The Railroad Aid Bonds

In the case of the township of Pine Urove, plaintiff, in error, -os. Edward B. Talcott, in error to tho Circuit Court of the United States for tho Western District of Michigan, Justice Swayne delivered the opinión of the United States Supreme Court on on tho 4th inst., as fullows: This is a writ of error to tbe Circuit of the United States for the Western District of Michigan. The faots of the case are few and undisputed, and tho legal question presented has been settled by this court. On the 22d of March, 1809, the Legislature of Michigan passed an act entitled " An act to enable any township, city, or village to pledgo its aid, by loan or donatiou, to any railroad coinpany now chartered or organized under and by virtue of the lawsof the State of Michigan, in the construction of its road." The plaintiff in error was the defendant in the court below. It is a body corporate in the county of Van Buren, in Michigan. The case ruado by tho deolaration is as follows : The Kalamazoo and South Haven llailroad Corapany is a corporation organized under the laws of Michigan, having for its object the construction of a railroad f rom the villago of Kalamazoo to the village of South Haven, in that State. The line of its proposed route possed through the township of Pine Grove. Pursuant to the act of tho Legislatura before mentioned, a meeting of the electors of the township was called to voto upon tho proposition whether the township should in aid of the construction of the road, give to the company its coupon bonds to the amount of $12,000, bearing interest at the rate of 10 per cent per annum, onosixth of the principal to be payable at the end of each succeeding year, from March lst, 1870, until the whole amount was paid ; the interest to be payable annually trom that time. A majority voted for the proposition and the bonds were issued. They bore date June lst, 1869. The plaintiff, Talcott, was the holder and owner of a part of tho bonds and coupons. They are described in the declaration and were overdue. The township filed a demurrer. It was overruled by the court ; and the township electing to stand by it, judginent was giveu for the plaiutiff. The township thereupon sued out this writ of error, and haa thus brought the case before this court for review. It, is not alleged that the bonds were not issued in conforniity to the act, nor that there has been any want of good faith on the part of the railroad cotnpany, nor that the plaintiff, Talco tt, was not a bona fide holder. But it has been argued that the act of the Legislature was oid. This presenta the only question in the case, and it is fundamental. If the foundation fails the entire superstructura reared upon it must f all. It is said the act is in conflict with the coustitution of the State. It is au axiom in American jurisprudence that a statute is not to be pronounced void upon this ground, unless the repugnancy to the constitution be clear, and the conclusión that it exists inevita-' ble. Every doubt is to be resolved in aupport of the enactment. The partitular clause of the constitution must be specified and the act admit of no reasonable construction in harmony with its meaning. The judicial funotion involving such a result is one of delicacy, and to be exercised always with caution. Twitchell vs. Blodgett, 13 Mioh., 127 ; Tyler vs. The People, 8 id., 320 ; People va. Mahany, 13 id., 482. It must be admitted that the conatitution here in question contains nothing directly adverse uüon the subject. But we have been referred in this connection to the following provisions : The 33d section of article 6 declares that " no person in any criminal case, shall be compelled to be a witness against himself, or be deprived of life, liberty, or property without due process of law." Here there is no imputation of criuie. The clause is confined to judicial proceedings. Article XIV. clauses 6, 8 and 9, provide that the credit of the State shall ïiot be granted to, or in aid of, any person, association or Corporation ; that the State shall not be interested in the stock of any Corporation, 'and that the State shall not subscribe to, or be interested in any work of internal iinprovement, or engage in carrying on any such work, except in the expenditure of grants to the State of land or other property. In this case it ia the township and not the State that is concerned. The State has done nothing, and is in no wise Hable. The present constitution was adopted in the year 1850. Before that time numerous acts involving the same principie with the one bere in question, had been passed by seventeen States. Congress, by the act of June 3d, 1856,11 Stat., 21, granted a large quantity of land to Michigan, to be used in aid of the construction railioada. This land was appropriated by the State to several different companies, pursuant to the provisions of the act. Other companieB were subsequeutly aided in the same way. In 1863 began a series of speoial legislativo acts authorizing the municipal subdivisions of the State natned therein to give their aid respectively to the extent and in the manner presoribed. Between that time and in the year 1869, thirty such statutes were enacted. In the latter year the general law was passed under which the bonds in question were issued. This summary shows the understanding in the Legislature, and out of it, in tne State, that there was no constitutibnal prohibition against such legislation. Itdoes not appear that its validity was ever in any instance judiccially denied until the year 1870. The case as to the constitution is a proper one tor the application of the maxium, Jixpresiio uniua est exclusw alterius. The instrument is drawn with ability, care and fullness of details. If those who fratned it had iutended to forbid the granting of such aid by municipal corporations of the State itBelf, it can not be that they would not have explicitly said so. It íb Dot to be supposed that such a gap was left in their work from oversight or inadvertence. The llth clause of the same article declares that the Legislature shall provide a uniform t'orin of taxation, except as to the property paying epecific taxes, and that taxes shall be levied upon such property as shall be prescribed by law. The object of this provisión was to prevent unj ust discriminations. It prevenís property fiom being classifíed and taxed as classed, by different rules. All kinds of property must be taxed uniformly, or be entirely exempt. The uniformity must be co-ex tensive with the territory to which the tax applies. If a State tax, it must be uniform all over the State. If a countyorcitytax.it must be uniform throughout such county or city. Gilman vs. The City of Sheboygan, 2 Black, 514. But the rule does not require that taxes for the saaie purposes shall be imposed in different territorial subdivisions at the same time. If so a county could not levy a tax to build a court-house, jail, or infirmary without rendering it necesaary for every other county in the State to do the sanie thing without reference to the different circumstances of each one. So here one township through which the railroad was to pass, expecting to be largely benefitted by its conBtruction, might give its bonds and impose the tax requisite to meet the principal and interest, while another township similarly situated might rfuse to do so. The rule would have no application to tho latter. The second and fourteenth clauses of article 18 prescribe that when private property is taked for public use just comXensation shall be made to the owner. - These provisions relate to the exercise of' the right of eminent domain. The thirteenth clause of article 15 declares that " the Legislature shall provide for the iucorporation and orgauization of cities and villages, and shall restrict their powers of taxatiou, borrowing money, contracting debts, and loaning their credit." The power here in question was exercised by a township. The language ot' this clause clearly ituplies that the powers to be restricted may be exercised ; and what ia implied is as effeetual as what is expressod, Ú. S. vs. Babbit, 1 Black., 61. Congress can pass 110 laws but such as the Federal Constiutiou expressly, or by necessary intendraent, permita. The logislative power of a State extouds to evurything witliin the Bphero of such power, except as it is restrictod by the Federal Constitution or that of the State. In the present case we have found uothing that, in our judgment, warrants the conclusión that the act in question is wanting in validity by reason of its unconstitutionality. But it has been arguod that, aside from any constitutional prohibition, the Legislature had no power to authorize the imposition of a tax for any othcr than a public purposo, and that this act is not within that rule. Conceding for the puiposes of this opinión the soundness of the lirst proposition the second can by no ineans be admitted. ïhough the Corporation was private, its work was public, as mueb. so as if it wero to bo constructed by the Stat3. Private property can be taken for a public purpose ouly, and not for private gain or beueñt. Upon no othor ground than that tho purpose is publie can the exerciso of the power of eminent doniain iu behalf of such corpora tions he supported. This view of the subject has been taken by the Supremo Court of Michigan. Swan ?;s. Williams, 2 Mich., 427. But upon other grounds, we think tho public character of such worlss cannot bo doubted. Where they go they anímate the 8ources of prosperity, and minister to tho growth of the cities and towns withinthe sphere of their influence. Unless prohibited from doing so a municipal corporation has the same power to aid ia their construction as to procure water from its water works, coal for its gas works, or gravol for its streets from beyond its territorial limits. Meyer es. Muscatine, 1 Wall., 389. Under the liniited powers conferred by the Federal Constitution, Congress has frequently given aid in such oases. The Pacific Railroads and the Louisvillo Canal furnish instances of such action by that body. The gift to the sufferers from tho overflow of the Mississippi, and prior acts of the kind, must also be borne in mind. Cannot a State Legislature do the same things 'i It does not bolong to courts to interpólate constitutional restrictions. Ourduty is to aüulv the law, not to make it. All power may be abused where no safoguards are provided. The reinedy in such cases lies with the people and not with the judiciary. We pass by without remark the point whether ia cases like this the public or private character of the work is not a legislativa rather than a judicial question. It ia insisted that the iuvalidity of the statute has been deterinined by two judgments of the Supreine Court of Michigan, and that we are bound to follow those adjudications. The People vs. Salem, 20 Mich., 452 ; Bay City v. The State Treasurer, 23 Mich., 499. We have examined those cases with care. With all respect for the eminent tribunal by which the judgments were pronounced, we must be permitted to say that they are not satisfactory to our ininds. We think the dissenting opinión in the one first decided is unanswered. Similar laws have been passed in twenty-one States. In all of them, but two, it is believed their validity has been sustained by the highest local courts. It is not easy to resist the force of such a current of reason and authority. The question before us bolongs to the domain oí' general jurisprudence. In this class of cases this court is not bound by the judgment of the courts of the States wbere the cases arise. It must hear and determine for itself. Here commercial securities are involved. When the bonds were issued, there had been no authoritative intimation trom any quarter that such statutes were invalid. The Legislature afiirmed tbeir validity in every act by an implication equivalent in effect to an express declaration. And during the period covered by their enactment, neither of the other departinents of the government of the State lifted its voice against them. The acquiescence was universal. - Gelpke vs. Duouque, 1 Wall, 175. The general undeistanding of the legal profession throughout the country, is believed to have been that they were valid. The National Constitution forbids the States to pass laws impairing the o"bligation of contracts. In cases properly brought before us that end can be accomplished unwarrantably no more by judicial decisious than by legisiation. Were we to yield-in cases like this to the authority of the decisions of the courts of the respective States, we should abdícate the performance of one of the most important duties with which this tribunal is charged and disappoint the wise and salutary polioy of the framers of the constitution in providing for the creation ef an independent federal judiciary. The exercise of our appellate jurisdiction would be but solemn mockery. Butz vs. Muscatine, 8 Wall., 579. The question here under consideration was fully considered by this court in the county of Ottoe vs. the Éailroad Company, 15 Wallace, 667, and in ülcott vs. the supervisors; id., 678. We have no disposition to qualify anything said in those cases. They are conclusive in the case before us. In Sedgewick on Stat. and Const. Law, 90, it is eaid : " It must be further borne in ruind that the invalidity of contracts made in violation of statutes is subject to the equitable exception, that although a Corporation in making a contract acts in disagreement with its charter, where it is a simple question of capacity or authority to contract arising either on a question of regularity of organization or of power cenferred by the charter, a party who has had the benefit of the agreement cannot be permitted in an action founded on it to question its validity. It would be in the highest degree inequitable and unjust to permit the defendant te repudíate a contract the fruits of which he retains. - And the principie of this exception has been extended to other cases. So a person who has borrowed money of a savings institution upon his promissory note, secured by a pledge of bank stock, is not entitled to an injunction to prevent the prosecution of the note upon the ground that the savings bank was prohibited by its charter from making loans of that description." The authorities referred to sustain the text. Palmer vs. Lawrence, 3 Sandf. S. C, 162 ; Stcam Nav. Co. vs. Weed, 17 Barb., 378; Chester Glass Co. va. Dewey, 16 Mass., 84 ; McCutchen vs. Steamboat Co., 13 Penn. It., 13 ; Potter va. The Bk. of Ithaca, 5 HM, 400 ; Suydam vs. Morris C. & B. Co., 5 Hill, 491 ; Sackett'sHarbor Bank vs. Lewis Co. Bank, 11 Barb., 213 ; Mott va. U. S. Trust Co., 19 Barb., 568. But it is not necessary to base our judgment upon this ground. We rest it upon the other viaws which have been expressed, and the authority of our own preceding adjudications. The judgment of the Circuit Court is affirmed. The Chief Justice did not sit in this case, and took no partin its decisión.