Union Sewer-Pipe Co. v. Connelly

• Decision Date: 29 January 1900
• Docket Number: 24,361.
• Citation: 99 F. 354
• Parties: UNION SEWER-PIPE CO. v. CONNELLY.
• Court: U.S. District Court — Northern District of Illinois

99 F. 354

UNION SEWER-PIPE CO. v. CONNELLY.

No. 24,361.

United States Circuit Court, N.D. Illinois, Northern Division.

January 29, 1900

Herbert W. Hamlin and Edwin Walker, for plaintiff.

O'Donnell & Coghlan and John R. McFee, for defendant.

KOHLSAAT District Judge.

Plaintiff in this case brings suit to recover on certain promissory notes given by defendant for balance due on purchases and deliveries of sewer pipe. Defendant pleads the general issue and gives notices thereunder of three special defenses, all of which are based upon the theory that plaintiff was a trust or combination organized for the express purpose of creating and carrying out restrictions in trade, contrary (1) to the common law in force both in Ohio and Illinois; (2) to the act of congress of July 2, 1890, commonly called the 'Sherman Act'; and (3) to the statute of the state of Illinois taking effect on July 1, 1893.

As to the matters set out in the first notice of special defense it is undoubtedly true that by the common law contracts which are themselves directly in restraint of trade may, in a proceeding based thereon, be declared void and unenforceable by the courts; but there is no case brought to the attention of the court in which it has been held that at common law a contract not in itself in restraint of trade is void because one of the parties thereto is a party to a contract which is in restraint of trade, and the one contract is in directly based upon the other. The fact that one party to a contract is engaged in illegal acts will not, at common law, avail the other party as a defense to the special enforcement of a contract in itself legal. The first notice of special defense will therefore be stricken out.

It will be seen by an inspection of the so-called 'Sherman Act,' and of the opinion of Mr. Justice Peckham in the Addyston Pipe & Steel Co. Case (decided by the United States supreme court, Dec.

4 1899) 20 Sup.Ct. 96, Adv. S.U.S. 96, 44 L.Ed.--, that the act only covers contracts which are themselves directly in restraint of trade, and does not affect those which 'merely indirectly, remotely, incidentally, or collaterally regulate, to a greater or less degree, interstate commerce among the states. ' It therefore follows that the second matter of special defense set up must be stricken out.

Now coming to the ground of special defense set up in the third notice, to wit, the Illinois statute which went into effect on July 1, 1893: This statute, in terms, provides, that the defense herein set up may be maintained as a bar;...