State v. Chicago, R. I. & P. Ry. Co.

• Decision Date: 09 May 1910
• Citation: 128 S.W. 555
• Parties: STATE ex rel. MEANS, Pros. Atty., v. CHICAGO, R. I. & P. RY. CO.
• Court: Arkansas Supreme Court

128 S.W. 555

STATE ex rel. MEANS, Pros. Atty., v. CHICAGO, R. I. & P. RY. CO.

Supreme Court of Arkansas.

May 9, 1910.

Appeal from Circuit Court, Garland County; W. H. Evans, Judge.

Action by the State, on the relation of H. B. Means, Prosecuting Attorney, against the Chicago, Rock Island & Pacific Railway Company. From a judgment of dismissal rendered on sustaining a demurrer to the complaint, plaintiff appeals. Affirmed.

The appellant instituted this action against appellee in the Garland circuit court. The complaint alleges that the appellee is a foreign corporation doing business in the state of Arkansas, and owns and operates a system of railroads in said state; that it has violated act No. 1 of the General Assembly of the state of Arkansas of 1905, commonly called the "anti-trust act" (Acts 1905, p. 1), by entering into a pool, trust, agreement, combination, confederation, and understanding with certain domestic corporations, also owning and operating lines of railroad within the state, for the purpose of fixing rates to be charged for the service of carrying freight and passengers. The prayer of the complaint is that the right of appellee to do business in the state be forfeited, and, in addition, that the state recover of appellee the sum of $720,000 as accrued penalties for the violation of the provisions of the act. The appellee filed a demurrer to the complaint, which was by the court sustained, and the cause dismissed. The case is here on appeal.

Hal L. Norwood, Atty. Gen., Wm. H. Rector, Asst. Atty. Gen., H. B. Means, and M. S. Cobb, for appellant. Jno. M. Moore and Thos. S. Bugbee, for appellee.

HART, J. (after stating the facts as above).

The question raised by the appeal is: Do the provisions of the anti-trust act apply to the fixing of rates for services performed by railroads in the carrying of freight and passengers?

Section 1 of the act is as follows: "Section 1. Any corporation organized under the laws of this or any other state or country and transacting or conducting any kind of business in this state, or any partnership or individual, or other association, or persons whatsoever, who are now, or shall hereafter create, enter into, become a member of, or a party to, any pool, trust, agreement, combination, confederation or understanding, whether the same is made in this state, or elsewhere, with any other corporation, partnership, individual, or any other person or association of persons, to regulate or fix either in this state or elsewhere the price of any article of manufacture, mechanism, merchandise, commodity, convenience, repair, any product of mining, or any article or thing whatsoever, or the price of premium to be paid for insuring property against loss or damage by fire, lightning or tornado, or to maintain said price when so regulated or fixed, or who are now, or shall hereafter enter into, become a member of, or a party to any pool, agreement, contract, combination, association or confederation, whether made in this state or elsewhere, to fix or limit in this state or elsewhere, the amount or quantity of any article of manufacture, mechanism, merchandise, commodity, convenience, repair, any product of mining, or any article or thing whatsoever, or the price or premium to be paid for insuring property against loss or damage by fire, lightning, storm, cyclone, tornado, or any other kind of policy issued by any corporation, partnership, individual, or association of persons aforesaid, shall be deemed and adjudged guilty of a conspiracy to defraud, and be subject to the penalties as provided by this act." Section 2 of the act prescribes the penalty. Section 3 provides for the forfeiture of corporate rights and franchises of corporations that violate its provisions. Acts 1905, p. 1.

Of course a railroad corporation operating a line of railroad in this state is a corporation "conducting a business in the state"; but, as above stated, the question is: Does such corporation violate the provisions of the act by entering into an agreement with other railroad corporations to fix the value of the services of railroads in the carriage of freight and passengers? Counsel for the state do not contend that freight or passenger rates are articles of merchandise, manufacture, mechanism, commodity, convenience, or repair, or that they are products of mining; but they do contend that the words, "or any article or thing whatsoever," includes passenger and freight rates. We cannot agree with...