Dissenting Opinion: White, Field, Harlan, Brown, JJ.

denied to the State of Illinois the power of regulating the rates of railway charges between Illinois and New York. Where, may I ask, can the line of distinction be drawn between the Covington Bridge case and this? The bridge in the former case was one between Kentucky and Ohio over the Ohio River, the bridge here is over the same river between Kentucky and Indiana. Certainly, it cannot be said that there is something peculiar to the State of Indiana which causes the bridge between that State and Kentucky not to be an instrument of interstate commerce, and the traffic over it not to be interstate commerce, when the contrary is the case as to a bridge between Kentucky and Ohio.

The contention that although the traffic over the bridge may be interstate commerce and the receipts from said traffic be interstate commerce receipts, yet the tolls paid to the bridge company are not receipts from interstate commerce business transacted by the bridge company, is a mere distinction without a difference. What, may I again ask, is the toll paid to the company for the use of the bridge but the result of a contract entered into for the purpose of carrying on interstate commerce? In the Covington Bridge case the sole question was as to the right of the State of Kentucky to regulate the amount of tolls to be received by the bridge company. The right of the State was denied on the ground that the tolls were a matter of interstate commerce, that is, that the business of operating the bridge and charging for the use thereof was interstate commerce and not subject to state control. In that case then, the tolls were adjudged to be receipts from interstate commerce; in the case at bar, they are declared not so to be. The far-reaching consequence of this asserted distinction is well calculated to arouse solicitude for the future. A large portion of the interstate commerce business of the country is carried on by freight lines. These lines arrange with the railways for transportation, pay them a charge or toll, and upon this basis afford the public increased business facilities. Under the supposed distinction all this interstate commerce traffic ceases to be such, and the whole of the gross receipts become taxable in every State through which the

Dissenting Opinion: White, Field, Harlan, Brown, JJ.

business passes. The freight lines do not transport the merchandise; the railways do; therefore the receipts of the freight lines as to such lines are not interstate commerce receipts. This illustration is but one of the many which at once suggest themselves. All the express business, the sleeping car business, the tank lines, and manifold other forms of interstate commerce, will be stricken down if the rule now applied to the tolls of an interstate bridge be enforced as to other means of interstate commerce.

Where, also, I submit, does a distinction exist between this case and the case of the ferry between Pennsylvania and New Jersey, considered in the Gloucester Ferry case, or the attempt of the State of Illinois to regulate freight charges between that State and New York, embraced in the Wabash case, supra? Manifestly, there is an irreconcilable conflict between the decision in this case and the rulings of the court in the cases just cited. It follows that in order to maintain. the tax in the case at bar the decisions referred to must be and are, as I conceive, substantially overruled by the opinion now announced.

Nor can I see the slightest relevancy to the issues in this cause of the decision in Erie Railroad v. Pennsylvania, 158 U. S. 431. In that case, the court considered a statute of Pennsylvania which authorized the imposition of a tax upon the gross receipts of companies for tolls and transportation derived from railroads, etc., situated within the State. The Erie company held and operated several branch lines lying wholly within the State of Pennsylvania, and permitted 'other railroad companies to use such branch lines or portions thereof, and the taxes there in question were laid upon the tolls so received by the Erie company from its lessees. Such receipts, of course, were merely the income derived from property lying wholly within the State of Pennsylvania.

Obviously, the mere fact that corporations who practically rented property wholly in Pennsylvania and paid rent charges thereon, did business outside of the State, could not exempt the landlord (the Erie company) from paying taxes on the rentals so received from its tenants for property wholly in

Dissenting Opinion: White, Field, Harlan, Brown, JJ.

Pennsylvania. Is there any ground for contending here that the Henderson bridge is wholly in Kentucky, when the fact is that it is both in Kentucky and Indiana, and that no business can be done over it which is not necessarily business done in both States and between both States? That there was no intention in the Erie case to question the settled doctrine as to the want of power in a State to tax interstate commerce, or the gross receipts derived therefrom, is conclusively shown by the express language of the opinion, where it was declared (p. 437) that it was needless to review the previous decisions of this court, holding that a tax laid upon gross receipts derived from interstate commerce put a burden upon commerce among the States and was void, because the proposition the decisions were quoted to sustain was regarded as thoroughly established. So, likewise, at page 438, an extract was made from the decision in Postal Telegraph Company v. Charleston, 153 U. S. 692, 695, and the doctrine there declared was approved, to wit, that a tax, by whatever name imposed, was valid where the amount of the tax was made dependent in fact on the value of the property of the taxpayer situated within the jurisdiction of the State imposing the tax.

How can it in reason be said that a case which proceeded solely upon the ground that the rentals which were taxed were the fruits of property which lay wholly within the State of Pennsylvania is authority supporting the proposition now maintained that the State of Kentucky has the right to tax the gross receipts derived from business not done wholly within the State, but consisting of tolls and charges derived from the operation of a bridge situated between that State and the State of Indiana, and which tolls and charges this court has recently declared in the Covington Bridge case, supra, constitute receipts from interstate commerce business?

I am authorized to state that MR. JUSTICE FIELD, MR. JUSTICE HARLAN and MR. JUSTICE BROWN concur in this dissent.

Syllabus.

ADAMS EXPRESS COMPANY v. KENTUCKY.1

APPEAL FROM THE CIRCUIT COURT OF THE UNITED STATES FOR THE DISTRICT OF KENTUCKY.

No. 586. Argued December 11, 14, 1896. Decided March 15, 1897.

Section 4077 of the compilation of the Kentucky statutes of 1894 provides that each of the enumerated companies or corporations; " 'every other like company, corporation or association"; and also "every other corporation, company or association having or exercising any special or exclusive privilege or franchise not allowed by law to natural persons, or performing any public service, shall, in addition to the other taxes imposed on it by law, annually pay a tax on its franchise to the State, and a local tax thereon to the county, incorporated city, town and taxing district, where its franchise may be exercised"; and in the succeeding sections the words "franchise," "franchises" and "corporate franchise" are used. Held that, taking the whole act together, and in view of the provisions of sections 4078, 4079, 4080 and 4081, it was evident that the word "franchise" was not employed in a technical sense, and that the legislative intention was plain that the entire property, tangible and intangible, of all foreign and domestic corporations, and all foreign and domestic companies possessing no franchise, should be valued as an entirety, the value of the tangible property be deducted, and the value of the intangible property thus ascertained be taxed under these provisions; and as to railroad, telegraph, telephone, express, sleeping car, etc., companies, whose lines extend beyond the limits of the State, that their intangible property should be assessed on the basis of the mileage of their lines within and without the State; but that from the valuation on the mileage basis the value of all tangible property should be deducted before the taxation was applied.

So far as the commerce clause and the Fourteenth Amendment of the Federal Constitution are concerned, this scheme of taxation is not in contravention thereof, as already determined in Adams Express Company v. Ohio State Auditor, 165 U. S. 194, and cases cited.

Considered as a property tax, it is in harmony with the provisions of the constitution of the Commonwealth of Kentucky.

Section 174 of the constitution of Kentucky does not prevent intangible property from being taxed, and the tax mentioned in section 4077 is not an additional tax upon the same property, but upon intangible property which has not been taxed as tangible property.

1 The docket title of this case is Levi C. Weir, President of the Adams Express Company, Appellant v. L. C. Norman, Auditor of Public Accounts for the Commonwealth of Kentucky.

Statement of the Case.

Neither section 172 of the Kentucky constitution, nor any other section, confines the levy of an ad valorem tax to tangible property.

The statute, as construed by the Court of Appeals of the State of Kentucky, cannot be overthrown for failure to conform to the requirements of sections 171, 172 and 174 of the state constitution.

THIS was a bill filed in the Circuit Court of the United States for the District of Kentucky on behalf of the Adams Express Company to enjoin the collection and certification of taxes against it for the year 1895 under an act of Kentucky of November 11, 1892, entitled "An act relating to revenue and taxation," carried forward as chapter 108 of the compilation of the Kentucky statutes of 1894, page 1291. The case comes to this court on appeal from a decree of the Circuit Court sustaining a demurrer and dismissing the bill as amended. The decree proceeded on the grounds stated by Judge Barr in the opinion of the court in Western Union Telegraph Co. v. Norman, 77 Fed. Rep. 13.

The bill charged the statute of Kentucky, under which the tax complained of was levied, to be in contravention of the Constitution of the United States, and also of sections 171, 172 and 174 of the constitution of Kentucky. Similar averments to those considered in Adams Express Company v. Ohio State Auditor, 165 U. S. 194, appear in this bill, and need not be repeated at length. It is stated that the Adams Express Company had no property in the State of Kentucky in the year 1895, except certain horses, wagons, harness, trucks, safes, office fixtures and other appliances, located at different points in the State, and that all of said property, including the moneys and credits of the company within the State, were duly returned and assessed for state, county, municipal and other purposes; that the said cash value of the same was $36,614.53, and that the taxes thereon were duly paid; and that the tax complained of is an assessment for state, county, municipal and other purposes on the further sum of $1,463,040. Sections 171, 172, 174 and 181 of the constitution are as follows:

"8 171. The general assembly shall provide by law an annual tax, which, with other resources, shall be sufficient to