Allen v. Inhabitants of Jay

60 Me. 124
CourtSupreme Judicial Court of Maine
DecidedJuly 1, 1872
StatusPublished
Cited by45 cases

This text of 60 Me. 124 (Allen v. Inhabitants of Jay) is published on Counsel Stack Legal Research, covering Supreme Judicial Court of Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Allen v. Inhabitants of Jay, 60 Me. 124 (Me. 1872).

Opinion

Appleton, C. J.

A town meeting of the inhabitants of Jay was duly called to see if the town would loan its credit to Hutchins & Lane, on certain terms, provided ‘ said Hutchins & Lane shall move their new saw-mill and box factory from Livermore Falls to Jay Bridge, and also put in operation one run of stones for grinding meal, and establish their manufacturing business as soon as the month of September, A. d. 1870, at or near Jay Bridge.’

At a legal meeting held upon this call on April 19th, and by adjournment on April 21, 1870, the town ‘ voted to loan their credit to the amount of ten thousand dollars, at six per cent annually, to H. W. Hutchins and B. R. Lane, provided said Hutchins & Lane will invest the amount of from twelve to thirteen thousand dollars in building a steam saw-mill, box factory machinery and land; also to put in one run of stones for grinding meal, to be located at or near Jay Bridge, and to keep the above-named property in good repair, and also keep it amply insured, and to cause said manufacturing business to be carried on for a term not less than ten years, said Hutchins & Lane to pay all the interest, and ten per cent of the principal annually, after three years,’ the town to be secured by a mortgage of the mill, machinery, and land, ‘ at the rate of one dollar for every seventy-five cents thus loaned by said town, and the selectmen are hereby authorized to issue town bonds for the above amount, payable in yearly instalments after three years, at six per cent interest annually, viz.: one thousand dollars the first year, and nine hundred dollars each year for the ten succeeding years, providing the whole amount shall be necessary to establish said manufacturing business.’

[127]*127The legislature passed an act, c. 716, approved Feb. 25, 1871, in the following terms :

‘ Whereas, upon due investigation and consideration, we deem it for the benefit of the town of Jay, and of the people of this State, said town is hereby authorized to loan the sum of ten thousand dollars to Hutchins & Lane, in accordance with a vote taken by said town on the 21st day of April, eighteen hundred and seventy, for the encouragement of manufacturing in said town.’

The complainants, ten taxable inhabitants of Jay, under R. S. c. 77, § 5, by which this court has equity jurisdiction, when counties, cities, towns, or school districts, for a purpose not authorized by law, vote to pledge their credit or to raise money by taxation, or to pay money from their treasury,’ have filed a bill in equity, praying that the defendants and all their officers may be enjoined from issuing certain bonds, duly described in the bill, the issue thereof, being for a purpose not authorized by law.

The purpose is obvious, and the inquiry is, whether the purpose is one authorized by law ?

Whether the loan be of town bonds or of money, as, if the loan be of bonds, the town must ultimately be liable for their payment, and as the payment is to be raised by taxation, matters not. The question proposed is whether the legislature can authorize towns to raise money by taxation, for the purpose of loaning the money so raised to such borrowers as may promise to engage in manufacturing or any other business the town may prefer,'for their private gain and emolument. Is the raising of money to loan to such persons as the town may determine upon as borrowers, a legal exercise of the power of taxation ? Ultimately, it will be found that the question resolves itself into an inquiry, whether the legislature can constitutionally authorize the majority of a town to loan their own and the money of a minority raised by taxation and against the will of such minority, as such majority may determine.

A tax is a sum of money assessed under the authority of the State, on the person or property of an individual for the use of the State. Taxation, by the very meaning of the term, implies the [128]*128raising of money for public uses, and exclude the raising if for private objects and purposes. ‘I concede,’ says Black, C. J., in Sharpless v. Mayor, 21 Penn. 167, ‘ that a law authorizing taxation for any other than public purposes, is void.’ ‘A tax,’ remarks Green, C. J., in Camden v. Allen, 2 Dutch. 839, ‘ is an impost levied by authority of government, upon its citizens or subjects for the support of the State.’

‘ No authority, or even dietum, can be found,’ observes Dillon, C. J., in Hanson v. Vernon, 27 Iowa, 28, ‘ which asserts that there can be any legitimate taxation when the money to be raised does not go into the public treasury, or is not destined for the use of the government or some of the governmental divisions of the State.’

If there is any proposition about which there is an entire and uniform weight of judicial authority, it is that taxes are to be imposed for the use of the people of the State in the varied and manifold purposes of government, and not for private objects or the special benefit of individuals. Taxation originates from, and is imposed by and for the State.

In this case the vote of the town of Jay, and the act of the legislature passed to enable the town to carry that vote into effect, are both before us. Taking the vote of the town in connection with the article in the warrant calling the meeting, it seems that Hutch-ins & Lane had a ‘ new saw-mill and box factory at Livermore Falls,’ which they were then carrying on at that place, and the town of Jay proposed to loan their credit for ten thousand dollars, and issue bonds of the town for that amount, if they would remove their saw-mill and box manufactory and put in one run of stones for grinding meal, to be located at or near Jay Bridge. The vote contemplates a mere matter of private business, the removing of certain business from one town to another, whereby the town to which the removal is made is expected to be a gainer by encouraging manufactures therein, and the town from which the removal is made is to be a loser to precisely the same extent by their removal therefrom.

Capital naturally seeks the best investment, or its owners do. [129]*129Those who by industry and economy have become capitalists are more likely to invest it well than those, who, having gained none, have none to lose. The sagacity shown in the acquisition of capital, is best fitted to control its use and disposition.

It is obvious, that, if the removal from Livermore Falls would be made without special inducement, in other words, if the prospect of profit at Jay Bridge were sufficient to induce Messrs. Hutchins & Lane to move their saw-mill, etc., without any special offer of the defendant town, there would be no necessity for making such offer. It is not readily perceived that raising money under such circumstances would be of public benefit. If they should not so deem it, and it is not advantageous on the whole for them to make the removal, then it is a premium offered for them to make a removal injurious to their interest, and which they would not otherwise make, and of sufficient magnitude to induce them to meet the probable loss. Still less can it be conceived to be of ‘ benefit ’ in such case to raise money to promote losing enterprises.

It is said that it induces enterprises which would not otherwise be undertaken. But why not undertaken? Everyman is the best judge of his interest. There may be exceptions, but such is the general rule. Now why is not capital invested at Jay Bridge? The answer is obvious.

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Bluebook (online)
60 Me. 124, Counsel Stack Legal Research, https://law.counselstack.com/opinion/allen-v-inhabitants-of-jay-me-1872.