Vicksburg Company v. Dennis

by Horace Gray

United States Supreme Court

116 U.S. 665

Vicksburg Company  v.  Dennis

 Argued: March 1, 1886. ---

The original suit was brought by the sheriff and ex officio collector of taxes of the parish of Madison, in the state of Louisiana, to recover the amount of taxes assessed, under general laws of the state, in 1877 and 1878 to the Vicksburg, Shreveport & Texas Railroad Company, and in 1880 to the Vicksburg, Shreveport & Pacific Railroad Company, upon 34 miles of railroad, with fixtures and appurtenances, in that parish. The Vicksburg, Shreveport & Texas Railroad Company was incorporated on April 28, 1853, by a statute of Louisiana, to construct and maintain a railroad from a point in the parish of Madison on the Mississippi river opposite Vicksburg, westward by way of Monroe and Shreveport to the line of the state of Texas. Section 2 of that statute was as follows: 'The capital stock of said company shall be exempt from taxation, and its road, fixtures, workshops, warehouses, vehicles of transportation, and other appurtenances shall be exempt from taxation for ten years after the completion of said road within the limits of this state.' The eastern part of the railroad, from Vicksburg to Monroe, about 75 miles, was completed before January 1, 1861; and the western part, from Shreveport to the Texas line, about 25 miles, was completed before January 1, 1862; leaving the central part, from Monroe to Shreveport, about 100 miles, uncompleted. The further construction of the road was prevented and suspended during the civil war, and much of the track, bridges, stations, and workshops was destroyed by the hostile armies. Soon after the return of peace, a holder of four out of a large number of bonds secured by a mortgage executed by the corporation on September 1, 1857, of its railroad, property, and franchises, commenced a suit in a court of the state of Louisiana, and obtained a decree for the sale of the whole mortgaged property, and it was sold under that decree. Upon a suit after wards brought by a very large number of the bondholders, in behalf of all, in the circuit court of the United States, that sale was, by a decree of this court, at October term, 1874, annulled as fraudulent and illegal, and the railroad, property, and franchises ordered to be sold for the benefit of the bondholders and other creditors of the corporation. Jackson v. Ludeling, 21 Wall. 616. On December 1, 1879, they were sold pursuant to this decree, and purchased by a committee of the bondholders, who on the next day organized themselves, with their associates, into a corporation under the general statute of Louisiana of March 8, 1877, by the name of the Vicksburg, Shreveport & Pacific Railroad Company, and now claimed to be entitled, under this statute, to all the rights, powers, privileges, and immunities of the Vicksburg, Shreveport & Texas Railroad Company, including its exemption from taxation. In 1881 and 1882 the new corporation made contracts for the completion of the railroad between Monroe and Shreveport, and began to complete it; but it has not yet been completed. The supreme court of Louisiana held that the provision of the statute of 1853, exempting the railroad, fixtures, and appurtenances 'from taxation for ten years after the completion of said road,' did not relieve the old corporation from taxation before the road was completed, and therefore gave judgment for the plaintiff, without determining whether the new corporation had succeeded to the rights of the old one in this respect. Dennis v. Vicksburg, S. & P. R. Co., 34 La. Ann. 954. A writ of error was sued out by the defendant, and allowed by the chief justice of that court, because there was drawn in question the validity of a statute of or an authority exercised under the state, on the ground of its being repugnant to the constitution of the United States, as impairing the obligation of contracts, and the decision was in favor of its validity.

E. M. Jonson, Geo. Hoadly, and Edwd. Colston, for plaintiff in error.

John S. Young and Thos. O. Benton, for defendant in error.

GRAY, J.

Notes