Page:Popular Science Monthly Volume 52.djvu/831

Rh to the interest on the loan of capital represented by the mortgage.

Note.—In addition to what may be termed the historical elements of this celebrated case, the more strictly legal features of it, as set forth subsequent to the action of the United States Supreme Court, are here pertinent and worthy of consideration:

No. 1. This case seems from its very nature to involve questions of conflict of State dominion. It is admitted that Mr. Kirtland, the plaintiff, so far as the question of taxation at issue is concerned, has not been assessed and taxed upon his body, person, poll, or head, or for any substance, the embodiment of labor, and which alone constitutes property, owned or possessed by him within the territory of Connecticut; nor for any business transacted by him within the State. The plaintiff has, however, been assessed and taxed for dealing in money or doing the business of loaning money, by an assessment and taxation of bonds and mortgages made in Illinois—the necessary incidents and evidence of the business of money lending, performed by himself or through a resident agent in the State of Illinois. It is conceded that the loans were actually made at Chicago in the State of Illinois, as the bonds and mortgages taken state that all the business and acts connected with the loaning and reloaning were actually done, from time to time, there, that the obligations were payable there, and that the contracts of loan were strictly Illinois contracts, to be interpreted as valid or invalid and as to their force and effect according to the laws of that State.

The State of Illinois imposes a tax on resident agents making loans in that State; but it is not important to inquire whether in this instance the business of loaning was done through a resident agent or what that State does actually tax, but what she can constitutionally tax by virtue of her dominion and sovereignty. Illinois can undoubtedly tax, if the tax is not discriminating but uniform on residents and nonresidents, all occupations and also all business transacted within her borders. She can tax money dealers or money lenders by license or otherwise, and she can impose stamp or other taxes and to any degree, in her discretion, on all contracts at the time when made within her jurisdiction. No other State has concurrent jurisdiction over any legitimate subject of taxation within her jurisdiction. Her sovereignty in taxation is absolute except as limited by the national Constitution. But the sovereignty of coequal States involves a full recognition of the dominion and sovereignty of all sister States, and hence section 1, Article IV, of the United States Constitution requires that "full faith and credit shall be given to the public acts, records, and judicial proceedings of other States." This is a compact of noninterference in the dominion of other States in matters of taxation or in reference to other subjects of State dominion. The power of taxation is an incident of sovereignty or of dominion. The dominion, therefore, of one State for the purpose of taxation over persons, property, or business, or the incidents of business, must exclude the dominion of other States over the same persons, property, business, and incidents of business at the same time. Neither in constitutional law in this country nor in mathematics can the same persons, property, business, and incidents of business occupy two places or sovereignties at the same time. The taxation by Connecticut of credits, choses in action, bonds, notes, book accounts, verbal and other contracts, the incidents of actual business transacted in Illinois, must be in legal effect extraterritorial taxation of a part of such business, or otherwise it must be assumed that the incident is not a part of the principal. The making of contracts is of itself a business in the strictest sense, nor can any business exist without the power to make contracts written or verbal. Money can not be loaned unless there is a business of lending money, and for the time being the vocation of a money lender. The amount or duration of a business in a State can have no influence on the question of the jurisdiction of the State over the business or the transaction. A State can tax all sales at auction, including the sales of goods in unbroken packages owned by nonresidents and just brought into the State and sold by nonresidents or by resident agents (Woodruff vs. Perham, 8 Wallace 123). In New York mere wandering peddlers are taxable on money invested in business in every town in which they peddle. If actually assessed in more than one town the same year the remedy is to appeal to the