AMERICAN SMELTING & REFINING COMPANY, Plff. in Err., v. PEOPLE OF THE STATE OF COLORADO ex rel. HENRY A. LINDSLEY, District Attorney of the Second Judicial District of the State of Colorado, Deft. in Err.

It is conceded that the corporation has paid all its indebtedness for taxes or otherwise to the state of Colorado, except the amount demanded under the above-mentioned law of 1902, and that it has obeyed all the laws of the state with that exception. It is urged, however, upon the part of the corporation, that, by its admission into the state, with its right to do business therein by the payment of the amount of money required for such purpose under the then-existing law, a contract between the state and itself was thereby made that it should be permitted to remain therein during the term of life which the state by law allowed to corporations created by it (which was twenty years), without being again subjected to further exactions of money for what it had once paid for, viz., the right to remain and transact business in that state. Undoubtedly, if the corporation violated the laws of the state properly applicable to it, or if otherwise it gave just cause for its expulsion, it could not insist upon such a contract as a defense.

It is also conceded on behalf of the corporation that it is not entitled to any exemption from taxes which the state of Colorado can properly impose upon persons or corporations within her borders.

Having obtained permission to enter the state and do business as above mentioned, the question, aside from that of the extent of the term, is whether any contract between the state and the corporation arose under these laws and the facts above mentioned.

In 1899, when this (foreign) corporation applied for a permit to enter and do business in the state, the laws of Colorado only granted such application on the payment of a certain fee named in the statute of 1897, which was payable upon filing its certificate of incorporation in the office of the secretary of state of Colorado, and until that payment was made and the certificate filed no such corporation was permitted to have or exercise any corporate powers, nor was it permitted to do any business in the state. Section 30 of the act of 1901 provided that, upon payment of all taxes, etc., due under the law, the secretary of state was to issue a certificate acknowledging the fact, for which the corporation was to pay a stated fee; and until the certificate was received from the secretary of state by the corporation it should not exercise any corporate powers or do any business in the state, as provided for by the act of 1897.

The result of these statutes was that the foreign corporation, upon filing the proper papers and paying the statutory fees and obtaining the certificate to that effect from the secretary of state, obtained the right to enter and do business in Colorado. The act of 1901 did not increase the amount of the exaction for entering and doing business in the state, but simply provided for a certificate, acknowledging payment, from the secretary, and it imposed the payment of a small fee for such certificate. The right obtained was a right to enter the state and do business therein as a corporation. It was also subject by statute to the liabilities, restrictions, and duties which were or might thereafter be imposed upon domestic corporations of like character. Domestic corporations at that time had the right to a corporate existence of twenty years.

These provisions of law, existing when the corporation applied for leave to enter the state, made the payment required, and received its permit, amounted to a contract that the foreign corporation so permitted to come in the state and do business therein, while subjected to all, should not be subjected to any greater, liabilities, restrictions, or duties than then were or thereafter might be imposed upon domestic corporations of like character.

A provision in a statute of this nature subjecting a foreign corporation to all the liabilities, etc., of a domestic one of like character must mean that it shall not be subjected to any greater liabilities than are imposed upon such domestic corporation. The power to impose different liabilities was with the state at the outset. It could make them greater or less than in case of a domestic corporation, or it could make them the same. Having the general power to do as it pleased, when it enacted that the foreign corporation, upon coming in the state, should be subjected to all the liabilities of domestic corporations, it amounted to the same thing as if the statute had said the foreign corporations should be subjected to the same liabilities. In other words the liabilities, restrictions, and duties imposed upon domestic corporations constitute the measure and limit of the liabilities, restrictions, and duties which might thereafter be imposed upon the corporation thus admitted to do business in the state. It was not a mere license to come in the state and do business therein upon payment of a sum named, liable to be revoked or the sum increased at the pleasure of the state, without further limitation. It was a clear contract that the liabilities, etc., should be the same as the domestic corporation, and the same treatment in that regard should be measured out to both. If it were desired to increase the liabilities of the foreign, it could only be done by increasing those of the domestic, corporation at the same time and to the same extent.

Such being the contract, how long was it to last? Only until the state chose to alter it? Or was it to last for some definite time, capable of being ascertained from the terms of the statutes as they then existed? It seems to us that the only limitation imposed is the term for which the corporation would have the right to continue in the state as a corporation. One of the restrictions as to domestic corporations is that which limits their corporate life to twenty years, unless extended as provided by law. The same restriction applies to the foreign corporation. Iron Silver Min. Co. v. Cowie, 31 Colo. 450, 72 Pac. 1067. Counsel for the state concedes that the corporation was admitted for a period of twenty years, but subject to the power of the state to tax. Curing that time, therefore, the contract lasts. This is the only legitimate, and we think it is the necessary, implication arising from the statute.

This is not an exemption from taxation, it is simply a limitation of the power to tax beyond the rate of taxation imposed upon a domestic corporation. Instead of such a limitation the act of 1902, already referred to, imposes a tax or fee upon or exacts from the foreign corporation double the amount which is imposed upon or exacted from the domestic one. The latter is granted the right to continue to do business upon the annual payment of 2 cents upon each $1,000 of its capital stock, while the former must pay 4 cents for the same right. This cannot be done while the right to remain exists. It is a violation of the obligation of an existing valid contract. Home of the Friendless v. Rouse, 8 Wall. 430, 19 L. ed. 495.

Nor is this a case where the power given by the state Constitution to the general assembly to alter, amend, or annul a charter is applicable. The act does not alter the charter or annul or amend it. It simply increases the taxation which, up to the time of its enactment, had been imposed on all foreign corporations doing business in the state.

A discussion as to the name or nature of the tax imposed by the act of 1902, or the former acts, is wholly unimportant with reference to the view we take of this case. After the payment of the money and the receipt of the permit to enter and do business in the state the corporation could not, as we have said, be thereafter further taxed than was the domestic one. The tax on the latter under that act is the same in substance and effect as that upon the foreign corporation, but it is for only one half thereof in amount. The domestic must pay 'an annual state corporation license tax,' while the foreign corporation must pay 'a state license tax' annually. The means of enforcing payment are not different, and such means are stated in § 66 of the act of 1902.

Whatever be the name or nature of the tax, it must be measured in amount by the same rate as is provided for the domestic institution, and, if the latter is not taxed in that way, neither can the state thus tax the foreign corporation.

It is unnecessary to refer to the many cases cited by both parties hereto. Some of them refer to the question as to the nature of such a tax, while others decide, upon the facts appearing in them, whether there was a contract or not. As already stated, the name of the tax or its kind is not important so long as it is plain that the act of 1902 increases the liabilities of the foreign corporation over those which obtain in that of the domestic. And in regard to the cases of contract, while the principle that a contract may arise from a legislative enactment has been reiterated times without number, it must always rest for its support in the particular case upon the construction to be given the act, and in this case we are not greatly aided by the former cases regarding taxation and legislative contract. We may, however, refer to the following out of many cases regarding contracts as to taxation: Miller v. New York, 15 Wall. 478, 21 L. ed. 98; New York, L. E. & W. R. Co. v. Pennsylvania, 153 U. S. 628, 38 L. ed. 846, 14 Sup. Ct. Rep. 952; Powers v Detroit, G. H. & M. R. Co. 201 U. S. 543, 50 L. ed. 860, 26 Sup. Ct. Rep. 556.

Holding that the act of 1902 impaired the obligation of the contract existing between the corporation and the state, and is therefore void as to the corporation, it becomes unnecessary to decide the other questions discussed at the bar.

The judgment of the Supreme Court of Colorado is reversed and the case remanded to that court for further proceedings not inconsistent with this opinion.

Reversed.

The CHIEF JUSTICE, Mr. Justice Harlan, Mr. Justice Holmes, and Mr. Justice Moody dissent.