Providence Coal Co. v. Providence & Worcester Railroad

TüjLINGHÁSt, J. The main questions presented for our consideration by the numerous exceptions to the defendant’s answer to the bill are, first, whether the provisions of Pub. Stat. R. I. cap. 139, which prohibit discriminations being made by common carriers in the transportation of goods and merchandise, can be construed to affect contracts made in this State for the transportation of goods and merchandise to points beyond the limits thereof; and, second, if they can be so construed, whether they are not to that extent in conflict with the “ commercial clause ” of the Constitution of the United States, which provides that “ the Congress shall have power to regulate commerce with foreign nations and among the several states.” The defendants are common carriers, owning and operating the Providence and Worcester Railroad, which is situated partly in Rhode Island and partly in Massachusetts. The corporation has been consolidated under the statutes of both states. The bill seeks relief against the defendants for discriminations alleged to have been made by them against the plaintiffs, both on contracts for the transportation of merchandise to points within this State, and also to points without the State, on the line of their road. Most of the exceptions are to the refusal of defendants to answer the allegations of the bill as to business transacted by them on contracts made for the shipment of merchandise to points without the State. The defendants contend that they are not called upon to answer these allegations, because they are only a Rhode Island corporation, owning and operating a railroad wholly in this State; that part of the road beyond the limits thereof being owned and controlled by another and distinet *308 corporation, created by, and only amenable to, the laws of another state. By the express provisions of the defendants’ act of incorporation in this State of May, 1844, §§ 15 to 18, the consolidated company forms but one corporation; and by § 18 it is expressly made subject to all the duties and liabilities of the Providence and Worcester Railroad Company created by the provisions of this act, and to the general laws of this State, to the same extent as the said Providence and Worcester Railroad Company and the stockholders therein would have been had the whole line of said railroad been located within the limits of this State. The defendants, then, are a consolidated railroad company, owning and operating a railroad extending, as alleged in the bill, from Providence, Rhode Island, to Worcester, Massachusetts; and we think it is well settled that such a corporation is but one entity, “ and that the acts and neglects of the corporation are done by it as a whole.” In Boston, &c. R. R. v. New York, &c. R. R. 13 R. I. 260, 262, this court, speaking of the Boston, Hartford, and Erie Railroad Company, which was chartered by the State of Connecticut, says that it “ was not a Rhode Island corporation except so far as it became, by virtue of the sale and action of the legislature, the successor of the Hartford, Providence, and Fishkill Railroad Company. Yet, as a foreign corporation, it might be empowered to own and operate a railroad within this State, the policy of such authority being wholly within the discretion of the legislature.” . . . “ But the Boston, Hartford, and Erie Railroad Company can hardly be regarded as a foreign corporation. True, it was not a Rhode Island corporation in the sense that it was chartered here, but it was subject to Rhode Island laws and control as fully as a domestic railroad company.” And then, after reciting the legislative action concerning it, the court further says, ■“It was thenceforth a corporation in this State, though not of this .State.” In Scofield v. Lake Shore & Michigan Southern R. R. Co. A Western Reporter, 812, wherein this question has recently been .fully considered by the Supreme Court of Ohio, the court says : “.A further question is presented, whether the decree for plaintiffs •should be limited to and enforced only in this State, or should .it .extend to, and be enforced against, the defendant at all points *309 reached by defendant’s railroad, its branches and connecting lines ? ” “ The District Court finds that the defendant is a consolidated company, its lines of road extending to various points in Pennsylvania, New York, Ohio, Indiana,' Michigan, and Illinois. It is an artificial person, and the same person in all this territory, and this court has acquired jurisdiction of the person of the corporation, and the right to enforce all proper decrees against it.” . . . “ The railroad is an entirety, whether within the State or without ; and the artificial person, by the acts of the several states authorizing consolidation, has been created one, and not two or more, and no reason is perceived why it may not be dealt wi th by the courts of either state that has procured jurisdiction.” “ This artificial person not only holds itself out, but does make contracts for the transportation of freight over its connecting lines as well as its own line, and it makes rates to points only reached by connecting lines. No reason is perceived why it should not be ordered to make no discriminations to the injury of the plaintiff in its rates to points thus reached. Of course it may, at any time, refuse to make any rates beyond its own lines; but, if it makes rates to points on connecting lines, the rates should be equal to all.” See, also, McDuffee v. Portland & Rochester Railroad, 52 N. H. 430; Peik v. Chicago, &c. R. R. Co. 94 U. S. 164, 176; Horne v. Boston & Maine R. R. Co. 18 Fed. Reporter, 50. This doctrine is now so fully settled that a review of the cases is quite unnecessary. Construing the statute, then, to include contracts for the transportation of merchandise to points without the State on the line of defendants’ road, is it obnoxious to the constitutional provision before mentioned? We do not think it is. It is not, in our judgment, a regulation of commerce within the meaning of the “ commercial clause ” as heretofore construed, either by the state courts or by the final arbiter of questions of that sort, the Supreme Court of the United States. It opposes no obstruction and causes no delay to commerce. Neither does it lay any tax thereon so as to make it obnoxious to the rule as laid down by the Supreme Court of the United States in Hays v. Pacific Mail Steamship Co. 17 How. U. S. 596; Morgan v. Parham, 16 Wall. *310 471; Steamship Co. v. Port Wardens, 6 Wall. 31; Case of the State Freight Tax, 15 Wall. 232; Henderson et al. v. The Mayor of New York, 92 U. S. 259; Walling v. Michigan, 116 U. S. 446; Gloucester Ferry Co. v. Pennsylvania, 114 U. S. 196, and many others of the same class. It simply prohibits discrimination being made in favor of one and against another having occasion to use the facilities afforded for the transportation of goods by common carriers under like circumstances, a substantial declaration of the common law doctrine upon this subject. Messenger et al. v. Pennsylvania R. R. Co. 37 N. J. Law, 531; v Chicago, &c. R. R. Co. v. The People, 67 Ill. 11. And although a statute of this sort may doubtless be properly said to affect commerce, yet, as held in the State Tax on Railway Gross Receipts, 15 Wall. 284, 293, “it is not everything that affects commerce that amounts to a regulation of it within the meaning of the Constitution.” In Peik v. Chicago, &c. R. R. Co. 94 U. S. 164, in which the power of the legislature of Wisconsin to provide by law for a maximum charge to be made for fare _____freight for the transportation of persons and property carried within the State, or taken up outside the State and brought within it, or taken up inside and carried without, was considered, the Supreme Court of the United States says: — “ As to tbe effect of the statute as a regulation of interstate commerce, the law is confined to state commerce, or such interstate commerce as directly affects the people of Wisconsin. Until Congress acts in reference to the relations of this company to interstate commerce, it is certainly within the power of Wisconsin to regulate its fares, etc., so far as they are of domestic concern. With the people ofW isconsin this company has domestic relations. Incidentally these may reach beyond the State. But certainly, until Congress undertakes to legislate for those who are without the State, Wisconsin may provide for those within, even though it may indirectly affect those without.” In the case of Chicago, &c. R. R. Co. v. Iowa, 94 U. S. 155, 161, the same doctrine was maintained. The conclusion deducible from the numerous decisions bearing upon this subject, as well stated by the Supreme Court of Indiana in Western Union Telegraph Co. v. Pendleton, 95 Ind. 12, *311 “ is, that the states cannot embarrass commércial communication, abridge the freedom of commerce, discriminate in favor of the products of one state, lay burdens upon the instruments of commerce, or exact licenses from persons, natural or artificial, engaged in interstate commerce.” See cases there cited. Accepting this as a summary of the law applicable to the case before us, we do not see that the statute under consideration is obnoxious thereto. Commercial intercourse is not thereby abridged or fettered, and no new duty or burden is imposed thereon. The defendants are only called upon to do, under a certain penalty, precisely what the common law declares it to be their duty to do without the statute, viz., to treat all alike under similar circumstances, — a mere police regulation. The Supreme Court of Illinois has recently had occasion to construe a similar statute, and in so doing, inter alia, says : “ It is no doubt true that the statute to prevent unjust discrimination in the rates of charges of railroad companies, under which this action was brought, may affect commerce, but in our judgment it cannot be said to .be a law regulating commerce among the states, within the meaning of the Federal Constitution. The law does not purport to exercise control over any railroad corporation except those that own or operate a railroad in the State, such corporations as have domestic relations with the people of the State ; and, as we understand the decisions of the Supreme Court of the United States, similar laws enacted by state authority have been upheld and sustained, although such laws may affect commerce.” The People v. Wabash, St. L. & P. R. R. Co. 104 Ill. 476. See, also, Hall v. De Cuir, 95 U. S. 485, 487; Peik v. Chicago, &c. R. R. Co. 94 U. S. 164; Chicago, &c. R. R. Co. v. Iowa, 94 U. S. 155; Munn v. Illinois, 94 U. S. 113. The exceptions are sustained in so far as they are based upon the omission of the defendants to answer the allegations of the bill as to transactions reaching beyond the limits of the State. Note. — Subsequently to the above opinion the Supreme Court of the United States, October 25, 1886, gave its decision in the case of Wabash, St. Louis §1 Pacific Railway Company v. Illinois, 118 U. S. 557. This decision seems to annul legislation like that above considered as being in conflict with the Constitution of the United States.