a truth that argument would be superfluous. Its functions and means essential to the administration of the government, and the employment of them, are liable to constant interruption and possible annihilation. The case in hand is an illustration. The power to borrow money on the credit of the United States is admitted. It is one of the most important and even vital functions of the general government, and its exercise a means of supplying the necessary resources to meet exigencies in times of peace or war. But of what avail is the function or the means if another government may tax it at discretion? It is apparent that the power, function or means, however important and vital, are at the mercy of that government. And it must be always remembered, if the right to impose a tax at all exists on the part of the other government, "it is a right which, in its nature, acknowledges no limits." And the principle is equally true in respect to every other power or function of a government subject to the control of another.

In our complex system of government it is oftentimes difficult to fix the true boundary between the two systems, State and Federal. The chief justice, in MCCULLOH vs. THE STATE OF MARYLAND, endeavored to fix this boundary upon the subject of taxation. He observed, "if we measure the power of taxation residing in a State by the extent of sovereignty which the people of a single State possess, and can confer on its government, we have an intelligible standard applicable to every case to which the power may be applied. We have a principle which leaves the power of taxing the people and property of a State unimpaired, which leaves to a State the command of all its resources, and which places beyond its reach all those powers which are conferred by the people of the United States on the government of the Union, and all those means which are given for the purpose of carrying those powers into execution. We have a principle which is safe for the States and safe for the Union."

All will agree that this is the enunciation of a true principle, and it is only by a wise and forbearing application of it that the operation of the powers and functions of the two governments can be harmonized. Their powers are so intimately blended and connected that it is impossible to define or fix the limit of the one without, at the same time, that of the other, in respect to any one of the great departments of government. When the limit is ascertained and fixed, all perplexity and confusion disappear. Each is sovereign and independent in its sphere of action, and exempt from the interference or control of the other, either in the means employed or functions exercised; and, influenced by a public and patriotic spirit on both sides, a conflict of authority need not occur or be feared.

Judgment of the court below is reversed.

THE PEOPLE OF THE STATE OF NEW-YORK, ex rel. THE BANK OF THE COMMONWEALTH, Plaintiffs in Error, vs. THE COMMISSIONERS OF TAXES AND ASSESSMENTS FOR THE CITY AND COUNTY OF NEW-YORK. In Error to the Supreme Court of the State of New-York.

BEFORE THE SUPREME COURT OF THE UNITED STATES.

DECEMBER TERM, 1862.

Mr. Justice NELSON delivered the opinion of the court.

This is a writ of error to the Supreme Court of the State of NewYork.

The capital of the Bank of the Commonwealth amounts to the sum of $750,000; one hundred and three thousand dollars of which is invested in the stocks of the United States, and which was claimed in the court below to be exempt from State or city taxation under the Constitution of the United States.

This defence was overruled, and the tax imposed by the authorities of the city of New-York confirmed.

The case is brought up here for review under the 25th section of the judiciary act. The case involves the same question presented in the case of the Bank of Commerce against these same defendants, and we need only to refer to the opinion of the court in that case for our judgment in this.

Judgment of the court below reversed.

TAXATION OF GOVERNMENT LOANS BY STATES,

AND OTHER DECISIONS,

By the Supreme Court of the United States.

I. TAXATION BY THE STATES. THE PROVIDENCE BANK vs. BILLINGS & PITTMAN. Reported in Peters' Supreme Court Reports, Vol. IV., year 1830.

II. WESTON VS. CITY OF CHARLESTON. Peters' Reports, Vol. II., year

1829.

III. THE UNITED STATES vs. GRATIOT. Peters' Reports, Vol. XIV., year , 1840.

IV. THE STATE OF RHODE ISLAND VS. COMMONWEALTH OF MASSACHUPeters' Reports, Vol. XII., year 1838.

SETTS.

V. SEARIGHT vs. STOCKTON & STOKES. year 1845.

Howard's Reports, Vol. III,

Howard's Re

VI. THURLOW vs. COMMONWEALTH OF MASSACHUSETTS. ports, Vol V., year 1847.

VII. CONSTITUTIONAL LAW. OSBORN AND OTHERS VS. BANK OF THE UNITED STATES. Wheaton's Reports, Vol. IX., year 1824.

VIII. CONSTITUTIONAL LAW. BROWN AND OTHERS vs. STATE OF MARYLAND. Wheaton's Reports, Vol. XII., year 1827.

IX. CONSTITUTIONAL LAW. WEST RIVER BRIDGE Co. vs. Town of BRATTLEBORO, &c. Howard's Reports, Vol. VI., year 1848.

X. CONSTITUTIONAL LAW. SMITH VS. HEALTH COMMISSIONERS OF THE PORT OF NEW-YORK. Howard's Reports, Vol. VII., year 1849.

XI. THE RIGHTS OF STATES. S. A. WORCESTER VS. THE STATE OF GEORGIA. Peters' Reports, Vol. VI., year 1832.

XII. TAXATION BY STATES. DOBBINS VS. COMMISSIONERS OF ERIE COUNPA. Peters' Reports, Vol. XVI., year 1842.

TY,

I. THE PROVIDENCE BANK, Plaintiffs in Error, vs. ALPHEUS BILLINGS AND THOMAS G. PITTMAN.

Reported in Peters' Reports, Vol. IV., year 1830, p. 514.

In 1791 the legislature of Rhode Island granted a charter of incorporation to certain individuals, who had associated for the purpose of banking. They were incorporated by the name of the president, directors and company of the Providence Bank, with the ordinary powers of such associa

tions. In 1822, the legislature passed an act imposing a tax on every bank in the State, except the Bank of the United States. The Providence Bank refused the payment of the tax, alleging that the act which imposed it was repugnant to the Constitution of the United States, as it impaired the obligation of the contract created by the charter of incorporation. Held, that the act of the legislature of Rhode Island, imposing a tax, which, under the law, was assessed on the Providence Bank, does not impair the obligation of the contract created by the charter granted to the bank.

It has been settled, that a contract entered into between a State and an individual, is as fully protected by the prohibitions contained in the tenth section, first article of the Constitution, as a contract between two individuals; and it is not denied that a charter incorporating a bank is a contract.

The power of taxing moneyed corporations has been frequently exercised, and has never before, so far as is known, been resisted. Its novelty, however, furnishes no conclusive argument against it.

That the taxing power is of vital importance; that it is essential to the existence of government, are truths which it cannot be necessary to re-affirm. They are acknowledged and asserted by all. It would seem that the relinquishment of such a power is never to be assumed. We will not say that a State may not relinquish it; that a consideration sufficiently valua ble to induce a partial release of it may not exist; but, as the whole community is interested in retaining it undiminished, that community has a right to insist that its abandonment ought not to be presumed in a case in which the deliberate purpose of the State to abandon it does not appear.

The great object of an incorporation is to bestow the character and properties of individuality on a collected and changing body of men. Any privileges which may exempt it from the burthens common to individuals do not flow necessarily from the charter, but must be expressed in it, or they do not exist.

The power of legislation, and consequently of taxation, operates on all the persons and property belonging to the body politic. This is an original principle, which has its foundation in society itself. It is granted by all for the benefit of all. It resides in government as a part of itself, and need not be reserved where property of any description, or the right to use it in any manner, is granted to individuals or corporate bodies.

However absolute the right of an individual may be, it is still in the nature of that right that it must bear a portion of the public burthens, and that portion must be determined by the legislature. This vital power may be abused; but the Constitution of the United States was not intended to furnish the correction of every abuse of power which may be committed to the State governments. The intrinsic wisdom and justice of the representative body, and its relations with its constituents, furnish the only security, where there is no express contract, against unjust and excessive taxation, as well as against unwise legislation generally.

II. PLOWDEN WESTON AND OTHERS, Plaintiffs in Error, vs. THE CITY COUNCIL OF CHARLESTON, Defendants.

Reported in Peters' Reports, Vol. II., year 1829.

A tax imposed by a law of any State of the United States, or under the authority of such a law, on stock issued for loans made to the United States, is unconstitutional.

The power of this court to revise the judgments of State tribunals, depends upon the 25th section of the judiciary act. That section enacts, "that a final judgment or decree in any suit in the highest court of law or equity of a State, in which a decision in the suit could be bad," where is drawn in question the validity of a statute, or of an authority exercised under any State, on the ground of their being repugnant to the Constitution, treaties or laws of the United States, and the decision is in favor of their validity, "may be re-examined, and reversed or affirmed in the Supreme Court of the United States." 463.

The City Council of Charleston, exercising an authority under the State of South Carolina, enacted an ordinance, by which a tax was imposed upon the six and seven per cent. stock of the United States; and, in the Court of Common Pleas of Charleston District, an application was made for a prohibition to restrain them from levying the tax, on the ground that the ordinance violated the Constitution of the United States. The prohibition was granted, and the proceedings in the case were removed to the Constitutional Court, the highest court of law in the State; and in that court it was held, that the ordinance did not violate the Constitution of the United States, and a writ of error was prosecuted on this decision to this court. Held, that the question decided by the Constitional Court, was the very question on which the revising power of this court is to be exercised. 464.

A writ of error to this court may be prosecuted, where, by the judg ment of the highest court of the State of South Carolina, a prohibition, issued in a State court, to prevent the levying of a tax which was imposed by a law repugnant to the Constitution of the United States, was refused on the ground that the law was not so repugnant to the Constitu

tion. 464.

The term suit is certainly a very comprehensive one, and is understood to apply to any proceeding in a court of justice, in which an individual pursues that remedy in a court of justice which the law affords him. 464.

The words "final judgment," in the 25th section of the judiciary act, must be understood in the section under consideration as applying to all judgments and decrees which determine the particular cause; and it is not required that such judgments shall finally decide upon the rights which are litigated, that the same shall be within purview of the section.

464.

It is not the want of original power in an independent sovereign State to prohibit loans to a foreign government, which restrains the State legislature from direct opposition to those made by the United States. The restraint is imposed by our Constitution. The American people have