PRINCIPLES OF TAXATION. 809 



tion to the interest on the loan of capital represented by the mort- 

 gage. 



Note. — In addition to what may be termed the historical elements of this celebrated 

 case, the more strictly legal features of it, as set forth subsequent to the action of the 

 United States Supreme Court, are here pertinent and worthy of consideration : 



No. 1. This case seems from its very nature to involve questions of conflict of State 

 dominion. It is admitted that Mr. Kirtland, the plaintiff, so far as the question of taxation 

 at issue is concerned, has not been assessed and taxed upon his body, person, poll, or head, 

 or for any substance, the embodiment of labor, and which alone constitutes property, owned 

 or possessed by him within the territory of Connecticut; nor for any business transacted by 

 him within the State. The plaintiff has, however, been assessed and taxed for dealing in 

 money or doing the business of loaning money, by an assessment and taxation of bonds and 

 mortgages made in Illinois — the necessary incidents and evidence of the business of money 

 lending, performed by himself or through a resident agent in the State of Illinois. It is 

 conceded that the loans were actually made at Chicago in the State of Illinois, as the bonds 

 and mortgages taken state that all the business and acts connected with the loaning and 

 reloaning were actually done, from time to time, there, that the obligations were payable 

 there, and that the contracts of loan were strictly Illinois contracts, to be interpreted as 

 valid or invalid and as to their force and effect according to the laws of that State. 



The State of Illinois imposes a tax on resident agents making loans in that State; but it 

 is not important to inquire whether in this instance the business of loaning was done through 

 a resident agent or what that State does actually tax, but what she can constitutionally tax 

 by virtue of her dominion and sovereignty. Illinois can undoubtedly tax, if the tax is not dis- 

 criminating but uniform on residents and nonresidents, all occupations and also all business 

 transacted within her borders. She can tax money dealers or money lenders by license or 

 otherwise, and she can impose stamp or other taxes and to any degree, in her discretion, 

 on all contracts at the time when made within her jurisdiction. No other State has concur- 

 rent jurisdiction over any legitimate subject of taxation within her jurisdiction. Her sover- 

 eignty in taxation is absolute except as limited by the national Constitution. But the sover- 

 eignty of coequal States involves a full recognition of the dominion and sovereignty of all 

 eister States, and hence section 1, Article IV, of the United States Constitution requires that 

 " full faith and credit shall be given to the public acts, records, and judicial proceedings of 

 other States." This is a compact of noninterference in the dominion of other States in mat- 

 ters of taxation or in reference to other subjects of State dominion. The power of taxation 

 is an incident of sovereignty or of dominion. The dominion, therefore, of one State for the 

 purpose of taxation over persons, property, or business, or the incidents of business, must 

 exclude the dominion of other States over the same persons, property, business, and inci- 

 dents of business at the same time. Neither in constitutional law in this country nor in 

 mathematics can the same persons, property, business, and incidents of business occupy 

 two places or sovereignties at the same time. The taxation by Connecticut of credits, 

 choses in action, bonds, notes, book accounts, verbal and other contracts, the incidents of 

 actual business transacted in Illinois, must be in legal effect extraterritorial taxation of a 

 part of such business, or otherwise it must be assumed that the incident is not a part of 

 the principal. The making of contracts is of itself a business in the strictest sense, nor 

 can any business exist without the power to make contracts written or verbal. Money can 

 not be loaned unless there is a business of lending money, and for the time being the voca- 

 tion of a money lender. The amount or duration of a business in a State can have no 

 influence on the question of the jurisdiction of the State over the business or the transac- 

 tion. A State can tax all sales at auction, including the sales of goods in unbroken pack- 

 ages owned by nonresidents and just brought into the State and sold by nonresidents or by 

 resident agents (Woodruff vs. Perham, 8 Wallace 123). In New York mere wandering ped- 

 dlers are taxable on money invested in business in every town in which they peddle. If 

 actually assessed in more than one town the same year the remedy is to appeaUto the assess- 



