bering its property situate in the state to the injury or exclusion of any citizen of the state, creditor of such corporation, and further provided that no mortgage given by such foreign corporation to secure a debt created in another state should take effect against any citizen of the state until all liabilities due to any person or corporation in the state had been paid and extinguished. But this court said, and I think correctly, that there could be no doubt of the validity of these statutory provisions. It may be said, and said truthfully, that the attention of the court was not specially directed to this particular portion of the statute, and hence that the decision cannot be taken as authority. Yet the section was spread before the court, it is quoted in its opinion, and it was so obviously constitutional that neither counsel nor court had any doubt thereof. I note this case in order to suggest the objectionable evolution of the thought that a state may not protect those persons who are within its jurisdiction in respect to property also within its jurisdiction, or im[268]pose conditions on *foreign corporations doing business therein, which amount to such protection. Ten years ago a statute of Colorado guaranteeing priority to citizens of the state over all other creditors, even those by mortgage, was by all parties, counsel, and by court, conceded to be free from objection, while today a statute of Tennessee, in no way discriminating between citizens, but only between residents and in respect to foreign corporations, is declared to be so plainly at variance with the Constitution of the United States that it must be adjudged void. the California creditors find that all the as- I am authorized to state that the Chief VILLAGE OF NORWOOD, Appt., v. ELLEN R. BAKER. (See S. C. Reporter's ed. 269-303.) Due process of law-cost of public improve 2. The doctrine of this opinion is that a state has no power to secure protection to persons within its jurisdiction, citizens or noncitizens, in respect to property also within its jurisdiction, because, forsooth, such protection may in some cases work to the disadvantage of one who is not only a nonresident but also not a citizen of the state. It seems to me that the practical working out of this doctrine will be, not that the state may not dis-1. criminate in favor of its own residents as against nonresidents, but that the state must discriminate in favor of nonresidents and against its own residents. Take this illustration: A corporation organized and having its home office in New York comes into California to do business. The state of California attempts to require that its assets within the state shall be kept as a primary security for home creditors. This court declares that such requisition is unconstitutional. The solvency or insolvency of that New York corporation will be known in New York by those who are nearer to its home office sooner than by people in California. Insolvency is impending. The creditors in New York, near the home office, and familiar therefore with its exact condition, ascertaining its approaching insolvency, send to California, where there are assets, and, availing themselves of the ordinary statutory provisions of that state, seize by attachment all the assets there situated. The insolvency is thereafter made public, and 3. 4. 5. Due process of law requires compensation to be made or secured to the owner of private property when it is taken by a state, or under its authority, for public use. The exaction from the owner of private property, of the cost of a public improvement in substantial excess of the special benefits accruing to him, is, to the extent of such excess, a taking, under the guise of taxation, of private property for public use without compensation. A special assessment upon abutting property by the front foot, without taking special benefits into account, for the entire cost and expense of opening a street, including, not only the amount to be paid for the land, but the cost and expense of the proceedings, is a taking of private property for public use without compensation. An injunction against a special assessment which is illegal because it rests upon a basis that excludes any consideration of benefits should enjoin the whole assessment, without considering whether the amount is in excess of the special benefits to the property, or not. Payment or tender of the amount of benefits received from an Improvement is not necessary in order to obtain an injunction against an illegal assessment which is based | narrow, straighten, extend, keep in order, [No. 34.] Submitted May 3, 1898. Decided December erty for the use of the corporation. And 12, 1898. rate limits for the following purposes, but no APPEAL from a decree of the Circuit See same case below, 74 Fed. Rep. 997. 270] *Mr. Justice Harlan delivered the opin- This case arises out of the condemnation of certain lands for the purpose of opening a street in the village of Norwood, a municipal corporation in Hamilton county, Ohio. streets, alleys, and avenues; also for obtain- Other provisions of the statute prescribe The particular question presented for consideration involves the validity of an ordi71]nance of that village, assessing upon the ap-clusive. pellee's land abutting on each side of the new street an amount covering, not simply a sum equal to that paid for the land taken for the street, but, in addition, the costs and ex- "2263. When the corporation appropri penses connected with the condemnation pro-ates, or otherwise acquires, lots or lands for ceedings. By the final decree of the circuit court of the United States it was adjudged that the assessment complained of was in violation of the Fourteenth Amendment of the Constitution of the United States forbidding any state from depriving a person of property without due process of law; and the village was perpetually enjoined from enforcing the assessment. 74 Fed. Rep. 997. It is further provided by the statutes of Ohio (1890) title XII. Assessments, etc., chap. 4, as follows: the purpose of laying off, opening, extending, straightening, or widening a street, alley, or other public highway, or is possessed of property which it desires to improve for street purposes, the council may assess the cost and expenses of such appropriation or acquisition, and of the improvement, or of either, or of any part of either, upon the general tax list, in which case the same shall be assessed upon all the taxable real and perThe present appeal was prosecuted direct-sonal property in the corporation. ly to this court, because the case involved the construction and application of the Constitution of the United States. It will conduce to a clear understanding of the case to ascertain the powers of the village under the Constitution and statutes of Ohio, and to refer somewhat in detail to the proceedings instituted for the opening of the street through appellee's property. By the Constitution of Ohio it is declared: "Private property shall ever be held inviolate, but subservient to the public welfare. When taken in time of war or other public exigency imperatively requiring its immediate seizure, or for the purpose of making or repairing roads, which shall be open to the public, without charge, a compensation shall be made to the owner, in money, and in all other cases, where private property shall be taken for public use, a compensation therefor shall first be made in money; and such compensation shall be assessed by a jury, without deduction for benefits to any property of the owner." Const. Ohio 1851, art. 1, § 19, Bill of Rights; Bates's Anno. Ohio Stat. vol. 3, p. 3525. Cities and villages in Ohio are by statute given power to lay off, establish, open, widen, "§ 2264. In the cases provided for in the last section, and in all cases where an improvement of any kind is made of an existing street, alley, or other public highway, the council may decline to assess the costs and expenses in the last section mentioned or any part thereof, or the costs and expenses or any part thereof of such improvement, except as hereinafter mentioned, on the general tax list, in which event such costs and expenses, or any part thereof which may not be so assessed on the general tax list, shall be assessed by the council on the abutting and such adjacent and contiguous or other benefited lots and lands in the corporation, either in proportion to the benefits which may result from the improvement, *or accord-[273] ing to the value of the property assessed, or by the front foot of the property bounding and abutting upon the improvement, as the council by ordinance setting forth specifically the lots and lands to be assessed, may determine before the improvement is made, and in the manner and subject to the restrictions herein contained; and the assessments shall be payable in one or more instalments, and at such times as the council may prescribe. 1 Rev. Stat. Ohio, p. 581. Section 2271 provides: "In cities of the of any improvement contemplated in this first grade of the first class, and in corpora- chapter shall include the purchase money of tions in counties containing a city of the first real estate, or any interest therein, when the grade of the first class, the tax or assess- same has been acquired by purchase, or the ment especially levied or assessed upon any value thereof as found by the jury, where the lot or land for any improvement shall not, same has been appropriated, the costs and except as provided in § 2272, exceed twenty- expenses of the proceedings, the damages asfive per centum of the value of such lot or sessed in favor of any owner of adjoining land after the improvement is made, and the lands and interest thereon, une costs and excost exceeding that per centum shall be paid penses of the assessment, the expense of the by the corporation out of its general revenue; preliminary and other surveys, and of printand whenever any street or avenue ing, publishing the notices and ordinances reis opened, extended, straightened, or widened, quired, including notice of assessment, and the special assessment for the cost and ex-serving notices on property owners, the cost pense, or any part thereof, shall be assessed of construction, interest on bonds, where only on the lots and lands bounding and bonds have been issued in anticipation of the abutting on such part or parts of said street collection of assessments, and any other necor avenue so improved, and shall include of essary expenditure." such lots and lands only to a fair average depth of lots in the neighborhood, but shall also include other lots and parts thereof and lands to such depth; and whenever at least one half in width of any street or avenue has been dedicated for such purpose from the lots and lands lying on one side of the line of such street or avenue, and such street or avenue is widened by taking from lots and lands on the other side thereof, no part of the cost and expense thus increased [incurred] shall be assessed upon the lots and lands lying on said first-mentioned side, but only upon the other side, and as aforesaid, but said special assessment shall not be in any case in excess of benefits." 1 Rev. Stat. Ohio, p. 513. Section 2272 relates to assessments for improvements made in conformity with the petition of the owners of property. By section 2277 it is provided that "in cases wherein it is determined to assess the whole or any part of the cost of an improvement upon the lot or lands bounding or abut[274]ting upon the same, or upon any other lots or lands benefited thereby, as provided in § 2264, the council may require the board of improvements, or board of public works, as the case may be, or may appoint three disinterested freeholders of the corporation or vicinity, to report to the council an estimated assessment of such cost on the lot or lands to be charged therewith, in proportion, as nearly as may be, to the benefits which may result from the improvement to the several lots or parcels of land so assessed, a copy of which assessment shall be filed in the office of the clerk of the corporation for public inspection." Section 2284 is in these words: "The cost 172 U. S. By an ordinance approved October 19th, 1891, the village declared its intention to condemn and appropriate, and by that ordinance condemned and appropriated, the lands or grounds in question for the purpose of opening and extending Ivenhoe avenue; and in order to make such appropriation effectual, the ordinance directed the institution of the necessary proceedings in court for an inquiry and assessment of the compensation to be paid for the property to be condemned. The ordinance provided that the cost and expense of the condemnation of the property, including the compensation paid to the owners, the cost of the condemnation proceedings, the cost of advertising and all other costs and the interest on bonds issued, if any, should be assessed "per front foot upon the property bounding and abutting on that part of Ivenhoe avenue, as condemned and[275] appropriated herein" the assessments payable in ten annual instalments if deferred, and the same collected as prescribed by law and in the assessing ordinance thereafter to be passed. Under that ordinance, application was made by the village to the probate court of Hamilton county for the empaneling of a jury to assess the compensation to be paid for the property to be taken. A jury was accordingly empaneled, and it assessed the plaintiff's compensation at $2,000, declaring that they made the "assessment irrespective of any benefit to the owner from any improvement proposed by said corporation." The assessment was confirmed by the court, the amount assessed was paid to the owner, and it was ordered that the village have immediate possession and ownership of the 445 premises for the uses and purposes specified | ing the same from year to year in an amount charge against the abutting property owned by the plaintiff. [276] *After the finding of the jury the village ty treasurer for collection, as a lien and council passed an ordinance levying and assessing on each front foot of the several lots of land bounding and abutting on Ivenhoe avenue, from Williams avenue to a point 300 feet north," certain sums for each of the years 1892 to 1901 inclusive, "to pay the cost and expense of condemning property for the extension of said Ivenhoe avenue between the points aforesaid [from Williams avenue to a point 300 feet north] together with the interest on the bonds issued to provide a fund to pay for said condemnation." By the same ordinance provision was made for issuing bonds to provide for the payment of the cost and expense of the condemnation, which included the amount found by the jury as compensation for the property taken, the costs in the condemnation proceedings, solic itor and expert witness fees, advertising, etc.; in all, $2,218.58. The present suit was brought to obtain a decree restraining the village from enforcing the assessment in question against the abutting property of the plaintiff. It was conceded that the defendant assessed back upon the plaintiff's 300 feet of land upon either side of the strip taken (making 600 feet in all of frontage upon the strip condemned) the above sum of $2,218.58, payable in instalments, with interest at six per cent, the first instalment being $354.97 and the last or tenth instalment $235.17, lessen But the village alleged that the appropri ation proceedings and consequent assessment were all in strict conformity with the law and statutes of the state of Ohio and in pur suance of due process of law; that the opening and extension of Ivenhoe avenue constituted a public improvement for which the abutting property was liable to assessment under the laws of Ohio; that the counsel fees, witness fees, and costs included in such total assessment were a part of the legitimate expenses of such improvement; and that at[277] any event an expense had been incurred by the municipal corporation in opening the street "equal to the full amount of the said assessment, which is a proper charge against the complainant's abutting property. It was agreed at the hearing of the present case that the sum awarded by the verdict of the jury was paid to and received by the plaintiff, and that it was that sum, together with the costs and charges, that the village undertook to assess back upon the land upon either side of said strip of land. The plaintiff's suit proceeded upon the ground, distinctly stated, that the assessment in question was in violation of the Fourteenth Amendment providing that no state shall deprive any person of property without due process of law nor deny to any person within its jurisdiction the equal protection of the laws, as well as of the bill of rights of the Constitution of Ohio. It has been adjudged that the due process of law prescribed by that Amendment requires compensation to be made or secured to the owner when private property is taken by a state or under its authority for public use. Chicago, Burlington & Q. R. R. Co. v. Chicago, 166 U. S. 226, 241 [41: 979, 986]; Long Island Water Supply Co. v. Brooklyn, 166 U. S. 685, 695 [41: 1165, 1168]. erty shall be considered as benefited by a pr But the power of the legislature in these matters is not unlimited. There is a point beyond which the legislative department, even when exerting the power of taxation, may not go consistently with the citizen's right of property. As already indicated, the principle underlying special assessments to meet the cost of public improvements is that the property upon which they are imposed is peculiarly benefited, and therefore the ownThe taking of the plaintiff's land for the ers do not, in fact, pay anything in excess of street was under the power of eminent domain what they receive by reason of such improve-[279] -a power which this court has said was the ment. But the guaranties for the protection offspring of political necessity, and insep- of private property would be seriously imarable from sovereignty unless denied to it paired, if it were established as a rule of by the fundamental law. Searl v. Lake constitutional law, that the imposition by County School District No. 2, 133 U. S. 553, the legislature upon particular private prop 562 [33: 740,746]. But the assessment of erty of the entire cost of a public improvethe abutting property for the cost and ex- ment, irrespective of any peculiar benefits pense incurred by the village was an exer- accruing to the owner from such improvecise of the power of taxation. Except for ment, could not be questioned by him in the the provision of the Constitution of Ohio courts of the country. It is one thing for above quoted, the state could have author- the legislature to prescribe it as a general ized benefits to be deducted from the actual rule that property abutting on a street value of the land taken, without violating opened by the public shall be deemed to have the constitutional injunction that compen- been specially benefited by such improvement, sation be made for private property taken for and therefore should specially contribute to public use; for the benefits received could the cost incurred by the public. It is quite be properly regarded as compensation pro a different thing to lay it down as an absotanto for the property appropriated to public lute rule that such property, whether it is [278]use. But *does the exclusion of benefits from in fact benefited or not by the opening of the estimate of compensation to be made for the street, may be assessed by the front foot the property actually taken for public use au- for a fixed sum representing the whole cost thorize the public to charge upon the abut- of the improvement, and without any right ting property the sum paid for it, together in the property owner to show, when an aswith the entire costs incurred in the condem-sessment of that kind is made, or is about to nation proceedings, irrespective of the question whether the property was benefited by the opening of the street? be made, that the sum so fixed is in excess of the benefits received. In our judgment the exaction from the owner of private property of the cost of a public improvement in substantial excess of the special benefits accruing to him is, to the extent of such excess, a taking, under the guise of taxation, of private property for public use without compensation. We say "substantial excess," because exact equality of taxation is not always attainable, and for that reason the excess of cost over special benefits, unless it be of a material character, ought not to be regarded by a court of equity when its aid is invoked to restrain the enforcement of a special assessment. Undoubtedly abutting owners may be subjected to special assessments to meet the expenses of opening public highways in front of their property-such assessments, according to well-established principles, resting upon the ground that special burdens may be imposed for special or peculiar benefits accruing from public improvements. Mobile County v. Kimball, 102 U. S. 691, 703, 704 [26: 238, 242]; Illinois Central Railroad Co. v. Decatur, 147 U. S. 190, 202 [37: 132, 136]; Bauman v. Ross, 167 U. S. 548, 589 [42: 270, 288], and authorities there cited. And according to the weight of judicial authority, the legislature has a large discretion in defining the territory to be deemed specially benefited by a public improvement, and which may be subjected to special assessment to meet the cost of such improvements. In Williams v. Eggleston, 170 U. S. 304, 311 [42: 1047, 1050], where the only question, as this court stated, was as to the power of the legislature to cast the burden of a public improvement upon certain towns, which had been judicially determined to be towns benefited by such improvement, it was said: *In Cooley on Taxation (2d ed. chap. 20) [280] "Neither can it be doubted that, if the state the author, in considering the subject of taxConstitution does not prohibit, the legisla-ation by special assessment, and of estimatture, speaking generally, may create a new ing benefits conferred upon property by a taxing district, determine what territory public improvement, says that while a genshall belong to such district and what prop-eral levy of taxes rests upon the ground that In Illinois Central Railroad Co. v. Decatur, 147 U.S. 190,202 [37: 132, 136],—where it was held that a provision in the charter of a railroad company exempting it from taxation did not exempt it from a municipal assessment imposed upon its land for grading and paving a street,-the decision rested upon the ground that a special assessment proceeds on the theory that the property charged therewith derives an increased value from the improvement, "the enhancement in value being the consideration for the charge." |
