Lillard v. Melton

Inasmuch as the questions now before the Court en banc are most important, and inasmuch as our conclusion may have a very serious effect upon the reserved rights of the people, I feel impelled to express my view somewhat at length.

I approach the decision of the case with a full realization of the responsibility that is upon each member of the Court en banc, and with a full appreciation of what Chief Justice Marshall has well said in Fletcher v. Peck, 6 Cranch, 128, where it became the duty of the Court to consider whether a statute of Georgia was in conflict with its Constitution. "The question," said Chief Justice Marshall, "whether a law be void for its repugnancy to the Constitution, is, at all times, a question of much delicacy, which ought seldom, if ever, to be decided in the affirmative in a doubtful case. But the Court, when impelled by duty to render such a judgment, would be unworthy of its station, could it be unmindful of the solemn obligations which that station imposes, But it is not on slight implication and vague conjecture that the legislature is to be pronounced to have transcended its powers and its acts to be considered as void." We shall attempt to keep in mind and adhere to these principles as vital in the relations which should exist between co-ordinate branches of the government.

The act in question undertakes to organize a commission composed of five private citizens theretofore in no way connected with the corporate affairs of Richland county, of any of the political subdivisions thereof or of any of the municipal corporations in said county, and, to give to the commission so created the right in their discretion to issue bonds of the said county of Richland to the amount of one and one-quarter millions of dollars, and to levy and have collected a property tax to pay the said indebtedness, etc. The money so raised is to be used for the purpose of improving the public highways of Richland county.

It is not pretended that the General Assembly has itself made the levy contemplated by the act, nor could such claim be successfully maintained in the face of the case ofRailway Co. v. Kay, 62 S.C. 28, 39 S.E. 785.

Among other safeguards against burdensome taxation, the people, in their sovereign capacity, enacted this provision of the Constitution: "The corporate authorities of counties, townships, school districts, cities, towns and villages may be vested with power to assess and collect taxes for corporate purposes, such taxes to be uniform in respect to persons and property within the jurisdiction of the body imposing the same." Art. IV, sec. 5. Is the act above referred to in contravention of this constitutional provision? This provision, as we understand it, is intended to be a limitation upon the power of the General Assembly to delegate the power of taxation. The legislature had no power at all to delegate the taxing power until an exception was made in favor of the municipal corporations enumerated, and to the corporate authorities thereof.

Such was the view of the late Chief Justice McIver, and such has been the view of the Courts of other States, and of the Supreme Court of the United States whenever this provision has undergone judicial interpretation.

In Floyd v. Perrin, 30 S.C. 15, 8 S.E. 14, 2 L.R.A. 242, C.J. McIver said:

"The people in their sovereign capacity have, by their Constitution, entrusted the taxing power to the General Assembly, and upon a familiar principle, this power thus delegated to that body, cannot be delegated by it to any subordinate agency, except by express permission of the sovereign authority. The framers of the Constitution, recognizing this doctrine, provided that this high power of taxation might be delegated to certain subordinate agencies for certain purposes, for we find it declared in section 8, article 14. (Here follows the language of the Constitution above quoted.) "It is clear, therefore, that this provision is," as said by Waite, C.J., in Weightman v. Clark, 103 U.S. 259, in speaking of a similar provision in the Constitution of Illinois, "a limitation on the power of the legislature to authorize taxation by public corporations."

"When, therefore, a question arises as to the constitutionality of an act purporting to delegate the taxing power to some subordinate agency of the government, two inquiries are presented:

"1st. Whether such agency is one of those to which the Constitution permits the taxing power to be delegated.

"2d. Whether the taxation proposed to be authorized is for a corporate purpose, for, as we have seen, this power can only be delegated to the corporate authorities of counties, townships, etc., and only for corporate purposes." Floyd v. Perrin, 30 S.C. 15, 8 S.E. 14, 2 L.R.A. 242.

This statement of the meaning of the constitutional provision referred to, has never been questioned, although it was subsequently decided, adversely to what was in this case held, that the purpose for which the levy was made was a corporate purpose, and that the township was a corporation.

Touching the power of the legislature to delegate the taxing power, Judge Cooley says: "It is a general rule of constitutional law that a sovereign power conferred by the people upon any one branch or department of the government is not to be delegated by that branch or department to any other. This is a principle which pervades our whole political system, and, when properly understood, permits of no exception. And it is applicable with peculiar force to the case of taxation. The power to tax is a legislative power. The people have created a legislative department for the exercise of the legislative power, and within that power lies the authority to prescribe the rules of taxation, and to regulate the manner in which these rules shall be given effect. There is, nevertheless, one clearly defined exception to the rule that the legislature shall not delegate any portion of its authority. The exception, however, is strictly in harmony with the general features of our political system, and rest upon an implication of popular assent which is conclusive. The exception relates to municipal corporations.

Immemorial custom which tacitly or expressly has been incorporated in the several State constitutions, has made these organizations a necessary part of the general machinery of State government, and they are allowed large authority in matters of local government, and to a considerable extent are permitted to make the local laws. This indulgence has been carried into matters of taxation, the State in very many cases doing little beyond prescribing rules of limitations within which for local purposes the local authorities may levy taxes. The legislature, however, in thus making delegation of power to tax must make it to the corporationitself, and provide for its exercise by the proper legislative authority of the corporation."

Without questioning whether the bonds contemplated to be issued by this act and for which taxes must be levied are for corporate purposes, we do question most vigorously whether the agency to which it is sought to delegate the taxing power is one of those to which the Constitution permits the taxing power to be delegated, namely, the corporate authorities of the county of Richland.

The limitation upon the General Assembly to delegate the power of taxation is undoubtedly to corporate authorities. What is meant by corporate authorities?

In the case of O'Brien v. Wheelock, 184 U.S. 487,46 L. Ed. 653, 22 Sup. Ct. Rep. 354, Chief Justice Fuller, speaking for the Court in construing a constitutional provision substantially identical with the language of our Constitution, says: "It was ruled that the right of taxation could not be granted by the General Assembly in any form to private persons or to private corporations; that the provision limited the power of the General Assembly to grant the right to assess and collect taxes to the corporate or local authorities of the municipalities or districts to be taxed; that a local burden of taxation or special assessment could not be imposed upon a locality without the consent of the taxpayers to be affected; and that corporate authorities were municipal officers directly elected by the people of the municipality or appointed in some mode to which they had given their assent," citing Harvard v. St. Clair M. Levee Drainage Co., 51 Ill. 130, and other cases from Illinois.

The construction of the State Constitution in Harvard's case and others has been repeatedly recognized by the Court as authoritatively established. The language of the Illinois Constitution is identical with the language in our Constitution. Corporate authorities in their Constitution was invariably interpreted to mean "municipal officers directly elected by the people of the municipality or appointed in some mode to which they had given their assent."

The legislature of Kansas passed an act authorizing the creation of a board of road commissioners and empowering it, among other things, to create a debt and levy taxes. In declaring the act unconstitutional the Supreme Court expressed itself vigorously as follows:

"Does the Constitution of the State of Kansas authorize the legislature to delegate the power of taxation either to the signers of these petitions or to these road commissioners? Can a tax be arbitrarily forced upon the taxpayers of a county either by the individuals or by officials in whose appointment they have no voice? The power of taxation is a power inherent in all governments. In a constitutional government, the people by the Constitution confer it on the legislature. It is one of the highest attributes of sovereignty. It includes the power to destroy. It appropriates the property and labor of the people taxed. Unrestrained power of taxation necessarily leads to tyranny and despotism. Hence, in all free governments the power to tax must be limited to the necessities for the purposes of government and the agencies for local taxation should be fixed and their powers limited by organic law and they should be so selected as to be directly answerable for their official acts to their local constituencies or districts to be taxed. If they act corruptly those directly interested may then remove them and appoint others. If those directly interested have no voice in their appointment or power to remove them they have no means of correcting their abuses. No other rule can secure those to be taxed from oppression and fraud on the part of the taxing officers." Wyandotte County Comrs. v. Abbott, 52 Kansas 148, 34 P. 416.

Proceeding further, the Court said: "Self-taxation or taxation by officers chosen by or answerable to those directly interested in the district to be taxed is inseparable from that protection of the right of property that is either expressly or impliedly guaranteed by all written constitutions under our system of government. Of all the powers of government the one most liable to abuse is the power of taxation. If placed in hands irresponsible to the people of the district to be taxed, its abuse is a mere question of time.

"The legislature is not the fountain, not the source of power. Under our system of government the legislature can exercise only such power as the people have delegated to that body, either expressly or by necessary implication by the Constitution. All rights not so delegated are retained by the people.

"Illegal or oppressive taxation is destructive of the right of property and is not government under the Constitution, but is misgovernment."

Equally as vigorous and to the point is the language of the Supreme Court of Iowa in the case of Howe v. DesMoines, 103 Iowa 76; 72 N.W. 639; 39 L.R.A. 285; 64 Am. St. Rep. 157, viz.: "We hold that no officer and no board not elected by and immediately responsible to the people can be made the repository of such power. If this power was given to the city council and it was abused the people could, at least, prevent a recurrence of the wrong at the polls; but if it be reposed in a body not elected by the people the remedy is uncertain, indirect and likely to be long delayed."

The almost unlimited power sought to be conferred by the act under consideration upon the newly created board of highway commissioners of Richland county is of itself a forcible reminder that the power to fix, determine and levy a tax for local purposes should be conferred upon some body which stands as the direct representative of the people.

To the same effect as the decisions above referred to, are the decisions of the Supreme Court of Pennsylvania, Michigan and other States, all regarded as high authority. But time will not permit me to call attention to any more.

In view of the long list of text writers and respectable authorities from our State and other States, holding that the words "corporate authorities," when used in the provision of the Constitution referred to, are intended to limit the persons to whom the taxing power may be delegated and that the words are intended to designate persons directly responsible to the people to be taxed, we feel constrained to take that view.

If, then, the words are intended as a limitation of the power to delegate the taxing power, it is obvious that it would be an evasion, if not a violation of the Constitution, to permit the legislature to ignore the corporate authorities of Richland county, and to create a highway commission with power to saddle upon Richland county a bonded indebtedness of one and one-quarter millions of dollars, according to its discretion. What Judge Cooley has said in an analysis and a review of the case I have just mentioned, and some inclining to a different view, seems appropriate here: "Whatever may be thought of the relative soundness of these decisions in matters of law, those which deny the power to levy such invidious burdens are likely to conduce to equality and fairness in matters of local taxation and to just purposes and purity in legislation. It is difficult to conceive of a more corrupting power than that of voting taxes by those who are not to feel them, especially when the expenditure may be confined to those who have no interest personally or as corporators." * * * "Any principle in representative government may well be considered obsolete when, as applied, it removes the substantial responsibility and restraining power from the constituency concerned to a distant central authority."

It may be that this highway commission is composed of high-minded, honorable men; and, possibly it is better qualified to know what tax should be put upon the people of Richland county than are the people themselves. However that may be, the principle is wrong, and the power of taxation attempted to be conferred upon this commission is a long step in the direction of permitting boards not elected by or responsible to the people to determine what the taxpayers' property shall bear and a long step towards centralized government.

It will not do to say that by its creation this board becameipso facto the corporate authorities of Richland county. If this be true, the limitation does not limit, for under that construction we can conceive of only very, very rare instances of a delegation of the taxing power that would be obnoxious to the provision of the Constitution referred to and the constitutional convention has done a vain thing, — simply enacted a high sounding but empty phrase — "corporate authorities," or as another has expressed it, "the maxim that taxation and representation go together would seem to be merely a glittering generality, promising much but assuring nothing."

It is only by adopting this view, to wit, that the highway commission becomes "the corporate authorities" by its creation, that those who contend for the constitutionality of the act can hope to sustain it. I cannot accede to such a view. I cannot concede that the constitutional convention, as a means of limiting the power of the legislature to delegate its taxing power, adopted a plan so impotent and unavailing.

For these reasons and for the further reason that the term of office of the members of the board of highway commissioners is uncertain in length and, therefore, obnoxious to the Constitution, I concur in the opinion of the Chief Justice and think that the judgment of the Court below should be reversed.

MR. JUSTICE FRASER and CIRCUIT JUDGE SHIPP concur in the opinion of CIRCUIT JUDGE GARY.