Plaintiffs Brief — Wells v. Savannah

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ArT RHE: SONA REA Eh SAT Dern. wnat, we Che's or Re iede mae Vee ata . = . , xe OE PLae ia ae |

IN THE

Supreme Court of the Mnited States.

OCTOBER TERY, 1900.

DAVID WELLS, THOMAS BALLANTYNE, CHARLES

M. GILBERT, JOHN HH. GILBERT. WILLIAM

KEHOR, HENRY BLUN, DANIEL G. PURSE.

ROBERT McINTIRE, MARY. E. DOUGLASS. axp

DENNIS O'CONNELL, Piatyrires 1s Error,

against

THE MAYOR AND ALDERMEN OF THE CITY OF

SAVANNAH axp ROBERT J

SHAL, DEFENDANTS IN: Enron.

. WADE, Crry Man-

STATEMENT OF THE CASE.

In May, 1790, the yearly expenses of the city government

of the city of Savannah were estimated to be 1.250 pounds

sterling, and the income of the city about 542 pounds sterling,

a deficiency of 708 pounds sterling. (See Record. p. 26.)

At this time there was a large body of land on the east.

south, and west of the city proper called the “ Town com-

mon,” the title to which was believed to be vested in the

lot-owners of the town. The town council, after consultin,,

with the lot-holders of the city, determined to lay off a cer-

tain portion of the East and West common into town lots

and to dispose of them, with a view of relieving the-inhal- |

itants from burdensome assessments and for the purpose of

defraying the necessary expenses of the current year, “ us

| well as establishing a fund for that purpose in future. (See

. —

| - ) Record, p. Direc fpeeteck ane Jr chan, orn ce eH At. 2

Te (tereler wt € Bighty lots were laid off from the East common and forty

| lots from the West common, 120 lots in all, with squares,

| streets, and lanes, and the terms and conditions of disposing

of these lots were, first, to value the lots at from 160) pounds

sterling to 40 pounds sterling and to fix a ground rent on

the same at the rate of tive pounds per cent. and the pur-

chaser could either pay down the valuation money or hold

the purchase on a ground rent payable quarterly. Secoud.

They were to be put up at public auction, beginning with

No. 1 in each ward, and be disposed of as long as there were

bidders. They were to be set up at the valuation fixed, and

whatever sum of money should be bid in addition to the

valuation money should be considered as increase money

and be paid down in cash, and the highest bidder of increase

money should be deemed the purchaser of the lot then of-

fered. Third. The purchaser had the option either to pay

the valuation money in cash and obtain a deed in fee-simple

(see Record, p. 28) or retain the valuation money in their

hands and the hands of their heirs and assigns forever on a

ground rent at the rate of 5 per cent., payable in four equal

quarterly payments into the city treasury (Record, p. 24).

The estate which the purchaser acquired in electing to

_——

retain the valuation money in his hands was declared to

amount to this:

* That the use and occupation of the premises should be

forever secured to the purchaser and those claiming under

him or her, on payment of the ground rent, but on failure

therein for fifteen days after the sanee shall become due, the

premises are to revert to the corporation who shall imme-

diately possess the power of re-entry to be exercised by its

proper officer in the manner prescribed, and on the exercise

of the right of re-entry the lots to be absolutely revested in-

the corporation free from any sale or incumbrancee thereon.”

(See Record, p. 2).

In further declaration of the nature of the estate in the

holders of the ground-rent lots the notice of sale published

by the commissioners appointed by the municipal corpora-

tion to superintend the sale of the lots contains the following

announcement :

“The terms specitied by the ordinance are as follows:

The lots will be set up at the valuation fixed by council

and whatever sum is bid above such valuation will be re-

quired in cash and the person being the highest bidder shall

be deemed the purchaser. Purchasers are at liberty to take

a lease to him or his or her heirs and assigns forever of the

lot so purchased at a ground rent of 5 per cent. on the valua-

tion, pavable quarterly to the city treasurer, or to extinguish

the leasehold title by paving at any time to the city treasurer

the original valuation money and all arrears of rent of the

lot and take a title in fee-simple to the premises” (Record,

pp. 30 and 31).

“On failure to pay groun | rent quarterly, the city to have

the right to re-enter on twenty days’ notice to the person in

possession, and in case of non-payment then the lot and im-

provements to revert to the city, Purchasers taking a lease-

hold estate will be required to give security for the rent”

(Record, p. 30). :

“ Other particulars will be declared on the day of the sale”

(Record, p. 31).

The form of the deed by which the city conveyed the

right to the use and occupation of the ground-rent lot to the

purchaser recited that the purchaser had made his election

for the present of retaining the valuation money in his own

hands and paying ground rent for the use and occupation of

the lot, which ground rent at and after the rate mentioned

in the ordinance will amount to § per vear. The city,

in consideration of the increase money and of the rent to be

paid and the covenants and agreements to be performed,

bargained and sold the said lot, with the rights, members,

and appurtenances thereof (Record, p. 19).

To have and to hold the said lot, with all and singular the

advantages thereunto belonging, to the purchaser, his execu-

tors, administrators, and assigns forever, upon the express

condition that the purchaser, his executors, administrators,

and assigns, do and shall yearly and every year during such

time as the valuation money shall remain unpaid by four

quarterly payments pay into the city treasury the sum of

as ground rent for the use and occupation of the lot,

and in case of failure to pay the rent for 20 days after any

of the quarterly payments shall become due the lot shall re-

vert to the city, who shall have the power of re-entry, to be

exercised as therein prescribed (Record, p. 20).

And the true intent and meaning of the conveyance and

of the parties is declared to be that on payment of the ground

rent as therein directed the grantee, his heirs, executors,

and administrators and assigns, shall from time to time and

at all times peaceably and quietly have, hold, use, occupy,

and possess and enjoy the said lot and premises, and receive

and take the rents, issues, and profits thereof and of every

part thereof to his and their own use absolutely without the

let, suit, eviction, or denial of the said corporation or of any

person Whatsoever acting under them or by virtue of their

authority, subject only to such assessments and burdens as

shall be common with other lot-holders in the city; and it

was agreed that at any future time it should be in the power

of the purchaser, his heirs, executors, administrators, or

assigns, to pay in the valuation money with what interest

may be due up to that time to the city treasury, and in that

case the payment should be acknowledged under the seal

of the city, signed by the mayor and a majority of the alder-

men for the time being, attested by the clerk and endorsed

on the conveyance, which should then and thenceforth vest

an absolute estate in fee-simple to the lot in the purchaser,

his heirs or assigns (Record, pp. 20 and 21).

It is admitted that all ordinances subsequently passed for

the sale of lots laid out from the common conform to the first

ordinance (Record, p. 51).

And that the conveyances and the purchases have always

conformed to the deeds originally given (Record, p. 33).

The conveyance is referred to as the “lease” of the lot

and the purchasers as the “ lessees” (Record, p. 35).

The lots are referred to as lots “held under lease” from

the corporation. (See Record, pp. 35, 42, 49, 50.)

Doubts having arisen as to the power of the municipal

corporation to dispose of the town common, the contract

made by the municipal corporation in making sale of these

lots was confirmed and validated by the legislature of the

State by an act of the General Assembly assented to Decem-

ber 21, 1823, to confirm certain conveyances of the town

common of Savannah made by the mayor and aldermen

(Record, p. 31).

The language of the validating act is as follows:

“The mayor and aldermen of the city of Savannah, hay-

ing been prohibited by an act passed on December 1, 1760,

from alienating or granting away for any purpose whatso-

ever than by an act of the General Assembly the common

appertaining to said town, and it being represented to the

legislature that the mayor and aldermen, to the great ad-

vantages of the lot-holders and with much profit to the

treasury of the city, had at different times granted and con-

veyed certain parts or lots of said common, and justice re-

quiring that the agreements made by the corporation with

the purchasers be confirmed :

“ Be it enacted, ete., That all and’ singular the conveyances

heretofore made of the town common, whether in fee-simple

or otherwise, shall be, and they are hereby, declared to be

legalized, confirmed, and made valid to all intents and pur-

poses, according to the covenants, limitations, and agree-

ments of the same.”

And again, in 1825, the legislature of the State conferred

upon the said mayorand aldermen power to sell and dispose

of any part of the property, domain, land, or lots to said cor-

poration belonging or appertaining by lease for years or fee-

simple as to the said mayor and aldermen or a majority of

them shall seem meet and proper.

Assented to December 24, 1825 (Record, p. 31).

In the statement made by the municipal authorities and

spread upon its minutes these “ city lots” are set out and

inventoried as real estate belonging to the city of Savannah

(Record, pp. 40 and 41).

And the official reports of the mayor, made annually,

shows that the municipal corporation claimed to be the

owner of these ground-rent lots as part of the “ eity domain”

(Record, p. 42).

Under the contract of the city and the holder of these city

lots or “leased lots” all that the city required from the

holder was the payment of the ground rent to entitle him

to the peaceable and quiet use, occupation, enjoyment, and

possession of the lot (Record, p. 20).

No tax or assessment was levied by the municipal authori-

ties on these lots, nor was any such payment provided for.

No re-entry was provided for except on failure to pay the

rent; but the lessee was to bear any assessment or burden

that might be assessed against a lot-owner (Record, p. 51).

As long as the title remained in the city the tenant could

claim that all assessments and burdens that might be made

upon the lot should be a&sumed and be borne by the owner ;

hence, in order that all taxes that might be assessed by the

State and all assessments for improvements should be paid

by the lessee instead of the lessor, the stipulation was incor-

porated in the conveyance that the lessee should hold the

same subject “ only to such assessments and burdens as shall

be common with other lot-holders.”

The city ceased to dispose of its domain upon the ground-

rent plan in the year A. D. 1872. Down to this time no

attempt had ever been made to tax these lots. After the

city had ceased to sell lots under the old ground-rent plan

the taxation of these leased lots by the city began to be

agitated (Record, pp. 51 and 52).

It is admitted in the record (p. 51) that no taxes were

ever assessed by the city on the “ground-rent lots” or

“leased lots” until under the ordinance that was passed

May 29, 1878, and not under that ordinance until the year

1890 (Record, p. 51).

And that no taxes were assessed or levied by the city upon

these “leased lots” from the year 1791 to the year 1890, the

ordinance of May 29, 1878, being put in force in 1890 (Record,

p. 51).

The first taxation by the mayor and aldermen of the city

of Savannah on real estate was levied under authority of an

act of the kvislature assented to December 2, 1805 (Record.

p. 48).

The first ordinance was adopted April 7, 1806, and levied

a tax as follows:

“Qn all houses, buildings, lots and wards within the city

as well unimproved as improved, and including all lots held

by lease from the corporation, twenty-five cents on every one

hundred dollars” (Record, p. 49). »

At the council meeting, May 19, 1806, the tax ordinance

was recommitted to a select committee, and the discussion of

the ordinance continued until November 24, 1806, when it

was finally passed by an amending ordinance :

“ Be it ordained, etc., That so much of the first section of

the aforesaid ordinance as imposes a tax on lots held by lease

from the corporation be and the same is hereby repealed ”

(Record, p. 50).

And from that time every tax ordinance to raise reyenue

for the city up to and including the ordinance of January

22, 1857, “ excepted lots held by lease from the corporation ”

(Reeord, p. 50).

The tax ordinance of 1857 defined “ real property ” to in-

clude land itself and all buildings and other fixtures erected

upon land, whether the land upon which such buildings and

other fixtures may be erected be or be not itself subject to

taxation. Section 4 of the same ordinance specifically ex-

empted “each lot of land held at the time of the passage of

this ordinance upon the payment of ground rent to the mayor

and aldermen of the ‘class commonly called city lots’”

(Record, p. 50).

In one form or another every tax ordinance admitted the

exemption of leased lots or city lots from city taxation So

also in the annual reports made by the municipal aut ori-

ties in compiling the sources of revenue it is from time to

time announced “that ‘city lots’ or lots under lease net

being liable to city taxes are not included in the above com-

parison.” And in the volume of city ordinances published

in the year 1858 by the corporation, on page 538, is the fol-

lowing statement: “City lots or lots under lease not being

liable to city taxation are not included in the above com-

parison ” (Record, p. 50).

It further appears from the testimony of the oldest in-

habitants in life at the time of the trial of the cause that at

all sales of city lots the announcement was publicly made

by the city marshal, the city official conducting the sale,

which was also superintended by a committee of aldermen

representing the council, that ground-rent lots were not sub-

ject to city taxes. The announcement was always made that

lots thus sold would be free from taxation by the city.

These terms were publicly and openly stated by the marshal

and entered into the contract of sale. There is no evidence

to contradict this element of the contract, and the announce-

ment is in conformity with the written notice already cited,

in which the commissioners for the sale of these lots an-

nounce that other particulars will be declared at the sale

(Record, pp. 58, 60, 61, 63).

Among other facts in the record of recognition by the

municipal authorities that the ground-rent lots were a part

of the city domain, producing a revenue to the city from

rents alone, and not subject to taxation by the city, are the

official statements made in the annual reports of the

mayor for the years 1858, 1860, 1861, 1862, and 1863 (p. 50).

In the annual report of the mayor for the year A. D. 1571

occurs the following statement :

“Tt is not known to the foreign public that a very large

part of the real estate in the city consists of lots sold on con-

dition of the payment of ground rents and ere therefore not

the subject of taxation ” (Record, p. 51). .

In the estimates of resources in the report of the finance

committee made in the year 1841, when there was great need

of funds, after most careful investigation, no suggestion is

made to tax ground-rent lots (Record, pp. 52, 53, and 54;

also p. 58).

In the report of Wm. Hunter, chairman of the finance

committee, in 1872, which was adopted in council, it is ad-

mitted. that—

“The reason why city lots are not taxed is that the city is

understood to have bound itself not to tax them. It is of no

moment that the stipulation does not appear in the deeds,

the ordinances contain the real terms of the contract and

control the deeds wherever the latter depart from or conflict

with them. And as the city has never taxed such lots it is

difficult to resist the conclusion that, such was the design

when the ordinance of 1790 was framed ” (Record, p. 56).

In the face of all these facts, it would seem that the mu-

nicipal corporation is estopped from denying the relation of

landlord and tenant and the existence of the contract not to

levy or assess any tax on these lots.

The deposition of George W. Wylly, a resident of the

city for fifty-five years, shows that he was chairman of

the committee on public sales and city lots most of the

time; that he served as alderman; that as such chair-

man he was present at the sales of these lots. The

announcements of the terms of sales were made by the

city marshal, who conducted the sales by the direction of the

committee. He would usually read the advertisement and

then the particular lot offered, stating the valuation placed

on it by the city; then the option that the purchaser had,

to buy either the fee-simple or on the ground-rent plan. If

the fee, thé entire purchase-money would be payable on

execution of title. If on the ground-rent plan, 20 per cent.

of the bid would be paid in cash and an annual ground rent

of 6 or 7 per cent., according to the ordinance, on the bal-

ance of purchase-money, payable quarterly, and would also

announce that so long as the lots were held under ground-

rent plan they would be free from city taxes. These an-

nouncements were made under the authority of the com-

mittee; and often when the bidding would lag the marshal

would remind the bystanders that there was only 20 per

cent. cash payment required, and that there was no city

taxes, but only the annual ground rent (Record, pp. 57, 58).

This witness further testified :

“There never was a question during the period of my en-

tire service as alderman as to the meaning of the deed under

which the ground-rent lots were conveyed by the ¢ity. The

city had the power to re-enter for non-payment of rent and

the holder the right to hold under a perpetual lease as long

as he paid the ground rent when due. The city had no

power to tax the ground-rent lots” (Record, p. 58).

The statement that the city marshal made the announce-

ment at the sale of these lots that they would be free from

city taxes is testified to by several citizens and is not denied

by any witness (Record, pp. 60, 61, and 62).

The exemptions of the ground-rent lots from city taxation

enabled the corporation to obtain better prices and conse-

quently larger rents, and the benefit to the city in obtaining

this perpetual income, which was larger than the revenue

from taxation, which is shown in the tables on pages 44 and

45, the report of the city marshal on pages 47 and 48, and

the testimony of the witnesses (Record, pp. 98, 59, GO, 61, 62,

and 63).

In the year 1850 the municipal corporation of Savannah

purchased a large body of land contiguous to the city known

as Springfield plantation and divided the same into lots

and proceeded to dispose of the same in the same manner as

it disposed of the town common, except that the term of time

for which the purchaser could retain the balance of purchase-

money was limited to 24 years. The purchaser had the

same option as to paying up the valuation money and ob-

taining a fee-simple title and the same covenant of quiet en-

enjoyment. There was the same forfeiture of possession and

use on default of payment of the ground rent and the same

right of re-entry, to be exercised in the same manner by the

municipal corporation; and the fee was conveyed by the

same endorsement of payment by the mayor and aldermen,

under the seal of the city, attested by the clerk, on the con-

vevance.

The deed conveying the Springfield lots is identical in

form with the deeds conveying the town-common lots where

the purchaser elected to retain the valuation money, except

that the estate continues in the Springfield lots for 24 vears,

while the estate continues in the town lots so long as the

purchaser or his assigns continues to pay the ground rent

therein reserved to be paid.

Both conveyances are referred to in the ordinances as

* leases,” and, while the Springfield lots have been incorpo-

rated in the city corporate limits since February, 1854, the

city has never attempted to collect from the lessees any other

redendum than the rent reserved, nor has any tax been

levied on the lots as the property of the lessees (Record, pp.

32, 35, and 19, 20, 21, and 22).

The report of the committee of the city council of Savan-

nah on finance reported on page 52 of the Record, marginal

pages 71, 72, was presented to the court and jury to show the

depleted condition of the city treasury, the heavy liabilities

due by the city, and the sources of income, and in the great

strait in which the finances of the city then were in the

search for new sources of taxation the ground-rent lots were

not deemed subject to taxation and no attempt made to vio-

late the obligation of the contract then universally admitted

not to tax this species of property.

The lots were the property of the city, from which was

derived a fixed rent, both under the covenant of quiet en-

joyment and the terms of the sale as announced by the city

marshal and the positive admissions in the ordinances spe-

cifically exempting from city taxation these lots.

The owners thereof refused to submit to an ordinance sub-

jecting them to city taxes adopted by the city after the sale

of lots under the ground-rent plan had been permanently

discontinued and the rights of the holders had been estab-

lished for over seventy years.

When this ordinance to tax the city lots was sought to be

enforced by the mayor and aldermen of the city in the year

18%) the plaintiffs in error brought their bill in equity to

enjoin the levy of such tax, alleging the facts showing the

contract and agreement not to tax and claiming the protee-

tion of the great constitutional inhibition against the viola-

tion of the contract. Discovery was expressly waived of the

detendant, so that all defensive or responsive allegations

were only pleadings and not evidence under the laws of

Georgia. The defendant in its answer admitted that the

petitioners or plaintiffs in error were the holders of lots in

the city of Savannah commonly known as ground-rent lots

or city lots, and that the ordinances and deeds were of the

character described in the bill in equity and exhibited a

copy of the form of the deeds, both for the citv leased lots

and the Springfield leased lots. At the trial of the cause

the plaintiffs submitted the evidence admitted and exhibited

in the answer and the facts and documents reported in the

record. The defendant offered no evidence and moved for

a nonsuit. The plaintiffs submitted the legal principles

that are reiterated in the specifications of error set forth in

this brief. After argument had, the court granted the mo-

tion for a nonsuit and dismissed the petition.

Thereupon the plaintiffs in error brought this case by

writ of error to the supreme court of the State of Georgia

at the October term, 1898S, of said court. f

On March 17, 1899, the supreme court of Georgia ren-

dered its decision, affirming the judgment of the court

below.

To this judgment of the supreme court of Georgia a writ

of error was sued out from this honorable court to the

supreme court of Georgia on the Sth day of February, . DD.

1900.

SPECIFICATION OF ERRORS.

We assert that the supreme court of Georgia erred—

First. In deciding that by the contract disposing of the

common to the lot-holders under the ordinance of Septem-

ber 28, 1790, the mayor and aldermen parted with all title

to those lots bid in by those who elected to retain the pur-

chase-money and pay ground rent.

Second. In deciding that under the contracts made with

those who elected to pay ground rent the mayor and alder-

men could lawfully tax said land as the property of the

lessees.

Third. In deciding that the reservation of rents and the

covenant of quiet enjoyment in the ordinances and contracts,

the notices of sale, reports of the city officials, receipts of rents,

assertion of title and ownership and conveyances set out in

the record did not estop the mayor and aldermen to deny

that the interest held by the lot-holders was a mere lease-

hold.

Fourth. In deciding that those who took lots under the

ordinance of September 28, 1790, upon the ground-rent plan

got anything more than the right to the use and occupation

of the premises so long as the rent was paid and for 15 days

after failure to pay an installment of rent when due.

Fifth. In deciding that the mayor and aldermen, after

having covenanted that the lot-holders under the ground-

rent plan should have quiet enjoyment of the premises, with

all the advantages thereof, without let, suit, eviction, or denial,

so long as the stipulated rent was paid, could nevertheless

impose an additional annual burden, under the guise of a

tax, as a condition to the quiet enjoyment of the premises.

Sixth. In deciding that the relation between the mayor

and aldermen, of the one part, and the holders of ground-rent

lots, of the other part, was not that of landlord and tenant.

Seventh. In affirming the judgment of nonsuit, thereby

denying to the plaintiff the right of trial by jury of the issues

of fact.

Eighth. The judgment of the supreme court of Georgia

affirming the judgment of the superior court of Chatham

county, Georgia, is violative of that provision of the Constitu-

tion of the United States which prohibits any action by a

State or its authority which impairs the obligation of a con-

tract.

Ninth. In deciding that the ordinances, conveyances,

notices, and reports did not constitute a contract between the

mayor and aldermen and the holders of the ground-rent lots

exempting said lots from taxation.

ke (3

ARGUMENT.

The determination of the question whether the ground-

rent lots in the city of Savannah are subject, to taxation by

the city, in addition to the ground rent payable on the same

to the city, depends upon the contract under which the city

originally disposed of the lots and the holders obtained pos-

session, acted upon by the city and Jot-holder for nearly one

hundred years.

The ordinance and the contract are to be construed and

interpreted not according to the present powers of the city

as restricted by the constitution of 1877, but according to

the practical interpretation of the parties themselves, both at

the time of the passage of the ordinance and of the execu-

tion of the contract, and continuously since that time, and

the law as it existed at the time the contract was made.

If the ordinance and contract has received a settled construe-

tion that has been acted on by both parties for a long period

of time, and rights had been acquired under such settled con-

struction, it is not competent for the present city council to

change this construction and assert rights and powers in di-

rect antagonism to such settled interpretations, impairing the

obligation of the contract and imposing additional burdens

and charges on the holders of the ground-rent lots not con-

templated nor collectible under the settled interpretation

of the contract and ordinance.

What was the settled construction and interpretation of

the ordinance of September 28, 1790, and of the contract

made thereunder in 1791 and subsequently ?

The principle of contemporaneous and practical construe-

tion is expressed in some of the oldest maxims of the law.

“ Contemporanea expositio est fortissima in lege.” “Optima

est legis interpres consuetudo.” “A communi observantia non est

recedendum.” ¢

Long and continued usage furnish contemporaneous con-

struction, which must prevail over the mere technical import

of the words.

Rogers vs. Goodwin, 2 Mass., 475.

Rumsey vs. People, 19 N. Y., 41-50, 6th head-note.

Cronise vs. Cronise, 54 Pa. St., 255.

People vs. Maynard, 15 Mich., 463.

Seanlon vs. Childs, 33 Mo., 663.

Johnson rs. Joliet & Chicago R. R., 23 TL, 202.

Weems, trustee, vs. Coker, 70 Ga., 749.

Harvard College vs. Boston, 104 Mass., 477-488.

Hardy vs. Waltham, 7 Pick., 110.

Edwards’ Lessee vs. Darby, 12 Wheat., 206, 210.

U.S. vs. Moore, 95 U.S., 763.

U_S. vs. Johnston, 124 U.S., 253.

Solomon vs. Cartersville, 41 Ga., 157.

General and long-continued usage is not without its im-

portance, and may be resorted to in aid of a proper con-

struction of a statute or charter. ‘4

1 Dillon Municipal Corporations, sec. 93 and note.

The holders of ground-rent lots declined to pay the tax on

the lots, denied the right of the city to tax the lots, resting

their claim of exemption upon the following general

grounds :

First. The fee to the lots is in the city, and the holders in

their relation to the city were tenants under a perpetual as-

signable lease, on which only rent is due and payable, and

the city could not tax its own property and could not in-

crease the rent reserved by adding an additional per cent.

under the name of taxes.

Second. That under the contract and conveyance from

the city to the holder and his assigns the city covenanted

that the holder should peaceably and quietly have, hold,

use, occupy, and enjoy the lot and premises and receive

and take the rents and_ profits thereof to his use absolutely,

without let, suit, trouble, eviction, or denial of the corporation or

any person whatsoever acting under it or by virtue of its

authority, on the payment of the said ground rent (reserved in

the conveyance) at the times and after the manner directed,

and there was no reservation of any other charge, rent, or

tax to the said city other than the ground rent in the agree-

ment reserved (Record, pp. 20 and 29).

Third. That the assessments and burdens to which the

holder was subject were only such as were common to other

lot-holders in the city, and referred to such assessments and

burdens that would have been chargeable to the city as the

owner, and which were thus assumed by the holder as tenant

(Record, p. 20).

Fourth. That the municipality from the time of the date

of the first contracts of renting continuously until the passage

of the ordinance of May 26, 1878, construed the contract as

exempting the city lots from taxation so long as they con-

tinued subject to ground rent, and such construction of the

contract was acted on by the city and the lot-holders and

their assigns (Record, pp. 50, 51, and 56).

Fifth. That the city, in accordance with the universal in-

terpretation of the original ordinance and deed, caused public

notice to be given when these lots were exposed at public

sale by the city marshal that the same would not be subject

to city taxes so long as the lots were held under ground rent,

and the same were purchased on the leasehold plan with

such notice, and the present holders purchased the same

with knowledge of and influenced by said notice, and that

the city is bound by the said contract and cannot by any

subsequent ordinance interfere with the obligation of the

contract (Record, pp. 57 and 60).

Sixth. That the city having, in the most solemn and public

manner, declared that the city lots were not subject to taxa-

tion by the city, and the recent lot-holders and their vendors

having purchased the same and paid valuable consideration

therefor on account of and influenced by such notice, the

said city is estopped from denying that the said contract

with the purchasers of the leasehold interest does exempt

said lots from city taxes and only reserved a certain rent to

be paid, and is estopped from levying any city taxes on said

lots so long as they are held under ground rent.

THE CITY RETAINED THE FEE IN THE LOTS.

The minutes of council show that the lots were called in-

diseriminately “city lots,” “leased lots,” or “lots held under

lease.” ;

The ordinances, the deed, the public notice of sale, and

the announcement made at the sale together constitute a

contract between the city and the purchaser.

The ordinance provided that a certain portion of the east

and west common should be laid off into 120 lots; that the

lots should be valued from one hundred and sixty to forty

pounds sterling and sold and disposed of, the ground rent

of the same to be after the rate of five pounds per annum

on every one hundred pounds of value, the purchaser to

pay down the purchase-money or else to hold his purchase

on ground rent payable quarterly. (See Record, pp. 28, 29,

and 30.)

From the above and from the declaration of the city that

the disposing of the commen was for the purpose of defray-

ing the necessary expenses of the current year, “as well as

establishing a fund for the purpose in the future,” it clearly

appears that the city contemplated disposing of these lots

ata fixed ground rent because it fixed the amount of the

ground rent in advance.

Secondly. Because it reserved no right to compel a sale of

the entire interest in the lot. This was to be in the option

of the purchaser alone.

Thirdly. Because it desired to establish a fund for the

future to meet current expenses.

The conveyance which was executed by the city to the

purchaser at such sale does not conflict with the ordinance ;

the ordinance declared that the estate of the purchaser who

did aot exercise the option to pay the purchase-money and

take a absolute estate in fee-simple should amount to this:

“That the use and occupation of the premises should be for-

ever secured to the purchaser and those claiming under him

or her on payment of the ground rent,” and on failure to pay

the ground rent for fifteen days after it became due the

premises to revert to the corporation and it to have the

power of re-entry (Record, p. 29).

The deed exhibited to the answer, which is the form orig-

inally adopted and which has always been used in consid-

eration of the payment of the increase money and of the

rent to be paid and the covenant and agreement to be per-

formed, conveys the lot, “to have and to hold, with all and

singular the advantages thereof,” not the remainders and

reversions, to the purchaser, “ his executors, administrators,

and assigns,” not to his heirs, and the conveyance was before

the act of 1821, “on the expressed condition that the holder,

his executors, administrators, or assigns shall yearly * * *

pay the sum of dollars as ground rent for the use and

occupation of said lot” (Record, pp. 19 and 20).

It is further “ declared to be the true intent and meaning”

of the instrument and of the parties to the same that on the

payment of the ground rent at the times, ete., in the instru-

ment directed, the purchaser, his heirs, executors, adminis-

trators, and assigns, shall from time to time,” ete., peaceably

and quietly have, hold, use, occupy, possess, and enjoy the

lot and premises and receive and take the rents, issues, and

profits, ete., to his and their own use absolutely without let,

suit, trouble, eviction, or denial of the corporation or of any

person whatsoever acting under them.”

These are all terms familiar to the conveyancer and to be

found in every well-drawn, lease ; and the terms in said con-

veyance above quoted are identical with the terms used in

7 ad

the conveyance by the city to the purchaser of lots belong-

ing to the city, known as “Springfield Plantation lots,” a

copy of which instrument is also exhibited to the defend-

ant’s answer (Record, p. 21).

We ask a comparison of these deeds, as by this means the

intent of the corporation is made the more conspicuously

clear. The “Springfield Plantation lots” were sold at public

outery to the highest bidder under an ordinance passed Jan-

uary 16,1851. This ordinance was passed at a time when

ground-rent lots were not considered subject to taxation by

the city and while the city claimed to be the owner. This

ordinance, like that of September 28, 1790, provided for lay-

ing off into lots a part of the city domain and disposing of

the same. The lots were first valued, then put up for sale

to the highest bidder, who is by the ordinance declared to

be “ the purchaser of the lot.” He is required to pay 20 per

cent. of the aggregate of the increase money bid at the sale

and the value fixed on the lot, and had the option to retain

80 per cent. of the purchase-money and to take a deed for a

24-vear lease or estate, paying 7 per cent. on the amount of

residue, in quarterly payments, by way of ground rent, with

a further option to pay in the residue and obtain a fee-simple

title at the expiration of 24 years (Record, p. 32).

The deed made to the “Springfield Plantation lots” is an

“indenture.” The recitals in the first and second preambles

are identical with those in the ground-rent deed, except the

words “Springfield plantation ” are substituted for the word

“common ” (Record, pp. 21, 22).

The third preamble differs, first, in limiting the time in

which the ground rent is to be paid to the period of twenty-

four years ; second, in referring to the ground rent as interest

24°

per annum “ by way of rent ;” and, third, in stating the option

to pay up the residue of the purchase-money in twenty-four

years and thereupon receiving a deed in fee-simple.

The words of conveyance are, “ Demise set (let) and to

farm-let,” instead of “ bargain and sell,” but the conveyance

is to the purchaser, his heirs, executors, administrators, and

assigns. The habendum is to the purchaser, his executors

and administrators, on condition that he pay yearly and every

year the interest on the residue by way of ground rent, and in

case of failure to pay the ground rent for twenty days or to

pay the purchase-money at the end of twenty-four vears the

lot and premises revert to the corporation, and the right of

re-entry and manner of re-entry are identical with the pro-

visions of the ground-rent deed of conveyance; and all other

covenants and conditions are the same, with only the inser-

tion of “twenty-four years” instead of “ at all times here-

after.” It is “declared to be the true intent and meaning

of the conveyance ” that on the payment of the interest by

way of ground rent at the time and after the manner therein

directed “the purchaser, his heirs, executors, administrators,

or assigns, shall and may from time to time and at all

times during the continuance of this lease peac ‘eably and

quietly have, hold, use, occupy, possess, and enjoy the lot

and premises and receive and take the rents, issues, and

profits thereof to his and their own use without the let, suit,

trouble, eviction, or denial of the said corporation or of any

person whatsoever acting under them or by virtue of their

authority.” This is the precise covenant for quiet enjoy-

ment that is found in the conveyance of the ground-rent

lot.

Without going further into detail, the comparison shows

that the same general plan and intent actuated the corpora-

tion in disposing of the town common and the “ Springfield

Plantation,” viz., to divide the property into lots, to put a

fixed value on them, to put them up at public outery to the

highest bidder, who shall pay in the increase money and a

fixed ground rent equal to a given per cent. on the valuation

money, the purchaser to have the use and occupation, with-

out let, suit, or eviction from the city, so long as the annual

ground rent shall be paid, in the one case perpetually and

in the other for twenty-four years, with the option in each

case to secure a fee-simple absolute title by paying the valu-

ation money in the one case at any time, and in the other

within twenty-four vears. The use and occupation and the

rights and privileges of the purchaser are the same in each

conveyance—they are those of a tenant having an assignable

lease. ‘The fee is retained by the city and is not conveyed

until the purehase-money is paid; the tenant in the one

case hasa perpetual lease and in the other a term of twenty-

four years. We shall see presently that a lease may be in

perpetuo ; that a perpetual lease is not invalid, but is recog-

nized as a legal estate in Georgia.

In the notice of sale of lots, published by the commission-

ers appointed to sell the same, in the Georgia Gazette of June

13, 1799, it is stated that terms specified by the ordinance

are as follows:

“The lots will be set up at the valuation fixed by council,

and whatever sum is bid above said valuation will be required

in cash, and the person being the highest bidder shall be

deemed the purchaser; purchasers are at liberty to take a

lease to him or her or his or her heirs and assigns forever of

the lots so purchased at the grownd rent of five per cent. on

the valuation, payable quarterly to the city treasurer, or to

extinguish the leasehold title by paying at any time to the

city treasurer the original valuation money and all arrears

of rent for the lot and take a title in fee-simple to the prem-

ises. * * * Purchasers taking a leasehold estate will be

required to give security in four times the annual ground

rent for the due payment of the ground rent quarterly”

(Record, p. 50).

Also the ordinance of February 27, 1851, authorizing any

person holding a lot in the city of Savannah as tenant in

common with another under ordinary city deed may pay

one-half the balance of purchase-money due on the same

and receive a deed in fee for one-half of the lot. “Any /essee

of a city lot may on application to council divide said lot

into two parts and receive separate leases for the same, and

the party shall severally pay for the deeds issued ” (Record,

p. 34).

In the ordinance adding twenty feet to lots on Gaston

street and in the form of the deed for the additional twenty

feet it is provided that “the additional sum of $— as ground

rent for the use and occupation of the same at the same time

and on the same terms as in the original lease of the original

lot” (Record, p. 35).

In the form of the deed for subdivision of city lots under

the ordinance of February 27, 1851, set out on page 35 of the

Record in this case, the property is conveyed to the grantee,

“to have and to hold the same unto the said grantee forever

upon the terms, covenants, and conditions mentioned and

expressed in the original lease of said lot unto the former

grantee and of record in the clerk of council’s office; which

said lease unto the original grantee is to be taken, held, and

eat

considered as part and parcel of this lease and applying in

the same manner as therein contained,” ete.

The records of the city of Savannah contain at different

times “reports of real property belonging to the city,” and

in the statement of the resources of the city of Savannah in

the mayor's report, under the head of “the city domain,”

these city lots are set down as the property of the city as so

many lots in a number of wards under lease. (See Record,

pp- 40, 41, 42).

The form of the original transfers of these lots entered on

the “ registry of city lots in the treasurer's office” shows that

they were transferred and assigned as leasehold property

rather than as estates in fee (Record, p. 37).

No estate in fee, either conditional or otherwise, passed to

the purchaser who paid rent, for the ordinance providing

for the disposal of the lots laid out from the town common

gave to the purchaser the option to pay down the valuation

money or to hold his purchase under ground rent, and the

deed states expressly “that the purchaser has made his

election for the present of retaining the valuation money in

his own hands and paying a ground rent for the use and oe-

eupation.” So that it distinctly appears that the purchaser

elected not to take a title in fee to the land, but to obtain

the use and occupation on payment of a ground rent (Ree-

ord, p. 19).

The conveyance does not create a fee conditional, because

made at a time when the word “ heirs” was necessary to

a deed to convey a fee. The habendum is to the purchaser,

his executors, administrators and assigns, upon the express

condition that he and they do and shall, vearly and during

such time as the valuation money shall remain unpaid, pay

into the city treasury 8— dollars as ground rent, for the use

and occupation of the lot. * * = * “And it is further “ de-

clared to be the true intent and meaning of the conveyance

and of all the parties to the same that on ‘ payment of said

ground rent at the times and after the manner therein before’

directed, the purchaser, his heirs, executors, administrators

and assigns shall and may from time to time and at all

times hereafter peaceably and quietly have, hold, use, ocenpy,

possess and enjoy the said lot and premises and take the rents,

ete., to his own use absolutely without let, suit, trouble, evic-

tion or denial of the corporation or of any one acting by

virtue of its authority ” (Record, p. 20).

A lease does not require any set form of expression. No

particular form of words is necessary to constitute a lease.

Taylor’s Landlord and Tenant, sec. 159.

Boone on Real Property, sec. 90 (8).

Any expression which shows an intention on the part of

the lessor to divest himself of the possession in favor of the

lessee and a corresponding intention of the lessee to come

into the possession of the premises for a determinate period is

sufficient.

Taylor’s Landlord and Tenant, see. 159.

Martindale on Conveyancing, sec. 326, p. 273.

A contract by which one is to pay an annual rent of 6

per cent. on the cost of a building with the right of becom-

ing owner on paying the price is a lease. Its accidental

provisions do not change its character.

Munic. No. 1 vs. New Orleans, La. Ann., vol. 5, p. 761.

Guilbert vs. Post, 28 Ohio, p. 276.

The use and possession of the lot passes from the lessor to

the lessee for a determinate period, “during such time as

the valuation money shall remain unpaid.” Jd certum est,

quod certun reddi potest. The determinate period is “ during

the time the valuation money remains unpaid (Record,

p. 20).

The instrument provides that when the valuation money

shall be paid the lessee’s estate shall be enlarged to a fee

(Record, p. 20).

The fee, by the express terms of the conveyance, remains

in the corporation until the valuation money shall be paid.

As has already been pointed out, the estate and conditions

and covenants in the two instruments exhibited to the

answer, the conveyance of the ground-rent lots and of the

Springticld Plantation lots, are identical, save that one con-

tinues in force during such time as the valuation money re-

mains unpaid and the other for 24 years.

The latter is admitted to be a lease; the former must also

be so. That the time may continue in perpetuo does not de-

feat the intention to create a lease nor enlarge the estate to

a fee, especially when the fee by the express terms of the

conveyance, by the election of the purchaser, remains in the

lessor or vendor and remains in it as long as the valuation

money remains unpaid,

A lease may be made to continue so long as the lessee

shall pay rent and perform its covenants.

Gould vs. Bugbee, 6 Gray, 371.

Worcester vs. Great Falls Mfg. Co., 41 N. H., 18-22.

Taylor's Landlord and Tenant, see. 72.

Boone on Real Property, see. 97.

Sadlier vs, Biggs, 27 Eng. L. and Eq., p. 74.

The conveyance expressly reserves the fee in the city until

the valuation money shall be paid. It expressly conveys to

the holder only the “use and occupation.” As has already

been shown, the estate conveyed and the covenants and con-

ditions contained in the conveyance comport only with a

perpetual lease and not an estate in fee (Record, p. 19).

In Folks vs. Huntley, 7 Wend., 210, the conveyance is the

use of water in a creek with so much of the bank as may be

necessary, ete., for such term of time and upon the express

condition—that is, he, the said Huntley, his heirs, executors,

and administrators, shall pay or cause to be paid to the

grantor and his heirs and assigns annually and every year

the sum of $

strument was declared to be a lease and the term a perpetual

and perform certain covenants. This in-

one.

The instrument made by the corporation to the purchaser

conveys the lot to the party and his executors, administra-

tors, and assigns on this express condition, that the said (party),

his executors, administrators, and assigns, do and shall yearly

and every year during the time, etc., pay or cause to be paid

into the city treasury, ete., the sum of $—— as ground rent

for the use and occupation of the said lot.

Are not these cases on “all fours” with each other? And

if the estate in the Folks-Huntley case was a perpetual

lease, is not the ground rent a similar estate? No greater

interest is conveyed in the one than in the other. ‘The estate

ceases on breach of the condition and continues as long as

the ground rent is paid.

The supreme court of Georgia, in the case of Atkinson vs.

Orr, in 83 Ga., p. 34, have approved the decision of Folks vs.

Huntley, and declares that a writing by which the grantor

stipulates with the grantee that he and his heirs and assigns

shall retain possession as long as the rents are paid is a per-

petual lease.

It seems, therefore, to be undoubtedly true that parties

may contract so as to create a perpetual lease dependent on

the prompt payment of an annual rent. There is nothing

illegal or inconsistent in such estate; and this is the contract

that the city of Savannah made with the purchasers of lots

from the city.

The construction of the deed according to its express

terms corresponds with the actual interpretation by the cor-

poration, and the deed is a perpetual lease and not a fee

conditional.

We have been unable to find any case in which a lease

creating a tenancy and reserving an adequate annual rent

with right of re-entry on the non-payment of rent or non-

performance of other conditions has been adjudged void on

account of being perpetual in its duration.

White vs. Fuller, 38 Vt., 206.

The town of Carondelet ordered a sale of its common, the

purchaser to pay 2 per cent. on the amount bid as annual

rent for ninety-nine years and 4 per cent. forever afterwards,

with clause of forfeiture and re-entry for non-payment both

in the ordinance and conveyance. The court held the con-

veyance to bea lease, and that the forfeiture for non-payment

of rent was complete, Leonard, J., dissenting as to the ef-

fects of the forfeiture and coinciding with the supreme court

of Georgia in Laurence vs. Mayor, etc., as to the equity of

the lessee. .

Taylor vs. Carondelet, 22 Mo., 105, 106, 112.

The city had full authority to let, lease, or rent any lot or

lots of land. There is no restriction on this power, and the

corporation has determined that a perpetual lease at an an-

nual ground rent of a certain per cent. on a valuation which

itself fixed on the property would be advantageous to the

corporation, and there being no legal restriction on the

power, the contract becomes binding oii it. If there had

been any want of authority, the contract made by the cor-

poration was legally confirmed and made valid to all in-

tents and purposes, according to the covenants, limita-

tions, and agreements of the same, whether the conveyances

were in fee-simple or otherwise.

Act of December 21, 1822, Dawson’s Compilations, p.

443. See Record, p. 31.

» But it is unnecessary to cite any confirmation of the con-

veyance. The corporation continues to collect the ground

rent and to claim the enforcement of all the covenants and

conditions in the instrument, and its force and legality is

not questioned or denied.

The only payment required to be made to the city and the

only condition for the perpetual use and enjoyment of the

property as against any interference by the city is the pay-

ment of the ground rent. (See the contract.)

In the case of Laurence vs. The Mayor, ete., Savannah, the

relations of the city and the lot-holder are thus stated by

the court:

“In this case the city, by the resale of the lot, gets not

only fhe amount then due, but also secures its future rents ;

it gets all that it ever contracted for, and by returning to the

original lessee what is over and above the amount due at the

mol

ono

time of the resale, he gets nothing more than he was entitled

to under the contracts.”

Laurence ef al. vs. Mayor, ete., Savannah, 71 Ga., p. 399.

The conveyance is construed as a lease and not as a con-

ditional fee; for the court further says:

“The right to redeem and continue the lease, even after

forfeiture and re-entry, exists whenever the lessee will pay

what is due, and if the lessor refuse to receive it when ten-

dered, the amount will be ordered paid into court and he

will be enjoined from ousting the tenant.”

See also the further remarks of the court.

Laurence et al. vs. Mavor, ete., Savannah, 71 Ga., 398,

399.

The consideration of the contract was not the amount of

money fixed by the city as the price of the lot, but the in-

crease money bid at the sale and the ground rent reserved,

which was fixed before the sale. The covenant of the pur-

chaser was not to pay the purchase-money due at any time

whatsoever, but only to pay an annual ground rent quarterly.

The covenant of the city was not a warranty of title, but

a covenant for quiet enjoyment in the precise terms used

between landlord and tenant, with the usual right of re-entry

and power to terminate the estate in case of default in the

payment of the ground rent.

As further confirmatien that the conveyance was intended

to be a lease, the ordinance of April 7, 1806, subjecting ground-

rent lots to taxation, afterwards amended, described them as

“lots held under /ease from the corporation.” These lots are

+ described as “ held under lease” in the ordinances of Decem-

ber 14, 1807; January 7, 1809; March 11, 1825; August 27,

1839; January 4, 1811; January 3, 1812; July 3, 1828,

November 11, 1842. In the resolution of council passed

April 8, 1806, the recorder was directed that in those cases

where bonds (required by the ordinance of September 28,

1790) have not been executed the proper suit be commenced

on the covenant contained in the Jeases, referring to the

holders of ground-rent lots (Record, pp. 49 and 50).

Now, then, being a lease, the tenant pays to the landlord

only the redendum actually reserved and no more.

The ordinance providing for the disposal of these lots at a

fixed ground rent to purchasers at public sale and the con-

veyance to the purchaser reserved no other consideration

than the annual ground rent, payable quarterly, and no

other right or power to the mayor and aldermen save that

of receiving said ground rent, and of re-entry in the event

of default in the payment of the ground rent; and the con-

veyance contained an express covenant that the purchaser,

his heirs, executors, administrators, and assigns, should

peaceably and quietly hold the premises without let, suit,

trouble, eviction, or denial, and so long as the purchaser

paid the rent he could not be disturbed by the city in his

possession and enjoyment of the lot.

In making the contract with the purchaser to convey the

lot to him in consideration of a certain annual rent, the

city retaining the absolute title, the city did not stipulate for

any increase of the rent or the imposition of any other

charges on the lot than the rent. It could not, so long as

the contract remained of force, ask any other charge to the

holder.

The lots are subject to the payment of ground rent to the

city and “only such assessments and burdens as shall be in

common with other lot-holders.” These assessments and

burdens refer to the State and county taxes and local assess-

ments for street improvements and sidewalks. The cove-

nant was not to pay the city anything more than the rent,

and this the city was to receive net. Whatever assessments

and burdens that might be chargeable to other lot-holders,

these and these only were to be borne by the holder of the

lots held under lease (Record, pp. 20, 32).

When these lots should be subject to taxation by the State,

the tax was not to be paid by the city, nor if paid by the

holder to be deducted from the rent. If assessments were

to be levied for street improvements or sidewalks to be laid,

they were not to be chargeable to the city, but were to be as-

sumed by the lot-holder.

The fact that the deed should contain a covenant of that

nature demonstrates the truth of the conclusion that the

holder of these lots did not take a fee, either conditional or

absolute.

The owner of the fee is liable for all taxes. The grantor

when he conveys an estate in fee is no longer liable for sub-

sequent assessments and burdens on the property. He re-

quires no covenant and makes no saving clause that the

grantee shall assume and pay these burdens, but the land-

lord is liable for all taxes, assessments, and burdens of a

public character that are not in the contract assumed by

the tenant.

The law imposes the obligation on the landlord, when the

lease is silent on the subject, to pay all State, city, and county

taxes and assessments.

Taylor’s Landlord and Tenant, 4th ed., § 341.

Wood's Landlord & Tenant, p. 683, see. 417. aL © .

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A municipal corporation may hold property, not for gov-

ernmental purposes, but for mere convenience of. its people,

or as source of profit to itself, or to supply a need which is

commonly supplied by a private corporation. Such prop-

erty is deemed to be held by the corporation in its social or

commercial capacity as a private corporation and for its

own profit, and such property is not presumptively excluded

from taxation by the State.

Cooley on Taxation, pp. 173, 174.

2 Dillon on Municipal Corporations, sec. 773, 774 and

note.

City of Louisville vs. State, 1 Duvall (Ky.), 295; 85

Am. Dee., 624.

The right of the State to tax the city domain of the city

of Savannah was recognized by the passage of the act of

February 18, 1856, to exempt the city of Savannah from

taxation of the Springfield plantation.

Acts 1855-56, p. 546.

In a lease that might be perpetual in its term, with a

liability to taxation by the State, the city required the

covenant from the lessee that he should hold the premises

subject to such assessments and burdens only as should be

common to other lot-holders, and the admitted facts show

that the holder has always assumed and met such assess-

ments and burdens. The construction actually placed on

this covenant and the manner in which it has been per-

formed for nearly one hundred years are binding on the

present city council; the rights that had been acquired under

this construction are as absolutely protected from impair-

An Act to exempt the City of Savannah from taxation

upon certain property known as the Springfield

Plantation.

Approved February 18th, 1856.

Section I. Be it Enacted, &c., That from and after

the passage of this Act, the City of Savannah shall be

exempt from taxation upon certain property known

as the Springfield Plantation, now embraced within the

corporate limits of said city.

Section II. (Repeals conflicting laws.)

240(

ment as any other of the terms and covenants of the lease.

The city council could, with as much right and propriety,

increase the rent or diminish the term of time or compel the

payment of the valuation money and force the holder to ac-

cept a fee-simple title.

The contract definitely fixed the amount that was to be

paid to secure the rights to the use and occupation of the

| lot, and to receive and take the rents, issues, and profits

thereof, and expressly excluded the right to increase that

bee amount by taxation by declaring that the lot-owner should be

subject only to such assessments and burdens as were com-

mon to other lot-holders (Record, p. 20).

The covenant of quiet enjoyment was expressly condi-

tioned on the payment of ground rent at the time and after

the manner prescribed in the contract. The payment of the

ground rent was the extent of the city’s demand on the pur-

“chaser. It could never demand the payment of the valuation

money, and it was never, as owner of the lot, to be liable

for any assessments or burdens that might be imposed on

lot-holders, as the purchaser or lessee by express contract

had assumed that burden.

The municipal corporation, retaining the absolute owner-

ship of the lot, might as such owner be liable for any as-

sessments or burdens that might be common to lot-holders,

and to relieve itself of such liability by the express terms of

the contract the renter covenanted to be subject to such as-

sessments and burdens, and the evidence shows that the

municipal authorities have never been called on to bear such

burdens, but all taxes levied by the State and all assessments

and burdens for sidewalks, street improvements, etc., have

always been paid by the tenant, in common with other lot-

holders.

All that Ithe city reserved to be paid it was the specified

ground rent and no more.

The State of Georgia, by the act of the General Assembly

approved October 24, 1870, proposed to lease the Western

and Atlantic railroad at a rent not less than $25,000. The

act guaranteed the company should in no case be disturbed

by the authority of the State so long as they keep the con-

tract on their part and make the payment when due. The

contract did not reserve the right of the State to tax the

company.

On February 28, 1874, the legislature passed an act re-

quiring the “ president of all railroad companies to return

on oath to the comptroller general the value of the property

of their respective companies to be taxed as other property. 55

Notwithstanding the power of the legislature to modify the

chartered rights of corporations created since the adoption :

of the Code, the court say that the act guaranteed that the

company should “in no case be disturbed by the authority

of the State so long as they keep the contract on their part

and make the payments when due.” Therefore “ the right

does not exist by the leasing act in one party to revoke a

highly important stipulation in the contract and at the same

time to demand that the other shall abide by and perform

all the others.”

Western & Atlantic R. R. vs. Comptroller General, 54

Ga., 429-434.

In the case of the contract of lease of the Western and

Atlantic railroad, the contract expressly provided that the

company should pay to the State the same tax that the Cen-

tral railroad did; otherwise under the guarantee of quie,

enjoyment nothing but the rent reserved could have been

required,

The only payment required to be made to the city and

the only condition for the perpetual use and enjoyment of

the property as against any interference by the city:is the

payment of the ground rent. (See the contract.)

The city reserved no other right or power. There were

no taxes due or payable tothe city at the time the purchaser

went into possession of the lot under the ground-rent con-

tract, and the right of the city to increase the rent by adding

a tax on the leasehold interest was not reserved. “ What

is not expressed does not exist.”

The city did not expressly declare that “ city lots ” should

be exempt from city taxes, because under its contract it did

not dispose of the lots in fee, but only conveyed the use and

occupation for the consideration of an annual ground rent

and other covenants in the deed mentioned. It expressed

all that it would require of the purchaser, and the purchaser

was liable to pay what the contract declared to be the con-

sideration for this use and occupation.

In the case of Murray vs. The City of Charleston, the city

of Charleston had not expressly stipulated that it would

never tax its own bonds, and yet, when subsequent to the

sale thereof it levied a tax upon them, the Supreme Court

of the United States held that the tax impaired the obliga-

tion of the contract to pay the stipulated interest.

Murray vs. Charleston, 96 U. S., 432.

The obligation imposed by the contract entered into be-

tween the city and the ground-renters is to pay to the city

annually, in four quarterly payments, the rent reserved to

be paid. The valuation money was never demandable nor

collectible, nor was there any obligation to pay it.

The obligation assumed by the city to the ground-renter

was that so long as the rent was regularly paid in the man-

ner prescribed it would secure to the holder of the lot the

right at all times peaceably and quietly to have, hold, use,

oceupy, and enjoy the lot and premises, take the rents, issues,

and profits thereof, without let, suit, trouble, eviction, or de-

nial of the municipal corporation or any one claiming or

acting under it.

The corporation itself, in the sales at public outcry of new

lots laid out from the common, through its marshal, in the

presence of a committee of council, and at the direct and spe-

cific instruction and direction of said committee, announces

to the purchasers its interpretation of the contract and de-

clares that the lots are to be disposed of on specific ground

rent, payable to the city, and, so long as the lots are held

under the contract to pay ground rent, they are not to be

subject to city taxes. The testimony of Alderman Nichols

and ex-Alderman Wylly and others is explicit as to these

facts, and they are not rebutted nor denied.

The defendant denies that the city could be bound by the

announcement, made at the sales of these lots, that the same

while held on ground rent would be free from city taxes.

We insist that these announcements were in fact only the re-

iteration of the interpretation given to the contract by the

city in its ordinances and previous declarations. But the city

could be bound by the terms of sale so announced.

Mayor, ete., Macon vs. Franklin, 12 Ga., 253.

A municipal corporation may be estopped by the action of

its proper officer when the corporation is acting in its pri-

vate, as contradistinguished from its governmental, capacity

and has lawful power to do the act.

Chicago vs. Sexton, 115 [IL 230.

Dillon Mun. Corp., p. 322, note.

A State, when it enters into a contract with its citizens, can

claim no exemption from the rules of law applicable to con-

tracts between individuals, and all acts which relate to the

contract—declarations of agents—which in the case of a cit-

izen would affect the contract must be held as in like manner

affecting a contract made by the State.

Patten vs. Gilmer, 42 Ala., 545.

City lots were required to be sold in presence of a com-

mittee on public sales and city lots, and this committee is

presumed to have been present, the presumption being that

publie officers do their duty.

City Council of Augusta vs. Pearce, 79 Georgia R., p.

100, and authorities there cited.

A municipal corporation may so deal with third persons

as to justify them in assuming the existence of an authority

in another, which in faet it has never given.

1 Dillon Municipal Corp.. sec. 452, note 2.

Davis vs. New York, 93 N. Y., pp. 250-253.

A municipal corporation may hold property, not for gov-

ernmental purposes, but for mere convenience of its people

or as a source of profit to itself or to supply a need which is

commonly supplied by a private corporation. Such prop-

erty is deemed to be held by the corporation in its social or

commercial capacity as a private corporation and for its

own profit.

In making the sale or lease. of these lots the city of

Savannah was acting within its private or proprietary

powers as distinguished from its governmental or legislative

powers.

1 Dillon on Municipal Corporations, sec. 66 et seq.

1 Dillon on Municipal Corporations, 116, note 2.

Ratification by the city of unauthorized acts of its officers

in the scope of the corporate powers is valid and binding,

and the ratification may frequently be inferred from acqui-

escence after knowledge of all the material facts or from acts

inconsistent with any other supposition. The same principle

is applicable to corporations as to individuals.

1 Dillon on Municipal Corporations, sec. 463.

Dillon on Municipal Corporations, p. 322, note.

St. Louis vs. Armstrong, 56 Mo., 298.

Chicago vs. Sexton, 115 IIL, 230.

Let us see how the contract was regarded by the mayor

and aldermen from 1791 to 1876, at least, the latter being

the date of the last direct declaration on the subject from the

corporation.

It is admitted that no city taxes have ever been claimed

or assessed on the lots known as “ city lots” or ground-reht

lots (Record, p. 51) from the year 1791 to the year 1878 (when

the ordinance now resisted was passed), but it is suggestive

and important to trace the course of city legislation on this

subject and the municipal interpretation of the contract re-

garding the taxation of these city lots.

The city treasurers’ reports in the minutes of council show

that there were no taxes levied on real estate in Savannah

by the municipal corporation from 1791 to 1807. On April

7, 1806, under the authority of the act of the General As-

sembly passed December 2, 1805, the mayor and aldermen

passed an ordinance whereby a tax was assessed and levied

on all houses, lots, ete., improved or unimproved, and includ-

ing “ all lots held by lease from the corporation.” Soon, how-

ever, after the passage of the ordinance the liability of these

lots to city taxation was questioned, for it appears from the

minutes of counsel that on the 10th day of May, 1806, a com-

mittee was appointed to report necessary amendments to the

ordinance, and leave was granted to bring in a bill to amend

it. (See Record, p. 49.) Again, on August 25, 1806, a com-

mittee was appointed to revise the ordinance and to report

by bill such amendment as “ they deem necessary and proper.”

The committee reported on September 8, 1806, recommend-

ing an amendment which struck out “lots held under lease

from the corporation,” and the minutes of council reported in

the evidence show that the matter was carefully debated, and

on November 24, 1806, the amended ordinance was passed.

The amendment was in terms that “so much of section 1

of the ordinance of April 7, 1806, as taxes lots held by lease

from the corporation be stricken” (Record, p. 50).

The tax ordinance to raise funds for current expenses

thereafter were modeled on the ordinance of November 24,

1806, and each tax ordinance successively passed from

November 24, 1806, to the ordinance of January 11, 1857,

inclusive, excepted from taxation “lots held under lease

from the corporation.”

And it is to be noticed that the express exception of “ city

lots” does not occur in the tax ordinances from 1857 to 1874.

The phrase used is “ real estate” or “real property ;” but it

is admitted that no taxes were assessed or levied on “ city

lots” under any of these ordinances, and the explanation is

to be found’ in the tax ‘ordinance of December 11, 1857,

where the phrase “real property ” is construed to “ include

land and buildings and fixtures erected on land whether

> and in

the land be or be not itself subject to taxation ;’

compliance with this definition of taxable real property the

tax ordinances passed in the years 1866 to 1874 use the

following expression :

“Taxes shall be assessed, levied and raised at and after

the following rates, that is to say: 1. At the rate of — per

cent. per annum on real estate in said city according to the

valuation of the year” (Record, p. 50).

And in the years 1874, 1875, and 1876 the assessment was

as follows:

“ Every person holding real property in said city includ-

ing improvements on lots subject to ground-rent shall pay a

tax of — per cent. on the value of such property.”

The report of Hon. John Screven, one of the most learned

and intelligent citizens, who had been many times mayor

‘and who was conversant with the history of city lots and

familiar with the contract and the construction given to it,

is as clear as the testimony of ex-Alderman Nichols and ex-

Alderman Wylly and others. He saysin hisannual report for

the year 1871, page 5: “It is not known to the foreign public

thata very large part of the real estate in the city consists of

lots sold on condition of the payment of ground rent, and is

therefore not the subject of taxation and is not included

in” the statement of taxable property in the city assessed

for taxation (Record, p. 51).

The report of William Hunter, chairman of the finance

committee, contains the following statement :

“The reason why city lots are not taxed beyond the

ground rent is that the city is understood to have bound

itself not to tax them” (Record, p. 56). “The ordinance of

1799, which was the first to provide for the sale of lots on these

terms, contains a stipulation that the purchaser of such lot

and all claiming under him shall have the use, ete., upon

paying the ground rent. This ordinance has been followed

either in terms or substance by all succeeding ordinances

providing for such sale.

“Tt is of no moment that the stipulation does not appear

in the deeds. The ordinances contain the real terms of the

contracts and control the deeds whenever the latter depart

from or conflict with them; and, as the city has never taxed

such lots, it is difficult to resist the conclusion that such was

the design when the ordinance of 1790 was framed.”

See Record, p. 56.

The evidence also conclusively and affirmatively shows

that those lots held under lease from the corporation were

announced to be free from city taxes so long as they re-

mained ground-rent lots at the time they were exposed for

sale, the announcement being made by the city marshal

under the authority of a committee of council superintend-

ing the sate.

The evidence further shows that in all the years of finan-

cial stress and difficulty, when every source of taxation was

canvassed and every species of property and business were

subjected to taxation, these lots were not taxed, sustaining

the contention that it was not an attempt to create an exemp-

tion from taxation nor a gratuity, but was a binding and

valid contract, retaining the title in the city, whose obligation

could not be violated. The rate of taxation upon taxable

property was from time to time increased, new licenses were

required, and the subjects of taxation were increased, but,

however great the stress for money, no attempt was made to

tax these leasehold lots. The reason for excepting “ lots

held by lease,” or “ city lots,” as these lots were called, is not

expressed in the minutes of council or in the ordinances,

but the conclusion is irresistible that the contract being

construed as a lease and the city having reserved a stipu-

lated rent and having entered into an express covenant

of quiet enjoyment on the single condition of a faithful pay-

ment of the rent, it could not assess a tax on the lots held by

lease, and they were therefore clearly not subject to taxation,

the city thereby declaring its understanding of the contract

and its purpose in good faith of carrying it out. The power

of municipal corporations to make exemptions, while denied

by some authorities, was, prior to the constitution of 1877,

admitted to exist in Georgia.

Mayor of Athens vs. Long, 54 Ga., 330.

Waring vs. Savannah, 60 Ga., 93.

Atlanta Street Railroad vs. Atlanta, 66 Ga., 104.

The sales and leases of the town common and the contract

made by the city was confirmed by the General Assembly,

and the language of the act is peculiar: ‘The mayor and

aldermen to the great advantage of the lot-holders and with

much profit to the city treasury having alienated granted

and conveyed certain parts of the common and justice re-

quiring that the agreements made by the corporation with

the purchasers be confirmed. The conveyances whether in

fee-simple or otherwise, were legalized and made valid ac-

cording to the covenants limitations and agreements” (Ree-

ord, p. 31, acts Dec. 21, 1823); and the corporation was

further empowered to sell and dispose of any part of the

property, domain, lands, or lots by lease or fee-simple (Rec-

ord, p. 31, acts Dee. 24, 1825).

If there could have been any question as to the power of

the city to make the contract, this question has been settled

and the objection removed by the act of the General Assem-

bly approved December 21, 1823 (Dawson’s Compilation, p.

443).

This act confirmed, legalized, and made valid, to all in-

tents and purposes, all conveyances heretofore made of the

town common, whether in fee-simple or otherwise, accord-

ing to the covenants, limitations, and agreements of the

same.

The municipal corporation of Savannah was further in-

vested with power to sell and dispose of all or any part of

the property, domain, land, or lots to the said corporation

belonging or appertaining by lease for years or in fee-simple

as to said mayor and aldermen or a majority of them shall

seem meet and proper (act approved Dec. 24, 1825, P. A.;

Dawson’s Compilation, p. 465).

The General Assembly by subsequent act may validate

and confirm previous acts of the corporation otherwise in-

valid. If the act could have been lawfully performed or

done under ‘precedent legislative authority, the legislature

may subsequently ratify it and give it effect.

1 Dillon Municipal Corporations, sec. 79, 544.

: Bass vs. Columbus, 30 Ga., 845.

Winn vs. City of Macon, 21st Ga., 279.

Danielly vs. Cabanniss, 52 Ga., 212-224.

Wilkerson vs. Lehland, 2 Peters, 662.

The right of the State to make a valid contract to exempt

from taxation, which comes under the protection of the Con-

stitution of the United States, is now established beyond

question.

Salt Co. vs. East Saginaw, 13 Wall., 376, and authori-

ties cited in note.

Central Railroad and South Western R. R. vs. State,

92 U.S., 665.

Western & Atlantic R. R. vs. State, 54 Ga., 428-431.

Cooley on Taxation, pp. 66-68.

Exemption from taxation for a consideration is binding,

and is a contract that cannot be impaired, but is protected

by the Constitution.

Cooley on Taxation, pp. 66, 68.

Cooley on Constitutional Limitations, 5th ed., pp. 150

et seq., 340, note 3.

New Jersey vs. Wilson, 7 Cranch, 164.

Salt Co. vs. East Saginaw, 13 Wall., 376.

Central R. R. & 8S. W. R. R. vs. State of Georgia, 92

U.S., 665.

Western & Atlantic R. R. vs. State of Georgia, 54 Ga.,

428-431.

And in regard to exemptions arising from contracts Mr.

Cooley, in his Treatise on Taxation, states, in note four, page

200 :

“Tt seems that a city may make an exemption from taxa-

tion a part of the consideration for a water company sup-

plying it with water.”

Grant vs. Davenport, 36 Iowa, p. 393.

Cooley on Taxation, p. 201 ; note.

An exemption from taxation made on the basis of a con-

tract in which the public is supposed to have received a full

equivalent is admissible.

Cooley on Taxation, p. 214.

An exemption from taxation for a consideration is bind-

ing and is a contract which cannot be impaired, but is pro-

tected by the Constitution.

Cooley on Constitutional Limitations, p. 340.

The contract was beneficial to the city. In the first place,

the city rented the lots on its own terms. It fixed the rental

in advance at such amount as it deemed a fair compensa-

tion. The purchaser, induced by the advantages offered by

the city, paid in many instances a large increase on the

valuation in cash. The exhibit to the bill shows that this

increase in some cases exceeded the original valuation placed

on the lot by the city (Record, p. 47).

The exemption from city taxes was not a gratuity or privi-

lege, but entered into the consideration when the lots were

originally disposed of, and does not rest upon the idea of

exempting property which is or would otherwise be subject,

but rests upon the fundamental idea that it was not the

property of the lessee.

There were no restrictions on the power of the city to make

such; « contract of lease as to property which it had the right

to control (Record, p. 47).

The city received the full benefit of this arrangement in

the acceptance of the rents fixed by itself without diminution

or reduction, and the payment in most instances of a large

bonus or increase. The citizens have been induced to pur-

chase from the city and from its assigns these lots at prices

controlled by the advantages of fixed charges, as rent, instead

of fluctuating charges, as annual taxation; and all the prin-

ciples of estoppel apply te prohibit the city from levying a

tax in addition to the ground rent.

1 Dillon Municipal Corporations, sec. 452, note 2.

Davis vs. New York, 93 N. Y., 250-253.

Moran vs. Miami Co., 2 Black (U. 8.), 722.

13 Wall., 298-305, Pendleton vs. Amy.

tandolph vs. Post, 93 U.S. 502.

That the exemption of “city lots” from taxation was not

a matter of gratuity, but was due to the construction of the

contract made by the city with the holder, which shows that

the city and not the lessee was the owner, is further shown

in the records of the city in the statement of the city domain.

The common had been gradually encroached upon, the plan

of the city extended over it, and the same made off in lots,

until in 1854 there were six hundred and forty-three lots in 22

wards held under lease, many of them improved (Record, p. 42),

yet in giving the value of taxable real estate in the city the

statement is made that city lots or lots under lease, not being

liable to city taxation, are not included in the comparative

statement, and the 643 lots in 22 wards under lease are

claimed to be part of the city domain, having a distinct

valuation as part of the city resources and yielding a reve-

nue in the rents derived from the same, while real estate

held in fee-simple and the improvements on these lots or

lots under lease are alone mentioned as the taxable real

estate. Thereason isplain: the ground-rent lots are the prop-

erty of the city. .

The city of Mobile transferred certain water works to

Stein for 20 years, and covenanted that so long as he kept

his covenant he should retain quiet possession, without let or

hindrance of said city. The city could not require the pay-

ment of a license or tax for carrying on the business.

Stein vs. Mayor, ete., Mobile, 49 Ala., 362-369.

The city wished to build a sewer through defendant's lot.

It was necessary to condemn or get his permission. He con-

sented on condition that he could have three years in which

to pay his proportion of the costs of the sewer, to which the

city authorities agreed without any express authority. The

sewer was built, and before three years had expired the

city sued defendant for his proportion of the costs of the

sewer. Held, that the action was prematurely brought.

The city by using defendant's land under the agreement of

the officers was bound by that agreement.

St. Louis vs. Armstrong, 56 Mo., 298.

A municipal corporation may bind itself by and cannot

abrogate any contract which it has a right to make under

its charter (or which has been ratified and confirmed by the

legislature), but one council cannot bind itself or others to a

given line of policy.

Williams vs. City Council of West Point, 68 Ga., 816.

The city is estopped by the terms announced at its sales.

When it enters into a contract with its citizens it is not ex-

empt from the rules of law applicable to contracts between

individuals, and all acts, declarations, and admissions of its

agents which relate to the contract and which, in the case of

a citizen, would affect the contract, must be held as affecting

a contract made by it.

Mayor of Macon vs, Franklin, 12 Ga., 253.

Chicago vs. Sexton, 115 IIL, 230.

2 Dillon, Municipal Corporations, p. 322 (note).

Patten vs. Gilmer, 43 Ala., 548.

Barclay vs. Howell’s Lessces, 6 Peters, 498.

The covenant of quiet enjoyment on the payment of the

rent debarred the city from adding any terms whereby the

use and enjoyment of the tenant could be restricted or for-

feited.

Stein vs. Mobile, 49 Ala., 362-369.

St. Louis vs. Armstrong, 56 Mo., 298.

W.& A. R. R. vs. Comp. Gen., 54 Ga., 429-434.

The municipality having asserted its ownership of the

said ground-rent lots by official entries on its minutes in its

official reports, and the publication of this claim openly,

continuously, and notoriously until it determined not to

dispose of any more of its domain on lease at ground rent,

it is estopped now from disclaiming the title and ownership

for the purpose of imposing a tax on its tenants as the owners

while claiming the rent from them as lessees (Record, pp. 40

and 41).

A city cannot pass by-laws or ordinances which impair

the obligation of contracts.

Stein vs. Mobile, 49 Ala., 369.

Cooley on Constitutional Limitations, m. p. 368.

1 Dillon, Municipal Corporations, sec. 450, n. 3.

The inhibition of the Constitution against the impairing

of the obligation of a contract applies as well to city ordi-

nances as to the State laws.

Home Ins. Co. 2s. City of Augusta, 93 U. S., 116-121.

Murray vs. Charleston, 96 U. 8., 432-440.

N. O. Water Works vs. La. Sugar Co., 125 U.S., 18-31.

Stein vs. Mayor, etc., Mobile, 49 Ala., 369. e

1 Dill. Mun. Corp., sec. 450, n. 3.

Winter vs. Jones, 10 Ga., 196.

It isclaimed that the State constitution of 1877 required

the imposition of this tax. The answer is that the State

constitution could not impair the obligation of the contract

or validate such impairment. :

Railroad Co. vs. McClure, 10 Wall., 515.

County of Moultrie vs. Savings Bank, 92 U.S., 631, 4th

head note.

New Orleans Gas Co. vs. Louisiana Light Co., 115

U_S., 650.

Tax levied on the leased lots is a tax on the city’s own

property, which it certainly cannot impose for obvious

reasons.

Galveston Wharf Co. vs. Galveston, 63 Tex., 14-24.

Stein vs. Mobile, 54 Ala., 27.

A contract entered into between parties, valid at the time

by the laws of the State, no decision of the courts of the

State subsequently made can impair its obligation.

Chicago vs. Sheldon, 9 Wall., 50.

The subsequent imposition of a tax by the municipal

corporation on the lot so leased in addition to the rent re-

served was in fact an increase of the amount to be annually

paid for the use of said lot and was a violation of the obliga-

tions of the contract.

All that the city provided for in the matter of taxes was

that as owner it should not have to bear any assessment or

burden that might be common to lot-holders, but that the

renter should bear these burdens and thereby secure to the

city the full rent reserved.

An imposition of a tax by the city on the holders of these

lots was a payment in addition to this rent and was a viola-

tion of the contract by increasing the annual payments to

be made to the city beyond the amount specified in the con-

tract.

Where a municipal corporation issued bonds paying

a certain interest it could not impose any tax on such bonds.

The tax necessarily diminished the interest and violated the

contract.

Murray vs. City of Charleston, 96 U.S., 482.

-~*

The construction placed on the contract by the city, that

the lots were held under lease and were not subject to taxa-

tion, as shown by the evidence and acted on so long as it

continued to make such contracts, is binding on the parties

and it is not within the power of the city to change this con-

struction after it had ceased to make contracts of this char-

acter so as to bind the other parties to the contract.

It is claimed, however, that the estate of the holder of a

“ground rent” or “city lot” is not a “leasehold estate,” not-

withstanding the declarations to that effect and the construc

tion placed upon the conveyance by the municipal authori-

ties, and the case of Gibbons vs. Gibbons, T. U. P. Charlton's

(Ga.) Reports, page 113, is cited to sustain this contention.

The case arose from the refusal of a lot-holder to pay State

taxes on a “city lot.”

While the argument of the attorney general of the State,

Mr. Charlton, is a contention that the estate of the holder of

a city lot is a fee to be defeated by the non-performance of a

condition subsequent and is taxable to the holder, vet the

judgment is simply that the lot is taxable by the State in

the hands of the holder.

Mr. Charlton argues from a false premise. He contends

that the deed conveys an estate to the grantee, his “ heirs

and assigns” forever. This is absolutely incorrect. The

deed recites that the purchaser has “ made election for the

present of retaining the purchase-money in his own hands

and paying a ground rent for the use and occupation of said

lot,” and “ bargains and sells” the lot of land, with the rights,

members, and appurtenances thereof; to have and to hold

said lot, with all and singular the advantages thereunto be-

: ob

longing, unto the purchaser, his executors, administrators,

and assigns forever.”

It is true the purchaser covenants for himself, his heirs

and assigns, to pay the rent, but so does every lessee in a

well-drawn lease—e. g., the leases of the “ Springfield lots.”

The fee in the lots is retained by the municipal authorities

clearly and distinctly. We therefore contend that the case

of Gibbons vs. Gibbons simply decided that these lots were

subject to State taxation. This is not denied ; but the reason-

ing of counsel in that case, whereby the estate of the holder

is claimed to be a conditional fee, is denied to be correct.

The conveyance does not convey the lot to the purchaser,

“his heirs and assigns forever,” but to the holder, his “ ex-

ecutors, administrators, and assigns forever.”

The conveyance expressly reserves the fee in the city until

the valuation money shall be paid. It expressly conveys to

the holder only the “ use and occupation.” As had already

been shown, the estate conveyed and the covenants and con-

ditions contained in the conveyance comport only with a

perpetual lease and not an estate in fee. The decision is not

binding on the parties to this suit and is not res adjudicata,

and does not effectually determine the nature of the estate

between the city and the holder, and, being based upon an

erroneous statement of the terms of the conveyance, has no

force or authority, and is overruled by the current of au-

thorities hereinbefore cited.

As the special covenant in the conveyance was suflicient

to sustain the judgment of the court that the lots were sub-

ject to taxation by the State, the fallacious argument of the

attorney general has no binding foree on this court, and

never did work estoppel to the city or the holders of the lots

to deny that the estate in the holder was a fee, or that the

corporation had ever parted with the fee.

The holders of the “ city lots” or “ lots held under lease ”

were liable to the taxes assessed by the State, not because

their estate in said lots was a fee, but because by their con-

tract they had coyenanted to pay these taxes. The argu-

ment of Mr. Charlton, reported by himself, as to the estate

created by the ordinance and conveyance, was as unneces-

sury as it was fallacious, and he concludes his argument by

the statement that ifthe estate is not a freehold of inheritance,

“the form of the corporation grant subjects the lots to tax-

ation by the State.”

The construction of the words of the deed in Gibbons vs.

Gibbons, above cited, has not the weight of authority ; and

the case is also overruled, so far as it holds that the convey-

ance cannot be a lease because it may last forever, by the

recent decision of the supreme court of Georgia in the case

of Atkinson vs. Orr, in 83 Ca., 37, and the decision in Lau-

rence vs. The Mayor, ete., Savannah, 71 Ga., 398, 399, already

quoted in this brief.

“Exemption, to be admissible,” says Mr. Cooley, “ought

to be made on the basis of contract, in which case the public

is supposed to receive a full equivalent therefor, or on some

ground of public policy.”

In the case of these city lots the publie received a full

equivalent in the increase money paid for the privilege of

holding these lots under ground rent or in paying the high

values put on the lot in the first instance.

If the leasehold interest of the plaintiffs in error in the

ground-rent lots are subject to taxation as such by the

mayor aid aldermen, the ordinance under which such tax

is levied is unconstitutional and void, no other leasehold

interest in said city being taxed, and under the constitution

of the State of Georgia all taxation must be uniform on the

same class of subjects.

Ari. 7, sec. 2, par. 1, Constitution of Georgia.

“Taxation is a fearful power, but like other legislative

powers, in a representative government it has its checks and

balances. It is certainly limited as to purposes, and has

been generally believed by local rights immemorially existing

and universally recognized.”

Cooley on Taxation, p. 693.

Respectfully submitted.

Joacuim R. Saussy,

Pore Barrow,

Attorneys for Plaintiff in Error.

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