U.S. Supreme Court
Yazoo & Mississippi R. Co. v. Adams, 180 U.S. 41 (1901)
Yazoo and Mississippi Railroad Company v. Adams
Submitted October 22, 1900
Decided January 7, 1901
180 U.S. 41
A writ of error to the supreme court of a state cannot be sustained when the only question involved is the construction of a charter or contract, although it appear that there were statutes subsequent to such charter which might have been, but were not, relied upon as raising a federal question concerning the construction of the contract. If the sole question be whether the Supreme Court has properly interpreted the contract, and there be no question of subsequent legislative impairment, there is no federal question to be answered. The Court is not bound to search the statutes to find one which can be construed as impairing the obligation chanroblesvirtualawlibrary
of the charter when no such statute is set up in the pleadings or in the opinion of the court.
Such omission cannot be supplied by the certificate of the chief justice that, upon the argument of the case, the validity of the subsequent legislation was drawn in question upon the ground of its repugnancy to the Constitution of the United States.
This was an action begun in the Circuit Court of Hinds County, Mississippi, by Adams, as state revenue agent, suing for the use and benefit of certain cities and towns through which the defendant railway runs, to recover municipal taxes upon its property for the years 1893 to 1896 inclusive.
A demurrer to the declaration having been sustained upon the ground that the exemption claimed by defendant in its charter was perpetual and unconditional as to the municipal taxes, an appeal was taken to the supreme court, which reversed the action of the circuit court and remanded the case for a new trial. 75 Miss. 275. An amended declaration having been filed claiming taxes from 1886 to 1897 inclusive, defendant interposed pleas (1) of the general issue; (2) that defendant was organized under an act of February 17, 1883, containing the following provision in § 8:
"That in order to encourage the investment of capital in the works which said company is hereby authorized to construct and maintain, and to make certain in advance of such investment, and as an inducement and consideration therefor, the taxes and burdens which this state will and will not impose thereon, it is hereby declared that said company, its stock, its railroads and appurtenances, and all its property in this state necessary or incident to the full exercise of all the powers herein granted -- not to include compresses and oil mills -- shall be exempt from taxation for a term of twenty years from the completion of said railroad to the Mississippi River, but not to extend beyond twenty-five years from the date of the approval of this act; and when the period of exemption herein prescribed shall have expired, the property of said railroad may be taxed at the same rate as other property in this state. All of said taxes to which the property of said company may be subject in this state, whether for county or state, shall be collected by the treasurer of this state and paid into the state
treasury, to be dealt with as the legislature may direct; but said company shall be exempt from taxation by cities and towns;"
that the railroad was completed to the Mississippi River October 25, 1892, by a consolidation with the Louisville, New Orleans, & Texas Railway Company, which had constructed and was then the owner of certain branches which reached the Mississippi River at several different points; (3) that, after the company was organized but before its line was finally located and constructed, the municipal authorities of the City of Jackson adopted an ordinance releasing the road from all city taxation for twenty years from date, provided it selected Jackson for its southeastern terminus and provided further that the work on said road be commenced within one year and be completed within three years to Yazoo City; and that such ordinance was accepted and complied with by the defendant; (4) that, prior to the assessment of these taxes, defendant leased its road to the Illinois Central for a term of fifty years, which, until the bringing of this suit, held and operated such road under such lease; that, by its terms, the Illinois Central agreed to pay and discharge all taxes assessed upon the defendant company; that under defendant's charter, it was exempted from all municipal taxation; that the right of the legislature to make such exemption had been judicially recognized in the case of Mississippi Mills v. Cook, 56 Miss. 40; and that such exemption entered into and constituted a part of the aforesaid lease and of the charter contract between the defendant and the state; and that "the said exemption, by said charter conferred, has never been repealed by the legislature of said state," but that, during the four years named, the legislature refused to pass bills introduced to repeal such exemption.
A new trial resulted in a verdict for the plaintiff, which was affirmed by the supreme court. 76 Miss. 545. Hence this writ of error. chanroblesvirtualawlibrary