1 respectfully dissent from the opinion of the court in this case. The opinion concludes with the proposition that the demurrer to the bill should have been sustained. jSfo decree was rendered by the circuit, court either overruling or sustaining the demurrer. It: is true that errors are assigned predicated upon the failure of the circuit court to sustain the demurrer to1 the bill, hut, in advance of a decree on the demurrer, no question, I think, is raised In that, regard for review here. The court, after holding in the opinion that the demurrer should have been sustained, directs that the bill be dismissed. If the bill, on a hearing on the special demurrers, had been found deficient in its statement of facts, it is usual, and it would have been proper, to allow amendment. The hill should not, I think, be dismissed by this court for defects in the statement of facts, pointed out by special demurrers, before the demurrers are decided by the *804circuit court. Tlie decree appealed from, rendered on March. 7, 1899, is given in the footnote.1 Judge 'Speer’s opinion is reported in 92 Fed. 714. I think the decree is sustained by the authorities cited in the opinion, and that it should be affirmed.
The seventh paragraph of the bill shows the order made by the railroad commission, and why it was made:
“That certain citizens of Georgia refused to furnish the stamps to he attached to the receipts or hills of lading, or to pay for the same, if furnished by the express company, and thereupon complained to the railroad commission of the state of Georgia, to wit, the said Trammell, Orenshaw_, and Atkinson, who on July 11, 1898, issued an order as follows: ‘It being represented • to the railroad commission of Georgia that the Southern Express Company, a corporation engaged as an express company within this - state in the business of a common carrier of goods and merchandise for hire, since the passage by the federal congress of an act approved June 13, 1898, entitled “An act to provide ways and means to meet war expenditures, and for other purposes,” has exacted, and continues to exact, from the shippers, as a condition precedent to forwarding any goods tendered to it for transportation between points within this state, the payment of a special tax upon such shipments imposed by said act, thus indirectly increasing the cost of transportation beyond the rate fixed therefor by this commission, it is ordered that the Southern Express Company do appear before this commission on the 18th day of July, 1898, then and there to show cause, if any it can, why it should not be held to have violated the rules and regulations of this commission by the exactions or overcharges as aforesaid, and why suit should not be instituted against it in every case of such overcharges for the recovery of the penalty provided by law for such illegal act.’ Cause was shown respectfully denying all jurisdiction in the premises on the part of said'commission, who on August 2, 1S98, ordered and directed the said stamp tax to be furnished, attached, canceled, and paid by the said Southern Express Company alone, and not by the shippers, in whole or in part.”
Tbe purport and effect of tbe order is to so construe tbe act of congress of July 18, 1898, as to make it incumbent on tbe express company to pay tbe tax therein prescribed, and to bold that tbe express company cannot cast tbe burden, of tbe tax on tbe shipper without making tbe rates unreasonable, and exceeding tbe rate of charges previously fixed by the railroad commission. In tbe case of Express Co. v. Maynard (decided April 16, 1900) 20 Sup. Ct. 695, Adv. S. U. S. 695, 44 L. Ed.-, the supreme court bolds that there is nothing in tbe act *805cf congress levying tlie tux that prevents the express company from adding the tax to the charges made by it.
The order was unquestionably made by the railroad commission on the theory that the act of congress required the Southern Express Company to pay the tax, and that it forbade the company to shift the burden on the shipper. The supreme court in the case cited has not construed the act or congress on the question as to who is required to pay the tax, but it has decided that, conceding that the act requires the express company to pay it, there is nothing in the act to prevent the company from casting the burden of the tax on the shipper. The rates charged by the express company were prescribed as reasonable by the railroad commission of Georgia. The complaint in the order of July 11,1898, is that the express company has required the shippers to pay the special tax, “thus indirectly increasing the cost of transportation beyond the rate therefor fixed by the commission.” The authority conferred on the railroad commission is to fix reasonable rates. The order of the commission cannot be justified on the theory that the charges of the express company, with the taxes added, are unreasonable. If the rate which the commission has fixed was reasonable, it certainly does not make it unreasonable to add to it the increased cost of transportation caused by the act of congress. As the commission fixed the rate, the order complained of must have been made on the assumption that the act of congress places the tax on the express company, and deprives it of the right to shift the burden by contract.
In Express Co. v. Maynard, supra, the supreme court said:
“As there was no allegation that the rates existing prior to the imposition oi' the one cent stamp tax were unreasonable, it would follow lhat the rates which were otherwise reasonable were decided not, to be so solely because there was added to the charge for each package the exact amount of the increased cost for transporting the package, occasioned as to each package by the specific imposition on each by the act of congress of the one cent stamp tax. But, to cause rates which were conceded to be reasonable to become unreasonable because alone of such increased charge, the assumption must be made that the .act of congress not, only imposed the burden of the tax solely on the express company, but also forbade its shifting the same by any and every method.”
The older of the railroad commission prescribes who shall pay the tax and who shall not pay it, and, in effect, prevents any contract between the shipper and the carrier in reference to the payment of the tax. This order is evidently based on an erroneous construction of the act, of congress. It is assumed by the commission that the act requires the express company to pay the tax, and forbids the express company from making any agreement which shifts the burden upon the shipper. A brief quotation from the case last cited will show the conclusion of the supreme court on this point:
“A tax rests upon real estate. Can it be said that by the law imposing such a tax it was intended to prevent the owner of real property from taking into consideration the amount of a tax thereon, in determining the rent which is to be exacted by him? A tax is imposed upon stock in trade. Must it be held that the purpose of such a law is to regulate the price at which the g'oods shall be sold, and restrain the merchant, therefore, from distributing the sum of the tax in the price charged for liis merchandise? As the means by which the burden of taxes may be shifted are as multiform and as vari*806ous a's is the power to contract itself, it follows that the argument relied on, if adopted, would control almost every conceivable form of contract, and render them void if they had the result stated. Thus, the price of all property, the result of all production, the sum of all wages, would be controlled irrevocably by a law levying taxes, if such a law forbade a shifting of the burden of the tax. and avoided all acts which brought about that result. It cannot be doubted that to adopt, by implication, the view pressed upon us. would be to virtually destroy all freedom of contract, and its final analysis would deny the existence of all rights of property.”
The order made by the commission and enjoined by the circuit court cannot be held to be one fixing reasonable rates to be charged by the express company. The commission had already performed that duty. If, in view of changed conditions, the commission had made a new schedule of charges, and in doing so had not exceeded its authority, there would be no cause of complaint. But the order cannot be treated as one fixing a new schedule of charges. The one formerly fixed remains unchanged, and the present order, in effect, says to the express company: “You shall not require the shipper of packages to pay the one cent tax. You shall not contract with him to secure its payment by him. You shall furnish, attach, and cancel the stamp. The shipper shall not do it, in whole or in part.” The order is one forbidding certain contracts prior to the shipment of the goods by the express company. The express company is to be subjected to the suits and penalties, not for violating any new schedule prescribed, but for the making of contracts which shift the burden of the tax. The railroad commission seeks to accomplish by its order what was done by the writ of mandamus by the state courts in Michigan. But the supreme court, in reversing the decree of the supreme court of Michigan, has, it seems to me, established a construction of the act of congress in direct conflict with the theory on which the railroad commission of Georgia acted. Express Co. v. Maynard, supra.
I think that the circuit court was right in holding that the “railroad commission had no jurisdiction to adjudge and designate the party who shall pay the tax.” The order made by the commission requires “the stamp tax to be furnished, attached, canceled, and paid by the Southern Express Company alone, and not by the shippers, in whole or in part.” In effect, the command is that the express company shall pay it, and that the shipper shall pay no part of it, and that the shipper and the carrier shall not be permitted to make any contract for its payment, in whole or in part, by the shipper.
I concur in the views expressed by the court that a state has power to- prescribe the charges of public carriers for the carriage within the state of persons and merchandise. This power is, of course, subject to the limitation that the carriage cannot be required without reward, or upon conditions amounting to the taking of property for public use without just compensation. I do not deny or question the right of the state to tax, control, and regulate, subject to constitutional limitations, any business carried on by corporations or individuals within its limits. Conceding all this, where does the commission get the right to say who shall and who shall not pay a federal tax? It is the theory of our system of government that the state and the nation alike are to exercise their powers, respectively, each without hin*807drance from file other. This theory, by necessary implication, excludes wholly any interference by either with an independent exercise by the other of its constitutional powers. Cooley, Tax’n (2d Ed.) 83. The state tribunals must, in proper cases, construe federal laws, subject to the final decision of the supreme court; but neither the legislature of a state, nor a commission created by it, has authority to make laws or orders directing who shall or shall not pay a tax constitutionally levied by the United States. Surely, such orders cannot be valid in cases where they would tend to embarrass the government in the collection of the tax. The order in question does not purport to be one regulating the charges to be,made b-y the express company. It is, in terms, one laying down a rule as to who shall and who shall not pay a stamp tax to the United States. It is applicable to all packages, whether or not the stamp, if treated as an additional charge, makes the whole charge exceed the rates previously fixed by the commission. The order, it seems to me, not only embodies an erroneous construction of the revenue law, but its enforcement may materially interfere with the collection of the tax. The question of the taxing powers of the states, as their exercise has affected the functions of the federal government, has often been considered by the supreme court, and the right of the states to impede or embarrass the constitutional operations of the general government, or the rights of its citizens, by levying taxes, has been always denied. Crandall v. Nevada, 6 Wall. 35, 18 L. Ed. 744. If the states can interfere by prescribing regulations as to the collection of the revenues of the federal government, and can say who shall and who shall not pay a prescribed tax, and forbid contracts between citizens in reference to it which are permissible under the statute creating the tax, then the states have the right and power to embarrass and impede at a vital point the operations of the general government. The same policy and law which forbids the states to tax the instrumentalities of the federal government should deprive them of the power to embarrass, prevent, or regulate the collection of revenues levied under its constitutional powers.
The supreme court has said on two occasions, Chief Justice Marshall delivering the opinions, that “the states have no power,' by taxation or otherwise, to retard, impede, burden, or in any manner control the operations of the constitutional laws enacted by congress to carry into execution the powers vested in the general government.” McCulloch v. Maryland, 4 Wheat. 316, 4 L. Ed. 579; Weston v. City Council of Charleston, 2 Pet. 449, 7 L. Ed. 481. Is it not clear that the order of the railroad commission seeks “to control the operation” of the law enacted by congress? It pointedly says who shall and who shall not pay the tax levied by the act. It forbids lawful contracts on the subject. It impedes the collection of the tax by saying that it shall not be paid by certain persons who otherwise might pay it. If the state can create a commission to make the order in question, has it not equal authority to regulate by statutes and commissions the attaching, canceling, and furnishing of the stamps on checks, conveyances, leases, and other instruments, and on patent medicines, matches, and other articles taxed by the statute?
If the admin?stration of the United States revenue laws is subject to *808state supervision, is there any reason why the post offices within the state and the stamps there used should escape the same jurisdiction? If, for some reason not apparent to me, it be true that the commission may control and regulate the payment of the tax, it must be done within .legal restrictions. The commission cannot be permitted to make orders construing the federal statute which, in effect, deprive the express company of its property without due process of law, or which force it to carry without compensation. In other words, when the commission fixes rates by regulating federal taxation, it must keep within the same limits that would govern if it sought to perform its functions by direct action.,. The bill in this case shows that reasonable rates had been previously fixed. It shows that the subsequent order complained of will cause loss to the express company of $43,000 annually on its business in Georgia; that is, that the express company must do business receiving $42,000 less each year than it would receive if paid at the reasonable rates fixed by the commission. The bill also shows that, applying the last order of the commission to the rates now charged by the express company, some of which are below the schedule of the commission, part of the express company’s business will be done at an actual loss. The demurrers, if we are to consider them before a decree on them by the circuit court, admit the averments of the bill. These averments, I think, are sufficient to sustain and authorize the preliminary injunction. I am of opinion, therefore, that the bill •should not be dismissed.