The Act of the Legislature of Wyoming, passed December 13, 1879,
which required the state auditor to furnish to the territorial
board of equalization a list for assessment and taxation of the
roadbed, superstructure, and other enumerated property of every
railroad and telegraph company in the territory when any portion of
the property of such company was situated in
Page 113 U. S. 517
more than one county, and which required the board to value and
assess the property of the corporation for each mile of its road or
line, and to certify to the county clerks of the counties in which
the property was situated the assessment per mile, specifying the
number of miles and amount in each of the counties, and which
required the county commissioners to decide and adjust the number
of miles and amounts within each precinct, township, or school
district within their respective counties and cause such amounts to
be entered on the lists of taxable property returned by the
assessors, withdrew the duty of assessing fractional parts of such
railroad and the property of such companies from all local
assessors in the territory, including its incorporated cities.
A statute which provides a general scheme for assessing and
taxing the property of railroad and telegraph companies as a whole
and for distributing it ratably among the different counties and
their several precincts, townships and districts according to the
number of miles of line in each repeals, as to such property, a
power conferred upon the authorities of a city to make provisions
for the assessment of the taxes which they were authorized by other
provisions of the city charter to assess and collect.
A bill which charges that the collection of an illegal tax would
involve the plaintiff in a multiplicity of suits as to the title of
lots being laid out and sold, which would prevent their sale, and
which would cloud the title to all his real estate, states a case
for relief in equity.
The bill in this case was filed by the Union Pacific Railway
Company against the City of Cheyenne and its marshal, Ryan, to
enjoin the collection of certain city taxes for the year 1880,
which the railway company alleges were unlawfully assessed against
it. The bill was demurred to by the defendants, and the District
Court for the First Judicial District of Wyoming, in which the suit
was brought, overruled the demurrer, and granted the injunction
prayed for. The defendants adhered the their demurrer and appealed
to the supreme court of the territory, and the decree of the
district court was reversed and the bill ordered to be dismissed,
and the case is now brought here by appeal.
The main question raised by the bill is whether the Union
Pacific Railroad, which passes through the whole length of Wyoming
Territory, and in its course passes through the City of Cheyenne,
with its accompanying telegraph, appurtenances, and rolling stock,
is liable to be assessed and valued for the purposes of taxation in
Cheyenne by the city authorities, or only by the territorial board
of equalization, consisting of the
Page 113 U. S. 518
governor, treasurer, and auditor of the territory, and this
question depends on the further question whether such assessment
and valuation are governed by the city charter of the city or by
the act entitled "An act in relation to the assessment of railways
and telegraph lines," passed December 13, 1879. The city charter,
which was last revised on the subject of taxation by an amendment
passed on the 26th of November, 1879 -- only seventeen days prior
to the railroad assessment act -- gives to the city power
"to levy and collect taxes for general revenue purposes, not
exceeding six mills on the dollar in any one year on all real,
personal, and mixed property within the limits of said city,
taxable under the laws of the territory,"
and it is provided that "the assessment, levy, and collection of
all taxes shall be made as may be provided by ordinance." Authority
is also given to the city to raise a further tax to pay interest on
its bonds and a tax for improvement of streets and alleys. The
railroad assessment act, passed on the 13th of December, 1879, is a
very carefully prepared statute, providing for a mode of assessing
the value of railroad property and distributing it among the
counties and districts through which the railroad may run. Although
general in its terms, it must have had particularly in view the
Union Pacific Railroad, to which alone it would principally apply.
This act is so important a factor in the decision of this case that
we quote the first section entire. The title has already been
quoted. The first section is as follows:
"SECTION 1. The president, secretary, superintendent, or other
principal accounting officers of any railroad or telegraph company
having property in this territory at the time of the assessment of
every railroad and telegraph company, whether incorporated by any
law of this territory or not, when any portion of the property of
said railroad or telegraph company is situated in more than one
county, shall list for assessment and taxation, verified by the
oath or affirmation of the person so listing, all the following
described property belonging to such corporation within the
territory,
viz., roadbed, superstructure, right of way,
and all structures situated thereon, rolling stock, side track,
telegraph lines, furniture, and fixtures,
Page 113 U. S. 519
and personal property belonging to such corporation. Such list
shall contain first, the number of miles of such railroad or
telegraph line in the Territory of Wyoming and the number of miles
of the same in each organized county therein; second, and such
return shall be made to the auditor of the territory on or before
the first day of July, annually. If the return aforesaid be not
received by said auditor by the third day of July, he shall
thereupon proceed to obtain the facts and information aforesaid in
any manner that may appear most likely to secure the same
correctly, and for that purpose may address a written communication
to the corporation or to some officer of the corporation who has
failed or refused to make the return aforesaid. As soon as
practicable after the auditor has received said return or procured
the information required to be set forth in said return, a meeting
of the territorial board of equalization, consisting of the
governor, territorial treasurer, and auditor, shall be held at the
office of said auditor, and the said board shall then value and
assess the property of said corporation for each mile said road or
line, the value of each mile to be determined by dividing the sum
of the whole valuation by the number of miles of said road or line.
In making up such valuation or assessment, the said board shall
examine and consider the return herein required to be made, or the
information procured by the auditor in default of such return,
together with such other reliable information relative thereto as
they may be able to procure. Said board shall not assess the value
of any machine shop, or repair shop, or other buildings not
situated on said right of way or grounds or other real estate of
any corporation or company within this territory, but it shall be
the duty of the assessor of the county or district in which said
machine or repair shops, or other buildings or grounds or other
real estate is situated to assess the same and make return thereof
in the manner now provided for the assessment and return of real
estate. On or before the first Monday of August, or so soon
thereafter as the said board, or any two thereof, shall have made
and determined said valuation and assessment, the territorial
auditor shall certify to the county clerks of the several counties
in which property of the
Page 113 U. S. 520
aforesaid corporation, or any part thereof, may be situated, the
assessment per mile so made on the property of such corporation,
specifying the number of miles and amount in each of such counties.
The county commissioners shall thereupon divide and adjust the
number of miles and the amounts falling within each precinct,
township, or school district in their respective counties, and
cause such amounts to be entered and placed on the lists of taxable
property returned by the several assessors. The auditor shall
certify whether a return was made to him by such corporation, or
proper officer thereof, or whether the information required in and
by such returns was procured by himself, and in case the return was
not made as required by this act, or, being made, was not sworn to,
it shall be the duty of the county commissioners to add any amount
not exceeding ten percent to the valuation thus brought before
them."
The fifth section of the act declares as follows:
"All acts and parts of acts providing for the assessment of the
property of railroad and telegraph companies, and the equalization
of assessments, inconsistent with the provisions of this act, are
hereby repealed, so far as they provide for the assessment and
equalization of the property of said railroad and telegraph
companies. "
Page 113 U. S. 521
MR. JUSTICE BRADLEY delivered the opinion of the Court. He
recited the facts as above stated, and continued:
Page 113 U. S. 522
It requires only a casual reading of this act to discover its
purpose and object. The difficulty of assessing the value of
railroad property in separate parcels, located in distinct cities
and townships, is almost insuperable. A railroad cannot be regarded
as mere land, like farm land or building lots; its value depends
upon the whole line as a unit, to be used as a thoroughfare and
means of transportation. A separate mile or two of its length is
almost valueless by itself. And then its rolling stock has no
particular locality except a constructive one in the place where
the principal office of the railroad company is situated, and it
would be manifestly unequal to give to that place the benefit of
taxing the whole of it. The plan adopted by the statute avoids
these difficulties. It places the power of assessing the value of
the whole line (so far as it lies within the territory), including
the rolling stock, in the hands of the board of equalization, and
after they have fixed such valuation and ascertained what it
amounts to per mile for the whole length within the territory, such
valuation per mile is certified by the territorial auditor to the
clerks of the several counties through which the road passes,
specifying the number of miles in each county so as to give to each
its
pro rata share, and then the county commissioners
divide and adjust the number of miles and the amounts falling
within each taxing precinct, township, and school district, to be
entered on their respective lists of taxable property. It seems
hardly to admit of a doubt that the object of this scheme was to
withdraw the difficult task of assessing fractional parts of a
railroad and its property from the hands of local assessors, who
could hardly be expected to proceed upon any uniform plan, and each
of whom would naturally favor his own particular district.
This being the evident purpose and object of the act, it is
difficult to see why it should not apply to the City of Cheyenne as
well as to every other portion of the territory. But the counsel
for the city raise several grounds of objection to this view which
it is necessary for us to consider.
They contend that the language of the city charter is very
broad, authorizing the corporation to assess every kind of
taxable
Page 113 U. S. 523
property situated within the city bounds, and that this includes
railroad property, and they insist that this law must stand until
it can be shown to be repealed; that the railroad assessment law
does not repeal it in express terms, and cannot be construed to
repeal it by implication, because the city charter is a special
law, intended for a particular locality, and will not be repealed
by implication by any general law containing contrary provisions
unless the latter be expressed in such universal terms as
necessarily to include every particular case; that such universal
terms are not used in the law, but, on the contrary, while other
subordinate territorial divisions are included by name, corporate
cities and municipalities are not mentioned nor alluded to. This is
a summary of the defendants' argument. It is certainly plausible
and entitled to careful consideration.
First, as to the relative character of the two statutes, is it
true that the one is a special statute and the other a general one
in the sense contended for? The city charter is special as it
relates to a single district or municipality, but the railroad
assessment act is quite as special as relating to a single subject
of taxation. The one gives general powers of assessment and
taxation to the city, but the other directs that railroad property
shall be assessed and valued by the board of equalization in a
particular way. Is not the last law even more special in character
than the first? Suppose a law had been passed declaring that every
horse in the territory should be assessed for the purpose of
taxation at the value of $200. Would not such a particular
direction be binding on the City of Cheyenne as well as on the
country districts? Do not the object and reason of the railroad
assessment law apply to a city like Cheyenne as well as to counties
and townships? Ought not the policy of the state with regard to
special objects of taxation to be extended to every portion of the
state, unless some defect in the laws themselves prevent its being
done?
Second, is it true that the language of the railroad assessment
act does not include cities in the fair construction of its terms?
Does it not fairly include every territorial district or
Page 113 U. S. 524
division of Wyoming -- cities as well as counties and townships?
Note the following passage:
"Said board shall not assess the value of any machine shop or
repair shop, or other buildings not situated on said right of way
or grounds, or other real estate of any corporations or company
within this territory, but it shall be the duty of the assessor of
the county or district in which said machine or repair shops or
other buildings or grounds or other real estate is situated to
assess the same and make return thereof in the manner now provided
for the assessment and return of real estate."
In using the words "county or district" in this clause, is not
the latter word "district" used in its largest sense, to signify
any subordinate territorial division whatever less than a county?
It seems to us that the language used is intended to cover every
case. In connection with this, read again the direction given to
the county commissioners, after the state auditor has certified to
them the assessment per mile made by the board of equalization. It
is as follows:
"The county commissioners shall thereupon divide and adjust the
number of miles and the amounts falling within each precinct,
township, or school district in their respective counties, and
cause such amounts to be entered and placed on the lists of taxable
property returned by the several assessors."
Does not this enumeration of subordinate tax districts (for
clearly tax districts are meant) embrace every kind of tax district
within the county? "Precinct" is a general word, and not a
technical one in Wyoming, and indicates any district marked out and
defined. In the connection in which it stands, it signifies a
district inferior to a county, for it is used to denote a portion
of a county, and superior to a township, for the enumeration
evidently proceeds from the greater to the less -- "precinct,
township, school district." What tax districts are there in Wyoming
inferior to a county and superior to a township, if incorporated
cities and towns are not such?
As before suggested, the railroad assessment law, considering
its purpose and object, ought to be extended to every tax district
in the state if its language admits of such a construction. We
think that it not only admits, but fairly requires, such a
construction.
Page 113 U. S. 525
If, in addition to this, we take into consideration the fifth
section of the act, which expressly repeals
"all acts and parts of acts providing for the assessment of the
property of railroad and telegraph companies, and the equalization
of assessments, inconsistent with the provisions of this act, . . .
so far as they provide for the assessment and equalization of the
property of said railroad and telegraph companies,"
we cannot doubt that the act was intended to reach every case of
taxation of railroads in the territory when situated in more than
one county. Surely the charter of the City of Cheyenne is embraced
in this description of acts or parts of acts to be repealed, for
according to the appellees' own contention, that charter does
provide for the assessment of the property of railroad and
telegraph companies, and there can be no doubt that the mode of
making such assessment under said charter is entirely inconsistent
with that prescribed by the act in question. We are of opinion
therefore that the assessment complained of was illegal and
unauthorized.
But it is contended that the complainant should have sought a
remedy at law, and not in equity.
It cannot be denied that bills in equity to restrain the
collection of taxes illegally imposed have frequently been
sustained. But it is well settled that there ought to be some
equitable ground for relief besides the mere illegality of the tax,
for it must be presumed that the law furnishes a remedy for illegal
taxation. It often happens, however, that the case is such that the
person illegally taxed would suffer irremediable damage, or be
subject to vexatious litigation, if he were compelled to resort to
his legal remedy alone. For example, if the legal remedy consisted
only of an action to recover back the money after it has been
collected by distress and sale of the taxpayer's lands, the loss of
his freehold by means of a tax sale would be a mischief hard to be
remedied. Even the cloud cast upon his title by a tax under which
such a sale could be made would be a grievance which would entitle
him to go into a court of equity for relief. Judge Cooley fairly
sums up the law on this subject as follows:
"To entitle a party to relief in equity against an illegal tax,
he must by his bill bring his case under some acknowledged head of
equity jurisdiction. The illegality of the
Page 113 U. S. 526
tax alone, or the threat to sell property for its satisfaction,
cannot of themselves furnish any ground for equitable
interposition. In ordinary cases, a party must find his remedy in
the courts of law, and it is not to be supposed he will fail to
find one adequate to his proper relief. Cases of fraud, accident,
or mistake, cases of cloud upon the title to one's property, and
cases where one is threatened with irremediable mischief may demand
other remedies than those the common law can give, and these, in
proper cases, may be afforded in courts of equity."
This statement is in general accordance with the decisions of
this Court as well as of many state courts.
Dows
v. Chicago, 11 Wall. 109;
Hannewinkle v.
Georgetown, 15 Wall. 549;
State Railroad Tax
Cases, 92 U. S. 575,
92 U. S.
612-613, and cases there cited. In
Cummings v.
National Bank, 101 U. S. 153,
101 U. S. 156,
where the bank filed a bill to prevent the collection of a tax
wrongfully assessed by the state against the shares of its
stockholders and which the bank was required to pay, we held that
the fiduciary character in which the bank stood to its stockholders
entitled it to come into a court of equity for relief. In the same
case, the fact that a like remedy by injunction was given to
parties in the state court was regarded as entitled to much weight,
and it was further held that where a rule or system of valuation
was adopted by the state board of assessment, calculated to operate
unequally, and to violate the constitution of the state, and
applicable to a large class of individuals or corporations, equity
might properly interfere to restrain the operation of such
unconstitutional exercise of power. And in
Litchfield v.
Webster Co., 101 U. S. 773,
101 U. S. 779,
we held that a court of equity might relieve against an excessive
rate of interest on taxes in arrear which was really in the nature
of a penalty, and which the state could not fairly and equitably
demand, having itself claimed title to the property taxed.
These authorities are sufficient to illustrate the rules by
which courts of equity should be governed in assuming jurisdiction
of suits brought to arrest the collection of illegal taxes. We
think that the allegations of the bill in this case bring it fairly
within the jurisdiction of the court. It shows that it would
involve
Page 113 U. S. 527
the plaintiff in a multiplicity of suits as to title of lots
laid out and being sold; would prevent their sale, and would cloud
the title to all its real estate. We think that these results are
sufficiently apparent, and render it unnecessary to look further.
The allegation of fraud has not been proven, and cannot therefore
have any effect in the case. It is unnecessary to inquire into the
sufficiency of other grounds for equitable relief which are alleged
in the bill.
Another point raised by the defendants, not affecting the
jurisdiction of the court but the propriety of its taking
jurisdiction, is that the complainant ought to have paid the taxes
which are conceded to be due to the city for the year 1880. As we
understand the facts stated by the bill (which, of course, the
demurrer admits to be true), the complainant did pay to the city
all the taxes which would be due upon the assessment and valuation
made by the board of equalization, including taxes due on outside
property of the company in the city.
The decree of the Supreme Court of Wyoming must be reversed
and the cause remanded with instructions to enter a decree in favor
of the complainant in conformity with this opinion, and it is so
ordered.
