narrow and specialized subject, the needs of the student are subordinated to the needs of the practitioner. The plan and the execution are well adapted to the purpose in view. Constitutions, the necessary subject matter of the discussion, are adequately quoted. The citation of decisions is not intended to be exhaustive, as the foot-notes sometimes point out; but the citations are certainly numerous enough, covering no less than five thousand cases. The text does not present to an undue extent extracts from opinions, but states without much discussion the effect of the decisions. The result is a book of value to persons interested in the specialty of taxation; and even the reader who cares not at all for this specialty must find interest in the chapters on state taxation in interference with commerce, state taxation impairing contracts, and due process of law. The opening chapter on equality as "The Fundamental Thought in the Constitutional Law of Taxation" gives an unnecessarily unfavorable impression of the author's soundness; for throughout a number of pages it tends to indicate a belief that there is some unwritten constitutional higher law requiring equality, whereas the author in quite orthodox fashion believes, and ultimately expounds, that there is no such unwritten requirement, but that equality is obviously just and desirable, and that consequently constitutions and statutes must be so construed as to attain equality, if such construction be possible. E. w. PRINCIPLES OF THE ENGLISH LAW OF CONTRACT AND OF AGENCY IN ITS RELATION TO CONTRACT. By William R. Anson. Eleventh English Edition. Second American Copyright Edition. By Ernest W. Huffcut. London and New York: Oxford University Press. 1906. pp. li, 462. 8vo. The new edition of this popular book, as it appears after a lapse of eleven years since the previous edition, does not differ strikingly from its predecessor. The merit of the book consists rather in the clear statements of fundamental principles than in a large collection of authorities or a development of all the applications of these principles. The book seems still the best treatise of its size on the subject, but in a few matters the treatment is unsatisfactory, which is the more important because it has influenced American text writers and students. We may mention especially the treatment of mistake and similar matters, under the head of "Reality of Consent." The distinction, highly important in our law, between mistake which prevents mutual assent at law, and mistake which affords equitable ground for rescission of a contract good at law, is wholly confused. Again, the treatment of the topic of performance of contract under the head of " Discharge of Contract," is unfortunate. The notion that a contract when broken is discharged, and the obligation of a right of action substituted, is distinctly overworked, and the distinction between the plaintiff's only available remedy and his right thereby confused. The notes of Dean Huffcut, if the limitations of space are considered, are to be commended. The American cases seem well selected, and the comments, though necessarily brief, are frequently suggestive. S. W. THE LAW OF PASSENGER AND FREIGHT ELEVATORS. By J. A. Webb. Second and Revised Edition. St. Louis: The F. H. Thomas Law Book Co. 1905. pp. xviii, 375. 8vo. Doubtless such a special book as this has its value to the practitioner who has to deal with a case which falls within its scope. It will save him many days of searching to have the cases bearing upon the subject collected and collated. There is little scope for generalization in making such a book. Negligence in the operation of elevators should be judged by the same standard as in other matters, due care under the circumstances. The author, however, follows many courts in considering elevators as common carriers. This can hardly be; it is enough to say on that point that service could be refused in any particular case. Seaver v. Bradley, 179 Mass. 329. DIE LEHRE DER RECHTSSOUVERÄNITÄT. By H. Krabbe. Groningen: Wolters. 1906. pp. vi, 254. 8vo. England, according to Professor Krabbe, is the only country in which the power of the law and of the state have come to coincidence. The statement will appear to many open to considerable question, but is, after all, largely academic. So is in fact the whole volume of the Groningen jurist, who examines the doctrines relating to the sovereignty of the state in various countries and contexts. The value of the book is lessened by the absence of an index. R. M. J. A DIGEST OF THE LAW OF TRADE-MARKS AND UNFAIR TRade. By Norman F. Hesseltine. Boston: Little, Brown, and Company. 1906. pp. xlviii, 378. 8vo. A SELECTION OF CASES ON EVIDENCE, for the Use of Students of Law. Compiled and edited by John Henry Wigmore. Boston: Little, Brown, and Company. 1906. pp. xxvi, 822. 8vo. THE LAW OF RAILROAD RATE REGULATION, with Special Reference to American Legislation. By Joseph Henry Beale, Jr., and Bruce Wyman. Boston: William J. Nagel. 1906. pp. lii, 1285. 8vo. ACT OF STATE IN ENGLISH LAW. By W. Harrison Moore. Murray. 1906. pp. xi, 178. 12mo. London: John New York: The LINCOLN THE LAWYER. By Frederick Trevor Hill. 8vo. PROBATE REPORTS ANNOTATED, containing Recent Cases of General Value decided in the Courts of the Several States on Points of Probate Law, with Notes and References. By Wm. Lawrence Clark. Volume X. New York: Baker, Voorhis and Co. 1906. pp. xxv, 709. 8vo. THE DECLARATION OF INDEPENDENCE: ITS HISTORY. By John H. Hazelton. New York: Dodd, Mead & Co. 1906. pp. vii, 629. 8vo. THE POWER TO REGULATE CORPORATIONS AND COMMERCE, a Discussion of the Existence, Basis, Nature, and Scope of the Common Law of the United States. By Frank Hendrick. New York and London: G. P. Putnam's Sons. 1906. pp. lxxii, 516. 8vo. A MANUAL OF THE PRINCIPLES OF EQUITY. By John Indermaur. Sixth Edition by Charles Thwaites. London: Geo. Barber. 1906. pp. xxxii, 597. 8vo. THE AUSTINIAN THEORY OF LAW, being an Edition of Lectures I, V, and VI of Austin's "Jurisprudence" and of Austin's "Essay on the Uses of the Study of Jurisprudence," with Critical Notes and Excursus. By Jethro Brown. London: John Murray. 1906. pp. xv, 378. 8vo. Leip FAHNENFLUCHT UND VERLETZUNG DER WEHRPFLICHT DURCH AUSWAN- THE LAW OF INNKEEPERS AND HOTELS, including other Public Houses, Tenth THE ELEMENTS OF JURISPRUDENCE. By Thomas Erskine Holland. HARVARD LAW REVIEW. VOL. XX. JANUARY, 1907. No. 3. THE LEGAL ASPECT OF MONOPOLY. MONOPOLY and competition are contrasted so constantly in current discussion as representing opposite and antagonistic business conditions that it is sometimes forgotten that, even under competitive conditions, the aim of each competitor is the sale of his own goods, or the securing of his own services, to the exclusion of those of some one else. Peculiar success, for any reason, of one competitor in the industrial war is a disadvantage, for the time at least, to others, and the reward of the successful is a larger business, increase in size and power to maintain the position already won. For size itself is an advantage in the competitive struggle and an aid to the exclusion of competitors. Not only does it afford greater economy in production and management, but the large concern, operating in a wide territory, can drive out one by one smaller competitors, operating in narrower territory, by simply cutting prices within the smaller field while making a profit elsewhere.1 This may be a strictly competitive method of warfare, and completely successful from the point of view of the large concern, but it does not insure that the public will receive the best or the most economical service. Inasmuch as size is in itself an advantage in the competitive struggle, the temptation is to accomplish it, not by the slower and more uncertain process of individual growth through successful 1 This consideration has led one economic writer to the conclusion that the evils of monopoly can be largely, if not entirely, avoided by merely requiring the large concern to make its prices uniform throughout the territory in which it operates, thus making the undue cutting of prices a greater risk to the large than to the small concern. See The Problem of Monopoly, by Prof. J. B. Clark. 1 competition, but by means of the combination and union in some form of actual competitors. Such a combination not only accomplishes greater size, but at the same time eliminates actual competition previously existing, and thus makes the position of the united interests, for the moment at least, the more secure and powerful. In fact, in organizing such a combination of competitors, the aim generally is to eliminate by means of the combination enough competition so that the united interests will be reasonably safe from such other existing competition as there may be, or, in other words, have a present control of the particular industry or market in which the parties operate. Unless such control is in fact accomplished, size may ultimately prove to be a disadvantage, for the disadvantage of size lies in the fact that it means more to lose. A successful competitor is a greater danger to a large than to a small concern just because of the greater investment which the big concern represents. If economies in management on the side of the large concern are more than offset by newer methods or other advantages on the part of a smaller competitor, then the large concern, which is bound to maintain its position at all hazards, must rely finally upon its power to dominate and control the market, and make use of its size as a competitive weapon to exclude and crush competition which might otherwise prove dangerous to it just because it would be beneficial to the Its warfare is not waged primarily in the interests of the public, and its success by such means may be the public's loss. consumer. For the purpose of the present article the important point to notice is that monopoly, viewed as size sufficient to give control of the market in a particular trade or industry, may be accomplished in more than one way, though no doubt the method by which most of the large corporations are formed at the present day is by the combination or union of former competitors, and not by individual growth merely. Does the law object to size, control of the market, in itself, or only to particular methods of accomplishing size, or is size not taken into account at all? These are the questions which it is proposed to consider in the following pages. The problem obviously concerns itself primarily with the legality of transactions between competitors, using that word to mean rivals in the same line of business. Starting, therefore, with a consideration of the invalidity, because in restraint of trade, of certain contracts between competitors, an attempt will be made in the first place to distinguish between contracts of sale between competitors, and contracts for the purpose of regulating and controlling the conduct of their competing interests, before considering finally the legality of a more intimate union of the business of such rivals. I. Professor Gray 1 has criticised the position taken by Mr. Justice Holmes in his dissenting opinion in the Northern Securities case on the ground that common law contracts in restraint of trade were contracts which inflicted a detriment upon the conduct of the business of one party for the benefit of the other party, while the cases arising under the Sherman Act which had been already decided by the Supreme Court 2 had extended the principle to include contracts which had for their object the conferring of benefits upon all the parties to the agreement, and not the infliction of a detriment on the business of some or one of the parties. And his contention was that if these decisions were accepted as binding (and Justice Holmes did explicitly so accept them), then the result arrived at in the Northern Securities case was a foregone conclusion. But even the English authorities & have not defined contracts in restraint of trade so narrowly as is here stated, and the prevailing view in this country has certainly included in the class of contracts which are invalid as in restraint of trade on common law principles, contracts which limit or restrain competition in some form between the parties, although the object of the contract is to confer a benefit upon the business of all the parties to it.* Mr. Justice Holmes, in the opinion referred to,5 defines common law contracts in restraint of trade as contracts with a stranger to the contractor's business (although in some cases carrying on a similar one), which wholly or partially restrict the freedom of the contractor in carrying on that business as otherwise 1 17 HARV. L. REV. 474. 2 U. S. v. Freight Association, 166 U. S. 290; U. S. v. Joint Traffic Association, 171 U. S. 505, and Addyston Pipe & Steel Co. v. U. S., 175 U. S. 211. Hilton v. Eckersley, 6 E. & B. 47; Urmston v. Whitelegg, 63 L. T. (N. S.) 455. Stanton v. Allen, 5 Den. (N. Y.) 434; Morris Run Coal Co. v. Barclay Coal Co., 68 Pa. St. 173; Nester v. Continental Brewing Co., 161 Pa. St. 473; Craft v. McConoughy, 79 Ill. 346; More v. Bennett, 140 Ill. 69. And see Judge Taft's opinion in U. S. v. Addyston Pipe & Steel Co., 85 Fed. Rep. 271, 288-290. 5 193 U. S., at 404. |