ERROR to the Supreme Court of Arkansas, the case, as stated by the Chief Justice in delivering the opinion of the court, being thus:
In 1850, the United States granted, by act of Congress, to the State of Arkansas, all the swamp and overflowed government lands within its limits, on condition that the proceeds of the lands, or the lands themselves, should be applied, as far as necessary, in reclaiming them for cultivation by means of levees and drains.
The State accepted the grant, and, by an act of the legislature, in 1851, provided for the sale of the lands; for the issue of transferable scrip receivable for any lands, not already taken up, at the time of selection by the holder; for contracts for the making of levees and drains, and for the payment of contractors in scrip or otherwise.
In the fourteenth section of this act it was provided that 'to encourage, by all just means, the progress and the completing of the reclaiming such lands, by offering inducements to purchasers and contractors to take up said lands, all said swamp and overflowed lands shall be exempt from taxation for the term of ten years, or until they shall be reclaimed.'
In 1855 this section was repealed, and provision was made by law for the taxation of swamp and overflowed lands, sold or to be sold, precisely as other lands.
The plaintiff in error, before this repeal, had become the owner, by transfer from contractors, of a large amount of the scriptissued under the act of 1851, and with this scrip, after the repeal, took up and paid for many sections and parts of sections of the granted lands lying in Chicot County.
In 1857 another act of the legislature, local in its nature, provided for the making of levees and drains in Chicot County, and authorized a special tax to meet the cost. This special tax was assessed upon the unreclaimed swamp lands of the plaintiff in error, as well as upon other lands, and the defendant in error, under authority of the act, proceeded to take the necessary measures for the collection of the tax.
The Constitution of the United States ordains that 'no State shall pass any law impairing the obligation of contracts.'
The plaintiff in error filed his bill in the proper State court, alleging that the acts of 1855 and 1857 impaired the obligation of the contract of the State with the United States, expressed in the grant by Congress in 1850 and its acceptance by the State; and also the contract between the State and the levee contractors, and other lawful holders of swamp land scrip, issued under the act of 1851, that such scrip should be receivable for unlocated swamp lands, and that such lands should not be subject to taxation for ten years from the time when taken up, or until reclaimed; and prayed an injunction to restrain the defendant in error from the collection of the taxes authorized by those acts.
In his answer to the bill, the defendant stated that the state and county taxes imposed on the lands of the complainant had been stricken out of the assessment by order of the County Court, and justified his proceeding as sheriff to collect the special levee tax under the act of 1857.
The cause was brought to hearing in the Supreme Court of Arkansas, by whose decree the bill of the complainant was dismissed, and it now came before this tribunal upon writ of error directed to that court.
Mr. Reverdy Johnson, with a brief of Mr. Garland, for the plaintiff in error:
We here controvert the validity of a statute passed through all branches of the law-making power, and afterwards, on argument, declared valid by the highest court of a State. Coming to such an office, we may be excused for some fulness of argument.
The plaintiff in error asserts that the act of 1857, familiarly known as the Levee Act, and under which his lands were taxed, is unconstitutional. And to show this, he maintains:
1st. The fourteenth section of the act of 1851, which exempted swamp lands from taxation for ten years, or until reclaimed, was a contract, it being a part of the law which accepted the grant from Congress.
2d. This levee act misuses and diverts from its proper channel the grant of Congress, inasmuch as the act of Congress of 1850 provides that, as far as necessary to the purpose of reclaiming swamp lands by means of levees and drains, the proceeds of the lands, whether from sale or by direct appropriation in kind, shall be applied in that way.
3d. That having received this scrip representing swamp land, which was issued to him on contracts made prior to the repeal of the fourteenth section of the act of January, 1851, although his lands were entered with this scrip after its repeal, they are as much exempt as if entered before the exempting clause was repealed.
In The State v. County Court of Crittenden, before the Supreme Court of Arkansas,*fn1
it was held that the fourteenth section named above was a valid contract under the Constitution. As a contract, from the day of the passage of the act, it held out an encouragement to persons to take up these lands. It does not say from the day of entry, but it is general and operates necessarily from the day of its passage. When the legislature passed this law, exemption from taxation became at once one of the conditions of the acceptance of the grant. Until the legislature, by an act for that purpose, accepted the grant from Congress, it was of no avail, and could not be used for the benefit of any one. But when the legislature did accept it, the bounty was in a shape to be used; and whatever the legislature did in that behalf related back to the grant, and the act granting, as well as the one accepting, formed in themselves, together, one act–an entirety. Both stood then as material parts of the whole.
If, as we have contended, the two acts together made the grant complete, and they alone did this, the grant then became a contract, and any ...