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Great Northern Ry. Co. v. Minnesota, 216 U.S. 206 (1910)

Great Northern Railway Company v. Minnesota

No. 359

Argued November 5, 8, 1909

Decided February 21, 1910

216 U.S. 206


A state legislature, unless restrained by the constitution of the state, may contract to limit the state's power of taxation; but, as taxation is essential to the existence and operation of government, an exemption therefrom will not be presumed from doubtful language, but must be expressed beyond reasonable doubt.

When a state becomes the owner by purchase of the entire property and franchises of a corporation created by itself, it can only convey the same pursuant to the provisions of the then existing constitution and it cannot reinvest either a purchaser or the original owner with any exemption from taxation prohibited by the existing constitution.

Page 216 U. S. 207

Where the constitution of the state requires equal and uniform taxation of all real and personal property in the state upon a cash basis and specifies the property that can be exempted, the legislature cannot thereafter agree that the payment of a given percent of the earnings of a corporation from property of a class not included among the properties that can be exempted shall be in lieu of all other taxation, and such a contract, if attempted to be made, would not be protected by the impairment of obligation clause of the Constitution of the United States.

There is a difference between a contract for a commuted system of taxation on earnings of a railroad corporation and a specific exemption from taxation of lands granted to the corporation for a defined period; the former is personal and not assignable, while the latter is attached to and follows the land.

In this case, this Court accepts the view of the state court as to the scope of its own decisions.

106 Minn. 303 affirmed.

The facts are stated in the opinion.

Page 216 U. S. 211

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