This suit, like that of the Great Northern R. Co. v. Minnesota, just decided [[[216 U.S. 206]], 54 L. ed. --, 30 Sup. Ct. Rep. 344] involves the constitutionality, as applied to the plaintiff in error, of chapter 253, General Laws of Minnesota of 1903, requiring every railroad company owning or operating any line of railway in that state to pay an annual tax, commencing with 1905, equal to 4 per cent of the gross earnings derived from the operation of such line within the state.
The gross earnings received by the defendant company during the year 1905 amounted to $1,248,890.93, 4 per cent of which is $49,959.24. The state alleges that the defendant refused to pay and has paid only $24,979.62, leaving a balance of $24,979.62, for which amount the state asked judgment.
The court of original jurisdiction sustained the company's contention that it was liable only to a sum equal to 2 per cent of its gross earnings, and gave judgment for the defendant. That court was of opinion that a certain statute of the territory of Minnesota, approved March 1st, 1856 (Laws of 1856, chap. 47), constituted a valid contract between the territory and state of Minnesota, on one side, and the Minnesota & Northwestern Railroad Company, on the other, and fixed the lawful rate of taxation to be paid by that company at 2 per cent of its gross earnings; that said contract was never forfeited or lost by the company, but was transferred and passed, first to the Chicago, St. Paul, & Kansas City Railway, and subsequently to the defendant herein; and that the statute of 1903, fixing the tax at 4 per cent of the company's gross earnings, was unconstitutional when applied to the defendant herein. The judgment was reversed by the supreme court of Minnesota, with directions to enter judgment in favor of the state for the full amount stated in its complaint. 106 Minn. 300, 119 N. W. 211.
The facts and issues are so fully and accurately set forth by the supreme court of Minnesota that we take from its opinion the following statement of the case: 'This action, like that of State v. Great Northern R. Co. 106 Minn. 303, 119 N. W. 202 [filed herewith], involves the validity of chapter 253, p. 375, General Laws 1903, increasing the rate of the gross earnings tax upon railroad companies in this state to 4 per cent. As in the Great Northern Case, defendant asserts an irrepealable contract, under which it claims the right forever to discharge its tax liability by the payment of a 2 per cent rate. The fixed rate claimed by the Great Northern Company was 3 per cent. The determination of the case involves, as in the other case, the construction of an old territorial railroad charter, the facts with reference to which are as follows: