United States v. Township of Muskegon/Dissent Whittaker

Mr. Justice WHITTAKER, with whom Mr. Justice BURTON joins, dissenting.

Though the tax involved in these appeals rests upon the same Michigan statute and generally the same legal principles as No. 26, United States v. City of Detroit, 355 U.S. 466, 78 S.Ct. 474, also decided today, the facts are sufficiently different to render this tax even more clearly unconstitutional than the one there sustained.

Here the Government did not even lease nor rent its plant. It simply entered into a contract with Continental providing that the latter would produce certain military supplies at a price equal to its cost, plus a fixed fee; that the work would be done in the Government's plant which was to be furnished without rent (and also that the Government would furnish certain other facilities, and might furnish certain materials, required to produce the supplies) and that Continental would not include in its 'cost' for the supplies any charge for the plant and other facilities and materials furnished by the Government.

Continental, thus, had no leasehold estate, tenancy, or other property interest in the plant; and the right to use the plant belonged to and was provided by the Government as a part of the facilities which, under the contract, it was to furnish for production of the supplies. It thus seems plain to us that the Government itself was actually using its plant in the full and only sense that the 'Government,' being an abstraction, can ever use its military plants. United States v. Allegheny County, 322 U.S. 174, 187-188, 64 S.Ct. 908, 915-916, 88 L.Ed. 1209. Therefore, Continental not only had no estate in this real estate to be taxed, but, moreover, it had no independent right of use of the Government's plant to be subjected to a use tax. We think it must follow, even under the majority's interpretation of the law which we believe to be erroneous-that the tax here imposed by the State, however it may be viewed, is a direct tax against the Government and is, hence, invalid.

For these reasons and also those stated in my dissenting opinion in No. 26, as well as those stated in my dissenting opinion in City of Detroit v. Murray Corporation, 355 U.S. 511, 475, 78 S.Ct. 462, 479, also decided today, I dissent, and would reverse the decision and judgment below.

For concurring opinions of Mr. Justice FRANKFURTER and Mr. Justice HARLAN, see 355 U.S. 489, 505, 78 S.Ct. 486, 492.