The first is correct.
In answer to your other question, that's how language is. I don't think anyone can really answer
why something is now an adjective. "smart" originally was a verb which became adjectival and by extension a noun. Its meaning has also evolved and extended. Language changes all the time
Smart: •
adjective 1 clean, tidy, and stylish.
2 bright and fresh in appearance.
3 (of a place) fashionable and upmarket.
4 informal having a quick intelligence.
5 chiefly N. Amer. impertinently clever or sarcastic.
6 quick; brisk
•
noun 1 a smarting pain.
2 (
smarts)
N. Amer. informal intelligence; acumen.
O.E. smeortan "be painful," from W.Gmc. *smert- (cf. M.Du. smerten, Du. smarten, O.H.G. smerzan, Ger. schmerzen "to pain," originally "to bite"), from PIE base *(s)***-, from base *(s)mer- "to rub, pound" (cf. Gk. smerdnos "terrible, dreadful," Skt. mardayati "grinds, rubs, crushes," L. mordere to bite").