650 POPULAR SCIENCE MONTHLY. 



property in the possession of another man to escape because of 

 varying circumstances beyond the control of the assessors, is not 

 taxation in any sense, but simply arbitrary taking. The court itself, 

 in referring to the tax under consideration, said with great point 

 and truth: "It is only one of many cases where, under the name 

 of taxation, an oppressive exaction is made, without constitutional 

 warrant, amounting to little else than an arbitrary seizure of pri- 

 vate property. It is, in fact, a forced contribution levied upon 

 property held in other States, where it is subjected, or may be sub- 

 jected to taxation upon an estimate of its full value." 



Decision of the Supreme Court of California on the 

 Taxation of Mortgages. — Any review of the history of local taxa- 

 tion in the United States would be imperfect which failed to notice a 

 notable and interesting decision given in May, 1873, by the Su- 

 preme Court of California in regard to the taxation by its State au- 

 thorities of real-estate mortgages. The question was one that for a 

 considerable time had greatly interested the people of California, 

 and the drift of popular sentiment of San Francisco seems to have 

 been most unmistakably in favor of their taxation. But how to do 

 it, and at the same time not increase the burden on the borrower, 

 who had mortgaged his land as security for a loan of capital to im- 

 prove or stock it, was a problem that not a little troubled the lawmak- 

 ers in Legislature assembled. One proposition brought forward con- 

 templated a deduction from the amount of land tax of the assess- 

 ment on the mortgage; but as the lands of California were found, 

 as a rule, to be taxed far below their value, and the mortgages for 

 a value far in excess of the assessor's appraisement of the land they 

 covered, it became soon apparent that this scheme was to a greater 

 or less extent equivalent to exempting the land and taxing the 

 mortgage. Another proposition, embodied in a bill introduced into 

 the Assembly, was to make void all contracts by which borrowers 

 agreed to reimburse lenders in the amount of the mortgage tax; 

 while others again were exceedingly strenuous in favor of trying 

 the pleasing little experiment — which no community having once 

 tried ever desires to repeat — of providing that the person giving 

 the mortgage should pay the taxes upon it, but be at the same time 

 authorized to deduct the tax from the principal, or interest, in 

 settling with his creditor. Pending these discussions, however, the 

 Supreme Court, which had the question before it on a suit to which 

 one of the savings banks of San Francisco was a party, rendered a 

 decision, that in virtue of a clause in the Constitution of the State 

 requiring all taxation to be equal and uniform, the taxation of 

 mortgages was unconstitutional and illegal; inasmuch as to tax a 

 given property and then tax a mortgage on it, which mortgage is 



