SOUTHERN RY. CO. V. WATTS, 260 U. S. 519 (1923)

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U.S. Supreme Court

Southern Ry. Co. v. Watts, 260 U.S. 519 (1923)

Southern Railway Company v. Watts

Nos. 368, 369, 381, 382, 383

Argued November 22, 23, 1922

Decided January 2, 1923

260 U.S. 519


1. The Equality Clause does not require that the methods of assessing and equalizing state taxes on railroads shall be the same as those applied to other classes of property. P. 260 U. S. 525.

2. Undervaluation of property for taxation, as compared with valuation of other property of the same class, does not violate the Equality Clause if it is not intentional and systematic. P. 260 U. S. 526.

3. The ad valorem taxes imposed on complainant railroads, through an application of the unit rule of assessment, under the Revaluation Act of North Carolina, Public Laws 1919, c. 84, do not violate the Due Process or the Commerce Clauses of the Federal Constitution

Page 260 U. S. 520

or the true value and uniformity provisions of the constitution of North Carolina, Arts. V and VII. P. 260 U. S. 527.

4. Mere errors of judgment upon the part of the assessing authorities are not subject to review in these suits to enjoin the collection of the taxes. P. 260 U. S. 527.

5. The North Carolina Revaluation Act, supra, though referring to data commonly used in valuing railroads and authorizing the state taxing board to require railroads to furnish such information, did not make mandatory any particular method of valuing railroads, but required the board to exercise an informed and honest judgment in that regard. P. 260 U. S. 527.

6. Failure to follow methods referred to in earlier statutes could not render illegal the revaluation of railroads made under that act by the state board in 1920, since such valuation was tentative, and became an assessment by the legislature through approval by North Carolina Laws 1920, Ex.Sess., c. 1. P. 260 U. S. 528.

7. The state board, though empowered to reduce this statutory assessment, was not required to make a new valuation or to apply any particular method of valuation. P. 260 U. S. 528.

8. The so-called franchise tax imposed for state purposes on railroad companies by North Carolina [Laws 1920, Ex.Sess., c. 1, § 82 (6 1/2); Laws 1921, C. 34], equal to one-tenth of one percent of the value of each company's property within the state, is not an additional property tax, and does not violate the Uniformity Clause of the state constitution or the Equality or Commerce Clauses of the federal Constitution. P. 260 U. S. 529.

9. The aggregate burden imposed by the property tax, the franchise tax, and the income tax does not obstruct interstate commerce. P. 260 U. S. 530.

10. Section 82 (312) of c. 34, North Carolina Laws 1921, has no application to railroads. P. 260 U. S. 530.

289 F.3d 1 affirmed.

Appeals from decrees of district courts, under Jud. Code § 266, denying interlocutory injunctions in suits by divers railroad companies to enjoin collection of taxes in North Carolina.

Page 260 U. S. 521

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