Trask v. Maguire, 85 U.S. 391 (1874)

Download as court, pdf, or txt
Download as court, pdf, or txt
You are on page 1of 14

85 U.S.

391
21 L.Ed. 938
18 Wall. 391

TRASK
v.
MAGUIRE.
October Term, 1873

APPEAL from the Circuit Court for the District of Missouri; in which
court Trask filed a bill against Maguire, collector of State and county taxes
at St. Louis, to restrain him from collecting taxes upon the property of the
St. Louis and Iron Mountain Railroad Company, a corporation organized
in the State of Missouri, July 26th, 1867, and to have the property of the
said company decreed exempt from liability to such taxes.
The case was this:
A general corporation law of Missouri, in force in 1845, thus ordained:1
'The charter of every corporation that shall hereafter be granted by the
legislature shall be subject to alteration, suspension, and repeal, at the
discretion of the legislature.'
This provision of general law being in force, the legislature of Missouri,
on the 3d of March, 1851, passed 'An act to incorporate the St. Louis and
Iron Mountain Railroad Company.' The capital stock of the company was
$6,000,000, and it was enacted that
'The stock of said company shall be exempt from all State and county
taxes.'
On the 17th of February, 1853, it was enacted that the railroad
abovementioned as having been incorporated should be exempted from
the provisions of the general corporation law already quoted. The statute
further enacted:
'All the engines, cars, wagons, machines and other property belonging to
said company, shall be deemed a part of the capital stock of the company,
and shall be vested in the respective shareholders of the company forever,

according to their respective shares, and transferable by them in the


transfer of stock, as personal property.'
Subsequently to this, and to aid it in making the road, the State of
Missouri lend to the company (in the shape of bonds, the principal and
interest of which the company agreed to pay) a large sum of money. The
act authorizing the transaction enacted that none of the bonds should be
delivered to the company until it filed in the office of the secretary of state
certificates of acceptance of them, executed under the corporate seal, &c.
The act then proceeded:
'SECTION 4. Each certificate of acceptance so executed and filed as
aforesaid, shall be recorded in the said office of the secretary to state, and
shall thereupon become and be, to all intents and purposes, a mortgage of
the road of the company executing and filing their acceptance, as
aforesaid, and every part and section thereof, and its appurtenances, to
the people of this State, for securing the payment of the principal and
interest of the sums of money for which such bonds shall from time to
time be issued and accepted.
'SECTION 11. In case the said companies, or either of them, shall make
default in the payment of either interest or principal of the said bonds . . .
it shall be lawful for the governor to sell their road and its appurtenances,
by auction to the highest bidder, or to buy in the same at such sale for the
use and benefit of the State, subject to such disposition in respect to such
road or its proceeds as the legislature may thereafter direct.'
On the 4th of July, 1865, the State of Missouri adopted a new constitution
of government. It contained the following provisions:
'No property, real or personal, shall be exempt from taxation, except such
as may be used exclusively for public schools, and such as may belong to
the United States, to this State, to counties, or to municipal corporations
within the State.
'The General Assembly shall not pass any special laws . . . exempting the
property of any named person or corporation from taxation.'
At the same time that it adopted this new constitution it adopted, in the
separate form of AN ORDINANCE, entitled 'An ordinance for the
payment of State and railroad indebtedness,' certain provisions which were
to have 'full force and effect as a part of the constitution of the State.'
The ordinance was thus:

'SECTION 1. There shall be levied and collected from the Pacific


Railroad, the North Missouri Railroad Company, and the St. Louis and
Iron Mountain Railroad Company, an annual tax of 10 per centum of all
their gross receipts for the transportation of freight and passengers . . .
from the 1st of October, 1866, to the 1st October, 1868, and 15 per
centum thereafter; which tax shall be appropriated by the General
Assembly to the payment of the principal and interest now due, or
hereafter to become due, upon the bonds of the State, and the bonds
guaranteed by the State, issued to the aforesaid railroad companies.
'SECTION 3. The tax in this ordinance specified shall be collected from
each company hereinbefore named only for the payment of the principal
and interest on the bonds, for the payment of which such company shall
be liable; and whenever such bonds and interest shall have been fully paid,
no further tax shall be collected from such company.
'SECTION 4. Should either of said companies refuse or neglect to pay said
tax as herein required, and the interest or principal of any of said bonds, or
any part thereof, remain due and unpaid, the General Assembly shall
provide by law for the sale of the railroad and other property, and the
franchises of the company that shall be thus in default, under the lien
reserved to the State, and shall appropriate the proceeds of such sale to the
payment of the amount remaining due and unpaid from said company.
'SECTION 5. Whenever the State shall become the purchaser of any
railroad or other property, or the franchises sold as hereinbefore provided
for, the General Assembly shall provide by law in what manner the same
shall be sold, for the payment of the indebtedness of the railroad company
in default; but no railroad or other property, or franchises purchased by
the State, shall be restored to any such company until it shall have first
paid . . . all interest due from said company; and no sale or other
disposition of any such railroad or other property, or their franchises, shall
be made without reserving a lien upon all the property and franchises thus
sold or disposed of, for all sums remaining unpaid; and all payments
therefor shall be made in money or in bonds or other obligations of this
State.'
On the 1st of November, 1865soon after the adoption of the new
constitution and of this ordinancethe General Assembly met, and bills
were introduced providing for the sale of several railroads, including the
St. Louis and Iron Mountain, then in default on its obligations. Pending
these bills, questions as to the effect of the ordinance arose in the mind of
the governor, and on the 27th of the same month of November he

propounded to the judges of the Supreme Court, as it was his right to do


under the constitution of Missouri, certain interrogatories as to the
operation of the ordinance, and among the rest one as follows:
'If you are of opinion that the sale of the railroads may be ordered before
such refusal or neglect, I request you to say whether such sale can be made
'without reserving a lien upon all the property and franchises thus sold for
all sums remaining unpaid,' as provided by section five of the ordinance.
In other words: Does this clause in the ordinance constitute a condition of
all sales of railroads ordered by the State, or does it refer only to sales
made, under the ordinance, for refusal or neglect to pay the tax?'2
To these questions the judges replied. In the course of their reply they say
that one of the things provided for by the ordinance is a tax to pay the
debts of the railroad companies to the State, and another thing provided
for is, 'in what manner railroads purchased by the State under her lien
shall be sold again;' that 'the fifth section relates to all sales of railroads
under liens reserved to the State,' whether sold for the non-payment of the
tax or for the nonpayment of the mortgage-debt. 'The fifth section,' say
the judges, 'provides further that no sale or other disposition of any such
railroad or other property, or their franchises, shall be made by the State
without reserving a lien upon the property sold for all sums remaining
unpaidthat is to say by the purchaser, and the purchaser is required to
make all payments therefor in money, or in bonds, or other obligations of
this State; but the legislature is left unrestricted further as to the time,
terms, and conditions of sale.'
After this, that is to say, on the 16th of February, 1866, the legislature
passed an act 'to foreclose the State lien and to secure the early
completion of the road.'
By the act it was made the duty of the governor to advertise for sale the
different roads in default, 'their appurtenances, rolling stock, and property
of every description, and all rights and franchises.' A board of
commissioners was to attend the sale, and on a contingency named
purchase for the State. The commissioners, in case the State should
purchase, were to give notice of their authority to sell, and to invite
proposals to purchase. The governor, on a sale being made by the
commissioners, was to make a deed to the purchaser, which, it was
provided, should have 'the effect to convey, transfer, and make over to the
purchaser said road and all of the franchises, privileges and rights, title
and interests appertaining to the road.' And the act further provided, that
the purchaser should acquire by his purchase 'all the rights, franchises,

privileges, and immunities which were had and enjoyed by' the original
corporation 'under the charter and the laws amendatory thereof.'
One month after the passage of the act just quoted, and pending
proceedings thereunder for the sale of the road, another act was passed,
approved March 20th, 1866, entitled, 'An act authorizing the incorporation
of the purchaser or purchasers of any railroad, or of any part, section, or
branch thereof, which has heretofore or may hereafter become forfeited to
and sold by the State.' That act enacted thus:
'SECTION 4. Each corporation provided under this act shall have the
same power, franchises, right, and privileges, and be subject to the same
liabilities and restrictions as the corporation to which it shall become the
successor may have had by its original charter, and the amendments
thereto, into and over the property and franchises forfeited and sold
aforesaid.'
At the sale, which the governor advertised, the State bought the railroad
and its appurtenances in: and the commissioners sold it to three persons,
who afterwards sold it to one Allen. Allen, availing himself of the
privileges of the last above-quoted act, organized himself and certain
other persons, including 'Trask, already named as the complainant below,
into a new corporation having the name of the old one.
Hereupon the defendant, Maguire, a collector, as already said, of State and
county taxes in Missouri, having sought to levy certain State and county
taxes on this new corporation, Trask filed a bill in the court below to
enjoin him, and that court dismissed the bill. Trask now appealed from
that decree.
Messrs. B. R. Curtis and Drydens, for the appellant:
That the property of the original corporation was exempt from taxation is
undeniable. It is nearly or quite as clear that if the purchaser at the sale
which was made had been a private person, or a corporationany
purchaser other than the Statesuch purchaser would have held what he
bought, equally exempt. The lien of the mortgage was 'on the road of the
company, and every part and section thereof, and its appurtenances.' That
by the word appurtenances it was meant at the time that all rights,
franchises, privileges, and immunities should pass under the lien is hardly
questionable. In any but a purely technical sensethe sense in which the
word is used in a deedappurtenances would certainly include them.
They would certainly do so alike in the popular and in the legislative
sense, and these are the only important senses to be considered here; for

the transaction was between managers of a railroad and a body of


legislators. The State expected to get and the road meant to give as a
security all that it had. Why retain an immunnity from taxation when 'the
road and every part and section thereof, and its appurtenances,' were put in
mortgage and liable to be gone? Of what use would the immunity be when
there was no property to which it could apply? Further than this, there
would be ground to argue that in a stricter sense the word appurtenances
would include the immunity.3
The only difficulty in the case is that the State has purchased; that
becoming owner of the road, she held it, of necessity and independently of
any contract with the mortgagors, free from liability to taxation. And then,
the further difficulty, that before she sold, the provisions of the new
constitution intervened, and prevented her granting, as she undeniably
meant to do, free from her own ability to tax.
The difficulty vanishes in the face of the 'ordinance,' which has 'the same
force and effect' as the constitution.'1. The constitution and the ordinance
being parts and parcels of one law ought not to be construed separately,
but in the construction of the one the other ought to be taken into
consideration.
Inasmuch as the ordinance, by its plain words, intended to pass to the
purchaser all the franchises of the railroad companies named in it; and as
one of the franchises of at least one of the companies was exemption of its
property from taxation, the ordinance was of necessity an exception, and
intended to be an exception to the general rule established by the
constitution, subjecting all property to taxation. There is room for both
parts of the law to operate; the rule and the exception each in its place.
And the law should be so construed as that both may stand and have
effect.
2. The rule and the exception are not inharmonious in their general
objects. The primary object of the rule is revenue. If revenue was not the
primary object of the exception it was at least a prominent one, as a
recurrence to the situation of the State and the history of the times will
show. At the time of the adoption of this constitution and ordinance, it is
matter of common knowledge that the State was staggering under the
burden of an enormous debt, with resources wasted by a devastating war.
In such an exigency what measure would so likely add to the wealth of the
people and to the resources of the State as the extension of her railroads,
then but just begun, into the mineral and agricultural regions of the State,
lying as yet undeveloped? It was in this view, and in a large degree as a

measure of finance, that the convention resolved upon the project of


selling these roads and extending them to their ultimate destinations. But
in order to the success of the project, privileges and franchises had to be
offered to induce the embarkation of capital apparently, but not really, at
the expense of the public revenue.
3. Upon a fair construction of the ordinance, power was given to the
legislature to grant to the purchasers of the property of the defaulting
corporations the exemption insisted upon by the complainant. The fourth
section of the ordinance relates to a period of time prior to the foreclosure,
while yet the title to the property remains with the mortgagor, and
contemplates a then future sale in foreclosure at which the State might
become the purchaser. The fifth section looks to a period after foreclosure
and presupposes the purchase of the mortgaged property by the State at
the foreclosure sale. Both sections direct that provision be made by law
for sales. What is it that the fourth section requires to be sold? 'The
railroad and other property, and the franchises.' Not one franchise, merely,
but the plural; franchises, all of the franchises of the company. What by
the fifth section is to be sold? The answer is, the same railroad, the same
other property, the same franchises 'as hereinbefore provided for' in the
fourth section. All, without exception or diminution, that the State
acquired at the sale under the fourth section was to be sold by it to its own
vendee under the fifth section; the vendee of the State was to take every
right that the State acquired at the sale for foreclosure. The State acquired
at the foreclosure sale every right that the mortgagor had. If the
mortgagor had the right to hold its property exempt from taxation, that
right, by the provisions of the ordinance, would pass by the sale under the
mortgage to the State and then from the State to its vendee. If it be
objected that the franchises of the St. Louis and Iron Mountain Railroad
Company did not, for want of apt words, pass by the mortgage, and that
therefore the franchises of the company did not pass to the State at the
foreclosure sale; we reply: first, as we have already once said, that the
words of the mortgage were and are sufficient in law to pass the franchises
of the mortgagor. But, second, this ordinance was the work of the people
acting as lawmaker in their sovereign capacity. The sovereign possesses
within himself all fulness of franchises. He is the author and source of all
franchises. The sovereign people professed in this ordinance to possess
and to be able to impart the franchises of these defaulting companies.
Their lawfully appointed agents sold, and for them professed to convey
these franchises, and having done this they will not be permitted now to
stultify themselves by the plea that they did not possess the things which
they professed to grant. But if they did not then possess them specifically
they must be held to supply the lack from their original inexhaustible

stores.
It was the clear intention of the convention to give to the purchaser all that
was enjoyed by the companies in default, and it was just as clearly within
the competency of the convention to give what it thus intended to give,
whether the franchises previously given out had come back to the State or
not. And as all parties, vendor and vendee, here contracted upon the idea
that the one was giving and the other receiving the franchises claimed, it
is no hardship to hold nor is it any stretch of judicial authority to decide
that in law the convention gave what it then intended to give, and had the
power to give.
Mr. R. E. Rombauer, contra .
Mr. Justice FIELD delivered the opinion of the court.

The question presented for our determination in this case is, whether the
property of the present St. Louis and Iron Mountain Railroad Company, a
corporation created under the laws of Missouri, is, by an irrepealable legislative
grant, forever exempted from all State and county taxes. Two corporations
bearing that name have existed in Missouri, the second succeeding the first in
the possession and ownership of its road and property. The first was created by
an act of the legislature of the State, passed in March, 1851; the second was
formed in July, 1867, under an act of the previous year authorizing the
incorporation of the purchaser or purchasers of any railroad, or any part,
section, or branch thereof, which had previously been, or might thereafter be,
forfeited to or sold by the State.

The property of the first corporation was undoubtedly exempt from State and
county taxes. The act of incorporation adopted as part of it a provision of
another act, which declared in terms that the stock of the company should be
thus exempt.4 It is true that at this time a statute was in existence, passed in
1845, which declared that the charter of every corporation subsequently granted
should be subject to alteration, suspension, and repeal at the discretion of the
legislature. But from the operation of this provision the company was expressly
exempted by an act amendatory of its charter, passed in 1853.5 From that time
at least the exemption of its stock from State and county taxation was placed
beyond legislative interference. The amendatory act also declared that all the
engines, cars, wagons, machines, and other property belonging to the company
should be deemed a part of its capital stock, and be vested in its respective
shareholders, according to their respective shares. All the property of the
company was thus placed within the exemption which attached to the original

stock; that designated was to be deemed a part of such stock, as well as that
originally embraced by this term.
3

On the argument some attempt was made, from the use of the term stock in the
original act, and the language of the amendatory act, that the property should
be vested in the respective shareholders according to their respective shares, to
establish the position that the exemption extended only to the separate shares of
the individual stockholders. But the argument does not strike us as possessing
much force. The terms 'stock of the company,' imported the capital stock of
such company, the subscribed fund which the company held, as distinguished
from the separate interests of the individual stockholders. The language of the
amendatory act did not qualify this meaning; that only declared that other
property of the company should also be deemed capital stock, and the
additional provision that it should be vested in the respective shareholders,
according to their respective shares, only meant that they should have the
interest of shareholders in the property, according to their respective shares.

The corporation in question was created to construct a railroad from a point in


the city of St. Louis to the Iron Mountain and Pilot Knob, in Missouri, with
liberty to extend the road to the Mississippi River, or to the southern part of the
State. This road was constructed from St. Louis to Pilot Knob, a distance of
about eighty-seven miles, with a branch to Potosi. During the progress of the
work, and in order to aid in its construction, the legislature of the State,
previous to 1860, passed various acts providing for the loan of the bonds of the
State to the company. All the acts referred for the terms of the loans to an act
passed in 1851 to expedite the construction of the Pacific Railroad and of the
Hannibal and St. Joseph Railroad.6 That act provided that no part of the bonds
should be delivered to the company until it signified its acceptance of them to
the secretary of state, by filing in his office a certificate of such acceptance
under the corporate seal of the company and the signature of its president; that
such acceptance should be recorded, and upon its record should become to all
intents and purposes a mortgage of the road of the company, and every part and
section thereof, and its appurtenances, to the people of the State, to secure the
payment of the principal and interest of the bonds. That act authorized the
governor, in case default was made in the payment of either the interest or
principal of the bonds, to sell the road and its appurtenances at auction to the
highest bidder, or to buy in the same at such sale for the use and benefit of the
State, subject to such disposition in respect to the road or its proceeds as the
legislature might thereafter direct.

Under the different acts bonds of the State to a large amount were issued to the
company; its acceptance of them in proper form was given to the secretary of

state, and the acceptance was duly recorded, and from the date of such record
the State acquired, for the payment of the principal and interest of the bonds, a
lien upon the road and every part and section thereof and its appurtenances.
6

The company failed to pay the interest on these bonds. It does not appear for
how long a period the company was thus in default, nor is this material. It is
sufficient to say that in 1865 the right of the State, under the provisions of the
acts cited, to interfere and sell the property, had become complete. Before a
sale, however, was made the legislature passed another act for the sale of this
and other railroads by the governor, and the foreclosure of the State lien
thereon. This act, which was approved in February, 1866, among other things
required the governor to advertise for sale the different railroads, with their
appurtenances, rolling stock, and property of every description, and all rights
and franchises thereto belonging; and to sell the same at auction to the highest
bidder, in pursuance of the several acts creating a lien thereon. It also provided
for the appointment of three commissioners to attend the sale of the different
roads as advertised, and to bid in the same for the use and benefit of the State
for an amount not exceeding the respective liens thereon; and in case the roads
were struck off and sold to them, to take possession of and hold the same, with
their appurtenances and property, and again, after due advertisement, inviting
proposals for the purchase of the different roads, their lands, appurtenances,
and franchises, to resell the same. Under this act the St. Louis and Iron
Mountain Railroad was advertised for sale, with its rights and privileges, and at
the sale was bid in by the commissioners for the State. However broad the
terms of the advertisement, the interest sold could not extend beyond the
property upon which the State at the time held a lien, and this was the entire
road of the company and its appurtenances. But as the property was sold to the
State it is unnecessary to determine whether, if the sale had been made to a
third party, the immunity from taxation possessed by the company would have
passed to the purchaser. When the State became the purchaser the immunity
ceased; the property stood in its hands precisely the same as any other
unincumbered property of the State, exempt from taxation, not by virtue of any
previous stipulation with the company, but as all property of the State is thus
exempt. Subsequently the road and its appurtenances, and all the franchises,
which, under the new constitution of Missouri, adopted in 1865, were
transferable by the State, were sold by the commissioners to McKay, Vogel,
and Simmons, who conveyed the same to Thomas Allen, who with others, in
July, 1867, became incorporated under the name of the St. Louis and Iron
Mountain Railroad Company. That company is still in existence, and is one of
the defendants herein. To it Allen transferred all the rights and privileges
acquired by him from his vendors, and all which they acquired from the State.
The act under which the sale was made provided that the purchasers of the road

should have all the rights, franchises, privileges, and immunities which were
enjoyed by the defaulting company under its charter and laws amendatory
thereof, subject to the limitations and conditions therein contained, and not
inconsistent with the act authorizing the sale. The new company thus acquired
all the immunity from taxation which the original company had possessed, if it
were competent for the legislature at the time, under the new constitution, to
confer this privilege. The question, therefore, is, whether the legislature was
competent to grant the immunity claimed, under that constitution, which went
into operation on the 4th of July, 1865, previous to the passage of any of the
acts authorizing the proceedings under which the new company acquired its
rights.
7

The sixteenth section of the eleventh article of that instrument provides that 'no
property, real or personal, shall be exempt from taxation, except such as may be
used exclusively for public schools and such as may belong to the United
States, to this State, to counties, or to municipal corporations within this State;'
and the twenty-seventh section of the fourth article declares that 'the General
Assembly shall not pass special laws . . . exempting any property of any named
person or corporation from taxation.'

These provisions require no explanation; they are absolute prohibitions against


the grant of any new immunity from taxation, unless railroad companies of the
State existing at the time are excepted from their operation. Such exception is
claimed under the 'ordinance for the payment of State and railroad
indebtedness,' which accompanied the constitution and was adopted with it.
That ordinance first provides for the levy and collection from different
railroads, and among others from the St. Louis and Iron Mountain Railroad
Company, an annual tax of ten per cent. on all their gross receipts for the
transportation of freight or passengers (not including amounts received from
and taxes paid to the United States) from the 1st of October, 1866, to the 1st of
October, 1868, and fifteen per cent. thereafter; and then enacts that the tax shall
be collected from the companies only for the payment of the principal and
interest on the bonds of the State issued for their benefit, or on bonds
guaranteed by the State; that if any of the companies refuse or neglect to pay
the tax thus required, and the principal or interest of any of the bonds, or any
part thereof, remain due and unpaid, the General Assembly shall provide by
law for the sale of the railroad and other property and the franchises of such
company under the lien reserved to the State; and that whenever the State
becomes the purchaser of any railroad or other property, or the franchises thus
sold, the General Assembly shall provide by law in what manner the same shall
be sold for the payment of the indebtedness of the company; that no railroad or
other property or franchises purchased by the State, shall be restored to the

defaulting company until it shall have first paid the interest due from it, and
that no sale or other disposition of any such railroad or other property, or its
franchises, shall be made without reserving a lien upon the property and
franchises thus sold or disposed of for all sums remaining unpaid.
9

Now, the argument of the appellants is that as the ordinance authorizes the
legislature to provide for the sale of the franchises of a defaulting corporation,
it can transfer under that designation immunity from taxation, if the company
ever possessed such immunity; and that this was the effect of the sale of the St.
Louis and Iron Mountain railroad and its franchises to McKay, Vogel, and
Simmons. And authority for this position is supposed to be found in the
answers given by the judges of the Supreme Court of Missouri, in November,
1865, to certain questions propounded by the governor under a provision of the
constitution authorizing him to take their opinion on important questions of
constitutional law. The questions propounded were substantially these:

10

1st. Whether the provisions of the ordinance operated to suspend the right of
the State to sell the roads named, or either of them, until there was a refusal or
neglect to pay the tax imposed by the ordinance; or whether the State might
order the sale of the railroads or either of them, prior to such refusal or neglect;

11

2d. If the judges were of opinion that a sale of the railroads might be ordered
before such refusal or neglect, whether such sale could be made 'without
reserving a lien upon all the property and franchises thus sold for all sums
remaining unpaid,' or, in other words, whether this clause constituted a
condition of all sales of railroads ordered by the State, or referred only to sales
made under the ordinance for refusal and neglect to pay the tax.

12

3d. If the judges should be of opinion that all sales of railroads by authority of
the State were subject to the restriction mentioned, whether the words 'all sums
remaining unpaid' referred to the sums for which the railroad sold was in
default, or to that portion of the purchase-money not paid in cash at the time of
sale; and,

13

4th. Whether upon a sale of a railroad under a lien of the State the constitution
authorized the State to receive, in payment of the purchase-money, preferred or
other shares of stock issued by a corporation purchasing the road.

14

None of these questions, as will be perceived, call for any opinion as to the
effect of the sale of the franchises of a road, or the meaning of that term. They
call only for an opinion upon the power of the legislature to order a sale of the

roads, the liens to be reserved, the payments to be made, and the right to receive
shares of stock of a purchasing corporation. The answer of the judges stated
that the fifth section of the ordinance related to all sales of railroads, whether in
default for not paying the interest on the bonds of the State or not paying the
tax levied; that when the State had become the purchaser of any railroad sold
under the lien of the State, the General Assembly could provide in what manner
such railroad could again be sold for the payment of the indebtedness which
the State had incurred on account of bonds loaned to it or guaranteed for its
benefit; that it would have had this power without the aid of the ordinance, but
that no sale or other disposition of any such railroad, or other property, could be
made by the State without reserving a lien upon the property sold for all sums
remaining unpaid, and that the purchaser was required to make all payments
therefor in money or in bonds or other obligations of the State; and then adds
that the 'legislature is left unrestricted further as to the time, terms, and
conditions of the sale.' This language is supposed to determine that in the sale
of such property the legislature is not bound by the provisions of the
constitution we have cited.
15

But we do not think the language used justifies any such conclusion, but was
rather intended to indicate that the ordinance imposes no other restrictions than
those designated, and has no reference whatever to the clauses of the
constitution in respect to which no opinion was asked.

16

It seems to us that the plain meaning of the ordinance, when it says that the
General Assembly shall provide by law in what manner the railroad and its
franchises shall be sold, is that they shall be sold in conformity with such law as
the legislature may constitutionally pass, not in conformity with any law which
the legislature could devise if it had unlimited discretion in the matter. It would
conflict with well-settled rules of construction to hold that the language used
authorizes any legislation regardless of the provisions of the constitution. And
there is nothing in the authority conferred to provide for the sale of its
franchises with the road of the defaulting company, which requires immunity
from taxation to be embraced within them. The language evidently refers to
such franchises as are essential to the operation of the road sold, without which
the ownership of the road would be comparatively valueless, such as the
franchise to run cars, to take tolls, and the like.

17

But if we are mistaken in this particular, we are clear that it never was intended
by the ordinance to sanction, by the sale of the franchises of a defaulting
corporation, the renewal of an exemption which had once ceased to exist, and
which the constitution had declared should never thereafter be created. The
inhibition of the constitution applies in all its force against the renewal of an

exemption equally as against its original creation; and this inhibition the
legislature could not disregard in providing for the sale of the property which it
had purchased.
18

JUDGMENT AFFIRMED.

Revised Statutes of Missouri, 1845, p. 232.

Advisory Constitutional Opinions, 37 Missouri, 129.

Pickering v. Steples, 5 Sergeant and Rawle, 107; Rouvier's Law Dictionary, title
'Appurtenances.'

Laws of Missouri of 1851, p. 479.

Ib. 1853, p. 296.

Laws of Missouri of 1851, p. 267.

You might also like