City of San Bernardino v. S. Pac. Co. (1895) · DecisionDepot

City of San Bernardino v. S. Pac. Co.

Name: California Superior Court Tentative Rulings
Creator: DecisionDepot
License: https://creativecommons.org/licenses/by-nc/4.0/

California Supreme Court Jun 27, 1895 No. No. 19576Published

Before: Garoutte

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Holding. A municipal ordinance imposing a license tax on a common carrier engaged in interstate commerce is unconstitutional and void because it imposes a burden on interstate commerce, which is subject to the exclusive regulatory power of Congress.

Issues

Whether a municipal license tax on a common carrier constitutes an unconstitutional burden on interstate commerce.
Whether the distinction between a main trunk line and a branch line affects the validity of a municipal license tax on interstate commerce.

Disposition. affirmed

Quotations verified verbatim against the opinion

“A license tax, which is a tax on the privilege of doing business involving interstate commerce, is void and cannot be enforced.”

“The ordinance covers its entire business as common carriers, regardless of its nature, and, therefore, of necessity, operates as a burden upon interstate commerce, if its business is of that character.”

Synopsis

Interstate Commerce — License Tax Upon Railroad Company.—A license tax imposed by a municipal corporation upon a railroad company engaged in interstate commerce is void and cannot be enforced.

Id.—Tax Upon Branch Line.—The fact that the license tax was imposed upon a branch line of railroad operated in the municipality does not render the tax valid, where it appears that the branch line was a part of the transcontinental line of railroad, and the railroad company is engaged in the carriage of passengers, freight, and mails between all points on the branch line and points on the main line of the railroad outside of the state of California.

Garoutte, J. This is an action by the city of San Bernardino, a municipal corporation of the fifth class, to recover of the Southern Pacific Company, a corporation organized under the laws of the state of Kentucky, the sum of one hundred dollars as license tax. for carrying on the business of common carrier, under the provisions of a city ordinance imposing a license tax of five dollars a month on any person or company carrying on such business in said city. The answer alleges that the defendant is engaged in interstate commerce in operating a railroad for the carriage of freight and passengers and United States mail from New Orleans, in the state [527]of Louisiana, through the state of California, to Portland, in Oregon, and as part of said system operates a line of railroad to said city of San Bernardino, and that the sum sought to be recovered from defendant is a license tax for the privilege of engaging in interstate commerce, and its assessment and attempted enforcement and collection is a violation of article I, section 8, parts III and VII of the constitution of the United States. The case was tried on an agreed statement of facts, and judgment went for defendant in the court below, and plaintiff appeals.

In the agreed statement of facts we find the following: “ That the defendant is now, and at all the times stated in plaintiff’s complaint herein was, a railroad corporation organized under the laws of the state of Kentucky, and engaged in operating, as lessee of the Southern Pacific Railroad Company, a continuous line of steam railroad, for the carriage of freight, passengers, and United States mails, for hire as common carriers, from the city of New Orleans, in the state of Louisiana, through the states of Louisiana and Texas, the territories of New Mexico and Arizona, and the states of California and Oregon, to the city of Portland, in the state of Oregon, and that as a part of its said transcontinental line of railroad, and connecting with its main line thereof, near Colton, in the county of San Bernardino, state of California, it operates a line of steam railroad to and into the city of San Bernardino, in said county and state, for the carriage of freight, passengers, and United States mails to and from points on its said main line of railroad outside the state of California; also between points in the state of California, and that it does now, and at all times mentioned in said complaint did, under contracts with the government of the United States, regularly carry over its said line of railroad the mails of the United States to and from said city of San Bernardino and to and from points outside of the state of California, and has at all times mentioned in the com

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It would appear from appellant’s brief that this proposition of law is not controverted, but its application to the facts of this case is denied, upon the ground that the line of railroad operated by the defendant in the city of San Bernardino is not its main trunk line, but is only a branch thereof. In other words, it is conceded that a similar license tax to the one here involved would not be a valid tax, and could not be collected» in any city located upon the main trunk line of road between New Orleans and Portland, Oregon, not even in the city of Colton, which is situated at the point of junction of the main and branch lines, and in the same county as the plaintiff itself. Under the agreed statement of facts there is no sound foundation upon which to rest the application of a different principle of law in these two classes of cities. It is stipulated that this branch line is “ a part of its said transcontinental line of railroad,” and, in the face of the existence of such fact, we do not perceive any force in plaintiff’s contention that this particular part of the railroad is no part of its main trunk line. But the stipulation of facts even goes beyond this broad statement, and declares that the line of road operating in the city of San Bernardino carries passengers, freight, and [529]United States mails to and from points on its said main line of railroad, outside of the state of California, also between points in the state of California, and likewise conveys the United States mails to and from such points. Carrying passengers and freight from San Bernardino to a thousand places on the line of the road in other states, and likewise from those points to San Bernardino, is conducting an interstate commerce business pure and simple, and by the stipulation this is the. business the defendant is carrying on in the city of San Bernardino. The question of power in the city to create such an ordinance is not to be tested by the fact as to whether or not the city is located upon any particular line of railroad, be it trunk or branch line, hut rather by the character of the business in which the defendant is engaged in the city passing the ordinance. In dealing with this question we do not concern ourselves as to the character of the franchise under which either the trunk line or the branch line of defendant is doing business. The character of defendant’s business, and not the character of its franchise, points the judgment. Again, as far as plaintiff is concerned, it is the terminus of the transcontinental line; but we think the question of direct line and termini wholly immaterial.

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