§ 29. Warehouses as an illustration.

This commanding position is always a badge of public calling, because it gives the upper hand. The most extreme case of this sort is Nash v. Page. That case was a controversy between the proprietors of ten of the tobacco warehouses in the city of Louisville, and the appellants, twenty-seven in number, who were dealers in tobacco. It appeared that the appellants had been denied the right to make purchases of tobacco at the warehouses of which the defendants were the proprietors. Accordingly, they had applied to the chancellor for an injunction asking that these warehousemen be enjoined from refusing them permission to make purchases at their several warehouses, and from rejecting their purchases when making the highest bids for the tobacco offered upon the payment of such fees as were charged other buyers. The refusal was upon the basis of a restriction which had been lately attempted to members of the Board of Trade.

The opinion of Mr. Justice Pryor is one of the most significant on this subject: "Since the formation of the State government, the sale of this great staple has been fostered and protected by legislation. Such warehouses have always been regulated by law for the benefit of the producer as well as those who are proprietors of these warehouses, and the latter have assumed an obligation to the public which exists as long as they continue public warehousemen. It is conceded fact that more than five millions in value of tobacco annually find its way from the producer to the warehouses in that city. The greater part of this product is grown within the State, and the producer has almost of necessity to place his tobacco under the control of and for sale by these several warehousemen at public auction. All this tobacco must necessarily pass through these warehouses, subject to such charges as are reasonable and proper.

3 80 Ky. 539 (1882).

Such a

public duty may be imposed on these warehousemen in express terms or by implication, but whether so imposed or not, it arises from the facts of the case. In this great tobacco centre the producer is restricted to these public warehouses, or rather these public warehouses have a mutual monopoly of the sales of tobacco at auction, and the fact that there is more than one or a dozen such warehouses cannot affect the question." 4

30. Associated Press as an illustration.

In various lines of business at the present time there are at most a few corporations, often one corporation, which have substantial control of the market in that industry. Whether these monopolistic conditions are real or fictitious, natural or accidental, is the question. A most interesting case that comes to mind at this point is Inter-Ocean Publishing Company v. Associated Press.5 The plaintiff newspaper had regularly taken the news of the defendant bureau. One of the by-laws of the Associated Press forbade members from buying news of any other agency; notwithstanding which the plaintiff took specials of the Sun Publishing Association. Thereupon the Associated Press enforced its by-law against the plaintiff, which is the basis of this action.

Mr. Justice Phillips held the by-law bad: "The organization of such a method of gathering information and news from so wide an extent of territory as is done by the appellee corporation, and the dissemination of that news, requires the expenditure of vast sums of money. It reaches out to the various parts of the United States, where its agents gather news which is wired to it, and through it such news is received by the various important newspapers of the country. Scarcely any newspaper could organize and conduct the means of gathering

4 Acc. Pannell v. Louisville T. W. Co., 113 Ky. 630, 68 S. W. 662, 23 Ky. Law. Rep. 24 (1902).

5 184 Ill. 438, 56 N. E. 822, B. & W. 53 (1900).

the information that is centred in an association of the character of the appellee because of the enormous expense, and no paper could be regarded as a newspaper of the day unless it had access to and published the reports from such an association as appellee. For news gathered from all parts of the country the various newspapers are almost solely dependent on such an association, and if they are prohibited from publishing it or its use is refused to them, their character as newspapers is destroyed and they would soon become practically worthless publications. The Associated Press, from the time of its organization and establishment in business, sold its news reports to various newspapers who became members, and the publication of that news became of vast importance to the public, so that public interest is attached to the dissemination of that news. The manner in which that corporation has used its franchise has charged its business with a public interest. It has devoted its property to a public use, and has, in effect, granted to the public such an interest in its use that it must submit to be controlled by the public for the common good, to the extent of the interest it has thus created in the public in its private property.” 6

§ 31. Ticker service as an illustration.

This case of the Associated Press is supported by those decisions which treat the ticker service as public in its nature because of its momentary monoply in its distribution of quotations. In one case, Shepard v. Gold Stock and Telegraph Co., one such company made the rule that the quotations furnished were for the subscribers' own use. The court was asked to declare the regulation void.

7

6 But see State v. Associated Press, 159 Mo. 410, 60 S. W. 91 (1900); Matthews v. Associated Press, 133 N. Y. 335, 32 N. E. 981 (1893). 738 Hun, 338, B. & W. 52 (1885).

Mr. Justice Pratt treated the question with discrimination: "Defendants are a public corporation under obligation to render their services impartially and without discrimination to all persons who comply with their reasonable rules. Yet the contract entered into by the parties is not to be disregarded, and such reasonable stipulations as it contains will be respected and enforced by the court. The contract provides as follows: These reports are furnished to subscribers for their private use in their own business, exclusively. It is stipulated that such will not sell or give up the copies of the reports in whole or in part, nor permit any outside party to copy them for use or publication. Under this rule subscription by one party for the benefit of himself and others at their joint expense will not be received. The stipulation is reasonable and not in conflict with the duty owed by defendants to the public."8

§ 32. The public services as virtual monopolies.

The extent to which a business is public is a matter of law to be determined by the courts upon the application of their own tried tests to the situation. Whether a business is public or not depends upon the situation of the general public with respect to it. Are there enough of such purveyors to serve the public? If so, there will be virtual competition; if not, there will be virtual monopoly. In all of the businesses discussed in this chapter competition, although from a legal point of view possible, is from the economic point of view improbable. So far as one can see, virtual competition is at an end in these great industries, and virtual monopoly will henceforth prevail. Therefore it must be said that the public has now an interest in the conduct of these businesses by their owners; they are

8 Acc. New York & C. Exchange v. Chicago Bd. of Trade, 127 Ill. 153, 19 N. E. 855, 11 Am. St. Rep. 107, 2 L. R. A. 41 (1889); Frurman v. Gold & S. Tel. Co., 32 Hun (N. Y.), 4 (1884); Smith v. Gold & S. Tel. Co., 42 Hun (N. Y.), 454 (1886).

affected with a public interest, since these agencies are carried on in a manner to make them of public consequence. There fore, having devoted their property to a use in which the public has an interest, they in effect have granted to the public an interest in that use, and must submit to be controlled by the public for the common good to the extent of the interest they have created. This is the application of the doctrine of Munn v. Illinois, a principle above all others in our constitutional law.

§ 33. Overshadowing importance of the problem of rate regulation.

6

All people who come in touch with the problem of rate regulation by any method of approach are agreed as to its overshadowing importance. An extract from one judicial opinion3 will serve to show what strong language it is necessary to use to give any idea of vital consequence of the general issue. “The administration of justice, said Webster, is the chiefest concern of man upon earth.' Within the scope of that function of government there is, perhaps, no single topic of greater magnitude or moment than controversies which arise in trade and commerce. Said Sir Walter Raleigh, Whosoever commands the trade of the world commands the riches of the world, and consequently the world itself.' In a material sense, and in our astonishing civilization, nothing is more important than the transportation of commodities sold or interchanged, and in transportation the stability and reasonable character of the rates charged therefor is scarcely less important than transportation itself. The three grand departments of government, legislative, executive, and judicial, are with steady and swerveless purpose enacting or enforcing laws to safeguard the rights of the general public, and as well that portion engaged in the

9 Speer, J., in Tift v. Southern Ry., 138 Fed. 753 (1905).