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among the several states, to establish post-roads, and to raise and support armies,'
and it provided as follows:
"Every railroad company in the United States, whose road is operated by steam, its successors and assigns, is hereby authorized to carry upon and over its road, boats, bridges and ferries, all passengers, troops, government supplies, mails, freight and property on their way from any state to another state, and to receive compensation therefor, and to connect with roads of other states, so as to form continuous lines for the transportation of the same to the place of destination. .
"This section shall not be construed to authorize any railroad company to build any new road, or any connection with another road, without authority from the state in which such railroad or connection shall be proposed."
The purpose of this act, as declared by the supreme court, was to remove trammels upon transportation which had previously existed, and to prevent the creation of such trammels in the future, and also to be a declaration by congress in favor of the great policy of continuous lines, and therefore as favoring such business arrangements between companies as would make such connections effective, and as indicating an intent that interstate commercial intercourse should be free.3
The statute however imposes no duties upon carriers so as to compel through routing of interstate traffic, and merely permits or authorizes the carriage of freight or traffic from one state to another and the formation of continuous lines by mutual agreement. The act was only intended to remove trammels upon transportation between different states imposed by state enactments or the then existing laws of congress, and did not prevent the operation of police laws of the states affecting interstate railways.5
This statute has been invoked in a number of cases, wherein
1 Railroad Co. v. Richmond, 19 Wall. 584 (1873), 22 L. Ed. 173.
2 Union Pacific R. Co. v. Chicago, etc., R. Co., 163 U. S. 564 (1896), 41 L. Ed. 265, 274, where the court said: "It is impossible for us to ignore the great public policy in favor of continuous lines thus declared by congress and that it is an effectuation of such policy that
such business arrangements as will make such connections effective, are made."
3 Bowman v. C. & N. W. R. R., 125 U. S. 465 (1888), 31 L. Ed. 700.
4 Kentucky & Indiana Bridge Co. v. L. & N. R. Co., 37 Fed. Rep. 567, 1. c. p. 633 (1889).
5 R. R. Co. v. Fuller, 17 Wall. 560 (1873), 21 L. Ed. 710.
the validity of state legislation affecting interstate railways was involved; and it has been uniformly held by the supreme court that the statute was not intended to interfere with the authority of the states to enact such regulations with respect at least to a railroad corporation of its own creation, as were not directed against interstate commerce, but which only incidentally or remotely affected such commerce, and were not in themselves regulations of interstate commerce, but were designed reasonably to subserve the convenience of the public.1 Thus, the statute did not interfere with state enactments, as the running of trains on Sunday, or excluding diseased cattle.3 Neither did this declaration of the national policy, favoring continuous transportation, exempt railroad cars employed in interstate transportation from the attachment laws of the states, nor the railroad companies from the process of garnishment therein.*
§ 43. State control of local business and incorporation of interstate railroads.-Though this statutory declaration of national policy in 1866 was not directly involved, the principle is applicable to recent decisions of the supreme court holding invalid the attempted state revocation of the license of interstate railroads and telegraph companies to do a local business in the state, notwithstanding the admitted state control over the admission of foreign corporations engaged in general business and its attempted control over the local business of interstate railroads and telegraph companies. Thus a statute of Missouri forfeiting the right of a railroad company to do a local business in the state, when under the sanction of the state it had come into the state and acquired a large amount of property therein, in case it should bring a suit in the federal court or remove from the state to the federal courts, was held void."
The statute of Kansas was also held void which exacted from
1 Lake Shore & M. S. Ry. Co. v. Ohio, 173 U. S. 285, 43 L. Ed. 702 (1899).
2 Hennington v. Georgia, supra. 3 M. K. & T. R. Co. v. Haber, 169
U. S. 613 (1898), 42 L. Ed. 878.
4 See supra, § 39.
Herndon v. C. P. I. & P. Ry. Co., 218 U. S. p. 135; 54 L. Ed. p. 970 (1910), affirming 157 Fed. 783 (1910).
a foreign telegraph company a charter fee of a given per cent of the entire authorized capital stock of the company as a condition of continuing to do local business in the state.1
Both these cases involved the right of corporations in the state, which had made investments therein, for the purpose of doing both an interstate and local business. A broader question of the right of the state to prevent an interstate railroad or telegraph company of another state from entering the state, or to require reincorporation as a state corporation as a condition of entering the state, was not decided. It would seem however that the right of an interstate railroad or other interstate company to do a local business under reasonable state regulation is an incident of the right to transact an interstate business, and that congress is the only authority which can prescribe the limitation of the right of a corporation directly engaged as an instrumentality of interstate commerce to enter a state.
§ 44 (41). State regulation of railways in the United States. With this judicial declaration of the freedom of interstate commerce from state control also came the distinct judicial recognition of the governmental power of regulation over public carriers. This principle had been already established both in the states of this country and in England.
Thus in this country prior to the adoption of the interstate commerce act railway commissions had been established in several states, some with powers of regulation, and others only with powers of investigation and recommendation. It was established in the Granger cases, that railroad companies were carriers for hire and as such were engaged in the public employment affecting the public interests and were subject to legislative control as to their rates of fare and freight, unless protected by their own charters therefrom. As carriers they must carry when called upon to do so, and can charge only a reasonable sum for the carriage. The principle was
1 Western Union Telegraph Co. v. Kansas ex rel., 216 U. S. 1, 54 L. Ed. 355, reversing 75 Kan. 609 (1910).
2 Munn v. Illinois, 94 U. S. 113
(1876), 24 L. Ed. 77; Railroad Co. v. Iowa, 94 U. S. 155 (1876), 24 L. Ed. 94; Peik v. Railway Co., 94 U. S. 164 (1876), 24 L. Ed. 97.
also distinctly declared that when property had been clothed with a public interest, the legislature may fix a limit to that which in law shall be reasonable for its use, and that this limit binds the courts as well as the people. It was urged in these cases that the statutes of the states regulating rates amounted to a regulation of commerce among the states; but it was held that where the railroad was employed in state as well as in interstate commerce, and until congress acted, the state must be permitted to establish such rules and regulations as may be necessary for the promotion of the general welfare of the people within its own jurisdiction, even though in doing so those without may be indirectly affected.
While there has been some difference of judicial opinion as to what classes of business were affected with a public use so as to warrant state regulation of charges, there has been no such difference as to the application of the principle to common carriers, and their subjection to public regulation has been uniformly conceded.1
§ 45 (42). Governmental regulation of railways in England. The principle of governmental regulation of railways was adopted in England soon after the first introduction of railways in that country. Thus, the Railways Clauses Consolidation Act of 1845, in granting the power to vary tolls upon railways so as to accommodate them to the circumstances of the traffic, provided that tolls should be at all times charged equally to all persons, and that the power of varying should not be used for the purpose of prejudicing or favoring particular parties, or for the purpose of collusively or unfairly creating a monopoly either in the hands of the company or of particular parties. The Railway and Canal Traffic Act of 1854 2 specifically provided that the railway company should make arrangements for receiving and forwarding freight, and prohibiting any undue or unreasonable preference or advantage, using substantially the language adopted in the third section.
1 Budd v. New York, 143 U. S. 517 (1892), 36 L. Ed. 247; Brass v. North Dakota, 153 U. S. 391 (1894), 38 L. Ed. 757; State ex rel. v. Associated Press, 159 Mo. 410
(1901); Minneapolis & St. Louis R. Co. v. Minnesota, 186 U. S. 257 (1902), 46 L. Ed. 1151.
2 17 and 18 Vic., c. 31.
of the Interstate Commerce Act, and authorized summary proceedings in the courts for the enforcement of its provisions. The act of 186s provided for securing equality of treatment where the railway company operates its steam vessels; and finally the Regulation of Railways Act of 1873 authorized the appointment of not more than three commissioners, one of whom should be experienced in the law and one of experience in the railway business, and not more than two assistant commissioners, and this commission was granted very comprehensive powers, including the power of making through routes and apportioning through rates thereon. As will be hereafter seen some of the provisions of the Interstate Commerce Act are based upon the English statutes, and the English decisions construing those statutes have been frequently cited in the federal courts.3 English precedents however in the matter of public regulation of railways are of limited value in this country, in view of the vast difference in the conditions of railroad service. In the one there is compact population in a limited area; in the other a great continent, with immense tracts of sparsely settled and newly opened territory, covered with a great network of railroads and with numerous competing communities.
§ 46 (43). The common law in interstate commerce.-There is no federal common law in the sense of a national customary law distinct from the common law of England, such as the common law adopted by the several states, each for itself, applied to its local law and subject to such alterations as may be provided by its own statutes.* There are therefore no crimes of the United States, and no pains and penalties are enforced by its courts, except as enacted in the statutes of the United States.
Under section 721 of the Judiciary Act the laws of the several states are enforced in the courts of the United States."
1 31 and 32 Vic., c. 119. 236 and 37 Vic., c. 48. 8 Infra, Interstate Commerce Act, secs. 2 and 3.
4 Wheaton V. Peters, 8 Pet. 1. c. 658, 8 L. Ed. 1079 (1834); Smith v. Alabama, 124 U. S. 465 (1888), 31 L. Ed. 508.
"Sec. 721. Laws of the states; rules of decision. The laws of the several states, except where the constitution, treaties, or statutes of the United States otherwise require or provide, shall be regarded as rules of decision in trials at common law, in the courts of the