Page images
PDF
EPUB

(106 A.)

*

*

ment of the public welfare, is, in its essential [sions for them otherwise, it is alike proper, character, a private and not a public object. useful, and needful for the government to However certain and great the resulting good provide," then taxes may be levied to provide to the general public, it does not, by reason these facilities. The support of schools, the of its comparative importance, cease to be inconstruction of highways, the building of cidental. The incidental advantage to the public, or to the state, which results from the sewers, the aiding of railroads, and the suppromotion of private interests, or en- plying of light and water to municipalities terprises, does not justify their aid by the use are instances of these well-defined public of public money raised by taxation, or for which purposes for which taxes may be imposed. taxation may become necessary. It is the es- Into this class falls the supply of fuel when sential character of the direct object of the ex- necessity requires. penditure which must determine its validity, as justifying a tax, and not the magnitude of the interests to be affected, nor the degree to which the general advantage of the community, and thus the public welfare, may be ultimately benefited by their promotion." Opinion of Justices, 211 Mass. 624, 98 N. E. 611, 42 L. R. A. (N. S.) 221.

It should be noted in this connection that the Const. Mass. pt. 2, c. 1, § 1, art. 4, with its "good and welfare" clause is much broader and more comprehensive than the Constitution of Maine. Brown v. Gerald, 100 Me. 351-365, 61 Atl. 785, 70 L. R. A. 472, 109 Am. St. Rep. 526.

It might be that in order to develop power to be applied by the state to some admittedly public purpose, such as public lighting or a power plant in aid of the operation of a railroad, the power of taxation could be lawfully invoked, but that is not the purport of the question under consideration. The dominant purpose here is for private benefit and not for the "benefit of the people," and therefore the power of taxation to promote it does not exist.

[22] The second obstacle to the furtherance of the proposed plan is the fact that it necessarily involves the exercise of the right of eminent domain on the part of the state. We are not aware of any great ponds within the

In other words, a state is simply a political unit, and not a business corporation, ex-state which are surrounded by land owned cept incidentally to further its political purposes. In its organization and machinery it is not adapted to acquire, own, manage, or make a profit out of lands or other property except for public uses. Banton v. Griswold, 95 Me. 445-449, 50 Atl. 89.

The decisions in Laughlin v. City of Portland, 111 Me. 486, 90 Atl. 318, 51 L. R. A. (N. S.) 1143, Ann. Cas. 1916C, 734, and Jones v. City of Portland, 113 Me. 124, 93 Atl. 41, subsequently affirmed by the Supreme Court of the United States (245 U. S. 217, 38 Sup. Ct. 112, 62 L. Ed. 252, L. R. A. 1918C, 765, Ann. Cas. 1918E, 660), in no way conflict with this principle. In those cases the Municipal Fuel Yard Act (R. S. c. 4, § 64) was held to be within the power of the Legislature on the ground that it enables our citizens to be supplied with fuel, which is a necessity in its absolute sense to the enjoyment of life and health, and which could otherwise be obtained with great difficulty and at times perhaps not at all, and whose want would endanger the community as a whole. The elements of commercial enterprise or pecuniary benefits to the municipality either direct or indirect were entirely lacking. In fact, they were expressly prohibited by the statute under consideration which compelled the furnishing of fuel by municipalities at cost. That decision was in line with the general rule laid down by Judge Cooley in his work on Constitutional Limitations when he declares that if the object is to furnish "facilities for its citizens in regard to those matters of public necessity, convenience, or welfare, which on account of their peculiar character, and the difficulty, and perhaps impossibility, of making provi

by the state, and from which the outlet rivers or streams flow through the public domain. If there are any great ponds so situated, they are few in number, of inconsiderable extent, and their outlet streams are of little value for industrial development. We understand that the questions have no reference to such ponds, if any there are. It is common knowledge that title to the lands surrounding substantially all the great ponds of the state and bordering on their outlet streams has passed into private ownership, and therefore the acquisition of these proper. ties by the state, with their water powers developed or undeveloped, would necessitate their being taken by the state under the exercise of the right of eminent domain.

The Declaration of Rights, which stands to-day as it was designed by its framers to stand, as a shield for the protection of the private individual against encroachment and usurpation on the part of the governing powers reads as follows:

"Private property shall not be taken for public uses without just compensation nor unless the public exigencies require it." Const. Me. art. 1, § 21.

[23, 24] Whether the public exigencies require such taking in a given case is a question for the Legislature; whether the taking is "for public uses" is a matter for the determination of the court. And here it must be remembered that, while the power of the state to take private property by taxation is somewhat akin to the power of taking it by eminent domain, yet the term "for public uses" under the clause of the Constitution

just quoted has a much more restricted mean- [ tically be no limit upon the exercise of this ing than "for the benefit of the people" under power. article 4, pt. 3, § 1, already discussed. This distinction should not be overlooked.

The

* 'Property is devoted to public use, when, and only when, the use is one which the public in its organized capacity, to wit, the state, has the right to create and maintain, and therefore one in which all the public has a right to demand and share in.' Budd v. New York, 143 U. S. 517 [12 Sup. Ct. 468, 36 L. Ed. 247]. In a broad sense it is the right in the public to an actual, and not to an incidental benefit. It is the right of the public as individuals to use, when occasion arises. The use must be for the general public, or some portion of it, and not a use by or for particular individuals. * It is not nec

*

problem, then, is to determine whether the taking by the state of privately owned property and property rights for the contemplated purposes is "for public uses," as that term has been judicially construed in this state. The term "public uses," as applied to the exercise of the power of eminent domain has met with two definitions and has given rise to two lines of decisions in this country, one holding that public use means public advan-essary that all of the public should have occatage, and thatsion to use. It may suffice if very few have, may ever have, occasion. It is necessary that every one, if he have occasion, shall have the right to use. * * * It must be more than a mere theoretical right to use. It must be an actual, effectual right to use."

"Anything which tends to enlarge the resources, increase the industrial energies, and promote the productive power of any considerable number of the inhabitants of a section of the state, or which leads to the growth of towns and the creation of new resources for the employment of capital and labor, contributes to the general welfare and prosperity of the whole community, and, giving the Constitution a broad and comprehensive interpretation, constitutes a public use."

The other line of decisions holds that public use means use by the public, or employment by the public, and that therefore, to make a use public, within the eminent domain clause, "duty must devolve on the person or corporation holding property appropriated by right of eminent domain to furnish the public with the use intended, and the public must be entitled as of right to use or employ the property taken." 10 R. C. L. p. 25. Public service corporations, such as steam and electric railroads, telegraph and telephone companies, and water companies, are familiar examples. This state in a comparatively recent case has adopted the latter rule as embodying the spirit as well as the letter of our Constitution, and as the stabler and wiser foundation upon which to build the fortunes of a state and to protect the rights and property of its citizens. The security and safety of the state rest upon the security and safety of the individual, and the security and safety of the individual depend upon the preservation of his sacred rights of life, liberty and property under the law. When these are in jeopardy the state itself is in jeopardy. After a review of many authorities and an illuminating discussion of the fundamental principles involved, this court in 1905 affirmed this interpretation of public uses in the case of Brown v. Gerald, 100 Me. 351, 61 Atl. 785, 70 L. R. A. 472, 109 Am. St. Rep. 526. In that case the court said:

or

*

* *

Applying this accepted definition of public uses it is obvious that the state cannot take property from one class of individuals or private corporations for the purpose of bene fiting another class of individuals or private corporations. It cannot take a privately owned dam or dam site from A. for the purpose of increasing the storage and thereby improving the privately owned water powers of B. or C. or D. It seems clear that the great public benefit which is supposed to follow from the exercise of this power is not a public use. It is not a use of which the public may avail itself if it have occasion. It is a private use pure and simple.

A manufacturing corporation which might reap the benefit is called into being by no public necessity, exercises no sovereign powers, subserves no public use, and is subject to no public duties. Further, if the state may exercise the power suggested, it may commit the execution thereof to any agency, corporate or otherwise, and this far-reaching right may be committed to any corporation. Riche v. Bar Harbor Water Co., 75 Me. 91. The proposed plan of state development of reservoirs for storing the waters of great ponds may render the flow of our rivers more uniform, may conserve the water supply, may tend to the development of more mill sites and the enlargement of existing mills, all of which are incidentally of public benefit. But the public benefit is only incidental. In its essential and legal aspect the plan is merely an aid to private enterprise.

We therefore answer question No. 1 in the negative; but, while so answering, we wish it to be understood that our opinion is not to be construed or extended beyond our interpretation of the question answered.

It should be further understood that this

"Public benefit or interest are not synonymous with public use. * Neither mere public convenience nor mere public welfare will justify discussion is entirely apart from the power the exercise of the right of eminent domain. to tax or to take, in the exercise of the police * If the doctrine of public utility were power of the state. The police power is inadopted to its fullest extent, there would prac-herent in all sovereignty and is exercised for

(106 A.)

As an answer to this question is only desired in case the former question were answered in the affirmative, the Justices infer that no further answer need be made. Since, however, we have indicated, although appar ently that inquiry was not in the contemplation of your honorable body, that the state might create storage reservoirs for conserving the waters of great ponds and regulating the flow for the purpose of increasing the

the protection of the people, the preservation of the peace and order of society, and the health and safety of its members. Skowhegan v. Heselton, 117 Me. 17, 102 Atl. 772. It was by virtue of this police power residing in the people that the Justices upheld the constitutionality of a proposed law to regulate or restrict the destruction of trees growing on wild land and to prohibit wanton and wasteful cutting. Neither the power of taxation nor of eminent domain was involved. Opin-navigability of the outlet rivers and streams, ion of Justices, 103 Me. 506, 69 Atl. 627, 19 L. R. A. (N. S.) 422, 13 Ann. Cas. 745. As was said by the court in Union Ice Co. v. Ruston, 135 La. 898, 66 South. 262, L. R. A. 1915B, 859, Ann. Cas. 1916C, 1274:

"The police power is the power to regulate the business of others and not the power to go into business."

the question might arise under No. 2 whether in such cases any tax or rental might be based upon the increased power thereby made available at the various mill sites. We must answer that we know of no such tax that could be assessed on the increased capacity, except an increased tax on the enhanced value of the dam site. That would be in violation of the constitutional provision requiring all taxes assessed by authority of the state to be "apportioned and assessed equally according to the just value thereof." Const. Me. art. 9, § 8, and article 36. This does not; however, involve the question of franchise taxes which may arise under questions No. 3 and No. 4, to be hereafter considered. Nor can we conceive of any kind of rental that could be charged, except possibly under such conditions as prevailed in Kaukauna Co. v. Green Bay, etc., Canal Co., 142 U. S. 254–273, 12 Sup. Ct. 173, 35 L. Ed. 1004, and Green Bay, etc., Canal Co. v. Patten Paper o., 172 U. S. 58-77, 19 Sup. Ct. 97, 43 L. Ed. 364; where there was a leasing of the surplus power incidentally created and that was a matter of agreement between the parties. Nor could any charge be enforced upon the lower water power owners, either in law or in

Nor is it necessary to consider in this discussion the essential nature and scope of the Mill Act, so called (R. S. c. 97), which has existed in this state since its organization a century ago, and in the mother commonwealth of Massachusetts for more than a century prior thereto. Province Laws 1714, c. 111; Corse v. Dexter, 202 Mass. 31, 88 N. E. 332. This act, generally speaking, authorizes any man upon his own land to erect a water mill and dam to raise water for working it upon or across any stream not navigable by paying compensation for all flowage damages caused thereby. It arose out of the necessities of the people in the early days, when small water mills of various kinds were essential to the very existence of the settlers, but is now regarded somewhat as a legal anomaly, because at the present day, and un-equity. A person cannot be made a debtor der modern industrial conditions, its effect is the acquisition of property rights from one individual or corporation against their will for the benefit of another individual or corporation, by the mere payment of damages. Were it a new proposition, its constitutionality might well be doubted. Jordan v. Woodward, 40 Me. 317. But it has been so long acquiesced in as the policy of the state, and so constantly upheld by judicial decisions, that its validity is no longer debatable. Ingram v. Water Co., 98 Me. 566-572, 57 Atl. 893. It is to be understood that these answers do not involve the mill act nor the rights acquired thereunder.

against his will. If an upper riparian proprietor sees fit to improve the storage system, he cannot charge a lower proprietor with any portion of the cost. Artificial improvements inure to the benefit of the lower proprietors. Phillips v. Sherman, 64 Me. 171; Weare v. Chase, 93 Me. 269, 44 Atl. 900. True, the owner below can claim no special rights in the additional storage. He is entitled of right to only the natural flow of the stream; but, if more than the natural flow at certain seasons comes to him, he can use it without being forced to pay therefor. This portion of our answer, however, we regard as quite academic, as the purpose of this supposed improvement is evidently not the purpose contemplated by the questions as framed.

"Question No. 3. Where the Legislature has granted a private corporation the right to erect a dam to control the waters of a pub

[25] Question No. 2. In the case the construction and development of water storage reservoirs and basins as aforesaid is held to be legal, may the state charge to the owners of water powers located on rivers below such storage reservoirs and basins a propor-lic lake or great pond without raising the tional part of the cost of such construction and development, or in lieu thereof a sum in the nature of a rental or tax, based upon the increased power thereby made available for use of said water power owners?"

natural high water level thereof, in order that the waters therein may be impounded and used for purposes of such corporation, may the Legislature subsequently impose a tax upon such corporation, based upon the

provision requiring equality of apportionment and assessment before referred to.

increased amount and use of water from said [ tax. That would violate the constitutional lake or pond which the corporation enjoys by reason of having erected such dam?" "Question No. 4. Where the Legislature has granted a private corporation the right to erect a dam to control and also to raise the natural level of the waters of a public lake or great pond, in order to impound additional waters to be used for the purposes of such corporation, may the Legislature impose a tax upon such corporation, based upon the increased amount and use of water from said lake or pond, which the corporation enjoys by reason of having erected such | franchises are discussed in Twin Village dam and of having raised the natural level of the waters of said lake or pond?"

We see no reason, however, why the Legislature may not have the constitutional power, if it is deemed expedient to exercise, to put into one class all corporations having express grants from the Legislature to control the waters of great ponds, and impose a tax upon the franchises of such corporations; that is, upon the right to carry on their corporate business and to exercise their granted powers. The nature and extent of corporate

Water Co. v. Damariscotta Gaslight Co., 98 Me. 325, 56 Atl. 1112, and Crawford Electric Co. v. Power Co., 110 Me. 285, 86 Atl. 119, Ann. Cas. 1914C, 933. Taxes of this kind are now imposed upon railroad, express, telephone, and telegraph companies, and savings banks. The power of the state to impose franchise taxes seems to be plenary, and it may not only impose them, but it may meas

These questions involve the same principles and can be answered together. In No. 3, the question assumes the erection of a dam to control the waters of a great pond without raising the natural high-water level. Even under those conditions, rights of flowage must be acquired, because every littoral proprietor, owning as he does the shore to low-ure their amount by any standard it sees fit water mark, is entitled to his land between high and low water mark in its natural state. No person or corporation would have any more right to flow land that, in a state of nature, would at any season of the year remain uncovered, than to flow above the highwater mark. Either act requires authority from the Legislature, general or special. Question 4 assumes the maintenance of flowage between high and low water and also above the natural high-water level. The same principles are therefore involved in both questions although the damage would be greater in the one case than in the other.

to adopt. State v. Western Union Telegraph Co., 73 Me. 518; State v. Maine Central R. R. Co., 74 Me. 383; Opinion of Justices, 102 Me. 527-529, 66 Atl. 726; Maine v. Grand Trunk Ry. Co., 142 U. S. 217, 12 Sup. Ct. 121, 163, 35 L. Ed. 994. So long as the franchises of all corporations in the same class are taxed at the same rate and on the same basis, the constitutional requirements are met. And since the tax may be measured by any standard that the Legislature may deem it wise to adopt, we see no objection to a franchise tax based upon the increased amount in use of water which each corporation enjoys by reason of having erected its dam; not by virtue of any alleged ownership of the state in the waters of the pond but as an arbitrarily adopted standard. In like manner it might impose a franchise tax upon manufacturing corporations using coal instead of water for the generation of power, and meas

These two questions, it will be observed, are complete in themselves and independent of interrogatories 1 and 2. The purpose for which the waters are to be impounded and the flow regulated and increased, whether public or private, is not divulged. The exercise of the power of eminent domain does not enter into the proposition. The single ques-ure the tax by the number of tons of coal contion is the right of the state to impose a tax upon a private corporation chartered for the purposes indicated, based upon the increased amount and use of water from a great pond which the corporation enjoys by reason of having erected such dam.

Evidently the corporation could not be taxed separately for the use of the water as property, because water power as a separate entity is not taxable. Union Water Power Co. v. Auburn, 90 Me. 60, 37 Atl. 331, 37 L. R. A. 651, 60 Am. St. Rep. 240; Water Power Co. v. Buxton, 98 Me. 295, 56 Atl. 914; Fibre Co. v. Bradley, 99 Me. 263, 59 Atl. 83. The corporation can be taxed only upon the "just value" of its property, however acquired and whatever may be its elements of value.

Nor can the dam itself with its appurte

sumed, not because the state owns the coal, but simply as a standard of computation. Since 1901 a tax has been imposed upon the franchises of all corporations incorporated under the laws of this state (except those exempted by R. S. c. 51, § 28), based upon the amount of authorized capital stock (R. S. c. 9, § 18). Nor is it any objection to a franchise tax that it is measured by the value of the property used in connection with the exercise of it (State v. Maine Central R. R. Co., 74 Me. 376); although, of course, a tax imposed under such circumstances as to become merely a tax upon property under the guise of a tax upon the franchise would be invalid.

[26, 27] With these qualifications and explanations we return a negative answer to questions Nos. 3 and 4 on the assumption of the assessment of a property tax, and an

(106 A.)

position of a franchise tax, leaving the legal rights of the parties in concrete cases to be determined by the developed facts.

[28] "Question No. 5. Has the reservation 'of a tract of land not exceeding 200 acres together with the best mill site in any such township,' as provided in section 5 of chapter 280 of the Laws of 1824, been repealed, or is the said reservation still in full force and effect?"

Before answering this question, the Justices take occasion to say that in their opinion it presents neither "an important question of law," nor is it propounded upon a "solemn occasion," within the meaning of section 3 of article 6 of the Constitution of Maine. But, as it accompanies other questions which we have answered, we will consider this one briefly.

[blocks in formation]

The answer to these questions involves The section in question was a part of an four inquiries: First. What is the present act passed in 1824, entitled "An act to pro- ownership of the state in the great ponds? mote the sale and settlement of public lands." Second. What is the effect of the Ordinance This act covered the entire subject of the of 1641-47 upon the titles purporting to have sale and settlement of our public lands and been conveyed by the state without excepting prescribed a method therefor. Section 5 conor reserving the great ponds? Third. Has tained this reservation for mill sites and the use of the waters of the great ponds, their grant to individuals by the state land raised and stored under the operation of the agent under certain conditions therein speci- Mill Act, become a vested right in the millfied. Section 8 reserved 1,000 acres for the owners? Fourth. Is development and storbenefit of the town. Four years later, in age by the state, in view of the private own1828, the Legislature passed another act with ership of the streams and rivers that constithe same title, and covering the same subject-tute the outlet of the great ponds, practicamatter, but changing in some respects the policy of the state. Public Laws 1828, c. 393. Section 8 of the act of 1824, as to reservation of 1,000 acres in each town for public uses, was retained in the new act; but section 5, as to reservation of mill sites, was omitted. Section 10 of the act of 1828 provided:

ble?

The answer to the first inquiry must be predicated upon the ownership of, or control which the state has in, the waters in the great ponds. It may be assumed that the state was primarily the owner of all the public lands and the great ponds situated there"Be it further enacted that this act shall on. The assumption is equally true that the take effect from and after the 3d day of March state, duly authorized by the Legislature, next, and all acts and parts of acts providing has, from time to time, transferred to private for the sale and settlement of public lands, from owners its title to all the public lands it pri→ and after that time are hereby repealed: Pro-marily held. It may also be assumed that vided, that all contracts entered into under any of said acts, prior to the expiration of said time, shall be valid."

the deeds given by the state were based upon plans, so delineated that the boundary lines either inclosed the great ponds, or ran in straight lines through them, and not "by," or This section expressly repealed the entire "by the shore of," a great pond, so as to exact of 1824, except in case of existing con- clude the ponds in the description. It is also tracts made under section 5, and section 5 of true that, at the time the state became posthat act was therefore no longer in force. It sessed of the great ponds, and continuing has never been re-enacted. This was the during the period of all the sales of its public view of the compiler of the so-called revision lands, the Ordinance of 1641-47 applied to of 1831, because in the preface to that revi- the waters of the great ponds, originally consion, which contained the public laws enacted ferring a common right upon "any man" to between 1822 and 1831, he explains that "fish and fowl" upon these waters. Therethose acts which in whole or in part had been fore arises the question whether the deeds of repealed by subsequent acts were printed in the state conveyed to the grantees thereof a small type. All of chapter 280 of the Public legal title in the great ponds, subject to the Laws of 1824 appears in small type, and the use impressed upon them by the ordinance, marginal note also calls attention to the factor, by virtue of the ordinance, did it retain that this act was repealed by chapter 393 of its title in the fee to the great ponds, althe Public Laws of 1828. We therefore an- though the deeds were absolute in form, withswer that section 5 of chapter 280 of the Pub-out exception or reservation?

lic Laws of 1824 has been repealed.

At common law a sale of land included all

« PreviousContinue »