203 U.S.

Argument for Plaintiff in Error.

Grima, 8 How. 490, 493; United States v. Fox, 94 U. S. 315; Magoun v. Illinois Trust & Sav. Bank, 170 U. S. 283, 292, 294; Atchison, Topeka &c. Ry. Co. v. Matthews, 174 U. S. 96, 105.

The Constitution of the United States was largely the result of the demand that there should be no discrimination between the several States in commercial regulations and rights of persons or property. Passenger cases, 7 How. 283, 407, 449, 492; Crandall v. Nevada, 6 Wall. 35, 43, 48; Woodruff v. Parham, 8 Wall. 123, 140, 147; Hinson v. Lott, 8 Wall. 148, 152.

This court has repeatedly denied to the States the right of discrimination in the exercise of their sovereign power of taxation. Ward v. Maryland, 12 Wall. 418, 430; Welton v. State of Missouri, 91 U. S. 275; Tiernan v. Rinker, 102 U. S. 123; Webber v. Virginia, 103 U. S. 344; Walling v. Michigan, 116 U. S. 466.

Corporations are not "citizens" within Article IV, Section 2, and the Fourteenth Amendment of the Constitution. Blake v. McClung, 172 U. S. 239, 259; Orient Ins. Co. v. Daggs, 172 U. S. 557, 561.

Corporations are "persons" within the Fourteenth Amendment. Pembina Mining Co. v. Pennsylvania, 125 U. S. 181, 189; Home Ins. Co. v. New York, 134 U. S. 594, 606; Charlotte &c. R. R. Co. v. Gibbes, 142 U. S. 386, 391; Covington &c. Turnpike Co. v. Sandford, 164 U. S. 578, 592; Gulf &c. R. Co. v. Ellis, 165 U. S. 150, 154; Smyth v. Ames, 169 U. S. 466, 522.

The right of a State to prescribe the terms and conditions upon which foreign corporations may transact business within its borders or to exclude such corporations altogether, is conceded, subject to the limitation that unconstitutional requirements cannot be made. This case is to be distinguished from the general principle, however, in that Illinois has not attempted through any agency to prescribe conditions upon which a foreign, religious or charitable corporation may succeed to property in Illinois. See Insurance Co. v. Morse, 20 Wall. 445; Doyle v. Continental In. Co., 94 U. S. 535; Barron

Argument for Defendant in Error.

203 U. S.

v. Burnside, 121 U. S. 186; Cable v. United States Life Ins. Co., 191 U. S. 288, 306; Dayton Coal & Iron Co. v. Barton, 183 U. S. 23; Security Mut. Life Ins. Co. v. Prewitt, 202 U. S. 246.

When the corporation or the property is within the jurisdiction of the State, it is entitled to the equal protection of the laws, and different rates of taxation, either upon property or succession to property, cannot be applied as between foreign or domestic corporations. Philadelphia Fire Assn. v. New York, 119 U. S. 110; Erie Railway Co. v. State, 2 Vroom, 531; S. C., 86 Am. Dec. 226, 236; Barbier v. Connolly, 113 U. S. 27, 31; Home Ins. Co. v. New York, 134 U. S. 594, 606; Pembina Consolidated M. Co. v. Pennsylvania, 125 U. S. 181, 189; New York v. Roberts, 171 U. S. 658, 663; Blake v. McClung, 172 U. S. 239, 255; Orient Ins. Co. v. Daggs, 172 U. S. 557, 566; Yick Wo v. Hopkins, 118 U. S. 356, 369.

Mr. Edward M. Ashcraft, with whom Mr. William H. Stead, Attorney General of the State of Illinois, was on the brief, for defendant in error:

If plaintiff in error seeks to reverse the judgment below on the ground that its construction of the amendatory act of 1901 is erroneous and repugnant to the Constitution of the United States, without drawing into question the validity of the act, then there is no Federal question involved, this court is without jurisdiction and the writ of error should be dismissed. Sec. 709, Rev. Stat.; Santa Cruz v. Railroad Co., 111 U. S. 361; Balt. & Pot. R. R. Co. v. Hopkins, 130 U. S. 210; United States v. Lynch, 137 U. S. 280; Sage v. Louisiana Board of Liquidation, 144 U. S. 647; Morley v. L. S. & M. S. Ry. Co., 146 U. S. 162; Marchant v. Pennsylvania R. R. Co., 153 U. S. 380; Central Land Co. v. Laidley, 159 U. S. 103; Union National Bank v. Louisville &c. Ry. Co., 163 U. S. 325; Turner v. Wilkes County, 173 U. S. 461; Johnson v. N. Y. Life Ins. Co., 187 U. S. 491.

If plaintiff in error seeks to reverse the judgment below

203 U.S.

Argument for Defendant in Error.

because the amendatory act of 1901, as construed by the state court, is invalid because repugnant to the Fourteenth Amendment to the Constitution of the United States, in determining the validity of the act of 1901, this court should follow the construction placed upon that act by the Supreme Court of Illinois. Machine Co. v. Gage, 100 U. S. 676; Chicago, M. & St. P. Ry. Co. v. Minnesota, 134 U. S. 418; Missouri Pacific R. R. Co. v. Nebraska, 164 U. S. 403; Ludeling v. Chaffe, 143 U. S. 301; Morley v. L. S. & M. S. Ry. Co., 146 U. S. 162; Illinois Central R. R. Co. v. Illinois, 163 U. S. 142; Noble v. Mitchell, 164 U. S. 367; Osborne v. Florida, 164 U. S. 650; New York State v. Roberts, 171 U. S. 658; Covington v. Kentucky, 173 U. S. 231; Turner v. Wilkes County, 173 U. S. 461; Gulf & Ship Island R. R. Co. v. Hewes, 183 U. S. 66; West. Un. Tel. Co. v. Gottlieb, 190 U. S. 412.

The construction of the amendatory act of 1901 by the Supreme Court of Illinois is correct. Catlin v. Trustees, 113 N. Y. 133; Prime's Estate, 136 N. Y. 347; Balleis' Estate, 144 N. Y. 134; Minot v. Winthrop, 162 Massachusetts, 113; Alfred University v. Hancock, 46 Atl. Rep. (N. J.) 178; United States v. Perkins, 163 U. S. 625; People v. Western S. F. Society, 87 Illinois, 246; Theological Seminary v. Illinois, 188 U. S. 662.

The amendatory act of 1901, as construed by the State, is not repugnant to the Fourteenth Amendment. Blake v. McClung, 172 U. S. 239; Kochersperger v. Drake, 167 Illinois, 122; Billings v. People, 189 Illinois, 472; S. C., 188 U. S. 97; Magoun v. Illinois Trust & Savings Bank, 170 U. S. 283; United States v. Perkins, 163 U. S. 625; Blackstone v. 'Miller, 188 U. S. 189; Kidd v. Alabama, 188 U. S. 730; Giozza v. Tiernan, 148 U. S. 657; Davidson v. New Orleans, 96 U. S. 97; Merchants' Bank v. Pennsylvania, 167 U. S. 461; Bells Gap Railroad v. Pennsylvania, 134 U. S. 232; United States v. Fox, 94 U. S. 315; Humphreys v. State, 70 Ohio St. 67; Central Land Co. v. Laidley, 159 U. S. 103; Marchant v. Pennsylvania Railroad Co., 153 U. S. 380; Campbell v. California, 200 U. S. 87. If the amendatory act, as construed by the state court, is

repugnant to the Fourteenth Amendment, then the judgment of the Supreme Court of Illinois should be affirmed.

MR. JUSTICE MCKENNA delivered the opinion of the court.

This writ of error is directed to a judgment of the Supreme Court of the State of Illinois sustaining a tax assessed against plaintiff in error under the inheritance tax law of that State, passed June 15, 1895, entitled "An act to tax gifts, legacies and inheritances in certain cases, and to provide for the collection of the same." Laws of 1895, p. 301.

The facts are as follows: Fanny Speed, a citizen and resident of Kentucky, died seized of certain real estate in the city of Chicago. She devised a one-half interest to plaintiff in error to be used as part of its educational fund, "to be held, invested and administered" as other properties forming a part of that fund. The will was probated in the Probate Court of Cook County, State of Illinois. An inheritance tax of $6,280.50 was assessed by the county judge against plaintiff in error, based on the value of the interest devised.

Plaintiff in error was incorporated by an act of the legislature of the State of Kentucky to form an educational fund for the promotion of literature, education, art, morality and religion. Its funds are held and used exclusively for such purposes and are required to be wholly expended within the State of Kentucky. It is not permitted to make dividends or distribution of profits or assets among its members or stockholders. It does not have or maintain an office in the State of Illinois or engage in educational or religious work therein.

From the action of the county judge imposing the tax, plaintiff in error appealed to the County Court of Cook County and assigned as grounds of appeal: (1) That by reason of its organization and the purposes of its organization, as shown by the record, it was exempt from such tax under the act of May 10, 1901, amending the act of June 15, 1895. (2) For that the imposition of such tax upon it (the plaintiff in error), when

corporations organized for like purposes under the laws of the State were exempt therefrom, was in conflict with the constitution of the State of Illinois, and rendered said act void as to plaintiff in error, as in conflict with the Fourteenth Amendment of the Constitution of the United States, in that it abridged the privileges and immunities of plaintiff in error, who was a citizen of the United States, and denied to it the equal protection of the laws. The County Court sustained the tax and the Supreme Court affirmed the judgment. This writ of error was then sued out.

The assignment of errors in this court, omitting the specification of error based on the constitution of the State, is the same as that in the state courts.

It is enough for our purpose to say that section one of the act of 1895, subjects to a tax all property situated within the State, which shall by will or by the intestate laws pass from any person who may die seized or possessed of the same. The act was amended in 1901 by adding thereto the following section:

"When the beneficial interest of any property or income therefrom shall pass to or for the use of any hospital, religious, educational, bible, missionary, tract, scientific, benevolent or charitable purpose, or to any trustee, bishop, or minister of any church or religious denomination, held and used exclusively for the religious, educational or charitable uses and purposes of such church or religious denomination, institution or corporation, by grant, gift, bequest or otherwise, the same shall not be subject to any such duty or tax, but this provision shall not apply to any corporation which has the right to make dividends or distribute profits or assets among its members."

The Supreme Court decided that this amendment did not apply to "corporations created under the laws of a sister State." And also decided, as so construed, the amendment was not repugnant to the Constitution of the United States. The court said:

"A clear distinction exists between domestic corporations