TREAT, TREASURER OF COCONINO COUNTY, ARIZONA,
v.
GRAND CANYON RAILWAY COMPANY
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The Grand Canyon Railway Company sought to enjoin Coconino County from collecting taxes, claiming exemption under Arizona territorial statutes that granted tax-exempt status to railroad properties used in construction and operation for ten years from the date of enactment. The Supreme Court affirmed the territorial court's decision that the tax exemption was a property-based right that transferred with the railroad's ownership, protecting the company from taxation. The Court held that it would not overturn the territorial court's reasonable interpretation of its own local statutes absent manifest error.
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Mr. Justice Holmes delivered the opinion pf the court.
This is a bill brought by the Railway Company, the appellee, to restrain the collection of taxes from, which it says that it is exempt. The facts in brief are theáé: A. predecessor of the appellee, the Santa Fe and Grand Canyon Railroad Company, between August, 1899, and. October, 1900, built over fifty-six miles of the road concerned In July, 1901, this road was sold on foreclosure sale-to purchasers who organized the appellee and in August conveyed the road to it. The new company finished the road to the edge of the Grand Canyon and laid out stations and hotel grounds at the end. In 1906 the Territorial Board undertook to levy the tax complained of. The Supreme Court held that the appellee was exempt. 12 Arizona, 69; 95 Pac. Rep. 187; 12 Arizona, 117; 100 Pac. Rep. 438.
The railroad company was organized under Act No. 3, February 8,1897, of. the Territory (Laws 1897, p. 5) which authorized such corporations to be formed for the purpose of buying the property of railroads sold on foreclosure, and to buy-and exercise “all the rights, privileges, franchises, immunities and powers” of their predecessors. By § 7 such corporations were to have all rights, immunities, &c., then or thereafter given to any railroad organized under the general laws; but by § 8 it was provided that, the act should not be construed “to give to any corporation created under it, any exemption from taxation created by any existing or future exemption laws of the . Territory of Arizona.” The question does not stand on this act alone, however, and the cases discussed in Rochester Railway Co. v. Rochester, 205 U. S. 236, for by a later statute of March 16, 1899, No. 68 (Laws 1899, p. 79) “for the purpose of inducing and encouraging the construction of railroads” it was provided that the “property used or necessary in the construction and operation of railroads,” of roads thereafter constructed, “whether owned or operated by a person or persons, association or railway corporation, his their or its successors or assigns,” should be exempt from all manner of taxation for ten years from the date of the act. The Supreme Court held that this exemption was in rem, so to speak, went with the land; and extended to the assigns of the first road.
No doubt a strong argument can be made and was made for a different view, based on the passage before and on the date of the act of 1897 of statutes like that of 1899. But the considerations that prevailed also are cogent and so obvious as not to need statement. Moreover, the question is not whether the later statute constituted a contract, Damon v. Hawaii, 194 U. S. 154, 160; Wisconsin & Michigan Ry. Co. v. Powers, 191 U. S. 379. The courts of the Territory have given to the railroad the rights that it claims, as against the-, territorial authorities seeking to levy the tax. The only question is whether any sufficient reason appears for not following the construction given to a local statute by the territorial court, when that construction is inherently reasonable, is at least the first to strike the mind, and is one that protects private rights. It is enough to answer that, on the principle followed so far as may be by this court, there is no such manifest error as to warrant us in reversing the decision below. Fox v. Haarstick, 156 U. S. 674, 679. English v. Arizona, 214 U. S. 359, 361, 363.
Judgment affirmed.
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De Castro v. Bd. of Comm'rs of San Juan, 322 U.S. 451 (U.S. 1944)…Board of Equalization, 206 U. S. 474, 479; Lewis v. Herrera, 208 U. S. 309, 314; English v. Arizona, 214 U. S. 359, 361, 363; Santa Fe County v. Coler, 215 U. S. 296, 305, 307; Albright v. Sandoval, 216 U. S. 331, 339; Treat v. Grand Canyon Ry. Co., 222 U. S. 448, 452; Clason v. Matko, 223 U. S. 646, 653; Gray v. Taylor, 227 U. S. 51, 56-57; Phoenix Ry. Co. v. Landis, 231 U. S. 578, 579-580; Santa Fe Central Ry. Co. v. Friday, 232 U. S. 694, 700. Given the conditions wbicb, as we have pointed out, call for…1 / 2
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Gray v. Taylor, 227 U.S. 51 (U.S. 1913)…ongress, the other objections are of a kind as to which we often have intimated our strong leaning toward following the local courts, and therefore will not be discussed at length. Fox v. Haarstick, 156 U. S. 674, 679. Treat v. Grand Canyon Ry. Co., 222 U. S. 448, 453. In the first place it is said that the statute was not approved by the Governor and does not appear to have reached him more than three days before the adjournment of the Legislature so as to have become a law by Rev. Stat., § 1842. Also it is…
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Straus v. Foxworth, 231 U.S. 162 (U.S. 1913)…hink this was right. At least, we cannot say that it was manifestly wrong, as must be done [*170] to 'justify us in rejecting the local interpretation of a territorial statute. Fox v. Haarstick, 156 U. S. 674, 679; Treat v. Grand Canyon Railway Co., 222 U. S. 448, 452. Of course, the provision was intended fo have some operation and effect, and it hardly could have any if restricted to sales made in accordance with the act, in the stricter sense, for .such sales would be as valid without the provision as wit…
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Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Wis. & Mich. Ry. Co. v. Powers, 191 U.S. 379 (U.S. 1903)
- Rochester Ry. Co. v. City of Rochester, 205 U.S. 236 (U.S. 1907)
- FOX v. Haarstick, 156 U.S. 674 (U.S. 1895)
- Chesapeake & Ohio Ry. Co. v. Miller, 114 U.S. 176 (U.S. 1885)
- English v. Territory of Arizona Ex rel. Griffith, 214 U.S. 359 (U.S. 1909)
- Damon v. Hawaii, 194 U.S. 154 (U.S. 1904)