proceedings, direct the proper District Attorney to conduct' them as other judicial proceedings in which the people are the party in interest. The right to bring the suit at all imports the duty to provide for its conduct by some officer or person competent for the discharge of that duty; and even if it be conceded that it is the general duty of the Collector to receive the taxes when offered by the taxpayer, and that it is not competent to the Legislature to authorize any other officer to perform that general duty, unless it first make such officer ex officio Tax Collector, we apprehend that when the Tax Collector has been defeated in the performance of that duty by the persistent refusal of the taxpayer, and has made his official return to that effect, his legal duties as Tax Collector may be said to have so far come to an end, and been discharged by him, as that judicial proceedings may be instituted to recover of the delinquent a sum of money equal to the delinquent tax, together with damages, percentage, costs, etc.

"W"e see nothing in this course, if pursued, which would amount to an interference with what is claimed to be the constitutional duties of the Tax Collector, or a disturbance ' of any discernible scheme of county government to be found in the Constitution.

*437The judgment and order denying a new trial must, therefore, be affirmed; and it is so ordered.

[The defendant made application to the Chief Justice, under the provisions of the Federal Judiciary Act, for the allowance of a writ of error in this case, but the Chief Justice denied the application. The writ was, however, afterwards allowed by one of the Associate Justices of the Supreme Court of the United States; and the record having been returned into that Court, and the cause argued and submitted there, the writ of error was dismissed upon the application of the plaintiff in error.—Reporter.]