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tutions, and repugnant to the instincts of a free people, and contrary to the whole scope and spirit of the Federal Constitution, and is not allowed to exist under express provisions in several of our State constitutions.. Indeed, it is doubtful if free government can long exist in a country where such enormous amounts of money are allowed to be accumulated in the vaults of corporations to be used at discretion in controlling the property and business of the country, against the interests of the public and that of the people, for the personal gain and aggrandizement of a few individuals. It is always destructive of individual rights, and of that free competition which is the life of business, and it invites and perpetuates one of the great evils which it was the object of the framers of our form of government to eradicate and prevent. It is alike destructive to both individual enterprise and individual prosperity, whether conferred upon corporations or individuals, and, therefore, public policy is, and ought to be, as well as public sentiment, against it. All combinations among persons or corporations for the purpose of raising or controlling the prices of merchandise, or of any of the necessaries of life, are monopolies and intolerable, and ought to receive the condemnation of all courts."'1

Richardson v. Buhl, 77 Mich. 632, 658. There is no general rule determining what are articles of necessity. The following are a few of the articles held to be articles of necessity: Lumber, Santa Clara Valley Mill, etc. Co. V. Hayes, 76 Cal. 387; s. c., 9 Am. St. Rep. 211; butter, Chapin v. Brown, 83 Iowa, 156; coal, Morris Run Coal Co. v. Barclay Coal Co., 68 Pa. St. 173; Arnot v. Pittston, etc. Coal Co., 68 N. Y. 568; s. c., 23 Am. Rep. 190; cotton bagging, India Bagging Assoc. v. Kock, 14 La. Ann. 164; grain, Craft v. McConoughy, 79 Ill. 346; s. C., 22 Am. Rep. 171; salt, Central Ohio Salt Co. v. Guthrie, 35 Ohio St.

666; Clancy v. Onondaga Fine Salt Co., 62 Barb. 395; cloth, Hilton v. Eckersley, 6 El. & Bl. 47; grain bags, Pacific Factory Co. v. Adler, 90 Cal. 110; alcohol, State v. Nebraska Distilling Co., 29 Neb. 700; s. C., 29 Am. & Eng. Corp. Cas. 656; candles, Emery v. Ohio Candle Co., 47 Ohio St. 320; s. c., 32 Am. & Eng. Corp. Cas. 165; preserves, American Preservers' Trust v. Taylor Mfg. Co., 46 Fed. Rep. 152. "Alcohol is an article of commerce. It is applied to a thousand uses in arts and manufactures. The amount which is rectified and used as intoxicating drinks forms but a very small part of the quantity actually distilled, and being

an article of commerce any contract creating a monopoly therein is against public policy and void." State v. Nebraska Distilling Co., 29 Neb. 700, 718. The supplying of illuminating gas is a business of a public nature to meet a public necessity. It is not a business like that of an ordinary corporation engaged in the manufacture of articles that may be furnished by individual effort. New Orleans Gas Co. v. Louisiana Light Co., 115 U. S. 683; Shepard v. Milwaukee Gas Co., 6 Wis. 539; Chicago Gas Light & Coke Co. v. People's Gas Light & Coke Co., 121 Ill. 530; St. Louis v. St. Louis Gas Light Co., 70 Mo. 69. Hence, while it is justly urged that those rules which say that a given contract is against public policy should not be arbitrarily extended so as to interfere with the freedom of contract (Printing, etc. Registering Co. v. Sampson, L. R. 19 Eq. 462), yet in the instance of business of such character that it presumably cannot be restrained to any extent whatever without prejudice to the public interest, courts decline to enforce or sustain contracts imposing such restraint, however

partial, because in contravention of public policy. This subject is much considered and the authorities cited in West Virginia Transportation Co. v. Ohio River Pipe Line Co., 22 W. Va. 600; Chicago, etc. Gas Co. v. People's Gas Co., 121 Ill. 530; Western Union Tel. Co. v. American Union Tel. Co., 65 Ga. 160." Gibbs v. Baltimore Gas Co., 130 U. S. 396, 408. The following are held not to be articles of necessity: Sewing machines, Bi-Spool Sewing Machine Co. v. Acme Mfg. Co., 15 Mass. 404; washing machines, Dolph v. Troy Laundry Machine Co., 28 Fed. Rep. 553; curtain fixtures, Central Shade Roller Co. v. Cushman, 143 Mass. 353. An agreement between two manufacturers of glue from fish skins under a supposed valid patent, the object of which is to avoid competition between themselves and secure to each a reasonable profit, is not against public policy, the article in question not being one of prime necessity, nor a a

staple commodity ordinarily bought and sold in the market. Gloucester Isinglass & Glue Co. v. Russia Cement Co., 154 Mass. 92; S. C., 27 N. E. Rep. 1005.

§ 167. Introduction.

CHAPTER XII.

TRUST COMBINATIONS.

168. The Purpose and Scope of
Federal Legislation.

169. The Subject Continued.
170. Pooling by Railroads.
171. The Pooling of Stocks.
172. The Pooling of Products.
173. The Subject Continued.
174. Monopoly under Patents.
175. The Subject Continued.

§ 176. The Voting Trust.
177. The Subject Continued.
178. The Same Subject.
179. Rebates on Freight Bills.
180. The Subject Continued.
181. Combinations of Insurance
Companies.

182. Rights of Parties under
Trust Combinations.

§ 167. Introductory.-The decisions and legislation adverse to the "trust" proper, as examined in the preceding chapter, has led to a variety of combinations which are of the nature of a trust, but are designed to conform to the requirements of the law. The design of these combinations is to secure the ends answered by the trust, while avoiding the methods which have rendered the trust illegal as in contravention of public policy and void. But the numerous schemes of this character have not been largely successful. As the ends sought are essentially illegal, condemnation is not escaped by a change of methods. These combinations have appeared under a variety of forms. But whatever phase they may assume the object is to suppress competition, or to regulate the production and sale of some article of necessity or of some commodity that is in general use. But this is a problem which, in view of recent decisions, presents some very grave difficulties, and the result has been that very many of these combinations have been found illegal and void.

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§ 168. The Purpose and Scope of Federal Legislation.-Federal statutes, prohibiting trust combinations, are limited, of course, to contracts relating either directly or indirectly to interstate commerce. But while Federal legislation is, necessarily, limited in this direction, the object, as in the case of State legislation of this character, is to suppress combinations designed to create a monopoly in restraint of trade. The most important statute on this subject is the Act of July 2d, 1890, entitled: "An Act to Protect Trade and Commerce against Unlawful Restraints and Monopolies." The design and scope of this act appears from section 1, which provides that "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce, among the several States or with foreign nations, is hereby declared to be illegal. Every person who shall make any such contract, or engage in any such combination, or conspiracy, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by a fine, not exceeding $5,000, or by imprisonment, not exceeding one year, or by both said punishments, in the discretion of the courts." In the recent leading case of The United States v. The Trans-Missouri Freight Association, we have a construction of this act by the Supreme Court of the United States. In that case it was held that, under this act, all combinations in restraint of trade or commerce are prohibited by the Act of Congress of July 2d, 1890, whether they are in the form of trusts or in any other form whatever. The words, "unlawful restraints and monopolies," in the title of the Act of Congress of July 2d, 1890, do not show that the purpose of the act was to include only contracts which were unlawful at common law, but refer to and include those restraints and monopolies which are made unlawful in the body of the act. The term "contract in restraint of trade," as used in the Act of Congress of July 2d, 1890, does not refer only to contracts which were invalid at common law, but includes every contract in restraint of trade, and is not limited to that kind of

1 Federal Anti-Trust Act, § 1.

a contract which is in unreasonable restraint of trade. The public policy of the government is to be found in its statutes, and where they have not directly spoken, then, in the decisions of the court and the constant practice of the government officials; but where the law-making power speaks on a particular subject over which it has constitutional power to legislate, public policy in such a case is what the statute enacts. A contract or combination made in violation of a law is void, whatever may have been theretofore decided by the courts to have been the public policy of the country on the subject.1

The act "to protect

1 United States v. Trans-Missouri of "monopolizing, or attempting to Freight Association, 166 U. S. 290, monopolize," trade or commerce 20 Stat. 209, declaring illegal among the States, within the mean"every contract or combination in ing Act July 2, 1890, § 2, it is necthe form of trust, or otherwise in essary to acquire, or attempt to restraint of trade or commerce acquire, an exclusive right in such among the several States or with commerce by means which will foreign nations," applies to com- prevent others from engaging binations of laborers as well as of therein. In re Greene, 52 Fed. capitalists. In order to sustain the Rep. 104. allegations of a bill for an injunction against a combination in restraint of interstate commerce, complainant may offer in evidence, .as matter of history, the official proclamation of the various government officers and also newspapers reports supported by affidavits containing manifestoes and declarations of respondents. United States v. Workingmens' Amalgamated Council, 54 Fed. Rep. 994. A contract between manufacturers, whereby the first party agrees in consideration of a percentage on the sales made by the second party, not to use his plant for the production of strap and T hinges for five years, the contract to be void in case the second party increases his facilities for production of such hinges, is void as against public policy. Oliver v. Gilmore, 52 Fed. Rep. 562. To constitute the offense

trade and commerce against unlawful restraints and monopolies" confers no right upon a private individual to sue in equity for the restraint of the acts forbidden by such statute, an action at law for damages being the only remedy provided for private persons, and the right to bring suits in equity being vested in the district-attorneys of the United States. Pidcock v. Harrington, 64 Fed. Rep. 821. An action in a Federal Circuit Court for New York, charging numerous business competitors of complainants in various States with forming a combination and attempting to create a monopoly in 1887, but charging that after the Act of July 2, 1890, defendants ratified and renewed their previous combinations, and demanding treble damages "under and by virtue of the statute," beld to be

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