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CHAPTER IV.
THE REGULATION OF COMMERCE.
29. The constitutional provisions.
30. The historical reason for the provisions.
31. Commerce defined.
32. Regulation of commerce defined.
33. The general principles defining the limits of national and state regula-
tion.
34. The internal commerce of a state.
35. Navigable waters and the soil under them.
36. Preferences of ports.
37. Duties upon exports.
38. Duties upon tonnage.
39. Port dues.
40. Pilotage.
41. Regulation of navigation.
42. Port regulations.
43. Quarantine.
44. Ferries.
45. Bridges and dams.
46. Improvements of navigation.
47. Wharves and piers.
48. State duties upon imports and exports.
49. State inspection laws.
50. Taxation discriminating against goods from other states.
51. The original package doctrine.
52. Transportation: (a) State regulation in the exercise of the police power;
Regulation by taxation; (c) The Interstate Commmerce Act.
53. The Anti-trust law.
54. Telegraphs.
55. Commerce with tbe Indian tribes.
The constitutional provisions.
29. The Constitution of the United States contains three clauses which directly bear upon the regulation of commerce. Section 8 of Article I declares that "the Congress shall have power....to regulate commerce with foreign nations, and among the several states, and with the Indian tribes. " Section 9 of the same article enumerates among the exceptions from the powers granted to the United States, that "no tax or duty shall be laid on articles exported from any state. No preference shall be given by any regulation of commerce or revenue to the ports of one state over those of another: nor shall vessels bound to, or from, oine state, be obliged to enter, clear, or pay duties in another." Section 10 of the same article, in its enumeration of the expressed restrictions upon the powers of the states, declares that "no state shall, without the consent of the Congress, lay any imposts or duties on imports or exports, except what may be absolutely necessary for executing its inspection laws: and the net produce of all duties and imposts, laid by any state on imports or exports, shall be for the use of the treasury of the United States; and all such laws shall be subject to the revision and control of the Congress. No state shall, without the, consent of Congress, lay any duty of tonnage." The constitutional provisions are, in effect, first, a grant to Congress of the power of regulatiiag foreign and interstate commerce, with the expressed restriction that the United States shall not lay any tax or duty on articles exported from any state, nor give preferenee by any regulation to the ports of one state over those of another, nor oblige vessels bound to or from one state to enter, clear, or pay duties in another; second, an implied restraint upon state regulation of foreign or interstate commerce; and third, an expressed prohibition of state duties on imports, exports, or tonnage, save under certain defined restrictions, the most material of which is the consent of Congress. These constitutional provisions are not only in full force and vigour today, but their application is wider and more far reaching than the framers of the Constitution imagined to be within the bounds of possibility. The only commerce that they knew was the foreign and coastwise commerce that was carried in ships. They little thought that the time would ever come when the commerce so carried would be far exceeded in amount and in value by the internal commerce of the country, yet that time has come. In the one hundred and seventeen years that have passed sinee the adoption of the Constitution, the country has made great strides. Less than three millions of people have grown to be more than seventy millions in number. Discoveries in science and inventions in the arts have developed new subjects of trade, and have created new agencies of commerce. Steam and electricity have been made to do man's bidding. Sailing vessels have given way to steamships, and railways have superseded turnpike roads, Conestoga wagons and canals for the movement of intraterritorial freight.Telegraphs and telephones have annihilated distance. The growth of population, the creation of new subjects of trade, and the improvements in the movement of traffic have necessarilv resulted in a vast enlargement in the volume of commerce. In view of these great changes in the conditions of the problem, it is more than ever important that the constitutional limits upon the regulation of commerce should be clearly comprehended, and that the line which separates the provinces of federal and of state authority over this subject of national interest should be, so far as is possible, accurately defined
The historical reason for the provisions.
30. It is an historical fact that the Constitution was framed and adopted mainly because all of the states had suffered under the Confederation by reason of the selfish commercial policy of England in closing her markets to goods of American manufacture, and because some of the states had also suffered by reason of the no less selfish commercial policy of other states in the imposition of heavy duties on imported goods, and in the enforcement of vexatious restrictions upon trade. There were great differences of opinion as to other features of the Constitution, yet, in the convention of 1787 and among the people, there was practical unanimity as to the expediency of vesting in the government of the United States the power of so regulating commerce as to overcome the disintegrating forces which threatened the loss of all that had been gained by the success of the Revolution.(1) But if the framers of the Constitution had ever imagined that the power of regulating commeree would be expanded as it has been by judicial construction, no such power would have been vested in Congress.
Commerce defined.
31. The term "commerce," as Marshall, C. J., construed lt,(2) means not only traffic, but also commercial intercourse in all its branches, including transportation by sea and on land, importation and exportation, and all that is necessarily incident thereto. As the Constitution is a frame of government intended to endure for all time, it follows that the term "commerce" must receive a construction sufficiently elastic to comprehend not only the subjects and instrumemtalities of commerce known and used when the Constitution was framed, but also all present and future subjects of commerce and agencies of commercial intercourse.(3) Yet everything that is connected with commerce is not necessarily commerce. Bills of exchange may be given in paynqent for goods to be imported, and yet sueh bills are mere personal obligations, and are not in themselves subjects of commerce.(4) Money assessed for state taxation is not by a subsequent investment in a subject of commerce relieved from such taxation.(5) So, also, a contract of insurance is not "an instrumentality of commerce, but a mere incident of commercial intercourse."(6) "A state may, therefore, prohibit foreign insurance companies and their agents from effecting within its territory contracts of insurance, marine, or otherwise, save upon such conditions as the state may prescribe;(7) but a state cannot prohibit its citizens from effecting in another state a contract of insurance.(8) Acts of Congress(9) having authorized the registration in the patent office of devices. in the nature of trademarks, made the wrongful use thereof a cause of action for damages, and punished by fine and imprisonment the fraudulent use, sale, and counterfeiting thereof, it was held (10) that the statutes in question were unconstitutional because not limited in terms, or by the essential nature of their subject matter, to the regulation of trademarks in their relation to foreign and interstate commerce. A subsequent statute(11) has provided for the registration and protection of trademarks used in foreign and interstate commerce, and is not open to the objection which invalidated the prior statutes. On the other hand, bills of lading of goods sold and transported in the course of interstate Commerce are, by reason of their representative character, entitled to protection as commerce,(12) and the transmission of ideas by telegraph is commerce, for the reason that in the development of modern business methods the telegraph has become indispensable as a means of intercommunication in commercial intercourse.(13) Would not the same reasoning apply, in the case of goods admittedly subjects of commeree, to the trademarks on such goods, the bills of exchange drawn for the price of the goods, and the policies of insurance against the loss of the goods by fire or by the perils of navigation? Insurance, commercial paper, and trademarks are certainly as clearly related to, and as truly incidents of, commerce, as a telegraphic inquiry as to the state of the market, or a telegraphic order for the forwarding of the goods, though, unlike the bill of lading, they do not represent the goods. Lottery tickets are subjects of traffic, and the carriage of such tickets by independent carriers from one state to another is interstate commerce.(14) The transfer of shares of railway companies is interstate commerce when such shares are transferred for the purpose of vesting in a holding company a majority of the shares of two competing railways engaged in interstate traffie.(15)
Regulation of commerce defined.
32. To regulate commerce is "to prescribe the rule by which commeree is to be governed."(16) The power to regulate is unrestrained, and it may, therefore, either control or prohibit. Commerce may be directly regulated by legislation enacted in the exercise of the police power and prescribing the manner in which the operations of commerce are to be conducted, or it may be indirectly regulated by the imposition of taxation upon its instrumentalities or subjects.(17) Taxation has been defined(18) as the compulsory exaction by a government, in the exercise of its sovereignty, of a payment of money or surrender of property by any person, natural or corporate, who, or whose property so taxed, is subject to the sovereign power of that government.(19) The police power may be defined to be that function of government by the exercise of which all persons who are subject to the sovereignty of the govervment exercising the power are, for reasons of public policy, restrained in their use or enjoyment of some right of person or of property.(20) The police power may attain its end by absolutely prohibiting the exercise of a particular right or by so regulating the exercise of that right as to permit its use under conditions, and, if the power exist, the extent to which it may be exercised in any case is limited only by the legislation of the government in which the power may be vested, unless farther restraint be imposed by the Constitution of the United States or by the constitution of the state. Congress cannot, in the exercise of the power to regulate, tax comerce;(21) and while the states cannot regulate foreign or interstate commerce, they are not prohibited from taxing either its instrumentalities or subjects, provided that taxation be imposed thereon as component parts of the mass of property in the state, and provided also that that which is in form taxation be not in substance a restriction upon, or a prohibition of, foreign or interstate commerce. The essential difference between taxation of property, and regulation of commerce in the guise of taxation, is illustrated by every case in which the court has had to determine whether any particular tax imposed under state authority on an instrumentality or subject of foreign or interstate commerce be, or be not, forbidden by the Constitution.(22) In the exercise of its power over commerce, Congress has, in statutes too numerous to mention, imposed duties on imports and even prohibited importations of certain goods(23) and regulated, among other things, the registrlion and recording of the titles of ships,(24) the clearance and entry of ships and steamers,(25) the tonnage duties payble to the United States by vessels,(26, navigation, including sailing rules, and the life-saving service(27) the transportation of passengers and merchandise by sea,(28) the shipping of sailors,(29) and their pay and discharge,(30) the lighthouse service,(31) the coast survey,(32) the building and use of bridges,(33) the improvement of rivers and harbours(34) and telegraphs.(35) It has authorized the transportation of government supplies, and mails, and troops by railway, and the connection of railways of different states so as to form a continuous line;(36) it has permitted the states to regulate the storage and sale of original packages of intoxicating liquors;(37) it has regulated the interstate transportation of live stock;(38), it has provided for arbitration between interstate railroad companies and their employees;(39) it has required the use of automatic couplers on interstate trains;(40) it has, by the Interstate Commerce Act and its amendments,(41) regulated the interstate transportation of passengers and freight by railways and constituted a commission to carry the statute into effect; and it has prohibited the making of contracts in restraint of interstate commerce.(42) The states have facilitated foreign and interstate commerce by the improvement of navigation, the construction of railways, wharves, and bridges, and they have incidentally affected it by the enactment of pilotage, quarantine, and police laws. The states have also regulated their internal commerce by taxation and by police legislation.
The general principles defining the limits of national and state regulation.
33. Foreign commerce is, obviously, that which is carried on between a foreign port, or a point in a foreign eountry, and a port of, or a point in, the United States interstate commerce is that which is carried on between ports, or points, in different states; and certainly that commerce which begins, moves, and ends, exclusively with in a state must be regarded as internal commerce and as such subject to state taxation and regulation. Where commerce begins within a state, passes beyond the territory of that state and through part of another state, and ends in the state of its origin, it is regarded as sufficiently internal commerce to be subject to taxation in the state of its origin and destination "in respect of receipts for the proportion of the transportation within the state."(43) On the other hand, transportation under such conditions is subject only to the regulation of the United States and not to the regulation of the state(44) It has also been held that navigation on the high seas between ports of the same state is subject to regulation by the United States.(45) A commodity is not to be regarded as a subject of foreign or interstate commerce until it has begun to move in trade from one country or state to another(46) for, until the commodity is actually shipped or started, "its exportation is a matter altogether in fieri, and not at all a fixed and certain thing.(47) The general distinction as to the respective powers of the United States and the states over commerce was clearly put by Marshall, C. J.,(48) when he said, "The genius and character of the whole government seems to be that its action is to be applied to all the external concerns of the nation, and to those internal concerns which affect the states generally, but not to those which are completely within a particular state, which do not affect other states, and with which it is not necessary to interfere for the purpose of executing some of the general powers of the government." Therefore, the internal commerce of a state is exclusively a subject of regulation by that state; and foreign and interstate commerce are subjects of regulation by Congress. But, as Curtis, J., said, the power to regulate foreign and interstate "commerce embraces a vast field, containing not only many, but exceedingly various, subjects, quite unlike in their nature; some imperatively demanding a single uniform rule, operating equally on the commerce of the United States in every port, and some.....as imperatively demanding that diversity which alone can meet the local necessities."(49) Therefore, where the subject is national in its character and demands uniformity of regulation, Congress alone can legislate, and, when Congress has not legislated, it necessarily follows that that subject is to be free from all legislation whatever. The so called "doctrine of the silence of Congress" means this, and nothing more than this.(50) On the other hand, where the subject is not national in its charaeter, and where local necessities require diversity of regulation, the states may legislate, and their legislation will be controlling and effective until, and only until, congressional legislation shall supersede the state legislation.(51)
The internal commerce of a state.
34. As Chase, C.J., said,(52) referring to the internal commerce of a static, "Over this commerce and trade Congress has no power of regulation nor any direct control. This power belongs exclusively to the states." The United States, therefore, may not prohibit the sale within the territory of a state of illuminating oil inflammable at less than a specified temperature;(53) nor license the sale of liquor in violation of the laws of the state;(54) nor does a Iicense granted by the United States exempt the licensee from state taxation on the business so conducted;(55) nor do letters patent granted for an invention confer upon the patentee the right of selling the patented article in violaion of the laws of the state.(56) The cases which illustrate the power of the state over its internal commerce are hereinafter referred to, and the rule deducible from them is that, while each state did not, by the adoption of the Constitution, surrender its ordinary local powers of self government operative upon all persons and property which exist, or may come, within its territorv, and which merge in the mass of persons and property subject to its jurisdiction, yet, nevertheless, the territorial limits of each state's jurisdiction, the grant to the government of the United States of powers conflicting with state sovereignty, and a due regard to the rights of citizens of other states, must be held to limit the exercise by each state of its otherwise illimitable powers, by the restriction that those powers are not to be so exercised as to interfere with the full execution of the powers granted to the United States. Therefore, persons or property brought within the territory of a state by the exercise of any federal power, must be exempted from obstructive state control until the federal power has ceased to operate, and until the persons or property on which it acted have merged in the mass of persons or property within the territory of the state.(57) On the same principle, federal agencies are exempted from any such state regulation as hinders the agent in the full performance of his or its duty to the government of the United States.
Navigable waters and the soil under them.
35. Before the Revolution, the title to navigable waters and to the soil under them was vested in the crown, or in its grantees. After the Revolution, the people became sovereign, and henceforth the title to navigable waters within the jurisdiction of a riparian state and to the soil under them became vested in that state for the public use of its citizens.(58) After the adoption of the Constitution, as before, the title to navigable waters and to the soil under them and the right to fish therein remained in the riparian state, its proprietary title extending in the case of inland waters constituting its boundary (59) from ordinary high water mark ad medium filae, and in the case of the sea and its bays, to the distanee that the international jurisdiction of the United States extended; and by force of the Constitution, the United States acquired only the right to exereise over navigable waters its power of regulating navigation, and states which were admitted to the union subsequently to the adoption of the Constitution have, of course, in this respect the same rights of sovereignty and jurisdiction as the original thirteen states. (60) Therefore, a state may rightfully regulate the exercise of the right of fishing in its navigable waters, and enforce by judicial proceedings a forfeiture of vessels whose navigators fail to conform to the regulations so prescribed, and a liceiase to navigate granted by the United States confers no immunity from the operation of such regulations.(61) The right of the people of a state to fish in its navigable waters comes not from their citizenship alone, but from their eitizenship and property combined,"(62) and it is, therefore, a right which does not by force of the Constitution vest in the eitizens of other states. The power granted to the United States of jurisdiction in admiralty does not carry with it a cession of navigable waters, or of general jurisdiction over them, and, therefore, a murder committed on a vessel of the navy of the United States while at anchor in navigable waters within the jurisdiction of a state is not cognizable in a court cf the United States.(63)
Preferences of ports.
36. The Constitution declares that "no preference shall be, given by any regulation of commerce or revenue to the ports of one state over those of another."(64) This prohibition is obviously intended to guard against favouritism in customs regulations, and, therefore, does not apply to the diversion of water from one navigable river to another in an improvement of navigation,(65) nor to the legalization by an act of Congress of a bridge over navigable waters, though indirectly obstructing the commerce of a port.(66)
Duties upon exports.
37. The United States are expressly forbidden to tax exports.(67) This pro-hibition applies to foreign, and does not apply to interstate, commerce(68) nor to goods "imported from the UnitedStates" into Porto Rico.(69) Internal revenue stamps required to be placed by the manufacturer upon articles for exportation do not fall within the prohibition.(70) On the otherhand, a specific stamp duty imposed upon bills of lading covering goods exported is a tax upon the articles covered by the bill of lading, and, therefore, a tax upon exports.(71)
Duties upon tonnage.
38. The Constitution in express terms forbids the states to impose duties on tonnage. Setion 10 of Article I of the Constitution declares that "no state shall, without the cousent of Congress, lay any duty on tonnage." The word "tonnage," as applied to American shipping, means "their entire internal capacity, expressed in tons of one hundred cubical feet each, as estimated and ascertained by those rules of admeasurement and computation(72) which are prescribed by the acts of Congress.(73) The constitutional prohibition prevents state taxation of " watercrafts plying in the navigable waters of the state.....at the rate of $1 per ton of registered tonnage.(74) Nor can a state require that every vessel arriving at a port of the state shall pay to the port wardens a fixed sum whether the wardens be, or be not, called on to perform auy services for the vessel;(75) nor compel every vessel arriving at any quarantine station on the eoast of the state to pay a fixed sum per ton;(76) nor require every steamboat mooring in any port of the state to pay a sum regulated by the tonnage of the boat;(77) nor require all vessels entering a certain port to load or unload, or making fast to any wharf therein, to pay a sum regulated by the registered tonnage of the vessel.(78) In each one of these cases, the taxation imposed by the state would have been void as an attempted regulation of interstate commerce, had there been no, express prohibition of state tonnage duties.
Port Dues.
39. Port dues, that is, charges imposed on vessels as instruments of commerce, and payable by all vessels entering, remaining in, or leaving a port, by reason of such entry, stay, or departure, and without regard to services rendered to or received by the vessel, are regulations of rightfully imposed under commerce, and as such cannot be state authority.(79) Under this rule, as expounded in Steamship Co. v. Port Wardens,(80) a charge of $5 per vessel payable to the wardens "whether called on to perform any service or not, for every vessel arriving in" the port of New Orleans, was held to be a wrongful imposition. So also, under pretence of making port regulations, a state (cannot rightfully vest in the master and wardens of a port, or in his deputies, a monopoly of the survey of the hatches of seagoing vessels coming to the port, or of damaged goods on such vessels, for such a monopoly is a burden upon, and therefore a regulation of, foreign and interstate commerce.(81) The prohibition of state duties on tonnages(82) forbids the imposition by a state of port dues in the form of a tax of $5 for the first hundred tons and 1 1/2 cents for each additional ton payable by vessels owned in another state and entering a harbour of the taxing state in the pursuit of commeree,(83) and also of a tax similarly proportioned on "all steamboats which shall moor or land in any part of" a state port.(84)
Pilotage.
40. As the thirteen original states were, before the ratification of the Constitution, existiiag governments, they had, with the obvious exception of New Hampshire, enacted laws regulating pilotage. The first Congress(81) declared that "all pilots.....shall continue to be regulated in conformity with the existing laws of the states respectively wherein such pilots may be, or with such laws as the states may respectively hereafter enact for the purpose, until forther legislative provision shall be made by Congress. It has been held that, pilotage being a subject of local concern, the states may regulate it so long as, and to the extent that, Congress does not legislate with regard to it.(86) A state may impose upon a vessel refusing to take an offered pilot the forfeiture of half pilotage fees, and it may exempt from such forfeiture vessels engaged in a particular trade.(87) The forfeiture of half pilotage fees being, not in the nature of a penalty, but of compensation under an implied contract,(88) those fees must be paid though the pilot's services were tendered and refused before the vessel had come within the jurisdiction of the state,(89) and though the statute authoriziiag the recovery was repealed after the services of the pilot were tendered and refused, but before the action was brought to recover therefor.(90) Such statute may impose a compulsory obligation on foreign vessels.(91) But a state may not discriminate in its pilotage regulations, as by requiring vessels of some states to pay half pilotage fees and exempting vessels of other states from that requirement; nor can a vessel under the control of a pilot licensed under the laws of the United States be required to take a pilot under the laws of a state.(92)
Regulation of navigation.
41. The power to regulate foreign and interstate commerce includes the control of navigation in the prosecution of such commerce. The United States may, therefore, license vessels navigating waters within the territorial jurisdiction of a state and plying between ports of different states, and a state may not create a monopoly interfering with the freedom of such navigation.(93) The United States may require, under a penalty, the inspection and licensing of a steam vessel(94) engaged in the transportation on a state's internal waters of goods from, or destined to, points in other states.(95) A state may not require vessels licensed by the United States to carry on the coasting trade and plying between a port in that state and ports in other states,(96) or vessels also licensed by the United States and employed as lighters and towboats in a port of a state in aid of vessels engaged in commerce, either foreign or coastwise,(97) to make return to the local authorities of the names, places of residence, and respective interests of the owners of such vessel state may not require "those engaged in the transportation of passengers among the states to give to all persons traveling within that state, upon vessels employed in such business, equal rights and privileges in all parts of the vessel without distinction on account of race or colour, "for such a statute acts directly upon the business, as it comes into the state from without, or goes out from within.(99) On the other hand, a state may grant an exclusive monopoly of the navigation of an internal waterway which, by reason of a lack of outlet or other connection with any possible system of interstate or foreign transportation, is available only for the internal commerce of the state, and on such a waterway an United States coasting enrollment and license is inoperative.(100)
Port regulations.
42. A state may establish port regulations, prescribing where a vessel may lie in harbour, how long she may remain there, and what lights she must show at night; thus in The James Gray v. The John Fraser,(101) an admiralty cause of damage resulting from a collision of the two vessels in Charleston harbour, that one was held to be in fault, which had, by its failure to display lights in conformity with the regulations of the port imposed under authority of the state, been the cause of the eollision. Taney, C. J., said(102) "Regulations of this kind are necessary and indispensable in every comnercial port, for the convenience and safety of commerce, and the local authorities have a right to prescribe at what wharf a vessel may lie, and how long she may remain there, where she may unload or take on board particular cargoes, where she may anchor in the harbour, and for what time, and what description of light she shall display at night to warn the passing vessels of her position, and that she is at anchor and not under sail. They are like to the local usages of navigation in different ports, and every vessel, from whatever part of the world she may come, is bound to take notice of them and conform to them. And there is nothing in the regulations referred to in the port of Charleston, which is in conflict with any law of Congress regulating commerce, or with the general admiralty jurisdiction conferred on the courts of the United States." Ostensibly on the same principle, it was held in New York v. Miln,(103) that a state may require under a penalty the master of every passenger carrying vessel on arriving at any port within the state to report to the state authorities the name, pIaee of birth, last legal settlement, age, and occupation of every passenger, the statute under consideration being one enacted by New York in 1824, and the court affirming its validity, on the ground that it was a regulation, not of commerce, but police, and as sueh falling within the reserved powers of the state. The authority of the case is, however, much shaken by the admirably reasoned dissenting judgment of Story, J., with whose conclusions Marshall, C. J., concurred (104) and the result reached by the court is clearly inconsistent with the later cases of Sinnot v. Davenport,(105) Foster v. Davenport,(106) and the yet later cases, which hold that a state cannot, directly or indirectly, tax the transportation of passengers coming from foreign countries.(107)
Quarantine.
43. As Brown, J., said in Bartlett v. Lockwood,(108) "While, under its power to regulate foreign and interstate commerce, the authority of Congress to establish quarantine regulations, and to protect the country as respects its commerce from contagious and infectious diseases, has never in recent years been questioned, such power has been allowed to remain in abeyance; and Congress, doubtless in view of the different requirements of different climates and localities, and of the difficulty of framing a general law upon the subject, has elected to permit the several states to regulate the matter of protecting the public health as to themselves seemed best. "A state may, therefore, prohibit the entry into its territory of physically infected persons or goods, and it may provide for an examination of all persons or goods coming into its territory in order to determine whether or not they be physically infected, and to defray the expenses of such sanitary examinations it may colleet charges, provided that such charges be not in the form of duties on tonnage and that they do not unnecessarily interfere with foreign or interstate commerce. A state may, therefore, require all vessels coming into its ports to stop at designated quarantine stations, submit to a sanitary examination, and pay therefore fees rated in amount in proportion to the maritime class to which the vessel may belong and equal in amount for all vessels of the same class.(109) On the other hand, a state cannot, for the purpose of defraying the expenses of enforcing her quarantine regulations, impose on vessels entering her harbours in the prosecution of commerce, taxes based upon the tonnage of the vessel.(110) A state may enact statutes declaring that persons transporting, or having in their possession, diseased animals are to be held liable for any damage caused by the spread of disease by such animals,(111) and a state may authorize its sanitary authorities to exclude from its territory animals imported from localities in other states wherein those sanitary authorities may determine epidemic discases among such animals to exist;(112) but a state may not, under the pretext of quarantine laws, regulate interstate commerce, as by prohibiting the driving or conveyance of Texan, Mexican, and Indian cattle into the state between the 1st of March and the 1st of November in any year,(113) or by prohibiting the sale of meat which has not been inspected on the hoof within the state.(114) The test is, as stated by, McKenna, J., "whether the police power of the state has been exercised beyond its province, exerted to regulate interstate commerce, exerted to exclude without discrimination the good and the bad, the healthy and the diseased, and to an extent beyond what is necessary for any proper quarantine.... The prevention of disease is the essence of a quarantine law. Such a law is directed not only to the actually diseased, but to what has become exposed to disease." (115)
Ferries.
44. A ferry is "a franchise grantable by the state, to be exercised within such limits and under such regulations as may be required for the safety, comfort, and convenience of the public," (116) and such a franchise confers the right of embarking and landiiag passengers and freight at designated points on a water bank.(117) Such a franchise is necessarily exclusive.(118) The state which grants the franchise may annex conditions to its exercise, and may, therefore, tax the ferry and its appliances. It may also tax the boats and other personal property of the owner of the ferry, if that owner be by residence subject to its jurisdiction.(119) On the other hand, a state cannot tax ferry boats which only come within its jurisdiction in the movement of interstate commerce.(120)
Bridges and dams.
45. Navigability in fact is the test of navigability in law. If a lake, river, or stream "be capable in its natural state of being used for purposes of commerce, no matter in what mode the commerce be conducted, it is navigable in fact, and becomes in law a public river or highway."(121) As navigable waters are no longer the sole, nor, indeed, the main channels of commerce, and as that volume of trade which is carried over such waters by bridges or viaducts is in many cases entitled, by reason of its magnitude, to greater consideration than that which is moved in boats upon the water, it must be determined in the case of any bridge, or other obstruction, whose erection or the method of whose construction is called into question, whether or not the public interest will be promoted by its erection or by its construction in the particular manner, and such a matter is primarily ome for the decision of the legislature, rather than of any court. As the subject is that of possible obstruction of highways of foreign or interstate commerce, final jurisdiction is necessarily vested in Congress,(122) which may forbid, or permit upon conditions, the erection of a bridge under state authority,(123) or may legalize a bridge already erected, pending a suit to enjoin its construction,(124) or even after the Supreme Court of the United States has entered a final decree declaring the bridge as constructed to be an unlawful obstruction;(125) or may reserve for future congressional action the approval of the construction of any bridge under an act of the legislature of any state over or in any "stream or other navigable water not wholly within the limits of such state," and in any delegate to the Secretary of War the power of approving bridges and other obstructions in navigable waters wholly within the Iimits of any one state, and may prohibit all obstructions not so approved.(126) This congressional legislation does not deprive the states of authority to bridge or otherwise obstruct intraterritorial streams, but only creates "an additional and cumulative remedy to prevent such structure although lawfully authorized, from interfering with commerce,"(127) nor does it vest in the Secretary of War" the right to determine when and where a bridge may be built."(128) Therefore, subject to the paramount authority of the United States, as exercised by Congress, or, under the legislation now in force, as delegated to the Secretary of War, a state may partially obstruct by bridges, or wholly obstruct by dams, navigable waters which are wholly within its limits.(129) The power of bridging their navigable waters is not affected in the states carved out of the Northwest Territory by the provision in the ordinance of 1787 for the free navigation of the Mississippi and the St. Lawrence "without any tax, duty, or impost therefor,"(130) nor in the states of California, Louisiana, or Oregon by the provisions of the acts of Congress admitting them to the union and declaring their navigable waters to be forever free.(131) A state cannot lawfully appropriate water for its nonnavigable streams to such an extent as to impair the navigation of its navigable streams.(132) In the case of the bridge spanning the Ohio river and connecting the city of Cincinnati, in the state of Ohio, with the town of Covington, in the state of Kentucky, it was held by the majority of the court (133) that the traffic across the river was interstate commerce, that the bridge was an instrument of that commerce, and that Congress possesses the power to fix the charges for the traffic over the bridge, the authority of the state being limited to fixiiag tolls exclusively within its territory; but the minority of the court held that, as Congress had made no provisions as to the tolls, it had thereby manifested its intention that the rates of toll should be as established by the two states. It has also been held that a state may tax so much of an interstate bridge as is within its territory, (134) and that a state may tax the capital stock of an interstate bridge company ineorporated by it.(135)
Improvements of navigation.
46. The United States may, in the discretion of Congress, authorize or prohibit improvements in the water ways of foreign or interstate commerce. It may change the established channels of rivers, (136) and dredge harbours,(137) and the action of the United States is exclusive of any right to the contrary asserted under state authority. On the other hand, a state may exercise exclusive control over such waterways as are wholly within its territory, and are not used in movement of foreign or interstate commerce.(138) The principle controlling the cases on this subject is nowhere more clearly stated than by Field, J., who said, in County of Mobile v. Kimball,(139) " The uniformity of
commercial regulations, which the grant to Congress was designed to secure against conflicting state provisions, was necessarily intended only for cases where such uniformity is practicable. Where from the nature of the subject or the sphere of its operations the case is local and limited, special regulations adapted to the immediate locality could only have been contemplated. State action upon such subjects can constitute no interfereiace with the commercial power of Congress, for when that acts the state authority is superseded. Inaction of Congress upon these subjects of a local nature or operation, unlike its inaction upon matters affecting all the states and requiring uniformity of regulation, is not to be taken as a declaration that nothing shall be done with respect to them, but it is rather to be deemed a declaration that for the time being, and until it sees fit to act, they may be regulated by state authority. The improvement of harbours, bays, and navigable rivers within the states falls within this last category of cases. The control of Congress over them is to insure freedom in their navigation, so far as that is essential to the exercise of its commercial power. Such freedom is not encroached upon by the removal of obstructions to their navigability or by other legitimate improvements. The states have as full control over their purely internal commerce as Congress has over commerce among the several states and with foreign nations; and to promote the growth of that internal commerce and insure, its safety they have an undoubted right to remove obstructions from their harbours and rivers, deepen their channels, and improve them generally, if they do not impair their free navigation as permitted under the laws of the United States, or defeat any system for the improvement of their navigation provided by the general government. A state may, therefore, if Congress does not otherwise direct, deepen and widen the harbours on its coast,(140) Construct dams and locks in navigable rivers, and levy tolls upon shipping using the improved waterway,(141) but a state may not levy charges for an improved waterway upon vessels whose draught is so light that the improvement has been of no benefit to such vessel's.(142)
Wharves and piers.
47. A state may build wharves on navigable waters and collect reasonable tolls for the use thereof,(143) for such tolls, not being impositions by virtue of sovereignty, are not taxes but are charges for services rendered or for conveniences provided, and they are claimed in right of proprietorship. Whether wharfage tolls be, or be not, in fact reasonable is not a question of federal law, nor as such cognizable in a court of the United States in cases other than those in which the federal court has acquired jurisdiction by reason of the citizenship of the parties.(144) Nevertheless, the right of a state to build wharves and charge tolls therefor cannot be so exercised as to discriminate in favour of the products of its own territory and against those of other states.(145)
State duties upon imports and exports.
48. "Imports" are goods brought into a state from a foreign country, and goods brought from one state into another are not "imports".(146) As the power vested in the United States to regulate commerce with foreign nations includes the power to impose duties on the importation of foreign goods, and to license, on the payment of those duties, the sale of the imported goods within any state, and as there is an express constitutional prohibition of state duties on imports and exports, excepting such duties as may be absolutely necessary for executing the inspection laws of the state, it follows that a state cannot require under a penalty importers of foreign goods by the bale or package, and vendors of the same by wholesale, to take out a license as a prerequisite to the sale of such imported goods in the original form and package in which they are imported, and before they become incorporated with the mass of property in the state.(147) On the same principle, a state cannot impose an ad valorem tax upon imported goods remaining in their original cases in the hands of the importer, even though a similar tax be imposed on all merchandise in the state;(148) and a state cannot tax an auctioneer's sales of imported goods in their original cases and for the account of the importers thereof.(149) Yet separately wrapped packages of foreign dry goods brought into a state in wooden eases are subject to state taxation upon their being taken from their cases.(150) Merchandise brought from a foreign country and which by the terms of the contract of purchase is not to be at the risk of the purchaser until delivered to him in the port of entry, does not come within the constitutional meaning of the term "imports," and such goods, though in their original packages, may be taxed by the state in whose port their purchase is completed by delivery.(151)
State inspection laws.
49. The object of inspection laws is to improve the quality of articles produced by the labour of a country, to fit them for exportation, or, it may be, for domestic use. They act upon the subject before it becomes an article of foreign commerce, or of commerce among the states, and prepare it for that purpose.(152) Such laws prescribe some or all of certain requisites, such as the quality of the article, the form, capacity, dimensions, weight, or marking of the package, and, to enforce compliance with their requirements, they provide for supervision by public officers.(153) Therefore, a state may prohibit under a penalty the exportation, without inspection, of articles produced in the state, such as tobacco,(154) and may require the official measurement of coal,(155) and lumber,(156) and the inspection of fertilizers.(157) The words "inspection laws," "imports," and "exports," as used in the Constitution, leaving exclusive reference to property, as distinguished from persons,(158) a state per capita tax on immigrants cannot be sustained as a means of executing the inspection laws of a state.(159) But a state may not, under the pretence of an inspection law, regulate interstate commerce, as by requiring an inspection by a public officer, upon payment of fees, of all meat slaughtered more than one hundred miles from the place of sale, when there is no such requirement with regard to meat slaughtered at a less distance from the place of sale;(16O) or by requiring an inspection of all flour ground without the state, when there is no such requirement as to flour ground within the state;(161) or by prohibiting the sale of meat which has not been inspected on the hoof within the state;(162) or by requiring, as a prerequisite to the shipment of alcoholic liquors into the state, an analysis by the state chemist of a sample thereof.(163)
Taxation discriminating against goods from other states.
50. A state may tax goods brought in from another state, though in the hands of the consignee and in the original packages;(164) but a state cannot by taxation discriminate against either the natural products of, or the goods manufactured in, other states, whether by requiring of every nonresident trader as a prerequisite to his sales of other than agricultural products of or articles manufactured in the state, a higher license fee than is required of traders in domestic goods;(165) or by requiring payment of a license fee by vendors of merchandise "not the growth, produce, or manufacture" of the state, no license fee being required of vendors of domestic merchandise;(166) or by charging vessels laden with the products of other states for the use of public wharves, when vessels laden with the products of the state are permitted to use such wharves without charge;(167) or by requiring a non-resident merchant desiring to sell by sample in the state to pay for a license to do that business a sum to be ascertained by the amount of his stock in trade in the state where he resides, and in which he has his principal place of business;(168) or by imposing a tax on each selling agent of a foreign dealer while not imposing a tax upon the selling agents of a domestic dealer; (169) or by imposing a license tax upon wholesale dealers in brewed or malt liquors but exempting from such tax all dealers paying a lesser tax for the privilege of manufacturing liquors within the state;(170) or by statutes under the guise of inspection laws imposing discriminating taxes upon products of other states, as, for instance, by, requiring that no meat slaughtered one hundred miles or more from the place of sale should be offered for sale unless previously inspected by a local official and a fee paid theref or, while requiring no inspection to be made of meat slaughtered within one hundred miles of the place of sale;(171) or by requiring flour brought into the state and offered for sale therein to be inspected by a state official and a fee paid therefor, while requiring no inspection to be made of flour produced within the state.(172) Nor can a state, under the act,(173) Which was passed to legislatively overrule the Original Package Case(174) establish, so far as regards the sale of intoxicating liquors, a system which would in effect discriminate between interstate and domestic commerce in commodities whose manufacture and use are permitted by the state.(175) There is no unlawful discrimination in requiring prepayment of the tax by vendors of the produets of other states, while vendors of domestic goods are permitted to pay the same tax on returns from time to time.(176) On the other hand, nondiscriminating taxation may lawfully be imposed by a state, as where a state levies a tax upon all peddlers of sewing machines without regard to their place of manufacture,(177) or by taxing the gross yearly commissions of all general agents selling on commissions.(178) A state wbich taxes the traffic in any intoxicating liquors at any place other than the place of manufacture does not impose a discriminating tax upon a dealer in liquors manufactured in another state.(179) Of course, one who claims under these cases exemption from the burden of state taxation must prove his right and must show a discrimination in taxation as against goods brought in from another state.(180) The cases that have been cited forbid only that state taxation which discriminates in favour of the products of the taxing state and against goods brought in from another state, but there are other cases wbieh rest upon the broad principle that a state eannot impose any tax or other restriction "upon the citizens or inhabitants of other states for selling, or seeking to sell, their goods in such state before they are introduced therein,(181) the ground of decision being, that such a tax does not subject to taxation goods brought from another state in common with t@e mass of property in the taxing state, but that, on the other hand, such a tax stands as a barrier in the way of the manufacturer or merchant of another state and hinders him in the introduction of his goods into the taxing state.(182) It is no answer to this to say, as White, C. J., and Field and Gray, JJ., said(183) that if citizens of other states cannot be taxed in the same way for the same business, there will be discrimination against the inhabitants of the taxing state and in favour of those of other states, for the conclusive reply is that while a state may without discrimination tax its domestic trade, it cannot, with or without discrimination, tax or otherwise regulate that interstate commerce which has not been terminated by the merging of its subject in the mass of property within the jurisdiction of the taxing state. It must be remembered that, as Bradley, J., said (184) to carry on interstate commerce is not a franchise or a privilege granted by the state; it is a right which every citizen of the United States is entitled to exercise under the Constitution and laws of the United States."
The original package doctrine.
51. In Brown v. Maryland,(185) a statute of Maryland requiring, inter alia, all importers of foreign articles, "by bale or package," to take out a license, was held to conflict with the prohibition of state duties upon imports, as well as with the federal power of regulating commerce, Marshall, C. J., saying (186) that "when the importer has so acted upon the thing imported, that it has become incorporated and mixed up with the mass of property in the country, it has, perhaps, lost its distinctive character as an import, and has become subject to the taxing power of the state; but while remaining the property of the importer, in his warehouse, in the original form or package in which it was imported, a tax upon it is too plainly a duty upon imports to escape the prohibition in the Constitution." Marshall, C. J., also said (187) that "Congress has a right, not only to authorize importation, but also to authorize the importer to sell," but he qualifies this (188) by his concession that the police power "remains, and ought to remain, with the states." It was subsequently held that the prohibition of duties upon imports and exports had no reference to interstate commerce;(189) and the congressional right of authorization of importation and the consequent right of authorization of the sale of imported articles have no relevancy to state taxation or to state police control of interstate commerce, and, therefore, a state tax upon sales at auction was held to be applicable to products of other states, even though the articles were sold in their original and unbroken packages.(190) It was also held that coal bronght from another state by vessel, and unladen, was subject to state taxation in its port of destination.(191) On the other hand, it was held that a state cannot forbid a common carrier to bring liquors into the state, and that such legislation does not release the carrier from liability in damages for his refusal to carry the liquor.(192) It was also held that beer brought from another state in barrels and in cases was not subject to seizure under a state statute prohibiting the sale of intoxicating liquors,(193) the grouud of decision being that beer is an article of lawful commerce, and, as such, entitied, under the commerce clause, to be brought into every state, and, so long as it remains in its original package, to be free from state control. The doctrine of this case was obyiously applicable to all importation and transportation of intoxicating liquors, and it necessarily was a cause of irritation to those people who conscientiously believe it to be the duty of every government to prohibit all traffic in, or use of, such liquors. There naturally followed an act of Congress,(194) providing "that all fermented....liquors....transported into any state or territory or remaining therein for use, consumption, or sale or storage therein, shall upon arrival in such state or territory be subject to the operation and effect of the laws of such state or territory enacted in the exercise of its police powers, to the same extent and in the same manner as though such liquids or liquors had been produced in such state or territory, and shall not be exempt therefrom by reason of being introduced therein in original packages or otherwise. " As the court's ruling in Leisy v. Hardin was based upon an affirmation of the constitutional exemption of articles of interstate commerce from the exercise of the state's police power, there was some ground for supposing that an act of Congress could not confer upon the states any power in the premises, for, as Taney, C. J., had said,(195) it will hardly be contended that an act of @ongress can alter the Constitution, and confer upon a state a power which the Constitution declares it shall not possess. And if the grant of power to the United States to make regulations of commerce is a prohibition to the states to make any regulation upon the subject, Congress could no more restore to the states the power of which they were thus deprived, than it could authorize them to coin money or make paper money a tender in the payment of debts, or to do any other act forbidden to them by the Constitution. "Nevertheless, the court held (196) that the act was constitutional because it was in effect a national regulation of interstate commerce in liquors, and because it imparted no power to the states not then possessed and simply removed an impediment created by the absence of a specific utterance on the part of Congress.(197) It has since been held that under this act a state cannot establish a system discriminating "between interstate and domestic commerce in commodities whose manufacture and use are not prohibited by its laws."(198) It has also been held that a state may prohibit the sale of oleo margarine in imitation of butter, and that the act of Congress (199) defining butter and imposing a tax upon oleo margarine does not authorize transportation and sale in violation of such a statute,(100) the ground of decision being that the doctrine of Loisy v. Hardin does not justify the broad contention that the states are powerless to prevent the sale of subjects of commerce, if their sale may cheat the people into purchasing something which is wholly different from that which its condition and appearance import. On the other hand, it has been held (201) that oleo margarine, being an article of food and commerce, a state statute cannot prohibit its transportation f rom another state and its sale in an original tenpound package. It has also been held(202) that a state may prohibit the sale of cigarettes brought in from another state, when the size of the original package is such as to indicate an intention to sell at retail that which the state in its exercise of the police power has forbidden to be sold, Brown, J., saying,(203) "The whole theory of the exemption of the original package from the operation of state laws is based upon the idea that the property is imported in the ordinary form in which from time to time immemorial foreign goods have been brought into the country."
Transportation(a) State regulation in the exercise of the police power.
52. The construction of railways and the consequent development of systems of through transportation have required the court to consider in many cases the respective powers of the United States and of the states in regard to transportation. Before railways came into use the then ordinary appliances of internal transportation, canals and turnpike roads, were regarded as "component parts" of "that immense mass of legislation which embraces everything within the territory of a state not surrendered to the general government."(204) It was subsequently held that a state through which the Cumberland road passed could not tax coaches carrying the mail or persons traveling on the coach in the service of the United States, but the exemption from taxation was, in the several judgments of the court, based exclusively upon the terms of the contracts between the United States and the several states through which that road ran, as made by the statutes of those states authorizing the construction of the road.(205)
Under the later cases a state may, in the exercise of its police power, regulate transportation so far as may be necessary for the protection, safety, and comfort of its citizens, but it may not by such regulations ulanecessarily impede or obstruct interstate transportation. A state could, before the passage of the Interstate Commerce Act, require under a penalty all railroads to fix and post their rates of fare and freight and not to charge in excess therefor. (206) A state may regulate the charges of a private warehouse for the storage of grain, although that grain be stored in the course of interstate transportation.(207) A state may fix and enforce maximum rates of fare and freight for intrastate transportation on all railways within the state, even though the people in other states may be indirectly affected thereby.(208) A state may forbid discrimination in transportation within its territory, and constitute a commission to revise railway tariffs and to enforce the statute, for it is not to be assumed that the commission will interfere with interstate transportation.(209) A state may forbid railways to employ in a position requiring the use, or discrimination of the form or colour, of signals "any person not having received from a state board a certificate of freedom from colour blindness."(210) A state may require railways to provide separate accommodations for white and coloured persons traveling between points within the state.(211) A state may proliibit the running of freight trains on Sunday on any railway in the state (212) A state may require railways to place guard posts in the prolongation of the line of bridge trusses so that in case of derailment the posts, and not the pridge trusses, shall receive the blow of the derailed locomotive or car,(213) and a state may prohibit the heating of passenger cars, other than dining cars, "by any stove or furnace kept inside the ear or suspended therefrom."(214) A state may require all regular passenger trains running wholly within the state to stop at all county seats long enough to take on and discharge passengers.(215) A state may forbid a common carrier of passengers to limit its liability by contract.(216) A state may forbid a common carrier to limit its liability save by an agreement in writing signed by the owner of the goods, for such a requirement is the establishment of a rule of evidence, and not a regulation of contracts as to interstate transportation.(217) A state may require all railways within the state to stop certain of their trains running each way daily, at stations in towns containing a specified number of inhabitants and to stop for a time sufficient to receive and let off passengers.(218) A state may require railways receiving freight for transportation to a point on a connecting line to be liable for damages caused on the connecting line, for the railway may lawfully limit its contract of transportation to its own line.(219) A state may authorize a municipality to prohibit by ordinance the running of any trains within its limits at a speed greater than that fixed in the ordinance.(220) A state may require intersecting railways to provide facilities for transferring cars used in the regular business of their respective lines.(221) A state may provide that all railways doing business within the state shall be liable in damages to their employees for any negligence of the railway's servants.(222) A state may require railways to construct and maintain cattle guards and fences under a penalty of double damages.(223) A state may authorize the recovery from railways of double damages for cattle killed or injured at a point where the railway might, but did not, fence.(224) A state may authorize its railroad commission to require a railway to erect and maintain stations at designated villages.(225) A state may prohibit or restrain the sale of wines or liquors imported from foreign countries or brought within its territory from another state, though introduced in an original package or otherwise, or manufactured in the state.(226) A state may prohibit the sale of an adulterated food product, even though it is brought from a foreign country.(227) A state may so regulate the operation of drawbridges over navigable waters that the traffic on the water and the traffic on the land shall be so conducted as to interfere as little as possible with each other.(228) A state may grant and control the exercise of ferry licenses.(229) A state may establish port regulations for its harbours.(230) A state may authorize a municipality to forbid the use of steam power by railways within the municipal limits(231) on the other hand, a state, by its police regulations, could not, before the passage of the Interstate Commerce Act, enforce with respect ito interstate transportation, a prohibition of a charge of the same, or a greater, toll for a shorter than for a longer distance in the same direction.(232) After the passage of the Interstate Commerce Act such a regulation was a fortiori beyond the power of the state.(233) A state may not require all trains carrying interstate passengers to stop at a station where other adequate accommodations were furnished by the railway, especially where the stoppage of through trains at that station requires them to run over a branch line taking them several miles out of their direct course.(234) A state may not require a railway to stop at all county seats, a sufficient time to take on or let off passengers, such express trains as are run only for the transportation through the state of passengers between two points in other states, especially when by other trains adequate accommodations are provided for all local and through transportation to and from each county seat.(235) A state may not require, under a penalty, a report to the state authorities of the name and occupation of every passenger.(236) A state cannot forbid a common carrier to bring into the state intoxicating liquors.(237) A state may not regulate rates of transportation over a line connecting two points within the state but passing in part through another state.(238)
While a state has, unless restrained by contract, or unless it thereby regulates foreign or interstate commerce, the power to fix by legislation transportation charges within its jurisdiction, and while the presumption is always in favour of the validity of a governmental regulation under legislative authority,(238a)it nevertheless cannot require a railway to carry without reward, nor can it so fix charges as to take private property without just compensation, nor without due process of law.(238b) A state cannot under pretence of regulating rates require railways to carry specified classes of people at rates lower than those fixed by law for all classes.(238c) As the power of fixing rates is administrative, it must be exercised by the legislature (238d) and not by the courts (238e) but it is within the judicial power, and it is the judicial duty, to restrain that which in the form of regulation operates to deny to the owners of property invested in the conduct of transportation the equal protection of the laws.(238f) The courts must, therefore, when a proper case is presented, determine whether transportation charges as fixed by legislative regulation are, or are not, so unreasonably low as to deprive the carrier of his property without just compensation. Yet a railway may not fix its rates solely with a view to its own interest and ignoring the rights of the public, nor may it fix its rates upon any basis other than that of the fair value of the property used and the fair value of the services rendered, or, in other words, a fair return upon the capital invested.(238g) In this connection Harlan, J., said:(238h) The basis of all calculations as to the reasonableness of the rates to be charged by a corporation maintaining a highway under legislative sanction must be the fair value of the property being used by it for the convenience of the public. And in order to ascertain that value, the originaI cost of construction, the amount expended in permanent improvements, the amount and market value of its bonds and stock, the present as compared with the original cost of construction, the probable earning capacity of the property under particular rates prescribed by statute, and the sums required to meet operating expenses, are all matters for consideration and are to be given such weight as may be just and right in each case. We do not say that there may not be other matters to be regarded in estimating the value of the property. What the company is entitled to ask is a fair return upon the value of that which it employ's for the public convenience. On the other hand, what the public is entitled to demand is that no more be exacted from it for the use of the public highway than the services rendered by it are reasonably worth."(238i)
Much misapprehension with regard to the proper limits of the exercise of governmental power over the railways has resuIted from reasoning by analogy, for the logical value of that method of reasoning is dependent upon an exact similarity in all points between the subjects of comparison. It is a truism that railways are public highways, and yet it is clear that they are not highways in the sense that navigable rivers and roads, whether common or improved, are highways. Railways differ from those othe= highways in three important respects, which deprive the analogy of much of its value. In the first place, the railways have in the United States been constructed, in aImost every instance, not by public officers expending the public funds, but by private persons under corporate organizations expending private funds realized from the sale of corporate bonds or shares, the investors taking all the risks, and relying upon the financial results of operation under the corporate franchises for income and reimbursement of outlay. In the second place, the railway is not only an artificial highway, but also it can only be used as a highway in connection with artificial means of transportation which the railway must itself supply and operate. The earlier railways in England and in this country were chartered upon the theory that the company would provide the road and the customers find their several modes of transportation, but it was soon discovered that the magnitude, complexity, and dangers of the business were too great to admit of its conduct in that manner. In the third place, every railway is a common carrier, and, as such is bound to carry at reasonable rates and without unjust discrimination all freight and all passengers that may be offered to the extent of its facilities.
If transportation rates could be treated, without reference to the public interest as subjects of private bargain between the railway and its customers, it would be lawful for the railway on the one hand to demand whatever sum, however exorbitant, that the necessities of its customer would compel him to pay, and for the customer, on the other hand, to have his goods carried as nearly free as possible. But that duty to the public which requires the railway to carry all freight at a reasonable rate defines as reasonable that rate which not only adequately remunerates the railway for the transportation of the particular freight, but also enables it to carry that freight without prejudice to its performance of its duty of transporting other classes of freight. In other words, neither the customer, nor the railway can be permitted to ignore the fact that the railway is not a private, but a common carrier, and that, therefore, its charges must be fixed with reference to its performance of duties to others as well as to the particular customer.
Local freight costs the railways more than through freight. By reason of the fluctuation in its demand upon the terminal facilities, rolling stock, and labour it involves a large outlay in capital and in cost of administration, with uncertainty as to the amount of return in any given period. It necessitates the frequent transportation of light loads, and a consequent loss of income from unused facilities and unemployed labour. Its necessary sidings, switches, and frogs increase the perils of operation. On the other hand, through freight can be transported in full loaded cars, and with the minimum of labour, by reason of certainty as to the duration of the trip and the demands upon that labour.
All freight is not of equal bulk or value, nor is it necessarily received, carried, or delivered in precisely the same manner. It may be received and delivered at the station and loaded and unloaded by the railway employees; it maybe received and delivered at the railway sidings, bnt
loaded and unloaded by the consignor or consignee; it may be received from and delivered to sidings on private premises, and loaded or unloaded there by the consignor or consignee; or it may be received in one of these ways and delivered in another. So also the stipulated speed of transportation may vary. A railway also has to deal both with retail and wholesale customers, that is, with those who at their option make occasional use of its transportation facilities, and with others who make a prearranged regular and constant use of these facilities.
It is to the interest of both the public and the railways that rates should be suffieiently large to yield an adequate return for the capital invested, to maintain the plant in a condition of efficiency, and to permit the railway to avail itself of such improvements as may be, from time to time, made in macliinery and appliances. The railway plant includes not merely the roadbed and main tracks, but also the terminal facilities, the way stations, the sidings necessary therefor, the rolling stock, and the skilled labour upon which devolves the maintenance and operation of the road. The traffic must be steady in order that there may be no loss from unused machinery and unemployed labour. Return freight must be provided in order to avoid as far as possible the transportation of empty cars. The cost of moving freight varies upon different lines and upon different parts of the same line, in accordance with the grades, the more or less expensive character of the tunnels, bridges, viadiiets, and other engineering appliances that have been provided to overcome natural obstacles, and the cost to the railway of its machinery, fuel, and labour. The railway manager has, therefore, in fixing a rate to determine the cost of moving a given quantity of freight of the particular kind over the designated distance in the desired manner, and to that end he must consider several elements, to each of which due weight must be given: first, the extent to which the company's way or terminal facilities and labour will be used in handling the motivepower and rolling stock, and the possibility of obtaining a full return freight; third, the length of the haul and the favourable or unfavourable character of the grades; fourth the degree of expedition required, and the consequent accommoclation to, or disturbance of, the general traffic arrangements of the road; fifth, the constant, or fluctuating, character of the demands of the particular freight upon the road's facilities; and, sixth, the relative bulk and value of the freight and the degree of the carrier's responsibility for its safe transportation. Railways have not been chartered, nor has capital been invested in their construction, upon the theory that they are to do business for less than cost and a reasonable profit upon the investment. The railway manager musts therefore, in order that dividends maybe earned, and, after determining the cost of moving and handling the particular freight, such a sum for profit as will, in addition to the company's profits from other sources, furnish an adequate return for the Capital invested.
When, therefore,government officers undertake to fix transportation rates, it is only fair and just that they should take into consideration the elements of the problem as it would present itself to the mind of an experienced and intelligent railway manager. And when the courts are called upon to determine the validity of governmental regulations as to rates they may properly give weight to the same considerations.
It is true that the sum of the par of the share and debt capital of every railway line does not always accurately express the exact amount of capital invested in the line. In some cases, more, or less, of the share capital is only water, and even more or less of the debt capital may have been issued at a discount. In other cases, and this is certainly true of the great trunk lines, the sum of the par of the share and debt capital is, by reason of past expenditure of income in betterments, and, in some cases and to large amounts, by reason of issues of additional share capital at a premium, very much less than the amouint actually invested in the line.
Transportation(b) Regulation by taxation.
The United States may, in the exercise of the power to regulate commerce, impose a duty payable by shipping companies in respect of passengers, not citizens of the United States, coming from a foreign port into a port of the United States,(239) and such a duty, being an incident of the regulation of commerce and not a tax, is not subject to the constitution requirement of uniformity, and "it operates, with the same force and effect in every place where the subject of it is found."(240) A state may require a railway, incorporated by it to construct a line between a point in the state and a point without the state, to transport passengers for a charge not exceeding a fixed sum, and to pay to the state a percentage of the whole amount which may be received for the transportation of passengers; the court holding that the payment to the state is not a tax upon interstate transportation but a charge for the use of improved facilities of transportation whieh the state, by its agent, the railway, has constructed and for whose use, it has a right to charge.(241) A state may impose a tax upon the actual cash value of every share of the capital stock of a railway incorporated by it even though the railway does interstate business.(242) A state may impose on every railway operating within the state a franchise tax, to be determined in amount by multiplying the average gross receipts per mile by the number of miles operated within the state, the ground of decision being that the state which grants the franchise may annex conditions to its exercise, and may measure the value of the franchise by the gross receipts earned by operation under that franchise.(243) A state may tax the tolls received by a railway chartered by another state, but owning a line within the taxing state, for the use of such line by another railway.(244) A state may tax the capital stock, of a car company in the proportion that the number of miles run by its cars within the state bears to the whole number of miles run by its cars in that and other states.(245) A state may require a company doing both a domestic and an interstate business to take out a license.(246) A state may tax the capital stock of a consolidated corporation chartered by it, and one of whose constituent corporations is a foreign corporation.(247) A state may tax transportation between two points within the state but passing in part throagh another state, the tax being "determined in respect of receipts for the proportion of transportation within the state."(248) A state may impose a privilege tax on the business of a railway company in transporting passengers in cabs to and from a station within the state.(249) A state may impose a tax upon sales at auction of goods which are the product of other states, and which are sold in their original and unbroken packages, the tax having a uniform application to sales at auction witliin a specified territory, and not discriminating as against sales at auction of the products of other states.(250) A state may tax coal consigned by a resident of another state for sale and afloat in a port of the taxing state in the vessel in which it had been transported.(251) And a state may tax timber cut in its forests, though owned by a resident of another state and deposited at a place from whence it is to be shipped to another state.(252)
A state may not impose a capitation tax on persons leaving the state by railroad, stage coach, or otherwise.(253) Curiously enough, this case is referred to in the later judgments as if it had been decided on the ground taken in the dissenting judgment(254) that the tax was void because it imposed "a burden upon commerce among the several states," whereas the judgment of the eourt was put(255) on the ground that a state tax on the interstate transportation of passengers is void because it is an interference with the freedom of transit of citizens to the seat of government and is consequently an infringement upon the federal supremacy. A state may not impose, as affecting interstate commerce, a tax on freight.(256) A state may not impose a privilege tax at a fixed rate per car on all cars run by railways not owning the cars, so far as affects cars used in the transportation of passengers into, through, or out of, the state.(257) A state may not, so far as affects interstate commerce, tax the gross receipts of corporations engaged in the business of running cars over any of the railways of the state.(258) A state may not tax the gross receipts of the transportation of passengers or goods in interstate commerce.(259) A state may not require a railway eompany, being a link in a through line of interstate transportation, to pay a license fee for maintaining an office for the sale of tickets.(260) A state may not require an agent of an interstate transportation line to pay a license fee for soliciting passenger traffic between points in other states;(261) nor require agents of foreign express companies to take out licenses, and satisfy the state authorities that the company has an actual capitaI to the amount fixed in the taxing(262)
statute. A state may not, directly or indireetly, tax the importation of passengers.(263) A state may not impose a stamp duty upon bills of lading for the transportation of goods from a port in one state to a port in another.(264) While a state may tax the property of those persons, natural or corporate, who may be by residence subject to its jurisdiction, even if that property be invested in ships,(265) yet a state may not tax property invested in shipping, whose owners are not personally subject to its jurisdiction, and which come into its ports in the pursuit of commerce,(266) and this exemption is not adversely affected by a temporary enrollment of a ship in a port of the taxing state.(267) Nor can a state tax shipping as such, when engaged in foreign or interstate commerce, though its owners be subject to its jurisdiction.(268) for taxation so imposed amounts to a regulation of commerce.(269)
Transportation(c) The Interstate Commerce Act.
In the years preceding 1870, the people, recognizing the fact that the development of the Middle and Western states required, as speedily as possible, improved means of communication, facilitatcd by legislation, and by prodigal grants of state and county aid, the organization and construction of railway lines; but, in the years following 1870, some of the railways having come to regard themselves as mere corporations for private gain, and, as such, entitled to conduct their business without regard to the public interest, popular feeling was excited, a reaction came, and some of the states, and afterwards the United States, undertook by legislation to correct the abuses, and enforce correct principles, of railway administration. Hence the Interstate Commerce Act and its amendments,(270) which apply to all interstate common carriers, by railroad or partly by railroad and partly by water, "under a com
mon control, management, or arrangement for a continuous carriage;" require all charges to be reasonable and just; forbid unjust and unreasonable charges; prohibit the receipt from any person of "a greater or less compensation for any service rendered ... than that received from any other person for a like and contemporaneous service in the transportation of a like kind of traffic under substantially similar circumstance and conditions;" forbid undue or unreasonable preferences or discriminations, either personal or local; require reasonable, proper, and equal facilities for the interchange of traffic with other lines, and forbid discrimination in rates as between connecting lines;
forbid the receipt of as great, or "greater compensation in the aggregate . . . under substantially similar eircumstances and conditions for a shorter than for a longer distance over the same line in the same direction, the shorter being included within the longer distance," provided, however, that the commission may prescribe the extent to which a designated carrier may be relieved from the operation of this prohibition; forbid the pooling of freights, or division of earnings, by competing lines; require publication of foreign and interstate rates; forbid any advance in rates except after ten days' public notice; permit reductions in rates after three days' public notice; forbid all departures from the published rates; require schedules of rates to be filed with the eommission; forbid combinations to prevent continuous carriage; declare carriers to be liable for noncompliance with the acts to any person injured thereby in the full amount of damages, together with a reasonable counsel or attorney's fee; authorize complaint to the commission, or aetion at law in the federal courts by any person injured by a carrier's noncompliance with the acts; provide that no person shall be excused from attending and testifying or from producing books, etc., on the ground that the testimony, or evidence, documentary or otherwise, required of him may tend to criminate him, but that no person shall be prosecuted, or subjected to any penalty or forfeiture, on account of any transaction, concerning which he may testify, or produce evidence, in any such proseding; subject to punishment by fine the corporation and all directors, officers, or employees violating the act; create a commission of five members, holding office for a limited term, not more than three of the members to be appointed from the same political party; authorize the commission to inquire into the management and operation of carriers, with power to require the attendance and testimony of witnesses and the production of papers, and to that end to invoke the aid of the courts of the United States; vest jurisdiction in the commission to examine and to take testimony upon complaint made by any person, natural or corporate; authorize the commission to investigate of its own motion; forbid the dismissal of a complaint " because of the absence of direct damages to the complainant;" make the findings of the commission prima facie evidence in all judicial proceedings; require the commission, and authorize any party interested, in case of the carrier's refusal or neglect to obey any lawful order of the commission, to apply in a summary way by petition to the courts of the United States for relief, and vest jurisdiction thereof in such courts, and authorize the court to enter a decree and issue process with right of appeal to the appropriate federal appellate tribunal; authorize the commission to make rules; fix the principal office of the commission in the city of Washington, but authorize it to hold special sessions, and prosecute inquiries, in any part of the United States; authorize the commission to require reports from carriers as to share and debt capital, rates, administration, and accidents to passengers or employees; require the commission to make annual reports to the Secretary of the Interior for transmission to Congress; and provide that carriers may carry free, or at reduced rates, goods for the United States, and municipal governments, or for charitable purposes, or for exhibition at fairs, etc., and may issue mileage, excursion, or commutation passenger tickets, or give reduced rates to ministers of religion, municipal governments for the transportation of indigent
persons, inmates of soldiers' and sailors' homes, officers and employees of their own line, and may exchange passes and tickets with other lines. Under the act and its amendments, it has been decided that the Interstate Commeree
Commission is a body corporate, with power to sue, and to be sued, in the federal courts.(271) It is not a court, because its members do not hold their offices by the tenure of good behavior, and because the duties imposed upon it are not judicial in their nature. It is, however, a "subordinate administrative, or executive, tribunal,"(272) and, as such, it cannot exercise the legislative power of fixing rates in futuro;(273) nor can it indirectly fix rates by determining what would be a reasonable rate, and then obtaining from the courts an order restraining a carrier from making in futuro a charge in excess of such rates.(274) In actions to enforce the orders of the commission an appeal from a circuit court now goes, not to the Supreme Court, but to the circuit court of appeals.(275) The provision in section 12 of the act that the commission may "invoke the aid of any court of the United States in requiring the attendance and testimony of witnesses and the production of books, etc., " is not open to constitutional objection upon the theory that it imposes upon a judicial tribunal duties which are not in their nature judicial.(276) The commission cannot compel obedience to its orders by entering a judgment subjecting any person to fine or imprisonment, for the power to impose such penalties, in order to compel performances of a legal duty imposed by the act, can only be exercised by a competent judicial tribunal.(277) A witness in any inquiry by or on behalf of the commission could not, before the passage of the Act of Ilth February, 1893,(278) be required to answer questions when he stated that his answers might tend to criminate him;(279) but, as that act provided that "no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction....concerning which he may testify or produce evidence....before said commission....in any such case or proceeding" he can now be compelled to answer notwithstanding the protection afforded by the V Amendment.(280) There is a continuous carriage of goods within the meaning of the act when goods shipped under a through bill of lading from a point in one state to a point in another state are received in transit and carried exellisively within a state by a carrier under a pro rata division of the rate, and such intrastate carrier thereby subjects itself to the jurisdiction of the commission so far as regards such transportation.(281) The pro rata share of a through rate may, without unlawful discrimination or undue preference, be less than a local rate.(282) Party rate tickets, sold at reduced prices for parties of ten or more in number, do not constitute undue, or unreasonable, preferences in favour of the purchasers thereof, nor unjust, or unreasonable, discriminations as against purchasers of single tickets.(283) In the absence of a general regulation that free cartage from a railway station to the premises of a consignee shall be regarded as a part of a terminal service, railway transportation must be held to end at the railway station, and the furnishing of free cartage to consignees in one town, but not in another town, does not constitute unjust local discrimination;(284) but a rebate allowed to a consignee to compensate for the cost of cartage from the railway station to his premises, when a similar rebate is not allowed to another consignee in the same locality, is an unjust personal discrimination.(285) That an unlawful discriminating rate was allowed, or a rebate paid, in violation of the act, does not prevent liability on the part of the carrier for the freight received and covered by insurance in the custody of the carrier's agents.(286) The act does not in terms authorize competing carriers to enter into contracts to maintain even reasonable rates.(287) The right of recovery given by the statute for an excess of payment over a rate charged to another shipper under similar conditions is in the nature of a penalty, and the plaintiff must produce full proof thereof, and must show a pecuniary injury to himself resulting from such discrimination.(288) Substantial similarity, or dissimilarity, of circumstances and conditions is a question of fact, to be proved by evidence and finding of the commission thereon is only prima facie, and is subject to review by the court.(289) Reduced through rates from a port of entry to a point within the country on goods from abroad, which, except for such reduced rate, would not have come through that port of entry, do not constitute an unjust discrimination as against traffic originating at that port of entry.(290) The comission may administratively determine the circumstanees and conditions affecting competitive rates, considering to that end the legitimate interests of the carrier as well as of the shippers, and the legitimate interests of the locality to which the goods are to be carried as well as of the locality from which the goods are shipped.(291) A substantial competition, that is a competition producing a substantial and real effect upon traffic and rate making, is one of the circumstances constituting substantial dissimilarity under the long and short haul clause in sections 3 and 4 of the act,(292) and which may justify a carrier in charging a greater compensation for a shorter than for a longer haul.
It was held, before the passage of the Interstate Commerce Act, that a state could require under a penalty all railroads to fix and post their rates of fare and freight and not to charge in excess therefor,(293) but it was held also that a state could not by a police regulation enforce, with respect to interstate transportation, a prohibition of a charge of the same, or a greater, toll for a shorter than for a longer distance in the same direction,(294) and, after the passage of the linterstate Commerce Act, it was held that such a regulation was a fortiori beyond the power of the state,(295) for Coiagress having enacted its long and short haul clause, it was, of course, not lawful for a state to legislate on the same subject. When a company owned by a railway corporation buys coal at the mines under an arrangement alleged to secure preferential rates for the vendors, the Interstate Commerce Commission may, in a proper proceeding in the circuit court, compel the testimony of witnesses and the production of contracts.(296)
The cases in the Supreme Court and the reports of the Interstate Commerce Commission show that the act of 1887 has invited much costlv and fruitless litigation. Nevertheless, the legislation is of value in that it has strengthened the hands of those broadminded railway managers who believe that the interests of their shareholders are best served by fair dealing with customers and with competitors.
The Antitrust law.
53. The so-called "trusts" are combinations of corporations and properties made, in some cases, by the merger and consolidation of existing associations, and, in other cases, by the organization of corporations to aequire and hold the properties to be consolidated, or the controlling interest in the shares of the corporations to be combiiaed.
The "trusts" are a necessary result of the growth of the country, and of the development of isolated and sparsely settled states into a nation whose territory is covered by a network of railways, whose trade is that of an empire and not that of a village, and whose markets have ceased to be local and have become worldwide. "Trusts" are formed to obtain capital by the sale of bonds and shares, to save the waste of competition, to secure in production, transportation, and distribution the maximum of efficiency at the minimum of cost to expand trade by reducing the price to the consumer, and by economical operation to increase the net profit to the producer and the carrier. It is not surprising that the capitalization of our railways, the number of our industrial organizations, and the magnitude of their operations should arouse the public interest, and should cause on the part of unintelligent people more or less fear as to possible consequences. Every great industrial development has excited such fears. The steam engine, the railways, and all forms of labour saving appliances, from the spinning jenny to the typesetting machine, have seemed, in their turn, to threaten large additions to the ranks of the unemployed, and heavy losses to different classes of people; and yet in each case the result has been the opening of new avenues to employment, and a substantial advance in civilization. So today, no one who is accurately informed as to present industrial conditions can doubt that, because of American financial skill in securing combination of resources and concert of action, and because of increased railway efficiency, the products of industry have been brought to a higher standard than ever before, the labour which produces them is better paid, the market is wider and is better supplied, and the coinsumer buys upon relatively more favourable terms.
In any legislative regulation of corporations, great or small, by the United States, there are only four classes of people to be considered. There are, first, the investors in the bonds and shares issued by the corporations, that is, those who desire to become partners therein, and to participate in their profits, and who, theref ore, in so far as they may properly be regarded as beneficiaries of legislation, can only be aided by the requirement of publicity, that is, by compelling the corporation, under proper penalies, to furnish sueh information as to its capital, earnings, and disbursements as will enable intending purchasers and owners to determine whether its financial condition be such as to render the purchase or holding of its securities a prudent investment. But the federal law can have nothing to do with the organization of corporations for purposes not directly connected with the exercise by the United States of some power of government, nor can the United States constitutionally regulate the issue, sale, or transfer of the bonds or shares of such corporations, or protect investments therein. There are, secondly, the business rivals or competitors of the trading "trusts." On their behalf complaint is made that those "trusts," in order to destroy competition, discriminate in their prices. But competition is industrial warfare. You cannot have a real competition that does not compete to the limit. When competition is actively conducted, the seller attains his ends, not only by underselling in order to effect a particular sale, but also by carrying his underselling to the extreme limit of driving his competitors out of business and securing for himself complete control of the market. This is done, asLord Justice Bowen said,(297) from "the instinct of self-advancement and selfprotection, which is the very incentive of all trade. . To say that a man is to trade freely, but that he is to stop short at any act which is designed to attract business to his own shop, would be a strange and impossible counsel of perfection," and to attempt to prohibit it "would probably be as hopeless an endeavour as the experiment of King Canute. " Is it proposed that there shall be a general legislative regulation of prices, and, if so, what would that amount to ? There are, thirdly, the consumers of the goods manufactured or sold by the corporations. So far as they are concerned, it is clear that no act of legislation can effectively prescribe the price at which the products of the corporations are to be sold, for the simple reason that market prices always have been, and always will be, regulated by the operation of the law of supply and demand. Successful commerce buys in the cheapest, and sells in the dearest, market. The seller rightfully seeks the highest price that he can obtain; the buyer, as rightfully, pays as little as he possibly can. There are, fourthly, those who or whose goods are carried by common carriers, and their rights have been adequately regulated and protected by the law.
It is said that the "trusts" have "a tendency to monopoly. "The fact is that, except in the cases of patents and copyrights, and of those who control the sole and exclusive source of supply of a natural produce it is not possible in this day of the world's history to maintain and enforce, more than temporarily, extortionate prices, for the reason that there is always available a large amount of uninvested capital seeking profitable employment and keenly watching for opportunities of remunerative investment. Therefore, intelligent managers of a successful business do not advance prices to the point at which destructive competition will be invited. Prices of commodities are automatically regulated by the law of supply and demand. When, by reason of an apparent permanence of demand and a present inadequacy of the means of supply, prices rise to a level that gives a reasonable assurance of profit to producers, the surplus capital of the world can always be relied upon to augment the means of supply.
Attempts to regulate trade by legislation are not of new invention. Whenever and wherever there has been an absolute government there have always been attempted restrictions upon trade. In medieval times it was the theory and the practice that it was the "duty and the right of the state to fix hours of labour, rates of wages, prices, times and places of sale, and quantities to be sold."(298) The selilsh commercial policy of England, intelligently directed to the restraint of colonial trade and manufactures, was the great cause of the War of Independence. When the suceessful revolution had substituted the sovereignty of the people for the supremaey of the Crown, there was naturally a jealousy of governmental power and a determination to guard individual liberty against oppression. The framers of the Constitution of the United States, therefore, founded the government, not only upon the supremacy of the government in the exercise of the powers granted to it, but also and equally upon the independence of the states and the freedom of the citizen. They foresaw the evil effects of an unrestrained exercise of the popular will. They endeavoured to establish and make perpetual the reign of law. They crystallized into the Constitution the great principles of free government, and they made it impossible to hastily change that organic law. They declared in express terms the supremacy of the Constitution and the laws made in pursuance thereof; and they created a Supreme Court whose judgments should give effect to that declaration. They united the states into a nation, with full powers of government, and they reserved to the individual citizen as much freedom as is consistent with the enforcement of law and the maintenance of order. Under the Constitution, there is no warrant for paternalism incongressional legislation.
It is to the states, and not to the United States, that we ought to look for the legislative and administrative regulation of the industrial organizations of the present and the future. The power of the state is ample. A state may create corporations, with or without conditions, and it may authorize a corporation to do any business which an individual may lawfully do. A state may forbid a foreign corporation to do business within its territory; it may permit that business on conditions; and it may, with or without reason, revoke a permission theretofore granted. It may, therefore, enforce with regard to foreign corporations all, and more than all, the restrictions which it enforces with regard to corporations of its own creation. On the other hand, the United States, save as the domestic government of the District of Columbia and the territories, cannot even grant a charter of incorporation, except as a means incidental to the exercise by the United States of a power of government, and it can control the operations of a corporation chartered by a state only under the power of regulating foreign and interstate commerce. It does not avail to say that the legislation of a state can have no extraterritorial force, and that in order to have a rule of uniform application throughout the country there must be congressional legislation, for the conclusive reply is that every state, under the Constitution, is entitled as of right to determine for itself by what agencies and under what conditions commodities shall be manufactured or sold within its territory, subject only to the paramount right of the United States to levy duties and taxes, and to regulate commercial intercourse. As Fuller, C. J., forcibly said in his dissenting judgment in the Lottery Case,(299) "The scope of the commerce clause of the Constitution cannot be enlarged because of present views of public interest."
In the past the country has had to overcome, under conditions of inadequate transportation facilities, the disintegrating tendencies of the expansion of territory and the growth of population, but as the results of the triumph of the nation in the suppression of the Rebellion, and the development of means of transportation and communication, our perils are now those of governmental consolidation and not those of dissolutioia. Any legislation which conflicts with the American doctrine that all men are eqaal before the law, and that equality of rights implies equality of obligations, and that subjects rights of property and freedom of contract to administrative control is dangerous in a republic governed by universal suffrage. The leaders of public opinion will do well to remember that, as Mr. Lecky has said, it is an inexorable condition that all "legislation which seriously diminishes profits, increases risks or even unduly multiplies humiliating restrictions, will drive capital away and ultimately contract the field of employment."(300)
The first of the congressional antitrust acts (301) was drawn by Senator Hoar,(302) and was passed because of some unintelligent clamour as to "the grave evil of the accumulation in this country of vast fortunes in single hands, or of vast properties in the hands of great corporations," an alleged evil with which the United States cannot, under the Constitution, possibly concern itself.
The Act of 1890 is entitled "An Act to Protect Trade and Commerce against Unlawful Restraints and Monopolies; " declares illegal "every contract, combination in the form of trust, or otherwise, or conspiracy in restraint of trade or commerce among the several states, or territories, or with foreign nations;" and every monopoly, or attempt to monopolize any art of such trade or commeree; subjects to forfeiture, seizure, and condemnation "any property owned under any contract, or by any combination, or person, pursuant to any conspiracy, " as aforesaid; imposes penalties upon persons disobeying the act; vests jurisdiction in the courts of the United States; gives a right of action for injury to business or property by reason of anything declared unlawful by the act, with threefold damages, costs of suit, and attorney's fee; and requires the several district attorneys, under the direction of the attorney general, to institute proceedings in equity to prevent and restrain such violations.
The Act of llth February, 1903,(303) provides that in suits brought by the United States under the act precedenc shall be given, on the filing of a certificate by the attorney general, and the cause be heard before not less than three judges of the circuit, and that an appeal from the final decree of the circuit court shall be only to the Supreme Court and must be taken within sixty days. The Act of 14th February, 1903 (304) Creates the Bureau of Corporations in the Department of Commerce and Labor, provides for the appointment of a commissioner thereof, a deputy commissioner, and clerks; authorizes the commissioner to make "under the direction and control of the Secretary of Commerce and Labor, diligent investigation into the organization, conduct, and management of the business of any corporation, joint stock company, or corporate combination engaged in the commerce among the several states and with foreign nations,excepting common carriers subject to" the Interstate Commerce Act, and, "to gather such information and data as will enable the President of the United States to make recommendations to Congress for legislation for the regulation of such commerce, and to report such data to the President from time to time as he shall require; and the information so obtained, or as much thereof as the President shall direct, shall be made public." The act also confers upon the commissioner respect to the parties subject thereto all the powers conferred on the Interstate Commerce Commission; and makes it "the province and duty" of the bureau "to gather, compile, publish, and supply useful information concerning corporations doing business within the limits of the United States, as shall engage in interstate commeree, or in commerce between the United States and any foreign country, ineluding corporations engaged in insurance, and to attend to such other duties as may be hereafter provided by law."
The Act of 25th February, 1903,(305) appropriates the sum of $500,000 to be expended under the direction of the attorney general "in the employment of special counsel and agents of the Department of Justice to conduct proceedings, suits, and prosecutions" under the antitrust acts. The Act of 3d March, 1903,(306) provides for the appointment of an assistant to the attorney general, an assistant attorney general, and two confidential clerks to "perform such duties. as may be required of them by the attorney general." The first of the statutes only has been judicially construed.
Of course, in every case in which the statute has been enforeed, it has necessarily been held to be constitutional as a regulation of commerce, and not to be open to objection on the ground of interference with the freedom of contract.(307) ln N. S. Co. v. U.S.(308) the question of constitutionality was fully and ably argued, and it was held that the statute, when construed to forbid a combination to organize a corporation to hold the shares of competing railways, is not open to objection as an infringement upon the reserved powers of the states, but, in his dissenting judgment in that case, White, J.,(309) argued with great force, that commerce as defined in Gibbons v. Ogden, is commercial intercourse, and is regulated by prescribing rules for carrying on such intcrcouse, and that the ownership or transfer of shares in a corporation created by a state cannot be said to be in any sense commercial iutercourse, and the prescribing of rules governing the ownership of such shares cannot fall within the power to prescribe rules for regulating commercial intercourse. White, J., also argued that the power to regulate commerce includes the power to regulate the instrumentalities of commerce, and that means the regulation, not of their acquisition and ownership, but of their employment and operation, and that because the ownership of property, if acquired, may possibly be so used as to burden commerce, it does not follow that to acquire and own is to burden.
Each of the cases also required of the court a construction of the statute, and a determination whether or not the facts in each case brought it within the statute. The general principles 'which can be deduced from the cases are these:
1. The word "unlawful" in the title of the statute has reference only to those contracts which the statute makes unlawful, and does not operate to qualify the expression of the legislative will in the body of the statute that "every" contract in restraint of foreign and interstate trade shall be unlawful,(310) but, in the more recent judgments of the court, the force of those words has been materially qualified by the determination that exclusive licenses to manufacture and sell under patents for inventions are not within the statute, and by Mr. Justice Peckham's admissions in the judgments of the court in U. S. v. T.M.F.A.,(311) in U.S. v. J.T.A.,(312) and in Hopkins v. U.S.(313) that neither a contract of partnership, nor the withdrawal of a competitor from business, nor the appointment by competitors of a joint selling agent, nor the purchase of an additional plant, nor "the formation of a corporation for business or manufacturing purposes, " nor an agreement collateral to a contract of sale, and requiring the competitor to abstain from again entering into the business within a designated territory and during a specified time, are within the prohibition of the statute. These conceded exceptions from the prohibitions of a statute, which expresses no exceptions, would seem to destroy the inclusive force claimed for the words "every and "otherwise."
2. The term "contracts in restraint of trade," as used in the statute, includes, without regard to their reasonableness or unreasonableness," all kinds of those contracts which in fact restrain, or may restrain, trade." (314) In so deciding, the court did not follow the modern and well considered judgments in the state courts and in the courts of England. The doctrine of contracts in restraint of trade is not of recent discovery. Holmes, J.,(315) points out that contracts in restraint of trade, as defined by the common law, are contracts with a stranger to the contractor's business, and which wholly or partially restrain the freedom of the contractor in carrying on that business; and that combinations or conspiracies in restraint of trade, as defined by the common law, are arrangements to keep strangers to the agreement out of the business, and which tend to monopolize some portion of the trade of the country. Such contracts were originally held void at common law, because of the injury to the public, by its deprivation of the results of the restricted individual's industry, and because of the injury to the individual by his deprivation of the opportunity to labour for himself and for those who might be dependent upon him. Under the conditions of trade in the time of the Year Books any restraint of trade was an unlawful restraint, but under modern conditions the test of invalidity is the unreasonableness of the restraint, for, as Mr. Justice Peckham said when he sat in the Court of Appeals of New York,(316) "An agreement would not," neeessarily, "be in restraint of trade, although its direct effect might be to restrain to some extent the trade which had been done." The overwhelming current of authority supports this view. Brewer, J., in his concurring judgment in N. S. Co. v. U. S.(317) holds that while the court had rightly decided the prior cases under the statute, because the contracts in all those cases were, in his opinion, in unreasonable restraint of trade, yet, nevertheless, the statute was not intended, and should not be construed, to prohibit contracts in partial or reasonable restraint of trade.
3. If it were not for the judgment in N. S. Co. v. U.S.(318) it might be regarded as authoritatively determined, that "there must be some direct and immediate effect upon interstate commerce in order to come within the act." (319) Upon that prineiple all the cases, other than that of N. S. Co. v. U. S., can be reconciled.
4. A direct,(320) or indirect,(321) restraint of railway competition in interstate commerce is within the statute, which, although a general statute, repeals pro tanto by implication the Interstate Commerce Acts,(322) which forbid unjust and unreasonable charges by railway earriers, which require public notice of increases or reductions in rates, which forbid secret or preferential rates and which, therefore, prohibit effective railway competition.(323)
5. A state cannot, in respect of its ownership of public lands and its maintenance of public institutions, and the possibilities of depreciation in the value of such lands, and of increase in the cost of maintaining such institutions, by reason of the possibility of a diminution of competition between railways, sue in a federal court under the statute to enjoin the organization of a corporation to hold the majorities of the shares of such railways, for the possibility of such damage to the state is too remote and indirect and is not the direct actual injury contemplated by the statute.(324)
6. A combination illegally formed in violation of the statute is not precluded from recovering the purchase price of goods sold by it, nor can its vendee set off the threefold damages under the statute, for the liability therefor is only enforcible by a direct action.(325) Nevertheless, anyone sued upon a contract may set up as a defence that that contract is a violation of the statute, and, if found to be so, that fact will constitute a good defense to the action.(326) Logically, a combination of labour is as clearly subject to the statute as a combination of capital.(327) The labour unions reasonably restrain trade, when they combine to sell a certain minimum of labour for not less than a certain price, but they unreasonably restrain trade when, in order to effect their purpose, they use threats and force to prevent employers from securing labour not provided by members of the union. In the absence of an express and unfulfilled contract of service, it is the legal right of every man to refuse to work, but it is neither the legal nor the moral right of any man to hinder other men from working.
In each case decided under the statute the judgment of the court was based upon a construction of the agreement of combination, and upon a consideration of the possibilities of action thereunder, without any reference to that which the to parties had done, or probably would do, there under.
The statute has been construed to forbid:
1. An agreement by several corporations organized under the laws of different states and engaged in the manufacture, interstate transportation, and sale of a commodity, to abstain from competition as between themselves within a designated territory, including more than one state.(328)
2. An agreement by members of an unincorporated association of manufacturers of, and dealers in, a commodity, doing business in several states not to sell to non-members save at a price in excess of that at which the members sell to each other.(329)
3. Agreements by competing railwav corporations for the maintenance of uniform rates upon interstate traffic.(330) A combination by several persons whereby aholding corporation is organized under the laws of a state to acquire and hold the majorities of the shares of two railways organized under the laws of other states and theretofore competing in interstate traffic,(331) the ground of decision being that the common corporate ownership of the shares will prevent competition between those railways, and that the statute forbids the formation and operation by whatever means of a combination which possibly may prevent such competition.
On the other hand the statute has been construed not to forbid:
1. Exclusive licenses to manufacture and sell under patents for inventions, for a patent is necessarily a monopoly, and a patentee's protection is valueless if he cannot fix prices and restrain Competition.(332)
2. The organization of a corporation for the purchase, manufacture, and sale of a commodity throughout the United States and the acquisition and ownership by that corporation of all, save one, of the manufactories of that commodity in the United States,(333) the ground of decision being, not that the case as presented was simply that of a combination of factories, but that the case was that of the vesting in one agency the ownership of, and the control over, theretofore separated instrumentalities of interstate commerce; that the possible abstention of those instrumentalities from competition could only be regarded as incidental to the exercise of lawful rights of purchase, sale, and ownership; and that the combination, therefore, lacked that direct and immediate effect upon interstate commerce which there should be in order to bring it within the statute.
3. An agreement by local sellers upon commission fixing their rates of commission, regulating competition as between themselves, forbidding purehases from non-members, and forbidding the transaction of anv business with suspended members.(334)
In deciding upon the possible effect of the agreements and acts of combination in the three railway cases(335) and in holding that they restrained trade because they checked competition, the court made the mistake of not properly appreciating the essential differences which distinguish competition between common carriers from competition between sellers of goods. A railway company, like all other common carriers, is bound to carry all freight that may be offered, to the extent of its facilities, at reasonable rates, and without unjust discrimination, either personal or local, and it is legally compellable to refund any over charge in excess of that which shall be adjudged to be reasonable; and the Interstate Commerce Act, (336) has made the rule of the common law obligatory upon all carriers engaged in interstate commerce. On the other hand, buyers of goods may lawfully buy at the lowest price and sellers of goods may lawfully sell at the highest price. In railway rates it is to the interest of the public that there should be uniformity, in order that all shippers may have equal advantages; stability, in order that all buyers and sellers may correctly estimate the cost of transportation as affectiing market prices; and adequacy of compensation to the carrier, in order that the carrier may receive that which, in the words of the court,(337) "the services rendered are reasonably worth."
Before the enactment of the statute of 1890 the Interstate Commerce Act, as amended by the Act of 2d March, 1889, (338) had forbidden an advance of railway rates, "except after ten days' public notice," and had permitted reductions in rates only "after three days' public notice." The Act of 19th February, 1903,(339) passed after the enactment of the statute of 1890, declared it to be a misdemeanor for any carrier subject to the Interstate Commerce acts to fail to obey those acts. Therefore, as well after as before the enactment of the Antitrust statute, any real competition between railways was forbidden by legislation, for as a earrier can take no business away from a competitor by a reduction in an open rate, of which three days public notice must be given, the only way to get business by reducing the rates is to give that reduction secretly to the customer whose traffic is to be secured. The Antitrust statute, as construed by the court, says that railway competition must be unrestrained. The Interstate Commerce acts say that railways must not do those acts which are essential to any effective competition.
Uncontrolled competition in transportation inevitably produces evils whieh the country has often experienced. A war of railway rates necessarily forces a diminution of that liberality of railway expenditure which benefits the manufacturer, the dealer, and the labouring man. Such a war may result also in the bankruptcy of weaker companies, in costly receiverships, and reorganizations, and in absorption by stronger rivals. When competition is unrestrained the power of fixing rates is necessarily vested in the company which receives the goods from the shipper, and that power is inevitably delegated to irresponsible subordinates, to whom their road's need of business is all important. From this it follows, that not only do the carriers fail to receive under such conditions the advantages of adequate compensation, but also the shippers and the public lose the benefits of uniformity and stability of rates. Uncontrolled competition, therefore, injures, instead of benefits, the public interest. While some judges have been captivated by the supposed advantages of unrestricted competition among carriers, other and equally eminent judges, and as competent observers, have detected the fallacy in the reasoning, and have pointed out the danger.(340) There are limits to legislation. Acts of Congress cannot control either the laws of nature or the laws of trade. As the statute, judicially construed, forbids treaties of peace between warring lines and consolidations of conflictin railway interests, some other way will be found, in the interest of the public, to accomplish the desired result.
It is difficult to reconcile the case of N. S. Co v. U. S.(341) with the case of U. S. v. E. C. Knight Co.(342) Obviously a statutory prohibition of "every" restraint of trade cannot be so construed as to permit mercantile, and forbid transportation, restraints of trade. In each of those cases the controlling fact is that there is vested in one agency the ownership of, and control over, instrumentalities of interstate commere, if there be a resultant restraint of trade, that result follows, not because of any agreement to abstain from competition, but only because such abstention may possibly follow the exercise of legal rights of purchase, sale and cwnership.(343)
The result in N.S. Co. v. U. S.(344) seems to be open to two further objections, which do not appear to be met by anything in the judgment of the court, as read by Harlan, J., or in the concurring judgment of Brewer, J.
1. The act, as construed in the T. M. F. A. and J. T. A. cases, forbids railways to agree not to compete, but it does not forbid noncompetition in the absence of agreement. As well after as before the act, railways were, and are, bound in law to carry all passengers and freight that may be offered, to the extent of their facilities, at reasonable rates, and without unjust discrimination, either personal or local; and if the managers of any railway, while observing those requirements, charge the same rates as are charged by other railways under like conditions, but without entering into any agreement to that effect, they violate no law. If it be not unlawful for two railway companies owned by different shareholders to abstain from competition, it cannot be unlawful for two railway companies owned by one body of shareholders to similarly abstain. The fact of common ownership, therefore, is not in itself a restraint of trade, nor does it give rise to a presumption that any restraint of trade will be committed. How can it then be unlawful to organize a holding company to acquire the shares of two operating companies?
If it be said that the organization of the holding corporation is only a means to the end of so unifying the management of the operating companies as to prevent any possibility of competition as between those companies and that the organization is therefore a fraud upon the statute, the answer is that which the court, speaking by Mr. Justice Hunt, gave(345) in a case where the question was as to the validity of that which was alleged to be a device to avoid the payment of a stamp duty; for in that case the court said "if the device is carried out by the means of legal forms, it is subject to no legal censure.
2. In the case, there is neither contract, combination, nor conspiracy between the operating companies, but there is an organization of a holding company by shareholders of the operating eompanies, and, by force of that Organization, the holding company becomes the majority shareholder of both operating companies. While the rights of the shareholder of both operating companies entitle them to elect its directors, and to participate in net profits, when declared, and, upon dissolution, in net assets, those rights, nevertheless, do not give any power of direct eorporate management. A corporatism is a legal entity distinguishable from the body of its shareholders. It can act only by its officers and agents, and its shareholders are neither its officers nor agents. An agreement signed by every shareholder will not bind the corporation. If an express agreement of shareholders of the operating companies be not effactive, how can effect be given to a sale and transfer of shares as legal evidence of presumptive corporate action/
Telegraphs.
54. Congress has authorized(346) any telegraph company organized under the laws of any state "to construct, maintain, and operate lines of telegraph through and over any portion of the public domain of the United States, over and along any of the military or post roads(347) of the United States which have been or may hereafter be declrared such by act of Congress, and over, under, or across, the navigable streams or waters of the United States" upon certain conditions, including priority to government messages, a reservation of the privilege of purchase by the government, and the written acceptance by the company of the restrictions and obligation of the act.(348) Under this legislation it has been decided that a state may require telegraph companies to receive on payment of their charges messages to be transmitted to points in other states, and to deliver messages with due diligence.(349) A state may require a telegraph company doing interstate business to pay to the municipality a rental for the use of public highways by its poles.(350) A state may tax the property owned by a telegraph company within the state.(351) A state may require from a telegraph company, payment of a license tax on business done within the state by the company, though it also carries on an interstate business.(352)
A state may not, as against the privileges conferred by the United States,(353) vest an exclusive monopoly in one telegraph company.(354) A state may not tax messages sent to points without the state, nor messages sent by officers of the United States on public business.(355) A state may not, as affecting delivery in other states of messages from points within the state, require delivery by special messengers.(356) A state may not require a license for the privilege of doing interstate business.(357) A state may not prohibit, until all state taxes have been paid by it, the doing of business by a corporation which has accepted the privileges granted by the act of Congress.(358)
Commerce with the Indian tribes.
55. The Indian tribes are not foreign but domestic and dependent nations; their relation to the United States resembles that of a ward to his guardian; and they are completely under the sovereignty and dominion of the United States. They, therefore, cannot sue in the courts of the United States as foreign states.(359) The regulation of the relation between the several states and the Indian tribes is exclusively vested in the United States, and state laws cannot operate within an Indian reservation.(360) Congress, under the power to regulate commerce with the Indian tribes, may grant to a railroad corporation a right of way through their lands.(361) It may also forbid the sale of spirituous liquors to all persons belonging to Indian tribes within the territorial limits of a state, even outside the bounds of an Indian reservation(362) and it is competent for the United States, in the exercise of the treatymaking power, to stipulate in a treaty with an Indian tribe, that the introduction and sale of spirituous liquors shall be prohibited within certain territories ceded by the tribe to the United States, and such stipulation operates proprio vigore, and is binding though the ceded territory be within the limits of an organized county of one of the United States.(363)
FOOTNOTES
(1) Gibbons v. Ogden, 9 Wheat. 1; Brown v. Maryland, 12 id. 445; Cook v. Pennsylvania, 97 U. S. 566 ; County of Mobile v. Kimball, 102 id. 691.
(2) Gibbons v. Ogden, 9 Wheat. 1.
(3) P. T. Co. v. W. U. T. Co., 96 U. S. 1.
(4) Bank of Augusta v. Earle, 13 Pet. 519, 531; Starges v. Crowninshield, 4 Wheat. 147; Nathan v. Louisiana, 8 How. 73.
(5) People v. Comissioners, 104 U. S. 466.
(6) Per Gray, J., Nutting v. Massachusetts, 183 U. S. 556.
(7) Paul v. Virginia, 8 Wall. 168; Ducat v. Chicago, 10 id. 410; L. I. Co. v. Massachusetts, ibid. 566; P. F. A. V. New York, 119 id. 110; Hooper v. California, 155 id. 648; N. Y. L. 1. Co. v. Cravens, 178 id. 389; Nutting v. Massachusetts, 183 id. 553.
(8) Allgeyer v. Louisiana, 1185 U. S. 578.
(9) 14th August, 1876, 19 Stat. 141; 8th July, 1870, Rev. Stat., secs. 4937 to 4947.
(10) The Trade Mark Cases, 100 U. S. 82.
(11) Act of 3d March, 1881, 21 Stat. 502, c. 138. See also Ryder v. Holt, 128 U. S. 525; Warner v. S & H. Co., 191 id. 195.
(12) Almy v. California, 24 How. 169; as explained by Miller, J., in Woodruff v. Parham, 8 Wall. 138. A tax on foreign bills of lading is a tax On exports: Fairbank v. U. S., 181 U. S. 283.
(13) P. T. Co. v. W. U. T. Co., 96 U. S. 1, 9; Tel Co. v. Texas, 105 id. 460, 464; W. U. T. Co. v. James, 162 id. 650.
(14) Lottery Case, 188 U. S. 321, 363. FiiUer, C. J., and Brewer, Shiras, and Peckham, JJ., dissented.
(15) N. S. Co v. U. S., 193 U. S. 197.
(16) Per Marshall, C. J., Gibboons v. Ogden, 9 Wheat. 1, 196.
(17) P. & S. S. S. Co. v. Pensylvania, 122 U. S. 336, per Bradley, J. " Taxing is one of the forms of regulation. It is one of the principal forms."
(18) Supra, see. 14.
(19) McCulloch v. Maryland, 4 Wheat. 420; The State Freight Tax, 15 Wall. 277.
(20) Taney, C. J., said, in the License Cases, 5 How. 504, 583, that the police powers "are nothing more nor less than the powers of government inherent in every sovereignty to the extent of its dominions." Harlan, J., said, in Patterson v. Kentucky, 97 U. S. 501: "The police powers extend at least to the protection of the lives, the health, and the property of the community against the injuricous exercise by the citizen of his own rights."
(21) Gibbous v. Ogden, 9 Wheat. 201; The Passenger Cases, 7 How. 402, 479.
(22) See particularly T. Co. v. Wheeling, 99 U. S. 280; W. F. Co. v. St.Louis, 107 id. 374; C. & C. B. Co. v. Kentucky, 154 id. 204, 212.
(23) Buttfield v. Stranahan, 192 U. S. 470.
(24) 29 Stat# 188 c. 255.
(25) Rev. Stat. 4197 et seq.
(26) Rev. Stat. 4219; 24 Stat. 79, c. 421.
(27) Rev. Stat. 4233;6 Stat. 320, c. 802;26 Stat. 425, C. S75;27 Stat. 55T, e. 202; 28 Stat. 82, c. 83 ; 28 Stat. 281, c. 284; 28 Stat. 645, C. 64; 28 Stat. 672, c. 102; 29 Stat. 381, c. 401; 29 Stat. 689, c. 389; 30 Stat. 96, c. 4.
(28) Rev. Stat. 4252, 4463; 22 Stat. 186, C. 374; 27 Stat. 445, C. 105; 29 Stat. 122, c. 199; 31 Stat 799, c. 386.
(29) Rev. Stat. 4501, 4509; 28 Stat. 667, c. 97; 29 Stat. 691, c. 389; 30 Stat. 775, c. 28.
(30) Rev. Stat. 4549; 30 f3tat. 755, c. 28.
(31) Rev. Stat. 4653.
(32) Rev. Stat. 4681.
(33) 27 Stat. 110, c. 158; 28 Stat. 362, c. 299; 30 Stat. 1151, C. 425.
(34) Rev. Stat. 5244; 26 Stat. 426, 453, 454, c. 907; 27 Stat. 110, c. 158;
30 Stat. 1151 c. 425.
(35) Rev. Stat. 5623; 25 Stat. 382, C. 772.
(36) Rev. Stat. 5285; 25 Stat. 382, C. 772.
(37) 26 Stat. 313, c. 728.
(38) Rev. Stat. 4386 et seq.; 23 Stat. 31, 32, C. 60.
(39) 30 Stat. 424, c. 370.
(40) 27 Stat. 531, c. 196.
(41) 24 Stat. 379, e. 104; 2 5 Stat. 855, c. 382; 26 Stat. 743, c. 128; 27
Stat. 443.
(42) 26 Stat. 209, c. 647. Bee, also U. S. v. T. M. P. A., 166 U. S. 290; U. S. v. J. T. A., 171 id. 505; U. S. v. E. C. Knight Co., 156 id. 1; Hopkins v. U. S., 171 id. 578; A. P. & S. Co. v. U. S., 175 id. 211; N. S. CO V. U. S., 193 id. 197.
(43) L. V. R. v. Penna., 145 U. S. 192.
(44) Hanley v. K. C. S. Ry., 187 U. S. 617.
(45) Lord v. S. S. Co., 102 U. S. 541.
(46) The Daniel Ball, 10 Wall. 557.
(47) Coe v. Errol, 116 U. S. .528; per Bradley, J.
(48) Gibbons v. Ogden, 9 Wheat. 294.
(49) Cooley v. Board of Wardens, 12 How. 299, 314.
(50) Welton v. Missouri, 91 U. S. 275; County of Mobile v. Kimball, 102 id. 691; Browm v. Houston, 114 id. 681; Robbins v. Shelby County Taxing District, 120 id. 493; Bowman v. C. & N. W. Ry., 125 id. 465, 508; Iiesy v. Hardin, 135 id. 100. Compare the ii3Lgenious argument of Dr. Wm.
Draper Lewis, in Chapter VI of his "Federal Power over Commerce aud its Effect on State Action."
(51) C. & C. B. Co. v. Keentucky, 154 U. S. 204. See particularly the judgment of Brown, J., p.p. 209 to 213, where there is a full discussion of this subject, and an exhaustive classification of the cases. License Tax Cases, 5 VVAH. 462, 470.
(52) U. S. v. Dewitt, 9 Wall 41; cf. Felsenheld v. U. S., 186 U. S. 126.
(54) McGuire v. The Comminnwealth, 3 Wall. 387.
(55) Pervear v. The Commomwealth, 5 Wau. 475.
(56) Patterson v. Kentu&y, 97 U. S. 501.
(57) A herd of sheep, driven at a reasonable rate of speed from a point in one state a distance of many hundred miles across the territory of a second state to a point in a third state and fed by grslzing en route, is property engaged in interstate commerce, and, as such, exempt from taxation in the second state: Kelley v. Rhoads, 188 U. S. 1.
(58) Martin v. Waddell, 16 Pet. 367; Rundle v. D. & R. C. Co., 14 How. 80; Den v. Jersey Co., 15 id. 426; Smith v. Maryland, 18 id. 71; Jones V. Soulard,'24 id. 41; R. Co. v. Schurmeir, 7 Wall. 272; Weber v. Harbor Commissioners, 18 Wall. .57; 1. C. R. v. IWnoiE, 146 U. S. 387, 184 id. 77; St. A. F. W. P. Co. v. St. P. W. Comrs., 168 id. 349.
(59) Barney v. Keokuk, 94 U. S. 324; H din v. Jordan, 140 id. 371; Mitchell v. Smale, ibid. 406.
(60) Pollard v. Hagan, 3 How. 212; Weber v. Harbor Commissioners, 18 Wall. 57; Shively v. Bowlby, 152 U. S. 1; M. T. Co. 'V. Mobile, 187 id. 479; U. S. v. M. R. Co., 189 id. 391.
(61) Smith v. Maryland, 18 How. 71; Manchester v. Massachusetts, 139 U. S. 240; cf. Geer v. Conueeticut, 161 id. 5ig. (62) MeCready v. Virginia, 94 U. S. 391, 395.
(63) U. S. v. Bevans, 3 Wheat. 336.
(64) Article I, See. 9.
(65) South Carolina v. Georgia, 93 U. S. 4.
(66) Pennsylvania v. W. & B. B. Co., 18 How. 421, 423.
(67) Const., Article T, Sec. 9.
(68) Woodruff v. Parham, 8 Wall. '123.
(69) Act of 12th April, 1900, 31 Stat. 77, c. 191, sees. 2 and 3; Dooley v. U. S., 183 U. S. 151. White, J., held that the fact that Porto Rico is not a foreign country, is decisives. Brown, Gray,, Shiras, and McKenna, JJ., concurred, holding, also, that the tax was imposed upon importations into Porto Rico, and not upon iexports from the TJnited States. Fuller, C. J., and Harlan, Drewer, and Peckham, JJ., dissented upon the ground that the prohibition forbids duties upon exports "irrespective of their destination." See supra, see. 17. (70) Pace v. Burgess, 92 U. S. 372; Turpin v. Burgess, 117 id. 504; Cornell v. Coyne, 192 id. 418.
(71) Fairbank v. U. S., 181 U. S. 283. @rlan, Gray, White, and McKenna, JJ., dissented.
(72) State Tonnage Tax Cases, 12 Wall. 204.
(73) 13 Stat. 70; ibid. 444.
(74) State Tonnage Tax Cases, 12 Wall. 204.
(75) Steamship Co. v. Port Wardens, 6 Wall. 31.
(76) Peete v. Morgan, 19 Wan. 581.
(77) Cannon v. New Orleans, 20 Wall. 577.
(78) I. S. S. Co. v. Tinker, 94 U. S. 238.
(79) Such dues are also open to objectiou as duties on tonnage. Section 3.6.
(80) 6 Wall. 31.
(81) Foster v. Master and Wardens of the Port of New Orleans, 94 U. S. 2". (82) Section 38.
(83) Peete v. Morgan, 19 Wall. 581.
(84) Cannon v. New Orleans, 20 Wall. 577.
(85) Act 7th August, 1789, see. 4, 1 Stat. 54.
(86) Cooley v. The Board of Wardens, 12 How. 299.
(87) Ex paru MeNiel, 13 Wall. 236; Wilson v. MeNamee, 102 U. S. 572.
(88) Ex parte MeNiel, supra.
(89) Wilson v. MeNamee, supra.
(90) S. S. Co. v. lit
(91) The China, 7 Wall. 53.
(92) Spraigue v. Thompson, 118 U. S. 90.
(93) Gibbons v. Ogden, 9 Wheat. 1.
(94) Acts 7th July, 1838, 5 Stat. 304; 30th August, 1852, 10 Stat. 61.
(95) The Daniel Ball, 10 Wall. 557.
(96) Sinnot v. Davenport, 22 How. 227.
(97) Foster v. Davenport, 22 How. 244.
(98) The case of New York v. Miln, 11 Pet. 102, though cited, and relied on,
in the argument, was not noticed in the judgment of the court.
(99) Hall v. De Cuir, 95 U. S. 485; cf. L., N. 0. & T. Ry. v. Mississippi, 133
id. 587; C. & 0. Ry. v. Kentucky, 179 id. 388.
(100) Veazie v. Moor, 14 How. 568.
(101) 21 How. 184.
(102) P. 187.
(103) 11 Pet. 102.
(104) P. 161.
(105) 22 How. 227.
(106) 22 How. 224; supra, Section 41.
(107) Infra, Section 52b.
(108) 160 U. S. 357, 361.
(109) Morgan v. Louisiana, 118 U. S. 455; Bartlett v. Lockwood, 160 id. 357. See also C. P. D. N. v. Louisiana, 186 id. 380.
(110) Peete v. Morgan, 19 Wzall. 581.
(111) Kimmish v. Bali, 129 U S. 217; M., K. & T. Ry. v. Haber, 169 id. 613.
(112) Rasmussen v. Idaho, 181 U. S. 198; Smith V. S. L. & S. W. R., ibid. 248.
See also Reid v. Colorado, 187 id. 137.
(113) R. Co. v. Husen, 95 U. S. 465.
(114) Minnesota v. Baxber, 136 U. S. 313.
(115) Smith v. S. L. & S. W. Ry,., 181 U. S. 248, 255.
(116) G. F. Co. v. Pennsylvania, 114 U. S. 196, per Field, J.
(117) II A ferry is in respect of the landing place, and not of the water: Vin. Abr. Vol. XIII, P. 208, Title "Ferry."
(118) Fanning v. Gregoire, :16 How. 524; Conway v. Taylor, 1 Bl. 603.
(119) W. P. Co. v. East St. Louis, 107 U. S. 365; T. Co. v. Wheeling, 99 id. 273.
(120) St. Louis v. W. F. Ce., 11 Wall. 423; G. F. Co. v. Pennsylvania, 114 U.S. 196. See also St. Clair County v. I. S. & C. T. Co., 192 id. 454.
(121) The MonteUo, 20 Wall. 430, 441; Leovy v. U.S., 177 U. S. 621; The Daniel Ball, 10 WalL 557.
(122) N. B. Co. v. U. S., 105 U. S. 470; U. S. v. B. B. B. Co., 176 id. 211.
(123) N. B. Co. v. U. S., 105 U. S. 470.
(124) The Clinton Bridge, 10 Wall. 454.
(125) Pennsylvania v. W. & B. B. Co., 18 How. 421.
(126) Act of 13th July, 1892, c. 158, 27 Stat. 88, 110.
(127) Per White, J., in L. S. 8= M. S. Ry. v. Ohio, 165 U. S. 365, 369.
(128) Ibid. 368. See also Cummings v. Chicago, 188 U. S. 410; Montgomery v. Portland, 190 id. 89, which decide that under existing legislation the right to construct a wharf or dock in a navigable water of the United
States wholly within the limits of a state depends upon the consent of the state in addition to the consent of the federal government.
(129) Willson v. The B. B. C. M. Co., 2 Pet. 245 ; Pennsylvania v. The W. & B. B. Co., 9 How 647, 11 id. 528, 13 id. 518, 18 id. 421; M. & M. R. v. Ward, 2 Bl. 485; The Albany Bridge Case, 2 Wall. 403; The Passaic Bridge Case, .3 Wall. 782; Gilman v. Philadelphia, ibid. 713; Pound v. Turelk, 95 U. S. 459; Escanaba Co. v. Chicago, 107 id. 678; CardweU V. A. B. Co., 113 id. 205; Hamilton v. V., S. & P. R., 119 id. 280; Huse v. Glover, ibid. 543; W. B. Co. v. Hatch, 125 id. 1; L. S. & M. S. R. v. Ohio, 165 id. 365; U. S. v. B. B. B. Co., 176 id. 211; Rider v. U. S., 178 id. 251; Leovy v. U. S., 177 id. 621.
(130) Escanaba Co. v. Chicago, 107 U. S. 678; Huse v. Glover, 119 id. 543; @ds v. M. R. I. Co., 123 id. 288.
(131) Cardwell v. A. B. Co., 113 U. S. 205; Hamilton v. V., S. & P. R., 119 id. 280; W. B. Co. v. Hatch, 125 id. 1.
(132) U. S. v. R. G. D. & 1. Co., 174 U. S. 690.
(133) C. & C. B. Co. v. Kentucky, 154 U. S. 204; Brown, Harlan, Brewer, Shiras, and Jackson, JJ., concurring in the judgment and also in the opinion, and Fuller, C. J, and Field, Gray, and White, JJ., concurring in the judgement but not in the opinion.
(134) P., C., C. & S. L. Ry. v. Board of Public Works, 172 U. S. 32.
(135) K. & H. B. Co. v. Illimois, 175 U. S. 626.
(136) South Caxolina v. Georgia, 93 U. S. 4.
(137) Wisconsin v. Duluth, 96 U. S. 379.
(138) Veazie v. Moor, 14 How. 568; Withers v. Buckley, 20 id. 84.
(139) 102 U. S. 691, 698.
(140) County of Mobile v. Kimball, 102 U. S. 691.
(141) Huse v. Glover, 119 U.S. 543; Sands v. M. R. I. Co., 123 id. 288; L. & P. Co. v. Mullen, 176 id 126.
(142) Harman v. Chicago, 147 U. S. 396.
(143) P. Co. v. Kookuk, 95 U. S. 80; P. Co. v. St. Louis, 100 id. 423; Vicks burg v. Tobin, ibid. 430 @ P. C. v. Catlettsburg, 105 id. 559.
(144) T. Co. v. Parkersburg, 107 U. S. 691; 0. P. Co v. Aiken, 121 id. 444.
(145) Guy v. Baltimore, 10 0 U. S. 434; infra, Section 50.
(146) A. S. & W. Co. v. Sp@, 192 U. S. 500.
(147) Brown v. Maryland, 12 Wheat. 419.
(148) Low v. Austin, 13 Wall. 29.
(149) Cook v. Pennsylvania, 97 U. S. 566.
(150) May, v. New Orleans, 178 U. S. 496. Almy v. California, 24 How. 169, is explained in Woodruff v. Parham, 8 WaH. 123, 138, and should have been decided upon the ground that the tax in question was a tax upon the transportation of goods from one state to another, and, therefore, a regulation of commerce and as such void.
(151) Waring v. The Mayor, 8 Wall. 110.
(152) Gibbons v. Ogden, 9 Wheat. 1, 203, per Marshall, C. J.
(153) Turner v. Maryland, 107 U. S. 55.
(154) Turner v. Maryland, ui5i supra.
(155) P. & tSS. C. Co. v. Louisiana, 156 U. S. 590.
(156) L. & P. Co. v. Mullen, 176 7u. S. 126.
(157) P. G. Co. v. North Carolina, 171 U. S. 345.
(158) Crandall v. Nevada, 6 Wall. 35.
(159) People v. C. G. T., 10T U. S. 59.
(160) Brimmer v. Rebman, 138 U. S. 78.
(161) Voight v. NVright, 141 U. S. 62.
(162) Minnesota v. Barber, 136 U. S. 313.
(163) Vance v. W. A. V. Co., 170 U. S. 438.
(164) Woodruff v. PELrham, 8 Wall. 123; Brown v. Houston, 114 U. S. 622; Emert v. Missouri, 156 id. 296.
(165) Ward v. Maryland, 12 Wall. 418. Bradlev J., concurred, but held that the license required would be equally void if it imposed upon residents the same burden for selling goods as it imposed upon nonresidents, for it would be in fact a duty upon importations from one state to another.
(166) Welton v. Missouri, 91 U. S. 275; Webber v. Virginia, 103 id. 344.
(167) Guy v. Baltimore, 100 U. S. 434.
(168) Corson v. Maryland, 120 U. S. 502, 506.
(169) Walling v. Michigan, 116 U. S. 446.
(170) Lyng v. Michigan, 135 U. S. 161.
(171) Brimmer v. Rebman, 138 U. S. 78.
(172) Voight v. Wright, 141 U. S. 62.
(173) Act of 8th August, 1890, 26 Stat. 313, C. 728.
(174) Leisy v. Hardin, 135 U. S. 100.
(175) Seott v. Donald, 165 U. S. 58, 100.
(176) Hinson v. Lott, 8 Wan. 148.
(177) M. Co v. Gage, 100 U. S. 676; Emert v.Missouri, 156 id. 296; v. Farley, 159 id. 263.
(178) Ficklen v. Shelby County Taxing District, 145 U. S. 1.
(179) R. D. Co. v. orister, 179 U. S. 445.
(180) Downham v. Alexandria council, l0 wall. 173; Brenian v. Titusville, 153 U. S. 289; Stockard v. Morgan, 185 id. 27.
(181) Robbins v. Shelby County Taxing District, 120 U. S. 489, 494.
(182) Asher v. Texas, 128 r. S. 129; Brennan v. Titusville, 153 id. 289; N. & W. Ry. v. Sims, 191 id. 441; cf. A. S. & W. Co v. Speed, 192 id. 500.
(183) Robbins v. Shelby County Taxing District, 120 U. S. 489, 501.
(184) Crutcher v. Kentucky, 141 U. S. 47, 57.
(185) 12 Wheat. 419,
(186) P. 441.
(187) P. 447.
(188) P. 443.
(189) Woodruff v. Parham, 8 Wall. 123; A. S. & W. Co. v. Speed, 192 U. S. 500.
(190) Woodruff v. Parham, 8 Wall. 123.
(191) Brown v. Houston, 114 U. S. 622; P. & S. C. Co. v. Bates, 156 id. 577. (192) Bowman v. C. & N. W. Ry., IL25 U. S. 465. Waite, C. J., and Harlan and Gray, JJ., dissented.
(193) Leisy v. Hardin, 135 U. S. 100. Harlan, Grav, and Drewer, JJ., dissented.
(194) Act of 8th August, 1890, 26 Stat. 313, C. 728.
(195) License Cases, 5 How. 580.
(196)In re Rahrer, 140 TJ. S. 545.
(197) Harlan, Gray, and Brewer, JJ., concurred in the judgment, but not in all the reasoning of the court.
(198) Scott v. Donald, 165 U. S. 58, 100.
(199) Act of N August, 1886, 2 4 Stat. 209, c. 840.
(200) Plumley v. Massachusetts, 155 U. S. 461, Fuller, C. J., and Field and Brewer, JJ., dissenting. See also Crossman v. Lurman, 192 U. S. 189.
(201) Schollenberger v. Pennsylvania, 171 U. S. 1. Harlan and Gray, JJ., dissented.
(202) Austin v. Tennessee, 179 U. S. 343. White, J., concurred, and Fuller, C. J., and Brewer, Shiras, and Peckham, JJ., dissented.
(203) P. 359.
(204) Gibbons v. Ogden, 9 Wheat. 203, 235.
(205) Searight v. Stokes, 3 How. 151; N., M. & Co. v. Ohio, ibid. 720; Achison v. Huddleson, 12 id. 293.
(206) R. Co. v. Fuller, 17 Wall 560.
(207) Munn v. lllinois, 94 U. S. 113; Budd v. New York, 143 id. 517; Brass v. North Dakota, 153 id. 391.
(208) C., B. & Q. R. v. Iowa, 94 U. S. 155; Peik v. C. & N. W. Ry., ibid. 164. Field and Strong, IJ., dissented in each case.
(209) Stone v. F. L. m& T. Co., 116 U. S. 307; Stone v. T. C. R., ibid. 347; Stone v. N. 0. & N. E. R., ibid. 352.
(210) N., C. & S. L. Ry. v. Alabama, 128 U. S. 96.
(211) L., N. 0. & T. Ry. v. Mississippi, 133 U. S. 587. Harlan and Bradley, JJ., dissented. C. & 0. Ry. v. Kentucky, 179 U. S. 388.
(212) He@gtou v. Georgia, :163 U. S. 299.
(213) N. Y., N. H. & H. R. v. New York, 165 U. S. 628.
(214) N. Y., N. H. & H. R. v . New York, supra.
(215) Gladson v. Minnesota, 166 U. S. 427; cf. L. S. & M. S. Ry. 'V. Ohio, 173 id. 285; I. C. R. v. llliinois, 163 id. 142.
(216) C., M. & S. P. Ry. v. Solan, 169 U. S. 133.
(217) R. & A. R. v. P. T. Co., 169 U. S. 311.
(218) L. S. & M. S. RY. v. Ohio, 173 U. S. 285.
(219) M., K. & T. Ry. v. McCann, 174 U. S. 580.
(220) Erb v. Morasch, 177 U. S. 584.
(221) W., M. & P. R. v. Jacobson, 179 U. S. 287.
(222) M. P. Ry. v. Mackey, 127 U. S. 205.
(223) M. P. Ry. v. Humes, 115 U. S. 512.
(224) M. & S. L. R. v. Beckwith, 129 U. S. 26.
(225) M. & S. L. R. v. Minnesota, 193 U. S. 53.
(226) The License Cases, 5 How. 504; Bartemeyer v. Iowa, 18 Wall. 129; Beer Co. v. Massachusetts, 97 U. S. 25; Poster V. Kang@, 112 id. 201; Mugler v. Kansas, 123 id. 623; Act of 8th August, 1890, 26 Stat. 313, c. 728, legislatively limiting the operation of Leisy v. Hardin, 135 U. S. 100
(227) Crossman v. Lurman, 192 U. S. 189.
(228) Escanaba Co. v. Chicago, 107 U. S. 678.
(229) Finning v. Gregoire, 16 How. 524, 534; Conway v. Taylor, 1 Black, 603
(230) The James Gray v. The John Fraser, 21 How. 184.
(231) R. Co. v. Richmond, 9(5 U. S. 521.
(232) W., S. L. & P. Ry. v. Lllinois, 118 U. S. 557. Waite, C. J., and Bradley and Gray, JJ., dissented.
(233) L. & N. R. t,. Eubank, 184 U. S. 27. Gray and Brewer, ii., dissented. G., C. & S. F. Ry. v. Helfley, 158 id. 98.
(234) 1. C. R. v. Illinois, 163 U. S. 142.
(235) C., C., C. &St. L. Ry. v. Illinois, 177 U. S. 514; Gladson v. Minnesota, 166 id. 427.
(236) Sinnot v. Davenport, 22 How. 227; Foster v. Davenport, ibid, 244. New York V. Miln, 11 Pet. 102, from the judgment in which Marshall, C. J., and Story, J., dissented, though not formally, is practicallyy, overruled.
(237) Bowman v. C. & N. W. Ry., 125 U. S. 465.
(238) Ilanley v. K. C. S. Ry., 187 U. S. 617.
(238) a C., M. & St. P. Ry v. Tompkins, 176 U. S. 167, 173.
(238) b Stone v. F. L. & T. Co., 116 U. S. 307; Dow v. Beidelnian, 125 id. 680, 689; G. R. & B. Co. v. Smith, 128 id. 174, 179; C., M. & St. P. Ry. v. Minnesota, 134 id.,618, 458; C. & G. T. Ry. v. Wellman, 143 ii. 339, 344;
Budd v. New York, ibid. 517, 547. Until Congress otherwise directs, a state may regulate the intrastate rates of railways chartered by the United States: Smyth v. Ames, 169 U. S. 466; Reagan v. M. T. Co., 154 id. 413.
(238) c L. S. & M. S. Ry. V. Smith, 173 U. S. 684.
(238) d C. & G. T. Ry. v. Wellman, 143 U. S. 339, 344.
(238) e Reagan t,. F. L. & T. Co., 154 U. S. 362, 399.
(238) f Reagan v. P. L. & T. Co., supra; St. L. & S. F. Ry. v. Gill, 156 U. S. 649, 657; C. & L. T. IL Co. v. Sandford, 164 id. 578, 584; C., B. & Q. R. v.
(238) g M. & St. L. Ry. v. Minnesota, 186 U. S. 287.
(238) h Smyth v. Ames, 169 U. S. 466, 546; 171 id. 361.
(238) i See also S. D. L. & T. Co. v. National City, 174 U. S. 739, 757; Stanislaus County v. S. J & K. R. C. & I. Co., 192 id. 201; S. D. L. & T. Co v. Jasper, 189 id. 439.
(239) Act of 3d August, 1882, 23 Stat. 214; The Head Money Cases, 112 U.S. 580.
(240) Per Miller, J., 112 U. S. 594.
(241) B. & 0. R. v. Maryland, 21 Wall. 456. Miller, J., page 475, dissented, holding that the state could not raise a revenue from all persons going from, or through, the state by railway to a point beyond the state. And compare Allen v. P. P. C. Co., 191 U. S. 171.
(242) Minot v. P., W. & B. R., The Delaware Railroad Tax Case, 18 Wall. 206.
(243) Maine v. G. T. Ry., 142 U. S. 217. Bradley, Harlan, Lamar, and Browin, JJ., dissented. A state cannot, upon this principle, tax a corporation created by an act of Congress: California v. C. P. E., 127 U. S. 1. Arad a state cannot tax the right of transporting interstate passengers within its borders: Allen P. P. C. Co., 191 U. S. 171.
(244) N. Y., L. E. & W. R. v. Pennsylvania, 158 U. S. 431.
(245) P. P. C. Co. v. Pennsylvania, 141 U. S. 18. (Field, Bradley, and Haxlan, JJ., dissented, on the ground that the tax was in reality imposed on cars which only came within the state in pursuit of commerce, and wsa, therefore, void under the principle of Hays v. P.M.S. Co., 17 How. 596) P.P.C. Co. v. Hayward, 141 U.S. 36; C.,C.,C.&S.L.Ry. v. Backus, id. 439; A.R.T. Co. v. Hall, 174 id. 70; U.R.T. Co v. Lynch, 177 id. 149. And a state, in taxing an express or telegraph company, may regard the mileage or property within the state not strictly loeally but part of a system operated in several states: A. E. Co. v. Ohio, 165 U. S. 194, 166 id. 185; A. E Co. v. Kentucky, ibid. 171; W. U. T. Co. V. Missouri, 190 id. 412; cf. Fargo v. Hart, 193 id. 490.
(246) Osborne v. Florida, 1164 U. S. 650; P. Co v. Adams, 189 id. 420. See also Allen u. P. P. C. Co, 191 id. 171.
(247) Ashley v. Ryan, 153 U. S. 436.
(248) L. V. R. v. Pennsylvania, 145 U. S. 192.
(249) New York v. Knight, 192 U. S. 21.
(250) Woodruff v. Parham, 8 Wall. 123.
(251) Brown v. Houston, 114 U. S. 622; P. & S. C. Co. v. Bates, 156 id. 577.
(252) Coe v. Errol, 116 U. S. 517.
(253) Crandall v. Nevada, 6 Wall. 35.
(254) By Chase, C. J., and Clifford, J.
(255) By Miller, J.
(256) The State Freight Tax, 15 Wall. 232; Swayne and Davis, JJ., dissented; E. Ry. v. Pennsylvan 5 Wall. 282.
(257) Packard v. P. S. C. Co, 117 U. S. 34; Tennessee v. P. S. C. Co., ibid. 51. See also Allen v. P. P. Co., 191 id. 171.
(258) Fargo v. Michigan, 121 U. S. 230.
(259) P. & S. S. Co. v. Pennsylvania, 122 U. S. 326, overruling the State Tax on Railway Gross Receipts, 15 Wall. 284, from the judgment in which Miller, Field, and Hunt, JJ., had dissented.
(260) N. & W. R. v. Pennsylvania, 136 U. S. 114.
(261) McCall v. California, 136 U. S. 104; Fuller, C. J., and Brewer and. Gray, JJ., dissented.
(262) Crutcher v. Kentucky, 141 U. S. 47.
(263) The Passenger Cases, 7 How. 283; Taney, C. J., and Daniel, Nelson, and Woodbury, JJ., dissented; Henderson v. The Mayor, 92 U.S. 259; Chy Lung v. Freeman, ibid. 275; People v. Compagnie G6n6rale Transatlantique, 107 U.S. 59.
(264) Almy v. California, 24 How. 169, as explained by Miner, J., in Woodruff v. Parham, 8 Wall. 124, 137.
(265) T. Co. v. Wheeling, 99 U. S. 273; W. P. Co. v. East St. Louis, 107 id. 365.
(266) Hays v. P. M. S. Co., 17 How. 596; St. Louis v. W. F. Co., 11 W&U. 423; G. P. Co. v. Pennsylvania, 114 U. S. 196.
(267) Morgan v. Parham, 16 Wall. 471; Act of 18th February, 1793, 11 Stat. 306.
(268) Moran v. New Orleans, 112 U. S. 69; S. S. Co. v. Portwardens, 6 Wall. 31.
(269) Harman v. Chicago, 147 U. S. 396.
(270) Act 4th February, 1887, 24 Stat. 379, as amended by Acts of 7th August, 1888, 25 Stat. 382; 2nd March, 1889, 25 Stat. 855; 10th February, 1891, 26 Stat. 743; llth ]Pebruary, 1893, 27 Stat. 443; 2nd March, 1893, 27 Stat. 531; 1st April, 1896, 29 Stat. 85; 8th February, 1895, 28 Stat. 643; 3d Mareh, 1901, 31 Stat. IL446; llth February, 1903, 32 Stat. 823; 19th February, 1903, 32 Stat. 847; 2nd March, 1903, 32 Stat. 943.
(271) T. & P. Ry. v. 1. C. C., 16" U. S. 197.
(272) I. C. C. v. Brimson, 154 U. S. 447.
(273) C., N. 0. & T. P. Ry. V. I. C. C., 162 U. S. 184; I. C. C. v. C., N. 0. &
T. P. Ry., 167 id. 479; Harlan, J., dissented.
(274) I. C. C. v. A. M. Ry., 168 TJ. S. 144.
(275) I. C. C. v. A., T. & S. P. R., 149 U. S. 264.
(276) 1. C. C. v. Brimson, 154 U. S. 447.
(277) I. C. C. v. Brimson, 154 U. S. 447; Fuller, C. J., and Brewer and Jackson, JJ., dissented, and Field, J., did not sit.
(278) 27 Stat. 44@ c. 83.
(279) Counselman v. Hitchcock, 14:2 U. S. 547.
(280) Brown v. Walker, 161 U. S. 591; Shiras, Gray, and White, JJ., dissented.
(281) C., N. 0. & T. P. Ry. v. I. C. C., 162 U. S. 184.
(282) Parsoias v. C. & N. W. Ry., 167 U. S. 447.
(283) 1. C. C. v. B. & 0. R., 145 U. S. 263.
(284) 1. C. C. v. D., G. H. & M. Ry., 167 U. S. 633.
(285) Wight v. U. S., 167 U. S. 512.
(286) M. C. P. & S. Co. v. Insurance Co. of N. A., 151 U. S. 368.
(287) U. S. v. T. M. P. A., 166 U. S. 290.
(288) Parsons v. C. & N. W. Ry., 167 U. S. 447.
(289) 1. C. C. v. A. M. Ry., 168 U. S. 144.
(290) T. & P. Ry. v. T. C. C., 162 U. S. 197.
(291) T. & P. Ry. v. I. C. C., 162 U. S. 197.
(292) 1. C. C. v. A. M. Ry., 168 U. S. 144; L. & N. IR. v. Behlmer, 175 id.
648; E. T., V. & G. Ry. v. I. C. C., 181 id. 1; I. C. C. V. L. & N. R., 190
id. 273.
(293) R. Co. v. Fuller, 17 Wall. 560.
(294) W., S. L. & P. Ry. v. luinois, 118 U. S. 5.i7; Waite, C. J., and Bradley
and Gray, JJ., dissented.
(295) L. & N. R. v. Eubank, 1 84 U. S. 27; Gray and Brewer, JJ., dissented;
G.1 C. & S. P. Ry. v. Hefley, 158 U. S. 98.
(296) 1. C. C. v. Baird, 194 U. S. 25.
(297) Mogul S. S. Co. v. McGregor, 23 Q. B. Div. 598; (1892), C. A. 43.
(298) Mrs. Green, "Town Life in the XV Century."
(299) 188 U. S. 373.
(300) Democracy and Liberty, Vol. 11, page 463.
(301) 2nd July, 1890, 26 Stat. 209.
(302) Autobiography of Hon. Geo. F. Hoar, Vol. 11, page 363.
(303) 32 Stat. 823.
(304) 32 Stat. 825.
(305) 32 Stat. 854.
(306) 32 Stat. 1031,1062.
(307) U. S. v. J. T. A., 171 U. S. 505.
(308) 193 U. S. 197.
(309) Fuller, C. J., and Peckbaim and Holmes, JJ., concur.
(310) U. S. v. J. T. A., 171 U. S. 505.
(311) 166 U. S. 290.
(312) 171 U. S. 505.
(313) 171 U. S. 578.
(314) U. S. v. J. T. A., 171 U. S. 505.
(315) In his dissentiug judgment in N. S. Co. v. U. S., 193 U. S. 197, 400.
(316) Matthew v. A. P. of N. Y., 136 N. Y. 333.
(317) 193 U. S. 357.
(318) 18 193 U. S. 197.
(319) Per Peckham, J., in FIopkins v. U. S., 171 U. S. 578, 592.
(320) U. S. v. T. M. F. A., 166 U. S. 290; U. S. v. J. T. A., 171 id. 505.
(321) N. S. Co. v. U. S., 193 U. S. 393.
(322) Act 4th February, 1887, 24 Stat. 379, C. 104, and its supplements, supra, Section 49.
(323) See the dissenting judgment of Wite, J., in U.S. v. T.M.F.A., 166 U.S. 357 et seq.
(324) Minnesota v. N. S. Co., 194 U. S. 48.
(325) Connolly V. U. S. P. Co., 184 U. S. 540.
(326) Bement v. N. H. Co., 186 U. S. 70, 88.
(327) In re Debs, 64 Fed. 724, 745, 755, 158 U. S. 564. See 'The Law of Contracts in Restraint of Trade, with special Reference to Trusts, "by George Stuart Patterson, Esq.
(328) A.P. & S. Co. V. U. S., 175 U. S. 211.
(329) Montague v. Lowry, 193 U. S. 38.
(330) U. S. v. T. M. F. A., 166 U. S. 290; Gray, Shiras, and White, JJ., dissented; U. S. v. J. T. A., 171 id. 505; Gray, Shiras and White, JJ., dissented, and McKenna, J., did not sit.
(331) N. S. Co. v. U. S. 193 U. S. 197; Harlan, Brown, McKenna, and Day, JJ., concurred in the judgment read by Harlan, J., and Brewer, J., concurred in the decree, but did not concur in all the reasoning of Harlan, J.; @er, C. J., and Peckham, White, and Holmes, JJ., dissented.
(332) Bement v. N. H. Co., 186 U. S. 70; Harlan, Gray, and White, JJ., did not sit in this case.
(333) U. S. v. E. C. Knight Co., 156 U. S. 1. Harlan, J., dissented.
(334) Hopkins v. U. B., 171 U. S. 5T8; Anderson v. U. S., ibid. 604. Harlan,
J., dissented in both cases. In the first case it was held to be an immaterial circumstance that the local market was situated partly in one state and partly in another state. In the last case the facto differed only in that the parties to the agreement were purchasers of property upon their own account.
(335) U.S. v. T. M. F. A., U. S. v. J. T. A., and N. S. Co. V. U. S.
(336) 4th February, 1887, 24 Stat. 379, c. 104.
(337) Smyth v. Ames, 169 U. S. 466.
(338) 25 Stat. 855.
(339) 32 Stat. 847.
(340) Hare v. L. & N. R., 2 J. & H. Ch. 80, 103; M. & L. R. v. C. R., 66 N. H. 100. See Report XIV of the Interstate Commerce Commission.
(341) 193 U. S. 197.
(342) 156 U. S. 1.
(343) See the view of Holmes, J., 193 U. S. 405.
(344) 193 U. S. 197.
(345) U. S. v. Isham, 17 WalL 506.
(346) Act of 24th July, 18616, 14 Stat. 221; Rev. Stat. 5263, etc.
(347) Congress, by Act of 8th June, 1872, c. 335, 17 Stat. 308; Rev. Stat. 3964, declared all railway lines in the United States to be post roads.
(348) This act does not apply to telephone companies: Richmond v. S. B. T. Co., 174 U. S. 761.
(349) W. U. T. Co. v. James, 162 U. S. 650.
(350) St. Louis v. W. U. T. Co., 148 U. S. 92; P. T. C. Co. v. Baltimore, 156 id. 210. See also W. U. T. Co. v. New Hope, 187 id. 419; but of. A. & P. T. Co. v. Philadelphia, 190 id. 160; P. T. C. Co. v. New Hope, 192 id. 55; P. T. C. Co. 'V. Taylor, ibid. 64.
(351) Massachusetts v. W. U. T. Co., 141 U. S. 40; P. T. Co. v. Adams, 155 ia. 688; W. U. T. Co. v. Taggart, 163 id. 1; W. U. T. Co. v. Missouri, 190 id. 412.
(352) Ratterman v. W. U. T. Co, 127 U. S. 411; P. T. C. Co. v. Charleston, 153 id. 692.
(353) Rev. Stat., see. 5263, etc.
(354) P. T. Co. v. W. U. T. Co., 96 U. S. 1.
(355) W. U. T. Co. v. Texas, 105 U. S. 460.
(356) W. U. T. Co. v. Pendleton, 122 U. S. 347.
(357) Leloup v. Port of Mobile, 127 U. S. 640 (overruling Osborne v. Mobile, 16 Wall. 479); W. U. T. Co. v. Alabama, 132 U. S. 472.
(358) W. U. T. Co.,v. Massachusetts, 125 U. S. 530.
(359) Cherokee Nation v. Georgia, 5 Pet. 1; Worcester v. Georgia, 6 id. 515; Cherokee Nation v. S. K. Ry., 135 U. S. 641.
(360) Worcester v. Georgia, 6 Pet. 515.
(361) Cherokee Nation v. S. ]K. Ry.7 135 U. S. 641.
(362) U. S. v. Holliday; U. S v. Haas, 3 Wall. 407.
(363) U. S. v. Forty-three Gallons of Whiskev, 9,3 U. S. 188. As to the term "Indian Country," see Ex parte Crow Dog, 109 U. S. 556; U. S. v. Le Bris, 121 id. 278. The subject of the exercise by the states of their Powers of taxation, and of police regulation, as affecting commerce, is more fully treated in other chapters of this book.