Phillip Wagner, Inc. v. Leser

Background

A corporation named Phillip Wagner sued on behalf of itself and other Baltimore property owners who own lots that directly abut public streets paved by the city with improved paving such as vitrified brick. The challenged law authorized the city to levy a new ten-year special paving tax on abutting properties, divided into three classes based on how wide the paving in front of each lot was, and set fixed annual rates per front foot. The city’s Appeal Tax Court was directed to classify properties and add the special tax to regular tax bills. Wagner argued the law took property without due process under the Fourteenth Amendment.

Reasoning

The Court asked whether the statute unlawfully deprived owners of property without due process. It relied on prior decisions allowing later special assessments for public works already performed and on the long-settled principle that legislatures may designate which lands are deemed benefited and fix assessment amounts. The Court held that the legislature could lawfully classify property and set per-foot rates without individualized hearings, absent evidence of arbitrary or confiscatory action. Finding that brick paving plainly conferred a continuing benefit and that the small annual charge was not arbitrary, the Court affirmed the state court’s judgment upholding the tax as constitutional.

Real world impact

The decision lets Baltimore and similar cities fund street-paving plans by imposing modest, class-based annual charges on property that benefits from improved paving. Property owners who abut improved streets will face the assessed per-foot annual payments for the statutory term. The ruling preserves legislative control over such assessments unless a court finds clear abuse.

Dissents or concurrances

Two Justices dissented, disagreeing with the Court’s conclusion on the constitutional issue.