U.S. Supreme Court
Michigan Central R. Co. v. Powers, 201 U.S. 245 (1906)
Michigan Central Railroad Company v. Powers
Argued February 21, 23, 26, 1906
Decided April 2, 1906
201 U.S. 245
A state statute may be unconstitutional because conflicting with the constitution of the state or with that of the United States, but all objections chanroblesvirtualawlibrary
to its validity, whether state or federal, may be presented in a single suit, and call for consideration and determination, and as a federal court has the jurisdiction, it may be its duty, when the question is properly presented, to pass upon an alleged conflict between a state statute and the state constitution even before the question has been considered by the state tribunals. It will, however, be reluctant to do so, especially when the statute is one affecting public revenues of the state.
There is no general supervision by the Nation over state taxation, in regard to which the state has, generally speaking, the freedom of a sovereign both as to objects and methods.
While there is always a possibility of misconduct on the part of officials, legislation may proceed on the assumption of their properly discharging their duties.
Where a legislature enacts a specific rule for fixing a rate of taxation, by which rule the rate is mathematically deduced from facts and events occurring within the year, and created without reference to the matter of that rate, there is no abdication of the legislative function, but, on the contrary, there is a direct legislative determination of that rate.
Unless there is some specific provision in the state constitution compelling other action, a state may treat its entire territory as composing but a single taxing district, and deal with all property as within the district and subject it to taxation accordingly.
This Court may, in a case of this nature, take judicial notice of the fact that the Michigan is traversed in almost every direction by railroads, and that the county in which there are no railroads, if any there be, is an exception.
Nothing in the federal Constitution prevents a state from separating a particular class of property and subjecting it to assessment and taxation in a mode and by a rate different from that imposed on other property and applying the proceeds to state, rather than local, purposes.
One hearing is sufficient to constitute due process, and a state statute giving a state assessing board power to correct valuations, naming time and place at which any person interested may be heard, does not deprive the persons assessed of their property without due process of law because those parties do not have further opportunities to be heard by a court or the legislature.
A legislature is not bound to impose the same rate of tax upon one class of property that it does upon another; it is sufficient if all of the same class are subjected to the same rate and the tax is administered impartially upon them.
This Court generally accepts the finding of a trial court upon a question of fact when the evidence is conflicting, and so held in this case as to a charge of systematic undervaluation which the trial court found against.
Act No. 173, Michigan Laws of 1901, imposing upon railroad and corporate chanroblesvirtualawlibrary
property the average rate of tax upon other property subject to ad valorem taxes, applying the proceeds to state purposes, and providing for ascertaining the rate by mathematical computations by the state board of assessors based upon reports from the local assessors, does not conflict with the constitution of the state or with that of the United States.
This suit was brought in the Circuit Court of the United States for the Western District of Michigan to restrain the respondent, the Auditor General of the state, from enforcing against the appellant the provisions of Act No. 173 of the Michigan Laws of 1901, an act to provide for the assessment of the property of railroad and certain other companies, for the levying of taxes thereon by a state board of assessors, and for the collection of such taxes. The taxes involved in the suit are those for 1902, resulting from the first assessment under the statute. Prior to the year 1900, the Constitution of Michigan contained, in Art. XIV, the following sections applicable to taxation:
"SEC. 10. The state may continue to collect all specific taxes accruing to the treasury under existing laws. The legislature may provide for the collection of specific taxes from banking, railroad, plank road, and other corporations hereafter created."
"SEC. 11. The legislature shall provide a uniform rule of taxation, except on property paying specific taxes, and taxes shall be levied on such property as shall be prescribed by law."
"SEC. 12. All assessments hereafter authorized shall be on property at its cash value."
"SEC. 13. The legislature shall provide for an equalization by a state board in the year one thousand eight hundred and fifty-one, and every fifth year thereafter, of assessments on all taxable property except that paying specific taxes."
"SEC. 14. Every law which imposes, continues, or revives a tax shall distinctly state the tax, and the object to which it is to be applied, and it shall not be sufficient to refer to any other law to fix such tax or object. "
In that year sections 10, 11, and 13 were amended so as to read as follows:
"SEC. 10. The state may continue to collect all specific taxes accruing to the treasury under existing laws. The legislature may provide for the collection of specific taxes from corporations. The legislature may provide for the assessment of the property of corporations at its true cash value, by a state board of assessors, and for the levying and collection of taxes thereon. All taxes hereafter levied on the property of such classes of corporations as are paying specific taxes under laws in force on November sixth, A.D. nineteen hundred, shall be applied as provided for specific state taxes in section 1 of this article."
"SEC. 11. The legislature shall provide an uniform rule of taxation, except on property paying specific taxes, and taxes shall be levied on such property as shall be prescribed by law: Provided, That the legislature shall provide an uniform rule of taxation for such property as shall be assessed by a state board of assessors, and the rate of taxation on such property shall be the rate which the state board of assessors shall ascertain and determine is the average rate levied upon other property upon which ad valorem taxes are assessed for state, county, township, school, and municipal purposes."
"SEC. 13. In the year one thousand nine hundred and one, and every fifth year thereafter, and at such other times as the legislature may direct, the legislature shall provide for an equalization of assessments by a state board, on all taxable property, except that taxed under laws passed