Argument for Defendant in Error.

the late Chief Justice Waite, is to be found a history of legislative control of property clothed with public interest, as well as also an exhaustive discussion of the principles upon which such legislative control rests.

In the consideration of the questions involved in that case, the court, after reviewing the history of the subject and supporting the position contended for by ample and pertinent illustrations, says:

"It is insisted, however, that the owner of property is entitled to a reasonable compensation for its use, even though it be clothed with a public interest, and that what is reasonable is a judicial and not a legislative question.

"As has already been shown, the practice has been otherwise. In countries where the common law prevails, it has been customary from time immemorial for the legislature to declare what shall be a reasonable compensation under such circumstances, or, perhaps more properly speaking, to fix a maximum beyond which any charge maḍe would be unreasonable. Undoubtedly in mere private contracts, relating to matters in which the public has no interest, what is reasonable must be ascertained judicially. But this is because the legislature has no control over such a contract. So, too, in matters which do affect the public interest, and as to which legislative control may be exercised, if there are no statutory regulations upon the subject, the courts must determine what is reasonable. The controlling fact is the power to regulate at all. If that exists, the right to establish the maximum of charge, as one of the means of regulation, is implied. In fact, the common-law rule, which requires the charge to be reasonable, is itself a regulation as to price. Without it, the owner could make his rates at will, and compel the public to yield to his terms, or forego the use.

"But a mere common-law regulation of trade or business may be changed by statute. A person has no property, no vested interest, in any rule of the common law. That is only one of the forms of municipal law, and is no more sacred than the other. Rights of property which have been created by the common law cannot be taken away without due process; but

Argument for Defendant in Error.

the law itself, as a rule of conduct, may be changed at the will, or even at the whim, of the legislature, unless prevented by constitutional limitations. Indeed, the great office of statutes is to remedy defects in the common law as they are developed, and to adapt it to the changes of time and circumstances. To limit the rate of charge for services rendered in a public employment, or for the use of property in which the public has an interest, is only changing a regulation which existed before. It establishes no new principle in the law, but only gives a new effect to an old one.

"We know that this is a power which may be abused; but this is no argument against its existence. For protection against abuses by legislatures the people must resort to the polls, not to the courts."

See, also, Chicago, Burlington & Quincy Railroad v. Iowa, 94 U. S. 155; Peik v. Chicago & Northwestern Railway, 94 U. S. 164; Chicago, Milwaukee & St. Paul Railroad v. Ackley, 94 U. S. 179; Winona & St. Peter Railroad v. Blake, 94 U. S. 180.

In Ruggles v. Illinois, 108 U. S. 526, 531, the court, citing and referring to the Granger Cases, says: "It was determined that a 'State may limit the amount of charges by railroad companies for fares and freights unless restrained by some contract in the charter.' . The company by its original charter was authorized to transport passengers and property and to receive compensation therefor. This, if there had been nothing more, would, under the rule stated in Munn v. Illinois, 94 U. S. 113, and the several railroad cases decided at the same time, require the company to carry at reasonable rates and leave the legislature at liberty to fix the maximum of what would be reasonable."

Discussing the effect of a provision of its charter, as amended, which empowered the board of directors to fix rates, the court says, page 533: "When, therefore, in a section of the charter which expressly declares that no by-law shall be made that is in conflict with the laws of the State, we find that the rates of charge to be levied and collected for the conveyance of persons and property are to be regulated by by

VOL. CXXXIV-29

Argument for Defendant in Error.

laws, the conclusion is irresistible that only such charges can 'be collected as are allowed by the laws of the State. This implies that, in the absence of direct legislation on the subject, the power of the directors over the rates is subject only to the common law limitation of reasonableness; for in the absence of a statute or other appropriate indication of the legislative will, the common law forms part of the laws of the State to which the corporate by-laws must conform. But since, in the absence of some restraining contract, the State may establish a maximum of rates to be charged by railroad companies for the transportation of persons and property, it follows that when a maximum is so established the rates fixed by the directors must conform to its requirements, otherwise the bylaws will be repugnant to the laws." Instead of Ruggles v. Illinois modifying the rule laid down in the Granger Cases, we insist that it is a plain affirmance of that rule.

Another case which it was urged modified the rule in the Granger Cases is the case of Stone v. Farmers' Loan & Trust Co., 116 U. S. 307; after referring to the Granger Cases, the court says:

"From what has been said, it is not to be inferred that this power of limitation or regulation is itself without limit. This power to regulate is not a power to destroy, and limitation is not the equivalent of confiscation. Under pretence of regulating fares and freights, the State cannot require a railroad corporation to carry persons or property without reward; neither can it do that which in law amounts to a taking of private property for public use without just compensation, or without due process of law. What would have this effect we need not now say, because no tariff has yet been fixed by the commission, and the statute of Mississippi expressly provides 'that in all trials of cases brought for a violation of any tariff of charges, as fixed by the commission, it may be shown in defence that such tariff so fixed is unjust.""

The principles here expressed will doubtless be pressed upon, the court with great force, it being insisted that in the case at bar the rates have been fixed, but it may be said in reply that in nearly all the Granger Cases, the court was called upon to pass upon a law which had in tact fixed a rate.

Argument for Defendant in Error.

However, as stated in the outset, the return to the writ of mandamus in the case at bar contains no allegations that could support a claim that the operation of the law would require the carrier to transport persons or property without reward, or would amount to a taking of private property for public use without just compensation. The most that is alleged is that the rate so established is unjust and unreasonable, and the statement in general terms that it amounts to a pro tanto taking of the property of the company without due process of law. But as was said by the court in the case last cited:

"General statutes regulating the use of railroads in a State, or fixing maximum rates of charges for transportation, when not forbidden by charter contracts, do not necessarily deprive the corporation, owning or operating a railroad within the State, of its property without due process of law, within the meaning of the Fourteenth Amendment of the Constitution of the United States, nor take away from the corporation the equal protection of the laws." Munn v. Illinois, 94 U. S. 113, 134, 135; Railroad Co. v. Richmond, 96 U. S. 521, 529; Spring Valley Water Works v. Schottler, 110 U. S. 347, 354.

In Dow v. Beidelman, 125 U. S. 680, the court says, concerning a law of Arkansas fixing a maximum rate for carrying passengers: "Without any proof of the sum invested by the reorganized corporation, or its trustees, the court has no means, if it would under any circumstances have the power, of determining that the rate of three cents a mile fixed by the legislature is unreasonable. Still less does it appear that there has been any such confiscation as amounts to a taking of property without due process of law."

In Georgia Banking Co. v. Smith, 128 U. S. 174, the principle contended for again received judicial sanction.

Thus we have an unbroken line of decisions of this court commencing with the case of Munn v. Illinois, decided in 1876, and terminating with the case of Georgia Railroad & Banking Co. v. Smith, decided in 1888, to support the proposition that when unrestrained by contract or charter stipulation, the legislature of a State may determine what is a just

Opinion of the Court.

and reasonable rate for a common carrier to charge for the transportation of freight and passengers; that the question of the reasonableness of the rate is a question for legislative determination, and when so determined, ceases to be the subject of judicial inquiry.

Mr. W. C. Goudy closed for appellant.

MR. JUSTICE BLATCHFORD, after stating the case as above reported, delivered the opinion of the court.

The opinion of the Supreme Court of Minnesota is reported in 38 Minnesota, 281. In it the court in the first place construed the statute on the question as to whether the court itself. had jurisdiction to entertain the proceeding, and held that it had. Of course, we cannot review this decision.

It next proceeded to consider the question as to the nature and extent of the powers granted to the commission by the statute in the matter of fixing the rates of charges. On that subject it said: "It seems to us that, if language means anything, it is perfectly evident that the expressed intention of the legislature is that the rates recommended and published by the commission (assuming that they have proceeded in the manner pointed out by the act) should be not simply advisory, nor merely prima facie equal and reasonable, but final and conclusive as to what are lawful or equal and reasonable charges; that, in proceedings to compel compliance with the rates thus published, the law neither contemplates nor allows any issue to be made or inquiry had as to their equality and reasonableness in fact. Under the provisions of the act, the rates thus published are the only ones that are lawful, and therefore, in contemplation of law, the only ones that are equal and reasonable; and, hence, in proceedings like the present, there is, as said before, no fact to traverse, except the violation of the law in refusing compliance with the recommendations of the commission. Indeed, the language of the act is so plain on that point that argument can add nothing to its force."