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acquired by the corporation belongs to it exclusively, and its ownership is as absolute as that of any private individual of property belonging to him.

The People ex rel., etc. vs. Bachellor, 53 N. Y., 140.

Moreover, this fact that a railroad is in some sense a public highway, stops far short of what is necessary in order to lay the foundation for such legislation as is found in this Act; because this legislation undertakes to prescribe the prices which shall be paid, not for tolls for passing over the road, but for the service rendered by the corporation as common carriers in transporting, at its own expense and risk, persons and property from point to point on the road, as well as for receiving and delivering the persons and the property.

Now, here again there is an element of publicity in the character of the corporation and of its business. Being common carriers of persons and property, the law requires them to transact business for all applicants, at reasonable times, and at reasonable rates of compensation. But a railway corporation, when carrying on the business of common carriers, at its own expense and risk, and for its own profit, cannot be distinguished from any other common carriers. Its duties, its liabilities, and its rights are the same, whether they transact business over a road which they own, or which they hire, or which nature has made for them in the shape of a navigable river, or which the public has built at its own expense, and thrown open for common use; and unless it can be successfully maintained that the legislature may, by what is in truth a legislative decree, establish for the future, prices for personal service and expenditures and risks incurred in rendering the services, I am unable to see how this law can be brought within the field of legislation. Secondly. The thirteenth article of the Bill of Rights of the Constitution of Wisconsin is as follows:

"The property of no person shall be taken for public use without just compensation therefor."

It is settled law both in Wisconsin and elsewhere that this article requires the law which takes the property to provide for making the compensation.

It is settled also by the highest authority that to amount to a taking, within the meaning of this article of the Constitution, it is not necessary that the owner of the property should be deprived of its possession. If he is allowed to remain in possession, but forced under heavy penalties so to use his property as effectually to destroy or greatly impair its value, the case comes within this article of the Bill of Rights.

Pumpelly vs. Green Bay Co., 13 Wallace, 166.

Upon the facts which have been already stated, it is apparent that this railway corporation has, under this law, but one of two alternatives: the first being to continue to carry on its business for the prescribed rates of compensation, certainly without any profit, and probably at a considerable loss; or to abandon the use of its property and close up its road. I cannot entertain any reasonable doubt that such a law, accompanied and to be enforced by severe penalties, which render one or the other of these alternatives absolutely necessary, is an infraction of the article in the Bill of Rights.

A law which, under heavy penalties, prohibits a person, whether natural or political, from using his property so as to derive any advantage whatever from it, and leaves him subject only to loss from its use, does as effectually take his property as if it had under the like penalties prohibited its owner from interfering with it.

Thirdly. But there is another objection to this law, which, to my mind, is of itself decisive. Under the power to alter, amend, or repeal a charter, a legislature may change, or in some instances, perhaps, destroy, contracts into which the State has entered by the granting of charters. But this must be limited to the modification or destruction of the contracts of the State. It has never been extended, and, consistently with the Constitution of the United States, it cannot be extended, to contracts made by the corporations under authority of law with bona fide creditors, who have lent their money to construct and equip the railroad and taken security by mortgage thereon. Any law of a State which takes away property relied on by creditors when they loaned their money, or the security on which they gave credit, or which seriously impairs the remedy which such creditors have had, impairs the obligations of their contracts. This has been repeatedly decided by the Supreme Court of the United States, in a series of cases.

Bronson vs. Kinzie, 1 How., 311.
McCracken vs. Hayward, 2 How., 608.
Hawthorne vs. Calef, 2 Wallace, 10.

Tomlinson vs. Jessup, 15 Wallace, 454.

This railroad mortgaged all its property under an authority conferred upon it by law so to do, to secure the payment of its bonds, and a law of the State, enforced by sufficient penalties, which compels the railroad corporations so to employ the property thus mortgaged to the bond-holders that it becomes useless, not merely to the corporation itself, but also to the bond-holders, deprives them of security which lawfully belongs to them, and impairs the obligations of their contracts. When they took these mortgages they had a right to presume, and unquestionably did presume, that the property mortgaged would be employed by the railway corporation for reasonable rates of compensation in transacting their business.

This just and reasonable expectation cannot, in my opinion, be disappointed, and the rights acquired by the mortgagees disregarded, through an Act of the legislature in effect commanding the road to transact its business on such terms that the bond-holders cannot possibly receive any part either of the interest or principal of their bonds.

And I wish to say in this connection, though it also has relations to some other positions in this opinion, that this power to prescribe prices of commodities and service for the future, does not exist at all, or it is unlimited, and if the fact above stated, that business transacted by the railway corporation, at the rates prescribed by this Act, would certainly no more than pay the expenses of transacting the business, should be controverted or denied, such denial would not be sufficient to support this law: because, as already stated, if the rates prescribed would leave some profit to the railroad, it is in the power of the legislature still further to reduce those rates, and compel the railway corporation to conduct its business at a loss; and indeed,

this very law, by its thirteenth section, undertakes to authorize the railroad commissioners who are to be appointed under it, to use their discretion to reduce the rates mentioned in the Act, and makes that act of discretion final and conclusive.

And it also delegates to the commissioners powers to classify all articles of freight other than those classified by the Act itself, and thereby to fix the rates which shall be paid for their transportation.

My conclusion is that this law impairs the obligations of the contracts of the bond-holders, and is therefore invalid under the Constitution of the United States.

Though I have taken full time for the investigation of these questions, the necessity for speedy decision as to their action by the managers of the railway corporation has prevented me from going more elaborately into the argument on either of the points taken, or from making more numerous citations of authorities. B. R. CURTIS.

BOSTON, April 10, 1874.

APR 1 6 1917

MAY

UNIV. OF Med. LIBRARY

3 9015 02113 5259

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