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Mr. Richard L. Maury for plaintiff in error on submission of case.

Mr. R. Taylor Scott, Attorney General of Virginia, for defendant in error on submission of case.

26, 1882 (Acts 1881-82, p. 37), the assembly | filed his petition in the circuit court of the passed a further act declaring that the tax city of Norfolk to establish the genuineness collectors should receive in payment of taxes of certain coupons tendered in payment of and other dues "gold, silver, United States taxes. The proceeding was had under the Treasury notes, national bank currency, and act of 1882, and no question is made of a nothing else," with a provision for suit by full compliance with the terms of that stat one claiming that such exaction was illegal. ute. Judgment was rendered in his favor by The act contained this proviso: "There shall the circuit court of the city of Norfolk, be no other remedy in any case of the collec- which judgment was, on March 23, 1894, tion of revenue, or the attempt to collect rev-reversed by the supreme court of appeals of enue illegally, or the attempt to collect reve- the state, 90 Va. 597, and a judgment ennue in funds only receivable by said officers, tered in favor of the commonwealth, dismissunder this law, the same being other and dif-ing the petition of the plaintiff and awardferent funds than the taxpayer may tender or ing to the commonwealth costs. Or[106] claim the right to pay, than such as are herein June 13, 1894, a writ of error was allowed, provided; and no writ for the prevention of and the case brought to this court. any revenue claim, or to hinder or delay the collection of the same, shall in anywise issue, either injunction, supersedeas, mandamus, prohibition, or any other writ or process whatever; but in all cases if for any reason any person shall claim that the revenue so collected of him was wrongfully or illegally collected, the remedy for such person shall be as above provided, and in no other manner." At the same session, on February 14, 1882, Messrs. A. J. Montague, Henry R. a new funding bill was passed containing a Pollard, and R. Taylor Scott, Attorney Genproposition to the bondholders (Acts 1881-eral of Virginia, for defendant in error on 82, p. 88); and again at the same session, on April 7, 1882, an act was passed amending the Code of Virginia in respect to man: damus, which provided "that no writ of Perhaps no litigation has been mandamus, prohibition, or any other summary process whatever, shall issue in any tricate and troublesome questions, than that severely contested, or has presented more in[105]case of the collection, or attempt to collect revenue, or to compel the collecting officers which has arisen under the coupon legisla to receive anything in payment of taxes other has been prolific of many cases, both in tion of Virginia. That legislation than as provided in chapter forty-one, acts the state and Federal courts, not a few of of assembly, approved January twenty-six, eighteen hundred and eighty-two, or in any v. Greenhow, 102 U. S. 672 [26: 2711; which finally came to this court. Hartman case arising out of the collection of revenue Antoni v. Greenhow, 107 U. S. 769 [27: in which the applicant for the writ or process has any other remedy adequate for the 468]; Virginia Coupon Cases, 114 U. S. 269 protection and enforcement of his individual [29: 185]; Poindexter v. Greenhow, 114 U. right, claim, and demand, if just." (Acts S. 270 [29: 185]; Carter v. Greenhow, 114 1881-82, p. 342.) U. S. 322 [29: 204]; Moore v. Greenhow,

On March 15, 1884, the general assembly passed a general act in reference to the assessment of taxes on persons, property, and incomes (Acts 1883-84, p. 561), the one hundred and thirteenth section (p. 603) of which required that all school taxes should be paid "only in lawful money of the United States."

On January 26, 1886 (Acts 1885-86, P. 37), an act was passed providing that in a suit in respect to coupons tendered in payment of taxes, no expert testimony should be receivable, and that the bonds from which the coupons were cut should be produced, if demanded, as a condition precedent to the right of recovery.

Section 399 of "the Code of Virginia," which was a revision and re-enactment of the general statutes of the state, adopted May 16, 1887, reads: "It shall not be lawful for any officer charged with the collection of taxes, debts, or other demands of the state to receive in payment thereof anything else than gold or silver coin, United States Treasury notes, or national bank notes."

On May 29, 1892, the plaintiff in error

Messrs. Richard L. Maury, William A. Maury, and M. F. Maury for plaintiff in error on oral argument.

oral argument.

ion of the court:
*Mr. Justice Brewer delivered the opin-[106]

more

114 U. S. 340 [29: 240]; Marye v. Parsons,
114 U. S. 325 [29: 205]; Barry v. Ed-
munds, 116 U. S. 550 [29: 729]; Chaffin
. Taylor, 116 U. S. 571 [29: 728[; Royall v.
Virginia, 116 U. S. 572 [29: 735]; Royall v.
Virginia, 121 U. S. 102 [30: 883]; Sands
585 [29: 739];
V. Edmunds, 116 U. S.
Stewart v. Virginia, 117 U. S. 612 [29:
McGahey v. Virginia, 135 U. S. 662 [34:
1006]; Re Ayers, 123 U. S. 443 [31: 216];

304].

For the first time in the history of this litigation has any appellate court, either state or Federal, distinctly ruled that the coupon provision of the act of 1871 was void. After the passage of the act of March 7, paid in cash, the case of Antoni v. Wright 1872, which in terms required all taxes to be came before the court of appeals of Virginia (22 Gratt. 833), and on December 13, 1872, was decided. Elaborate opinions were filed, and the court held the act of 1871 valid and the act of 1872 void, as violating the contract embraced in the coupon provision of the act of 1871. This decision was reaffirmed in Wise Bros. v. Rogers, 24 Gratt.[107] 169, decided December 17, 1873; Clarke v.

Tyler, 30 Gratt. 135, decided April 4, 1878, | payment of taxes in cash only was unconand again in Williamson v. Massey, 33 Gratt. stitutional, the general assembly of Virginia 237, decided April 29, 1880. In Greenhow has from time to time passed acts tending v. Vashon, 81 Va. 336, decided January 14, to embarrass the coupon holder in the exer1886, the act requiring school taxes to be cise of the right granted by the funding act. paid in cash was sustained, and such taxes Some of these acts appear in the statement excepted from the coupon contract on the preceding this opinion, but for a more full ground of a specific command in the state review of the legislation and the course of Constitution in force at the time of the pas- decision reference may be had to the opinion sage of the funding act. There was no di- of Mr. Justice Bradley in the several cases rect decision that the coupon provision was reported under the title of McGahey v. Virentirely void, although the intimation was ginia, supra. clear that such was the opinion of the judges then composing the court.

We are advised by the opinion of the court of appeals of Virginia, in 22 Gratt. 833, that the debt-two thirds of which was proposed to be refunded and most of which was, in fact, refunded-amounted to $40,000,000 of principal. These refunding bonds, amounting to many millions of dollars, have passed into the markets of the world, and have so passed accredited, not merely by the action of the general assembly of the state of Virginia, but by the repeated decisions of her highest court, as well as of this court, for substantially a quarter of a century, to the effect that such coupon provision was constitutional and binding. Now, at the end of twenty-seven years from the passage of the act, we are asked to hold that this guaranty of value, SO fortified as it has been, was never of any validity, that the decisions to that effect are of no force and that all the transactions which have been had based thereon rested upon nothing. Such a result is so startling[109] that it at least compels more than ordinary

In this court the decisions have been uniform and positive in favor of the validity of the act of 1871. There has been no dissonance in the declarations, from the first case, Hartman v. Greenhow, 102 U. S. 672, 679 [26: 271, 275], decided at the October term, 1880, in which, referring to this act, the court said, by Mr. Justice Field: "A contract was thus consummated between the state and the holders of the new bonds, and the holders of the coupons, from the obligations of which she could not, without their consent, release herself by any subsequent legislation. She thus bound herself, not only to pay the bonds when they became due, but to receive the interest coupons from the bearer at and after their maturity, to their full amount, for any taxes or dues by him to the state. This receivability of the coupons for such taxes and dues was written on their face, and accompanied them into whatever hands they passed. It constituted their chief value, and was the main consideration consideration. offered to the holders of the old bonds to surrender them and accept new bonds for two thirds of their amount,"-to McGahey v. Virginia, 135 U. S. 662, 668 [34: 304, 306], decided at the October term, 1889, in which Mr. Justice Bradley, delivering the unanimous opinion of the court, observed: "We have no hesitation in saying that the act of 1871 was a valid act, and that it did and does constitute a contract betweeen the state and the holders of the bonds issued under it, and that the holders of the coupons of said bonds, whether still attached thereto or separated therefrom, are entitled, by a solemn engagement of the state, to use them in payment of state taxes and public [108]dues. *This was determined in Hartman v. Greenhow, 102 U. S. 672 [26: 271], decided in January, 1881; in Antoni v. Greenhow, 107 U. S. 769 [27: 468], decided in March, 1883; in the Virginia Coupon Cases, 114 U. Secondly. It is insisted that whatever S. 269 [29: 185], decided in April, 1885, may be our own opinions upon the case, we and in all the cases on the subject that have are to take the construction placed by the come before this court for adjudication. court of appeals of Virginia upon the act This question, therefore, may be considered as the law of that state. While it is unas foreclosed and no longer open for consid-doubtedly the general rule of this court to eration. It may be laid down as undoubted law that the lawful owner of any such coupons has the right to tender the same after inaturity in absolute payment of all taxes, debts, dues, and demands due from him to the state."

Since the decision of the court of appeals of Virginia, in Antoni v. Wright, 22 Gratt. 833, that the act of 1872, providing for the

We pass, therefore, to a consideration of the specific questions presented in this record., First. It is insisted that the decision of the court of appeals was right, and that the coupon provision was void. It were a waste of time to repeat all the arguments which have been heretofore presented, and we content ourselves with reiterating that which was said by Mr. Justice Bradley speaking for the entire court, in McGahey V. Virginia, 135 U. S. 662, 668 [34: 304, 306]: "This question, therefore, may be considered as foreclosed and no longer open for consideration. It may be laid down as undoubted law that the lawful owner of any such coupons has the right to tender the same after maturity in absolute payment of all taxes, debts, dues, and demands due from him to the state."

accept the construction placed by the courts yet one exception to this rule has always of a state upon its statutes and Constitution, been recognized, and that in reference to the matter of contracts alleged to have been impaired. This was distinctly affirmed in Jefferson Branch Bank v. Skelly, 1 Black, 436, 443 [17: 173, 177], in which the court, speaking by Mr. Justice Wayne, gave these reasons for the exception: "It has never

been denied, nor is it now, that the Supreme | it could be enforced in respect to general Court of the United States has an appellate taxes. power to revise the judgment of the supreme It may be well to here quote the language court of a state, whenever such a court shall with which Mr. Justice Bradley concludes adjudge that not to be a contract which his general review of the prior litigation, has been alleged, in the forms of legal and which in its last paragraph shows that proceedings, by a litigant, to be one, within this very matter was considered and deterthe meaning of that clause of the Constitu- mined, pages 684, 685 [34: 312.]: tion of the United States which inhibits the states from passing any law impairing the obligation of contracts. Of what use would the appellate power be to the litigant who feels himself aggrieved by some particular state legislation, if this court could not decide, independently of all adjudication by the supreme court of a state, whether or not [110]the phraseology of the instrument in controversy was expressive of a contract and within the protection of the Constitution of the United States, and that its

"Without committing ourselves to all that has been said, or even all that may have been adjudged, in the preceding cases that have come before the court on the subject, we think it clear that the following propositions have been established:

"First, that the provisions of the act of 1871 constitute a contract between the state of Virginia and the lawful holders of the bonds and coupons issued under and in pursuance of said statute;

restraining the use of said coupons for the payment of taxes and other dues to the state, and imposing impediments and obstructions to that use, and to the proceedings instituted for establishing their genuineness, do in many respects materially impair the obligation of that contract, and cannot be held to be valid or binding in so far as they have that effect;

"Third, that no proceedings can be instituted by any holder of said bonds or coupons against the commonwealth of Virginia, either directly by suit against the commonwealth by name, or indirectly against her executive officers to control them in the exercise of their official functions as agents of the state;

"Second, that the various acts of the asobligation should be enforced, not-sembly of Virginia passed for the purpose of withstanding a contrary conclusion by the supreme court of a state? It never was intended, and cannot be sustained by any course of reasoning, that this court should, or could with fidelity to the Constitution of the United States, follow the construction of the supreme court of a state in such a matter, when it entertained a different opinion." The doctrine thus announced has been uniformly followed. Bridge Proprietors v. Hoboken Land & Improv. Co. 1 Wall. 116, 145 [17: 571, 576]; Wright v. Nagle, 101 Ú. S. 791,793 [25:921,922]; McGahey v. Virginia, 135 U. S. 665, 667 [34: 305, 306]; in which, in reference to this very contract, it was said: "In ordinary cases the decision of the highest court of a state with regard to the validity of one of its statutes would be binding upon this court; but where the question raised is, whether a contract has or has not been made, the obligation of which is alleged to have been impaired by legislative action, it is the prerogative of this court under the Constitution of the United States and the acts of Congress relating to writs of error to the judgments of state courts, to inquire and judge for itself with regard to the making of such contract, whatever may be the views or decisions of the state courts in relation thereto." See also Douglas v. Kentucky, 168 U. S. 488, 501 [42: 553, 557], and cases cited therein.

Thirdly. It is urged that our last decision, that in McGahey v. Virginia, supra, logically leads to the conclusion that the whole coupon contract was void, and that the court of appeals of Virginia rightly interpreted the scope of that decision when it so held. The argument of that court is that because the Constitution of Virginia compels the payment of certain taxes in cash, and that therefore the coupon contract cannot be enforced as against those taxes, the whole contract must fail, the partial failure being a vice which enters into and destroys the entire contract. But the court overlooks that which was in fact decided in the eight cases reported under the title of McGahey v. Virginia, for while in two of those cases it was held that the coupon contract could not [111]be enforced against certain specific taxes and dues, it was in others as distinctly held that 172 U. S. U. S.. Book 43.

25

"Fourth, that any lawful holder of the tax-receivable coupons of the state issued under the act of 1871 or the subsequent act of 1879, who tenders such coupons in payment of taxes, debts, dues, and demands due from him to the state, and continues to hold himself ready to tender the same in payment thereof, is entitled to be free from molestation in person or goods on account of such taxes, debts, dues, or demands, and may vindicate such right in all lawful modes of redressby suit to recover his property, by suit against the officer to recover damages for taking it, by injunction to *prevent such tak-[112] ing where it would be attended with irremediable injury, or by a defense to a suit brought against him for his taxes or the other claims standing against him. No conclusion short of this can be legitimately drawn from the series of decisions which we have above reviewed, without wholly overruling that rendered in the Coupon Cases and disregarding many of the rulings in other cases, which we should be very reluctant to do. To the extent here announced we feel bound to yield to the authority of the prior decisions of this court, whatever may have been the former views of any member of the court.

"There may be exceptional cases of taxes, debts, dues, and demands due to the state which cannot be brought within the operation of the rights secured to the holders of the bonds and coupons issued under the acts of 1871 and 1879. When such cases occur

385

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they will have to be disposed of according to
their own circumstances and conditions."
Neither is the argument a sound one. It
ignores the difference between the statute
and the contract, and confuses the two en-
tirely distinct matters of construction and
validity. The statute precedes the contract.
Its scope and meaning must be determined
before any question will arise as to the va-
lidity of the contract which it authorizes. It
is elementary law that every statute is to
be read in the light of the Constitution. How-
ever broad and general its language, it can-
not be interpreted as extending beyond
those matters which it was within the con-
stitutional power of the legislature to reach.
It is the same rule which obtains in the in-dison on Contracts, 905; Chitty on Contracts,
terpretation of any private contract between
individuals. That, whatever may be its
words, is always to be construed in the light
of the statute; of the law then in force; of
the circumstances and conditions of the.par-
ties. So, although general language was in
troduced into the statute of 1871, it is not
to be read as reaching to matters in respect
to which the legislature had no constitution-
al power, but only as to those matters within
its control. And if there were, as it seems
there were, certain special taxes and dues
which under the existing provisions of the
state Constitution could not be affected by
[113]legislative action, the statute is to be read
as though it in terms excluded them from its
operation.

promise is void. When, however, for a legal
consideration, a party undertakes to do one
or more acts, and some of them are unlaw-
ful, the contract is good for so much as is
lawful and void for the residue. Whenever
the unlawful part of the contract can be sep-
arated from the rest it will be rejected and
the remainder established. But this cannot
be done when one of two or more considera-
tions is unlawful, whether the promise be
to do one lawful act, or two or more acts
part of which are unlawful, *because the[114]
whole consideration is the basis of the whole
promise. The parts are inseparable. Wi-
doe v. Webb, 20 Ohio St. 431 [5 Am. Rep.
664], citing Metcalf on Contracts, 246; Ad-
730; 1 Parsons on Contracts, 456; 1 Parsons
on Notes and Bills, 217; Story on Prom.
Notes, section 190; Byles on Bills, 111;
Chitty on Bills, 94.

Indeed, the court of appeals does not follow what it calls the logic of the decision in McGahey v. Virginia to its necessary result. The scope of its argument is that if a part of the consideration be illegal, the whole contract fails. But the promise on the part of the state, written into these coupons and authorized by the act of 1871, was a promise to pay so much money and to receive such promise in satisfaction of taxes. In refer ence to this, the court of appeals, in its opinion in this case, uses this language:

"We do not assail that act as unconstitutional as an entirety. We simply hold that the coupon feature of the act, the coupon contract, which is readily separable from the rest of the act, is repugnant to sections 7 and 8 of the Constitution of Virginia, and is therefore an illegal contract. The validity of the bonds issued under and by authority of said acts of March 30, 1871, and March 28, 1879, is not denied; nor is it denied that the bondholders are entitled to the interest on the bonds, to be collected in the ordinary way; but we do deny that it can be collected through the medium of the illegal coupon, which has been most aptly designated the 'cut worm of the treasury.'' 90 Va. 597

606.

"And in the same case it is said: 'Whilst a partial want or failure of consideration avoids a bill or note only pro tanto, illegality in respect to a part of the consideration avoids it in toto. The reason of this distinction is said to be founded, partly at least, on grounds of public policy, and partly on the technical notion that the security is entire and cannot be apportioned; and it has been said with much force, that where parties have woven a web of fraud or wrong it is no part of the duty of courts of justice to unravel the threads and separate the sound from the unsound;' citing Story on Prom. Notes, and Byles on Hills, supra, and then adds: 'And, in general, it makes no difference as to the effect whether the illegality be at coramon law or by statute.'"

This decision declares that when the consideration is illegal, the promise fails; and to like effect are the other authorities cited. But in the case at bar there is no illegality in the consideration. That was furnished by the bondholder in the old bond, and that bond was the sole consideration. It is no

where suggested that there was any vice or
illegality in it; that it was not a valid obli-
gation of the state. When the bondholder
surrendered that he furnished the entire
consideration for the contract, and for that
he received from the state a promise. And
above cited: "When, however, for a legal
as the supreme court of Ohio said in the case
consideration, a party undertakes to do one
ful, the contract is good for so much as is
or more acts, and some of them are unlaw-
lawful and void for the residue." The
court of appeals concedes that the promise
made by the state to pay the interest is
valid, because made upon a good and lawful
consideration. Does it not logically follow
that the promise of the state is also good as
to all other matters contained within it in
respect to which it might lawfully make a[115]

Further, the authorities to which it re-
fers make against the conclusion which it
reaches. Thus, at the end of its argument,
it quotes as a principal authority the follow-promise? It promised to receive the coupons
ing:

"The concurrent doctrine of the text-books on the law of contracts is that if one of two considerations of a promise be void merely, the other will support the promise; but that if one of two considerations be unlawful the

"for all taxes, debts, dues, and demands due the state." That promise was necessarily for each tax and debt, as well as for all taxes and debts. If it should so happen that any single tax or debt cannot, under the Constitution of the state, be lawfully discharged

by the receipt of the coupon, there is no diffi- the contract can only be impaired within the culty in separating that part of the contract meaning of this clause in the Constitution, from the balance. And as said by the su- and so as to give this court jurisdiction on preme court of Ohio: "Whenever the unlaw-writ of error to a state court, by some subful part of the contract can be separated sequent statute of the state which has been from the rest, it will be rejected and the re-upheld or effect given it by the state court. mainder established."

To like effect are the decisions of this, court. In United States v. Bradley, 10 Pet. 343 [9: 448], suit was brought on a paymaster's bond, and it was claimed that as some of the stipulations were in excess of those required by the statute, and illegally inserted, the whole bond was void. But the court overruled the contention, saying (p. 360 [456]):

Lehigh Water Co. v. Easton, 121 U. S. 388
[30: 1059]; New Orleans Water Works Co.
v. Louisiana Sugar Refining Co. 125 U. S. 18
[31: 607]; Central Land Co. v. Laidley, 159
U. S. 103, 109 [40: 91, 94].
If the
judgment of the state court gives no effect
to the subsequent law of the state, and the
state court decides the case upon grounds
independent of that law, a case is not made
for review by this court, upon any ground
of the impairment of a contract. The above
cited cases announce this principle."

"That bonds and other deeds may, in many cases, be good in part and void for the residue, where the residue is founded in ille- It is true the court of appeals in its opingality but not malum in se, is a doctrine well ion only incidentally refers to statutes founded in the common law, and has been passed subsequent to the act of 1871, and recognized from a very early period. Thus, places its decision distinctly on the ground in Pigot's Case, 11 Coke, 276, it was said that that act was void in so far as it related that it was unanimously agreed in 14 Hen. to the coupon contract, but at the same time VIII., 25, 26, that if some of the covenants it is equally clear that the judgment did give of an indenture, or of the conditions indorsed effect to the subsequent statutes, and it has upon a bond are against law, and some are been repeatedly *held by this court that in re-[117] good and lawful, that in this case the cove-viewing the judgment of the courts of a state nants or conditions which are against law are void ab initio and the others stand good." So in Gelpcke v. City of Dubuque, 1 Wall. 221 [17: 531], this court said, in reference to a similar contention in a suit on a contract made by the officials of the city of Dubuque (p. 222 [17: 520]):

"We have not, therefore, considered the questions which they present. They relate to certain provisions of the contract which are claimed to be invalid. Conceding this to be so, they are clearly separable and sevarable from the other parts which are relied upon. The rule in such cases, where there is no imputation of malum in se, is that the bad parts do not affect the good. The valid may be enforced." [116] *We see no reason to change the views heretofore and often expressd by this court, and reiterate, as said in 135 U. S. 668 [34: 306], "this question, therefore, must be considered as foreclosed and no longer open for consideration."

Fourthly. It is urged that this court has no jurisdiction of this case for the reason that the court of appeals in its opinion does not consider the subsequent legislation passed by the state with the view of impairing the contract created by the act of 1871, but limits itself to a consideration of that act, and adjudges it void. In support of this proposition the rule laid down in New Orleans Water Works Co. v. Louisiana Sugar Ref. Co. 125 U. S. 18, 38 [31: 607,615], reaffirmed in Huntington v. Attrill, 146 U. S. 657, 684 [36: 1123,1134], and Bacon v. Texas, 163 U. S. 207, 216 [41: 132, 136], is cited.

In this last case the doctrine is summed up in the following statement:

"Where the Federal question upon which the jurisdiction of this court is based grows out of an alleged impairment of the obligation of a contract, it is now definitely settled that

we are not limited to a meré consideration of the language used in the opinion, but may examine and determine what is the real substance and effect of the decision.

Suppose, for illustration, a state legislature should pass an act exempting the prop erty of a particular corporation from all taxation, and that a subsequent legislature should pass an act subjecting that corpora tion to the taxes imposed by the city in which its property was located, and that, on the first presentation to the highest court of the state of the question of the validity of taxes levied under and by virtue of this last act, that court should in terms hold these city taxes valid notwithstanding the general clause of exemption found in the prior stat ute. In that event no one would question that this court had jurisdiction to review such judgment, and inquire as to the scope of the contract of exemption created by the first statute. Suppose, further, that this court should hold that the first statute was valid and broad enough to exempt from all taxation, city as well as state, and adjudge the last act of the legislature void as in conflict with the prior; and that thereafter the city should again attempt to levy taxes upon the corporation, and that upon a challenge of those taxes the state court should say nothing in respect to the last act, but simply rule that the original act exempting the property of the corporation from taxation was void, could it fairly be held that this court was without jurisdiction to review that judgment, a judgment which directly and necessarily operated to give force and effect to the last statute subjecting the property to city taxes? Could it be said that the silence of the state court in its opinion changed the scope and effect of the decision? In other words, can it be that the mere language in which the state court phrases its opinion takes from or adds to the jurisdic

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