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U.S. Supreme Court

Provident Institution v. Mayor of Jersey City, 113 U.S. 506 (1885)

Provident Institution for Savings v. Mayor of Jersey City, 113 U.S. 506 (1885)

Submitted January 9, 1885

Decided March 2, 1885

113 U.S. 506


An act which makes water rents a charge upon lands in a municipality, with a lien prior to all encumbrances, in the same manner as taxes and assessments gives them priority over mortgages on such lands made after the passage of the act, whether the water was introduced on the lot mortgaged before or after the giving of the mortgage.

An act thus making water rents a charge upon lands in a municipality prior to the lien of all encumbrances does no violation to that portion of the Fourteenth Amendment to the Constitution which declares that no state shall deprive any person of property without due process of law.

It is not necessary in this case to decide as to the effect of such act upon mortgages existing at the time of its enactment, but even in that case, the Court is not prepared to say that it would be repugnant to the Constitution.

This was a bill in equity filed in the Court of Chancery of New Jersey by the appellant, to foreclose two mortgages given to it on a certain lot in Jersey City by Michael Nugent and wife, and another person, the first being dated January

Page 113 U. S. 507

19, 1863, to secure the payment of $900 and interest, and the second, dated July 13, 1869, to secure the payment of $700 and interest. The complainants also claimed, under the stipulations of the mortgages, the amount of certain premiums of insurance paid by them. By an amended bill making the mayor and aldermen of Jersey City a defendant, the complainants alleged that the city claimed a lien on the mortgaged premises prior to that of the mortgages for certain water rents for supplying water to the occupants of the same for the year 1871, and from thence to the time of filing the bill; that this claim was made under an act of the legislature time of filing the bill; that this claim authorizing the construction of waterworks for the city, and the act revising the city charter, passed in March, 1871. The bill denied the validity of this claim, and averred that those portions of the said acts which purported to give such a priority had the effect to deprive the complainant of its property in the mortgaged premises without due process of law, and were in violation of the Constitution of the United States as well as that of New Jersey, and the complainant prayed for a foreclosure and sale of the lot in question as against all the defendants.

There was annexed to the bill and referred to therein a copy of the "Tariff of Rates and Regulations for the Use of Passaic Water; also Rules Regulating the Plumbing of Houses and the Tapping of Sewers," being the regulations adopted by the Board of Public Works of Jersey City under the statutes referred to in the bill. The water rates specified in this tariff (except for measured water) were graduated in a table according to the width and number of stories of the houses, and were made payable annually in advance on the 1st of May in each year, with a penalty of three percent if not paid by the 1st of July and interest at the rate of seven percent from the 20th of December. The regulations extend to many details, making provision for extra charges to certain kinds of establishments, providing penalties for misuse of the water, etc. The city authorities answered the bill, admitting that they had assessed upon the mortgaged premises the water rents set forth in the bill, and alleged that they were imposed in pursuance

Page 113 U. S. 508

of an act of the Legislature of New Jersey entitled "An act to authorize the construction of works for the supplying of Jersey City and places adjacent with pure and wholesome water," approved March 25, 1852, and an act entitled "An act to reorganize the local government of Jersey City," passed March 31, 1871, and the supplements thereto, and insisted that said water rents were a lien prior to the mortgages, and prayed that it might be so adjudged.

The other defendants made no defense.

The complainant and the city authorities entered into a stipulation to the effect that the allegations of fact in the bill were to be taken as true; that in the assessment of the water rents, interest, and penalties, all the requirements of the act "to reorganize the local government of Jersey City," passed March 31, 1871, and the supplements thereto, had been complied with, and that the only question to be determined by the court was whether, upon the facts stated in the bill, the water rents and interest and penalties mentioned therein, or any of them, were liens upon the property in question prior to the lien of the complainant's mortgages.

The chancellor decided that the giving of a priority of lien to the water rents over the mortgages pursuant to the statutes did not deprive the complainant of its property without due process of law and did not otherwise conflict with the Constitution of the United States or with that of New Jersey, and he decreed that for the purpose of raising the money due on the mortgages, the mortgaged premises must be sold subject to such lien, and that the bill must be dismissed as against the city. This decree, being appealed from, was affirmed by the New Jersey Court of Errors and Appeals and the record was remanded to the Court of Chancery. The case is brought here by writ of error, and the errors assigned resolve themselves into the single error of sustaining the priority of the lien of the water rents over that of the complainant's mortgages.

Page 113 U. S. 511

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