Western Union Telegraph Company v. Missouri
The defendant in error is the tax collector of Jackson county, Missouri, and brought this action against the plaintiff in error in the circuit court of that county for the sum of $1,027.22, the taxes assessed against plaintiff in error for the year 1899, apportioned to Jackson county. The answer of the plaintiff in error alleged illegality in the taxes upon two grounds: First, that the taxes were levied upon the franchise of the plaintiff in error, derived from the United States under certain acts of the Congress; second, that the state board of equalization, intending to injure the plaintiff by compelling it to pay an excessive and disproportionate share of state and local taxes, assessed its poles, wires, and instruments at far more than their actual value.

The plaintiff in error is a telegraph company, incorporated by the state of New York. It does business in the state of Missouri, having offices in a number of cities of that state, and its lines run between those cities and to and from them to other places in the Union; in other words, the plaintiff in error engages in intrastate and interstate business. It claims to have no franchises from the state of Missouri (except in an unimportant instance), but occupies the streets of its cities, and its public roads and highways, by authority of the act of Congress of July 24, 1866 (14 Stat. at L. 221, chap. 230, U.S.C.omp. Stat. 1901, p. 3579), entitled 'An Act to Aid in the Construction of Telegraph Lines, and to Secure to the Government the Use of the Same for Postal, Military, and Other Purposes.' The material part of § 1 of the act is as follows:

'Section 1. That any telegraph company now organized, or which may hereafter be organized, under the laws of any state in this Union, shall have the right to construct, maintain, and operate lines of telegraph through and over any portion of the public domain of the United States, over and along any of the military or post roads of the United States, which have been or may hereafter be declared such by an act of Congress, and over, under, or across the navigable streams or waters of the United States: Provided, That such lines of telegraph shall be so constructed and maintained as not to obstruct the navigation of such streams and waters or interfere with the ordinary travel of such military or post roads.'

Section 2 provides that the messages between the officers and agents of the government shall have priority, and be sent at rates to be fixed by the Postmaster General.

Section 3 forbids the transfer of the rights conferred by the act.

Section 4 gives the United States the power to purchase the telegraph lines, property, and effects of any company availing itself of the benefits of the act.

Section 4 is as follows:

'And be it further enacted, That before any telegraph company shall exercise any of the powers or privileges conferred by this act, such company shall file their written acceptance with the Postmaster General of the restrictions and obligations required by this act.'

Under the Constitution and laws of Missouri, the state board of equalization, composed of the governor, secretary of state, state auditor, state treasurer, and attorney general, assesses railroad and telegraph property, and it also equalizes the real and personal property assessed by the local assessors. Exercising its powers of original assessment, the board made the following order in regard to the property of plaintiff in error:

State of Missouri, office of state auditor.

Be it remembered that heretofore, to wit, on the 25th day of July, 1899, the following, among other proceedings, were had by the state board of equalization, viz.:

The state board of equalization having given to the Western Union Telegraph Company opportunity to be heard personally by the board, and having heard the said company, through its officers and agents, and having carefully considered the facts set out in the returns and the statements of said company, and all evidence of value, and all matters bearing upon the question of the value of the property of said company, and considering the cost of construction and equipment of said Western Union Telegraph Company, and the location thereof, and its traffic and business, and the market and par value of its stocks and bonds, and the gross receipts and net earnings and franchise owned by said company, and the value thereof, and having received evidence concerning the value of the cost of construction of said telegraph line, and the market value and par value of the stocks and bonds, and the gross receipts and net earning power, and the franchise and value thereof, and having heard evidence upon and considering all other matters ascertainable by said board bearing upon the question of the value of said company, which, in the opinion of the board, would assist in its findings, conclusions, and judgment in arriving at the actual cash value of the property of said telegraph company; on motion the state board of equalization assesses and values for taxes of 1899 the property of said Western Union Telegraph Company at $1,827,727.45; and it is further ordered by the state board of equalization that the assessed value thereof be distributed upon the classes of property as follows:
6,075.98 miles of poles at $71.50 per mile....... $434,432 57
23,767.34 miles of wire at $22.02 per mile.......  523,356 82
3,375 instruments at $5.70 each.................... 13,537 50
All other porperty at............................. 856,400 56

$1,827,727 45
The apportionment of the tax to Jackson county was as
follows:

For state purposes.................. $202.43
For county purposes.................. 283.40
For road purposes..................... 35.41
For general county school purposes... 370.61
For school building purposes........... 2.98
For other school purposes............. 19.03
For Kansas City municipal purposes.... 81.21
For Independence municipal purposes... 25.38
For Kaw township railroad purposes..... 2.03
For Blue township railroad purposes.... 4.74

Total............................ $1,027.22

The case was tried without a jury and the trial court found 'the fact to be from the evidence and the pleadings that the defendant owned in the state of Missouri, at the time of said assessment, the poles, wires, and instruments of the value hereinbefore set forth. And the court finds the fact to be from the evidence that in valuing 'all other property' of defendant the state board took into consideration the franchise of defendant company, and the court finds under the law, and so declares, that the franchise of defendant company is not subject to valuation and taxation, and as to this item of the above-named valuation the court finds the issues for the defendant.'

Judgment was entered against plaintiff in error in the sum of $605.82, being the tax on the poles, wires, and instruments of the company, with interest at 2 per cent for collector's fees, and also for attorney's fees. The amount found due was made a first lien against the property of defendant in error, and special execution ordered to be issued. Both parties moved for a new trial, which motions were denied. Both parties then appealed to the supreme court of the state, which court reversed the judgment of the circuit court. After an elaborate discussion of the case the supreme court said:

'It follows that the judgment of the circuit court holding the tax assessed against 'all other property at $856,400.56' to be unlawful, is erroneous, and that the plaintiff is entitled to a judgment for the whole amount of the tax sued for. Judgment is accordingly entered here for the plaintiff for $1,027.22, back taxes for the year 1899, with interest thereon from the 1st of January, 1900, at the rate of 1 per cent per month (Rev. Stat. 1899, § 9225), and costs.'

This writ of error was then sued out. Other facts appear in the opinion.

Messrs. Eleneious Smith, John F. Dillon, Alexander New, and Henry D. Estabrook for plaintiff in error.

[Argument of Counsel from pages 416-419 intentionally omitted]

Messrs. Hunter M. Meriwether and Robert E. Ball for defendant in error.

Mr. Justice McKenna, after stating the facts, delivered the opinion of the court: 

Notes
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