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violation of the Interstate Commerce Law, and void. The shipments were interstate commerce. Kizer had a contract for a rate not to exceed 2 cents per 100 pounds, covering shipments from Rankin, Ark., to Texarkana, Tex. He was actually charged the rate exacted from and paid by other shippers. The court quoted the first three sections of the Act to Regulate Commerce, which require reasonable charges and forbid unjust discrimination and undue advantage, and said that the contract appeared to be plainly within those provisions, and that such provisions place “special rates, rebates, drawbacks, and other devices” under the same prohibition and make them unlawful in express terms. It also observed that it has been adjudged in many cases that, when these circumstances arise, the contract which was entered into by the parties in this action is contrary to public policy, and can not be enforced.
In the opinion authorities are cited to the following effect: An agreement by a railroad company to carry goods for certain persons at a cheaper rate than it will carry under the same conditions for others is void, as creating an illegal preference. That no contract can be properly carried into effect which was originally made contrary to the provisions of the law, or which, being made consistently with the rules of the law at the time, has become illegal in virtue of some subsequent law, are propositions which admit of no doubt. An illegal contract is, as a rule, void, not merely voidable, and can be the basis of no judicial proceeding. No action can be maintained upon it either at law or in equity. The principles which have been stated are applicable to the Act of Congress to regulate commerce and the contract which has been described.
REFUSAL TO OBEY SHIPPERS' INSTRUCTIONS As To RouTING FREIGHT.
Post et al. v. Southern Railway Company (52 S. W. Rep., 301), decided by the supreme court of Tennessee, involved the right of a carrier to disregard the routes selected by a shipper of freight and to forward the shipment over another route to the same destination. The State court held in this case: (1) That when the shipper, by the assent of the carrier, designates the route, that route must be pursued, and a deviation therefrom is at the risk of the carrier. (2) When no special instructions are given and assented to as to routes, the initial carrier may select the route or use that commonly employed by it to the point of destination named, and the absence of special instructions given and acceded to amounts to an assent that the carrier's usual course of business may be followed, and it may designate the route as its convenience may suggest. (3) But when goods are tendered for shipment to a point beyond the carrier's line, and there are two or more routes equally safe, prompt, and reliable, the carrier can not be compelled to accept the goods to be carried over one route in preference to another, at the option of the shipper, unless some reason appears therefor; and especially is this so when the carrier shows that in the conduct of its business the use of one route may be advantageous to it without injury or sacrifice to the interests of the shipper. In order that the shipper may have the right to dictate the route under such circumstances, he must show some legitimate advantage or some detriment to himself in the selection of one route over another; and, in the absence of such showing, he is not entitled to dictate the route against the wishes of the carrier; and especially is this the case when the carrier shows that such designation will operate to its prejudice and injury. It has been generally accepted that the shipper is entitled to send his goods by the route which, for any reason, he may select. The decision of the United States Supreme Court in Express Company v. Kountz (75 U. S., 362), which the court in this case said did not necessarily involve the right of the shipper to control the routing, states expressly that it would be— hard to conceive a graver case of negligence, for here were two routes, the one safe and the other hazardous, and yet the express company, in defiance of the wishes of the owner of the property, reject the safe and adopt the hazardous route. Carriers of goods can not escape responsibility if they behave in this manner, for they are required to follow the instructions given by the owner of the property whenever practicable. The ruling of the State court in this Post case was made in regard to the choice of the shipper of one out of several through routes over connecting lines which were used by the Southern Railway Company and its connections under a published joint tariff applying on the interstate transportation of cotton from Memphis, Tenn., to Fall River, Mass. The court quotes from various authorities to the effect that it is a matter of discretion with the carrier whether it shall make through arrangements with other carriers or not, and then advances the rather startling proposition that “if this be true, and a carrier can refuse to make such through arrangements, certainly it can refuse to use them after being made, if for sufficient reasons it does not desire to do so.” Among other things intimated in the opinion of the court as sufficient reasons for refusing to use an existing through arrangement (in this case a through route and a joint through rate) are insolvency of a connecting carrier and return loading over one line and not over another. Such a reason might be ground for refusing to make the through line or to continue it in force, but it is hard to see how, when an initial carrier is party to published joint tariffs over two or more connecting routes to the same destination, it can say it will use one and will not use the other in defiance of the express direction of the shipper. The Commission decided the question in Rea v. Mobile & Ohio Railroad Company (7 I. C. C. Rep., 43). We said in that case that the shipper may control the route by which his merchandise shall go, and that the carrier must treat, in this respect, all members of the public alike. There was an established published rate from Verona, Miss., to Cleveland, Ohio. “Presumably,” said the Commission, “that rate and that route were open to the public. When the complainant directed the defendant's agent to route his carload of potatoes that way, it was the business of that agent to do so, and his failure to do so was a discrimination against the complainant which amounted to a violation of the Act to Regulate Commerce.” "
The decision of the United States Supreme Court in Lake Shore & Michigan Southern Railway Company v. Smith (173 U. S., 684) has important bearing upon the control of rates by legislative bodies. In 1891 the legislature of Michigan passed an act amending the general railroad law, and providing that 1,000-mile tickets should be sold by all railroad companies in that State at a price not exceeding $20 in the Lower Peninsula and $25 in the Upper Peninsula; that such tickets should be made nontransferable, but whenever required by the purchaser they should be issued in the names of the purchaser, his wife and children, designating the name of each on such ticket, and in case the ticket should be presented by any other than the person or persons named thereon, the conductor might take it up and collect fare, and thereupon such 1,000-mile ticket should be forfeited to the railroad company; that each 1,000-mile ticket should be good for two years only after the date of purchase, and in case it should not be wholly used within that time, the company issuing the same should redeem the unused portion thereof if presented by the purchaser for redemption within thirty days after the expiration of such time, and the company should on such redemption be entitled to charge 3 cents per mile for the portion thereof used. The court held that this statute violated that part of the Constitution of the United States which forbids the taking of property without due process of law and requires the equal protection of the laws.
The question presented in this case was whether the legislature of a State, having power, within such constitutional limitations, to fix maximum rates and charges for the transportation of persons and property by railroad companies, and having power to alter, amend, or repeal their charters, within certain limitations, has also the right, after having fixed a maximum rate for the transportation of passengers, to still further regulate their affairs and to discriminate and make an exception in favor of certain persons, and give to them a right of transportation for a less sum than the general rate provided by law. The views of the court are sufficiently shown in the following extracts taken from the opinion:
The legislature having fixed a maximum rate at what must be presumed, prima facie, to be also a reasonable rate, we think the company then has the right to insist that all persons shall be compelled to pay alike; that no discrimination against it in favor of certain classes of married men or families, excursionists or others, shall be made by the legislature. If otherwise, then the company is compelled at the caprice or whim of the legislature to make such exceptions as it may think proper, and to carry the excepted persons at less than the usual and legal rates, and thus to part in their favor with its property without that compensation to which it is entitled from all others, and therefore to part with its property without due process of law. The affairs of the company are in this way taken out of its own management, not by any general law applicable to all, but by a discrimination made by law to which the company is made subject. Whether an act of this nature shall be passed or not is not a matter of policy to be decided by the legislature. It is a matter of right of the company to carry on and manage its concerns, subject to the general law applicable to all, which the legislature may enact in the legal exercise of its power to legislate in regard to persons and things within its jurisdiction.
In this case there is not an exercise of the power to fix maximum rates. There is not the exercise of the acknowledged power to legislate so as to prevent extortion or unreasonable or illegal exactions. The fixing of the maximum rate does that. It is a pure, bald, and unmixed power of discrimination in favor of a few of the persons having occasion to travel on the road, and permitting them to do so at a less expense than others, provided they buy a certain number of tickets at one time. It is not legislation for the safety, health, or proper convenience of the public, but an arbitrary enactment in favor of the persons spoken of, who, in the legislative judgment, should be carried at a less expense than the other members of the community. There is no reasonable ground upon which the legislation can be rested, unless the simple decision of the legislature should be held to constitute such reason. Whether the legislature might not in the fair exercise of its power of regulation provide that ordinary tickets purchased from the company should be good for a certain reasonable time is not a question which is now before us, and we need not express any opinion in regard to it.
In holding this legislation a violation of that part of the Constitution of the United States which forbids the taking of property without due process of law, and requires the equal protection of the laws, we are not, as we have stated, thereby interfering with the power of the legislature over railroads as corporations or common carriers to so legislate as to fix maximum rates, to prevent extortion or undue charges and to promote the safety, health, convenience, or proper protection of the public. We say this particular piece of legislation does not partake of the character of legislation fairly or reasonably necessary to attain any of those objects, and that it does violate the Federal Constitution as above stated.
Three members of the court dissented from this decision.
The case of Cowen v. Winters (circuit court of appeals, sixth circuit; 96 Fed. Rep., 929) arose under the following circumstances: The Cincinnati, Jackson & Mackinaw Railroad Company was the authorized agent of the Baltimore & Ohio Railroad Company in selling certain mileage tickets. It sold a mileage ticket to Winters which purported on its face to be good for passage not only on the line of the selling company, but on the lines of several other roads, including that of the Baltimore & Ohio. The ticket purported to be good over the Baltimore & Ohio by virtue of an express agreement existing in full force at the time of the sale between that company and the selling company, under which each was authorized to sell mileage tickets good over both roads. In August, 1897, Winters boarded a passenger train of the Baltimore & Ohio at a station in Ohio to go to another station in the same State and on the same railroad. He presented his mileage book to the conductor of the train, and asked him to detach the requisite mileage due for his passage. The conductor refused to accept the ticket upon the ground that his company had expressly directed him to refuse all mileage tickets sold or issued by the Cincinnati, Jackson & Mackinaw Railroad Company, and he demanded that Winters should pay his fare in money or leave the train. This Winters absolutely refused to do, and thereupon the conductor forcibly ejected him from the train. The defense was that the ticket did not entitle Winters to passage over its railroad. It appeared that the real excuse for the repudiation of the ticket was that in July, 1897, the Baltimore & Ohio was notified by the Cincinnati, Jackson & Mackinaw Company that one of its agents had wrongfully sold a batch of mileage tickets good over the lines of the Baltimore & Ohio upon credit to a ticket broker, who refused to either pay for or return the tickets, and that it would not redeem any such tickets thereafter taken up by the Baltimore & Ohio Company. A list of these repudiated tickets was furnished the Baltimore & Ohio Company to enable its conductors to identify them when presented for passage. The general passenger agent of the Baltimore & Ohio declined the responsibility of guarding against so great a list of “bogus tickets,” and in a letter dated August 2, 1897, he said, among other things: “I think the only safe course to pursue would be to instruct conductors to refuse all of your tickets. * * * I dislike very much to adopt this extreme measure, but do not see any other recourse.” No other arrangement being made, the general passenger agent, the manager of passenger traffic, and the general superintendent of the Baltimore & Ohio issued orders to all train conductors to refuse all mileage books issued by the Cincinnati, Jackson & Mackinaw Company, to collect local fare, “and refer holders of such tickets to the issuing line for redress.” The foregoing statement of facts is taken from the decision. It appears that the ticket held by Winters was not one of the tickets wrongfully sold by the agent of the Cincinnati, Jackson & Mackinaw road, and the court said: “We need not concern ourselves as to the rights of one who bought one of that batch of tickets without notice of the circumstances under which they had been originally disposed of.” Neither was this ticket issued after the abrogation of the agreement authorizing that company to sell mileage books good over the Baltimore & Ohio road. The court held that the agreement between the two companies shown on the ticket constituted a contract between the purchaser and the Baltimore & Ohio which could not be repudiated without his consent, and that the contract was in every particular as obligatory upon the Baltimore & Ohio as if the ticket had been sold