ERROR to the Circuit Court for the District of South Carolina; the case being thus:
On the 16th of December, 1851, the legislature of South Carolina, by 'an act to incorporate the Northeastern Railroad Company,' chartered the corporation now known by that name. This act contained no exemption of the company's property from taxation, and by its terms was to continue in force for fifty years from the ratification thereof.
On the 19th of December, 1855, the same legislature passed another act, entitled 'An act to amend the charter of the Northeastern Railroad Company, and for other purposes.' This act enacted:
'SECTION 1. That the stock of the Northeastern Railroad Company and the real estate that it now owns, or may hereafter acquire, which is connected with or subservient to the works, authorized in the charter of the said company, shall be, and the same is hereby, exempted from all taxation during the continuance of the present charter of the said company.'
Prior to the date of either of these acts, that is to say, on the 19th of December, 1849, the same legislature had, by an act entitled 'An act to charter the Cheraw and Darlington Railroad Company,' incorporated the company of that name. This act, after authorizing the formation of the company and the raising of the stock, provided thus:
'SECTION 5. That for the purpose of organizing and forming this company . . . all the powers, rights, and privileges granted by the charter of the Wilmington and Manchester Railroad Company to that company shall be and are hereby granted to the Cheraw and Darlington Railroad Company,' &c.
The powers, rights, and privileges here referred to as granted by the charter of the Wilmington and Manchester Railroad Company, whose name is above italicized, to that company, did not include any exemption of its property from taxation.
The Cheraw and Darlington Railroad Company thus, as above mentioned, incorporated in 1849, had not up to the 17th of December, 1863, built its road; and on the day and year last mentioned the same legislature amended its charter by the passage of the act which thus enacted:
'SECTION 1. That section 5 of an act entitled 'An act to charter the Cheraw and Darlington Railroad Company,' ratified the 19th day of December, A.D. 1849, be amended so as to read as follows, to wit:
'That all the powers, rights, and privileges granted by the charter of the Northeastern Railroad Company are hereby granted to the Cheraw and Darlington Railroad Company, and subject to the conditions therein contained.'
Soon after this amendatory act of 1863 was passed, the Cheraw and Darlington Railroad, which had been lying dormant since 1849, was built and put in operation.
These different enactments above mentioned being in force, the State officers of counties in South Carolina where the Cheraw and Darlington Railroad was situate, acting under the authority of the legislature of the State, imposed certain taxes on the stock and property of that company, and were proceeding to enforce payment of them, when one Pegues, a stockholder in Mississippi, filed a bill in the court below praying an injunction to restrain the collection. The court granted the injunction, and from this, its action, the county officers appealed. The question was whether (as Pegues, the complainant, contended) the act of December 19th, 1855, 'to amend the charter of the Northeastern Railroad Company,' &c., and exempting its property from taxation, formed a part of its charter when, on the 17th of December, 1863, the privileges granted to that company were conferred on the Cheraw and Darlington company; or whether (as the State of South Carolina contended) the privileges thus conferred were limited to those granted to the Northeastern company by its original charter or act of incorporation, passed in 1851, by which no exemption from taxation was conferred.
Mr. D. H. Chamberlain, for the State officers, appellants, contended that an exemption from taxation was never to be implied; that nothing less than a clear intention on the part of the legislature-an intention expressed in terms which admit no other reasonable construction-would suffice to sustain a privilege so valuable and so far-reaching; that as was shown by the words-'an act to amend the charter of the Northeastern Company'-in the amendatory act of 1855, it was the act of 1851 incorporating the company which constituted its charter; and that when the act of 1863 gave to the Cheraw and Darlington Railroad all the powers, rights, and privileges granted by the charter of the Northeastern Railroad Company, it gave it only the powers, rights, and privileges granted by that act of 1851.
In addition to this, that the original grant of powers, rights, and privileges made to the Cheraw and Darlington road by the section 5 of the act of December 19th, 1849, to charter that road, was 'for the purpose of organizing and forming that company,' and that when this act was amended by substituting the new words contained in the amendatory act of the 17th of December, 1863, granting other privileges-the road not yet being so much as undertaken-the original purpose 'of organizing and forming the company' still remained; and that it was a construction such as, in regard to a law exempting property from taxation, was not to be made, that would extend the interpretation so much further, as the complainant sought to do.
The learned counsel also contended that if this view were not sound, and if the property of the Cheraw and Darlington Railroad were by the act of 1863 exempted, yet the right to repeal or amend any previously existing exemption from taxation was inherent and inextinguishable in the State; that the power of taxation was one of the highest and most vitally necessary powers of sovereignty, and that if one legislature could take it from all subsequent legislatures, government could not go on.
Mr. T. G. Barker, contra.
Mr. Justice HUNT (having quoted the several statutes above given) delivered the opinion of the court.