ARMSTRONG v. the Treasurer of Athens County

41 U.S. 281 (____) 16 Pet. 281

THOMAS ARMSTRONG AND OTHERS, PLAINTIFFS IN ERROR,
v.
THE TREASURER OF ATHENS COUNTY, DEFENDANT IN ERROR.

Supreme Court of United States.

The case was submitted to the Court, on a printed argument, by Mr. Ewing, for the appellants. No counsel appeared for the appellees.

Mr. Justice CATRON delivered the opinion of the Court.

This is a writ of error from a State Court; and it has become the duty of this Court, before proceeding to examine the merits of the controversy, to determine whether jurisdiction over it is conferred by the twenty-fifth section of the judiciary act of 1789 It is true no question upon that subject was raised in the argument presented for the appellant; (the respondent having no counsel;) but it has been the uniform practice of this Court, in every case of this description, to ascertain, in the first instance, whether the record presented a case in which we were authorized by law to revise the judgment or decree of a State Court. And this question has so often arisen, and parties have been so frequently subjected to unnecessary expense in bringing causes here, in which a writ of error or appeal to this Court would not lie, that we have thought this a fit occasion to state the principles upon which the Court have constantly acted, and which may now be regarded as the law of the Court.

In order to give this Court jurisdiction under the twenty-fifth section of the act of 1789, it must appear on the record itself, to be one of the cases enumerated in that section: and nothing out of the record certified to this Court can be taken into consideration.

This must be shown: first, either by express averment, or by necessary intendment in the pleadings in the case.

Or, secondly, by the direction given by the Court, and stated in the exception.

Or, thirdly, when the proceeding is according to the law of Louisiana, by the statement of facts, and of the decision, as usually made in such cases by the Court.

Or, fourthly, it must be entered on the record of the proceedings in the Appellate Court, in cases where the record shows that such a point may have arisen and been decided, that it was in fact raised and decided; and this entry must appear to have been made by the order of the Court, or by the presiding judge by order of the Court, and certified by the clerk, as a part of the record in the State Court.

Or, fifthly, in proceedings in equity, it may be stated in the body of the final decree of the State Court from which the appeal is taken to this Court.

Or, sixthly, it must appear from the record that the question was necessarily involved in the decision; and that the State Court could not have given the judgment or decree, which they passed, without deciding it.

We are not aware of any other modes in which the judgment or decree of a State Court can lawfully be brought before us; and we have stated them particularly, in order to prevent, in future, the difficulties and discrepancies which have so often arisen on this subject.

In the case now before us, the presiding judge of the Supreme Court of Ohio has certified on the record that the validity of a statute of the state was drawn in question, on the ground that it was repugnant to the Constitution of the United States, and that the decision was in favour of the validity of said statute; and this certificate of the judge is certified by the clerk, as a part of the record. We presume that the certificate of the presiding judge was made by the authority of the Court: and as this bill and answer show that such a point might have arisen, and this certificate on the record states that it did arise, and was decided; the case comes within the fourth clause above mentioned, and this Court must take jurisdiction, and examine whether the point so certified was rightfully decided.

An act of the legislature of Ohio, passed in 1840, ordered certain lands held by the complainants to be assessed and taxed. The defendant was the tax-collector. The bill prays he be perpetually enjoined from enforcing the payment of the tax, because the lands had been exempted by a statute of Ohio, of 1804, which entered into the conditions of sale under which the complainants held. Therefore, it is insisted, the act of 1840 violates the contract of purchase, and is void; being contrary to that clause of the Constitution of the United States, which prohibits the states from passing any law violating the obligation of contracts.

This is the only question presented by the record that we can examine; as the twenty-fifth section carefully restricts this Court to specified cases of jurisdiction, beyond which we have no power to go into the cause.

There are six complainants, each setting up a distinct title; they sue jointly — and for the six only, and not for themselves and others, equally assessed; as in Attorney-General v. Helin, 2 Simon and Stuart, 67; and similar cases, referred to in Story's Equity Pleadings, sec. 114, 123. The Supreme Court of Ohio having entertained jurisdiction, this Court must do so likewise. The question of misjoinder is not open to us for revision.

The immediate deeds in fee from the trustees of the Ohio University to complainants, are not set forth in the pleadings: we take it, however, that they contain no condition exempting the lands from taxation, as the bill is founded on the assumption that the seventeenth section of the act of 1804 entered into the contract and imposed the exemption on the state. Whether such an inference arises in favour of the complainants, depends on the construction of an ordinance of Congress and the several acts of the legislature of Ohio, passed in regard to these university lands.

By the ordinance of 1787, 1 L.U.S. 573, a sale of a large section of country was authorized to be made to a company of individuals, from which is reserved:

"Not more than two complete townships to be given perpetually, for the purposes of a university, to be laid off by the purchasers as near the centre as may be, so that the same shall be of good land, to be applied to the intended object by the legislature of the state."

Ohio came into the Union as a state, in 1802. In 1804, Ohio Land Laws, 226, an act was passed establishing a university on the foundation of the fund secured by Congress, to be situated on the reserved lands; being townships eight and nine. The lands were vested in the corporation, consisting of the president and trustees, "for the sole use, benefit, and support of the university, forever."

They were authorized to rent out the lands in separate tracts, of not less than eight acres, or more than two hundred and forty acres on a valuation of commissioners, at a yearly rent of six per centum per annum on the estimated value, for ninety years, renewable forever: and from time to time a re-valuation was to take place, to which the subsequent rents were to correspond; with this addition, sec. 12, "That the said corporation shall have power to demand a further yearly rent on said lands and tenements, not exceeding the amount of tax imposed on property of like description, by the state; which rents shall be paid at such time and place, to such person, and collected in such manner, as the corporation shall direct." The seventeenth section declares, "That the lands in the two townships, appropriated and vested as aforesaid, with the buildings which are or may be erected thereon, shall forever be exempted from all state taxes."

Thus the matter stood until 1826, when the legislature authorized the board of trustees of the university to sell and convey in fee simple, (1) all the lands situate in the college townships, which were not encumbered with outstanding leases; (2) such of said lands as had been re-entered by the board, for a breach of the conditions of the leases, or where this encumbrance had been or might be otherwise removed; (3) to convey in fee to the lessees, respectively, on the payment of such sum of money as would yield at an interest of six per centum per annum on the sum which was yearly reserved in the lease.

Pursuant to this statute, the complainants purchased and took deeds in fee; no exemption from state taxation being contained in the statute under which they took title, or in their deeds.

The object of the incorporating act of 1804, was to regulate a public fund, intrusted to the management of the state sovereignty, so as best to accomplish the intention of the donor, the United States. It was a matter of course, in the then state of the college fund, to exempt it from taxes, in the hands of the trustees. The lands brought no income, and could bear no tax in their uncultivated condition, until they passed into the hands of private individuals. The tenants of the university for ninety years made their own contracts, and were bound to pay the ordinary taxes levied on the inhabitants of Ohio, not into the state treasury but into that of the university. Every change in the general laws in regard to the revenue bound them: as the value of real estate increased, and taxes were imposed in addition to previous burdens, to such an extent the corporation of the university added to the rate of its tenants. The lands not leased continued exempt from taxation, on the fair supposition that they brought no income, and could bear no burdens.

The policy of the act of 1804 is too plain to admit of comment; and its wisdom so manifest as to meet with instant sanction.

But what was the policy of the act of 1826? An entire change of the fund from real estate to a capital in money vested by loan in the state treasury, was determined on by the corporation. Leave was asked and granted by the legislature to sell the lands, and convey them in fee simple to purchasers; giving the tenants a preference in cases where there were existing leases. As regarded the management and nature of the fund to sustain the university, the act of 1804 was to a great extent repealed; by that act, the lessees of the corporation were governed; their contracts were founded on it; but with it the purchasers in fee had no concern, their contracts originated in a different policy, and are sanctioned by a different statute; the complainants actually claim, and could only claim by force of the act of 1826. This act secured the payments of no taxes to the university, as the substitute of the state. It simply authorized the corporation to sell as an individual might sell, and the respective purchasers took title as from an individual; they were strangers to the act of 1804, with the exception of those provided for by the third section of the act of 1826, the value of whose lands were to be governed by the assessment of their rents under the former act, and who were entitled to have deeds in fee on the payment of one hundred dollars for every six dollars of annual rent assessed upon them, disregarding the taxes they were bound by the act of 1804 to pay to the corporation. The mode of ascertaining the value makes no difference; all the purchasers hold under the act of 1826, and cannot go behind it; and are subject like other persons holding lands in fee to be taxed by the state.

The case relied on by the complainants as ruling this is that of the State of New Jersey v. Wilson, 7 Cranch, 164. In 1758, the Delaware tribe of Indians agreed with the colonial government of New Jersey, to release to the latter all their lands in that colony south of the river Raritan: the government purchased a tract of land on which the Indians might reside, and stipulated by a legislative act, that this tract should not thereafter be subject to any tax. The Delawares wished to emigrate, and join the Stockbridge tribe in New York. In 1801, the state of New Jersey, by a statute, authorized them to sell their lands. This act of Assembly contained no exemption from the payment of taxes after the sale. In 1803, the Indian tribe sold to Wilson and others; and the commissioners appointed by order of the legislature conveyed for and on behalf of the Indians, to the purchasers. On the foregoing state of facts, it was held by this Court, that the purchasers being in under the first grant of 1758, to the Indian tribe, were equally entitled to its benefits; and that no taxes could be levied on the land.

The soundness of the decision we think undoubted. The compact with the Delaware tribe was for a cession to the government of a large body of land; the consideration for the cession, was a smaller tract vested in trust for them in fee; and a further, and very material consideration was, that the latter tract should never be taxed by the government. The parties were competent thus to contract, as no restriction was imposed on the colonial government, and the consideration was ample for the exemption.

The condition attached to the land; so this Court held: "The act authorizing the Indians to sell was a mere enabling statute; the purchasers took from and under the Indian tribe, held by virtue of the grant to them, and were, of course, entitled to all the benefits of the contract. New Jersey had therefore no more power to repeal that part of the grant which exempted the lands from taxation than she had to repeal the entire contract: and therefore her act of 1804, repealing the clause of exemptions, was void."

We think the case in Cranch compared with the one presented by the record, is too dissimilar to require a particular comparison, or further comment.

We concur with the Supreme Court of Ohio, that the bill must be dismissed: and so order.