Northern Central Railway Co. v. Maryland

Citations

• 187 U.S. 258
• 23 S. Ct. 62
• 47 L. Ed. 167
• 1902 U.S. LEXIS 813

Syllabus

<p>1. When a Maryland corporation, chartered in 1827, and possessing certain immunities from taxation, which under the then constitution might have been irrepealable, becomes merged with other corporations in an entirely new corporation possessing new rights and franchises created after the adoption of the constitution of 1850, under which the legislature has power to alter and repeal charters of, and laws creating, corporations, the right of exemption, if it ever passed to the new corporation, is subject to the right of repeal, and hence is not protected from repeal by the contract clause of the Federal Constitution.</p> <p>2. An act of the legislature compromising litigation between the State and such new corporation arising from the claim of the latter that it was exempt from taxation under the immunities at one time possessed by one of its constituent corporations, and fixing a rate of taxation to be paid annually thereafter by the new corporation, cannot be regarded as a legislative contract granting an irrepealable right forbidden by the then existing constitution of the State. If, therefore, the legislature subsequently passes another act fixing a higher rate of taxation, and the highest court of the State decides that such act repeals the former act and subjects the corporation to the higher rate of taxation, the later act is not bad as impairing the obligation of contracts within the purview of the Constitution of the United-States as the compromise, when made, was subject to the right to repeal, reserved by the constitution of the State at that time.</p>