secured. Neither has the constitutional prohibition of laws impairing the obligation of contracts any application to rules of evidence and procedure in State courts. And a statute merely penal in its nature may be constitutionally repealed although it may affect existing obligations.3

§ 33. Of the power of eminent domain.- Although the charter of a corporation is a contract between the State and the corporation, yet it, like other contracts, is made subject to the sovereign power of eminent domain; and the property of a corporation and its franchises may therefore be taken for public uses, like the property of individuals, without violating the obligation of the contract. Even the franchises of one corporation may be condemned for the benefit of another under the power of eminent domain upon due compensation being made therefor."

1 Cairo & F. R. R. Co. v. Hecht, 95 cuted; Breitung v. Lindauer, 37 Mich. U. S. 168. 217; Gregory v. German Bank, 3 Colo. 332.

2 Commonwealth v. Weller, (1887) 82 Va. 721, where it was held that the Virginia Act of January 26, 1886, ch. 49, entitled "An act to prescribe a rule of evidence in certain cases," is constitutional, valid, and binding on the courts. Under it, on a trial of the validity of detached coupons of State bonds, the State may require the bonds from which the coupons are alleged to have been detached to be produced in evidence; and also that the act of Virginia assembly of January 21, 1886, forbidding the use of expert testimony in the trial of an issue as to the genuineness of coupons detached from bonds of the State of Virginia, is valid, and binding on the courts as a rule of evidence. Cf. Skinner v. Richardson, B. & Co., (Wis. 1890) 45 N. W. Rep. 318.

3 Union Iron Co. v. Pierce, (1869) 4 Biss. 327, holding that actions pending at the time of the repeal of the penal statute under which they are brought, can not be further prose

4 West River Bridge Co. v. Dix, 6 How. 507; Miller v. New York &c. R. Co., 21 Barb. 513; Alabama &c. R. Co. v. Kenny, 39 Ala. 307; State v. Noyes, (1859) 47 Me. 189; Pierce v. Somersworth, (1858) 10 N. H. 369; Crosley v. Hanover, 36 N. H. 404; Red River Bridge Co. v. Clarksville, 1 Sneed (Tenn.), 176; Armington v. Barnett, 15 Vt. 745; White River Turnpike Co. v. Vermont &c. Co., 21 Vt. 590; James River &c. Co. v. Thompson, 3 Gratt. 270; Wood's Railway Law, 661.

5 West River Bridge Co. v. Dix, 6 How. 507; Richmond &c. R. Co. v. Louisa R. Co., 13 How. 71, 83; Greenwood v. Freight Co., (1881) 105 U. S. 22; New Orleans Gas Light Co. v. Louisiana Light Co., (1885) 115 U. S. 650, 673, where Harlan, J., said: “The rights and franchises which have become vested upon the faith of such contracts, can be taken by the public, upon just compensation to the company, under the State's

§ 34. Of exemptions from taxation.- While the State can not barter away its power and obligation to control the public health and morals, nor its power and duty with respect to the regulation of property dedicated to a public use, it may validly bind itself in the exercise of its power to levy and collect taxes upon corporate property,' unless there be some provision in the constitution of the State forbidding the exemption of corporations from taxation; in which case the legislature can not create a corporation capable of acquiring and holding property free from liability to taxation. The principle that the legislature may make an irrevocable contract of exemption from taxation does not derive its origin from the Dartmouth College case. It found its earliest assertion in the case of New Jersey v. Wilson,' decided in 1812; and the succeeding cases which affirm the rule, profess to rest upon that case. But a statutory provision for ascertaining a

power of eminent domain." Red River Bridge Co. v. Clarksville, 1 Sneed (Tenn.), 176; Central Bridge v. Lowell, 4 Gray, 474; Barber v. Andover, 8 N. H. 398; Armington v. Barnett, 15 Vt. 745; James River Co. v. Thompson, 8 Gratt. 170; Salem Turnpike Co. v. Lyme, 18 Conn. 451.

1 A law pledging the faith of the State not to impose any further tax or burden upon banks, if they would perform certain conditions, has been held to be an exemption of more than the franchise, and to protect the stockholders from any tax upon them as individuals by reason of their stock. Gordon v. Appeal Tax Court, 3 How. 133. A statute of Illinois, passed in 1855, declares that all the property of the Northwestern University shall be forever free from taxation. A statute of 1872 limited this exemption to land and other property in immediate use by the institution; and it was held, that the latter statute impaired the obligation of the contract of exemption found in the statute of 1855. Northwestern University v. People, 99 U. S.

309. In St. Anna's Asylum v. New Orleans, 105 U. S. 362, it was held that section 118 of the Louisiana constitution of 1868, requiring uniformity of taxation throughout the State, and the act in pursuance thereof, under which a tax was imposed on the property of an asylum contrary to the express terms of its charter, are in violation of § 10, art. 1 of the federal constitution.

2 Louisville & N. R. Co. v. Palmes, 109 U. S. 244. A provision in a new State constitution, that no property should be exempt from taxation except public school property, applies as well to the renewal of an exemption as to its original creation. Trask v. Maguire, 18 Wall. 391.

37 Cranch, 164. The contract in this case was an act of New Jersey declaring that certain lands should be purchased for the Indians and that such lands should not be thereafter subject to taxation.

4 Gordon v. Appeal Tax Court, 3 How. 133; Piqua Bank v. Knoop, 16 How. 369; Ohio Life Ins. & Trust Co. v. De Bolt, 16 How. 416; Dodge v.

tax in a certain manner is not a contract that no statute shall thereafter provide a different method.' And exemptions from taxation which are mere bounties, or privileges granted without consideration, may be withdrawn or repealed by the legislature.2

§ 35. The exemption to be clearly expressed.—It is essential that a charter contract exempting a corporation from taxation should be expressed in clear and unmistakable terms.3 Thus a statute imposing a tax of eight per cent. on each yearly dividend of the banks which it incorporates, will be interpreted to mean that they shall pay at least that amount, and not that the rate shall not be increased by future legislation.' So where the purposes for which a corporation may hold property are specified in connection with its exemption from taxation, only property acquired for those purposes is considered

Woolsey, 18 How. 331; Mechanics' & Traders' Bank v. Thomas, 18 How. 384; McGee v. Mathis, 4 Wall. 143; Jefferson Branch Bank v. Skelly, (1861) 1 Black, 436, 446, where it is held, however, that the abandonment of the power to tax "ought not to be presumed in a case in which the deliberate purpose of a State to abandon it does not appear;" Home of the Friendless v. Rouse, 8 Wall. 438; Wilmington R. Co. v. Reid, 13 Wall. 264; Farrington v. Tennessee, 95 U. S. 679; Murray v. Charleston, 96 U. S. 432.

1 Bailey v. Maguire, 22 Wall. 215. The legislature of Ohio, in 1834, incorporated the Ohio Life Insurance & Trust Company, a section in its charter providing that no higher taxes should be levied on the capital stock or dividends of the company than are or may be levied on the capital stock or dividends of incorporated banking institutions in the State. In 1851 an act was passed providing that the stock of this company, among others, should be taxed the same as other property. This act

was held constitutional, notwithstanding the fact that, under the Ohio Banking Law of 1845, certain banks are subject only to a tax therein specified, less than this. Ohio Life Ins. & Trust Co. v. De Bolt, 16 How. 416.

2 Rector &c. v. Philadelphia, 24 How. 301; Tucker v. Ferguson, 23 Wall. 527; West Wisconsin Ry. Co. v. Board of Supervisors of Trempealeau County, 93 U. S. 595.

Memphis Gas L. Co. v. Shelby County Taxing Dist., 109 U. S. 398; Providence Bank v. Billings, 4 Pet. 514; St. Louis, I. M. & S. R. Co. v. Softin, 98 U. S. 559. A clause in the charter of a company imposing a tax and providing that "this tax shall be in lieu and satisfaction of all other taxation or imposition whatsoever, by or under the authority of this State, or any law thereof," excludes the right of the State to revoke it at pleasure. New Jersey v. Yard, (1881) 95 U. S. 104.

4 Bank v. Commonwealth, 10 Pa. St. 442, 449; Bank of Pennsylvania v. Commonwealth, 19 Pa. St. 144,

within the exemption. Upon the same principle the privilege of exemption from taxation is construed to be the especial privilege of the corporation to which it is granted; and it does not pass to its successor unless the law granting the exemption expresses a clear intent to that effect.2 When, however, the intention to confer an immunity from taxation is distinctly expressed, or is a necessary inference from the words employed, the court will not resort to a strained interpretation for the sake of withholding a privilege which may have been the chief inducement to the acceptance of the grant or charter. The exemption may be lost by acquiescence in the imposition of taxes.*

155; Hare's American Constitutional Arundel County, 103 U. S. 1. But Law, 666. see Humphrey v. Peques, 16 Wall.

1 Bank of Commerce v. Tennessee, 244; Tennessee v. Whitworth, 117 104 U. S. 493. U. S. 139.

2 Morgan v. Louisiana, 93 U. S. 217; Wilson v. Gaines, 103 U. S. 417; Louisville & N. R. Co. v. Palmes, 109 U. S. 214; Memphis R. Co. v. Commissioners, 112 U. S. 609. Thus a grant to one company, of the powers, rights and privileges of another, for the purpose of making and using a railroad, carries with it only such rights and privileges as were essential to the operation of the other, and does not include an exemption from taxation, which was one of the privileges of that company. Memphis & C. R. Co. v. Gaines, 97 U. S. 697; Annapolis &c. R. Co. v. Anne

3 Farrington v. Tennessee, 95 U. S. 679; Commonwealth v. Pennsylvania Canal Co., 66 Pa. 46, 65; New York & E. R. Co. v. Sabin, 26 Pa. St. 242.

4 In Given v. Wright, 117 U. S. 648, it was held that the long acquiescence of the land owners under the imposition of taxes, raised a presumption that the exemption which once existed had been surrendered, as it was a franchise or privilege which could be lost by acquiscence. The court expressed the opinion that if the question in New Jersey v. Wilson, 7 Cranch, 164, were a new one, it might be differently decided.

§ 36. Of the

CHAPTER III.

AMENDMENT, REPEAL AND FORFEITURE.

reserved power of § 47. Judicial and legislative inamendment and repeal.

37. Construction of constitutional,

statutory and charter reser-
vations.

38. Of the construction of amend

quiry distinguished.

48. The same subject continued. 49. The fact of forfeiture to be judicially declared.

50. The fact of forfeiture not to be collaterally tried.

51. Proceedings to forfeit charters (a) Jurisdiction.

52. (b) Of the parties. .53. (c) Of the writs.

54. (d) Of the grounds of forfeiture- Misuser and non-user. 55. Of "trust agreements as a ground of forfeiture.

56. The same subject continued. 57. The acts of the shareholders, how far imputed to the corporation.

58. Actual or prospective injury to the public to be proven. 59. Waiver by the State.

§ 36. Of the reserved power of amendment and repeal.— After the decision of the Dartmouth College case, by which the charters of private corporations were declared to be within the protection of the constitutional prohibition of laws impairing the obligation of contracts,1 it became customary for State legislatures, in granting acts of incorporation, either to limit the duration of corporate life or to reserve to the State the power of amendment and repeal. General statutes also were passed, and constitutional provisions adopted by which the States reserved the power to amend and repeal the charters of all corporations not expressly excepted from the operation

1 Vide supra, § 17 et seq.