VII. tically to answer it. Granting that a State has no Chapter right to interfere with the internal economy of a railroad farther than to secure the safety and comfort of passengers, as, for example, to fix the wages of employees or control its contracts for construction, or the purchase of supplies, it has a clear right to pass upon the reasonableness of contracts in which the public is interested, whether such contracts be made directly with the patrons of the road, or for a joint action in the transportation of persons or property in which the public is indirectly concerned." Rates on Long and Short Hauls. 4 In Louisville, etc., R. Co. v. Kentucky, the validity of a Kentucky statute declaring that it should be unlawful for any person or corporation owning or operating a railroad in the State to charge or receive any greater compensation in the aggregate for the transportation of passengers, or of property of like kind, under substantially similar circumstances and conditions, for a shorter than for a longer distance, over the same line, in the same direction, the shorter being included in the longer distance, was considered. The statute was based upon a constitutional provision of similar tenor. As the particular case was one involving only transportation from one point in the State to another by a corporation of that State, and the statute did not in terms embrace a case of interstate commerce, it was held to be enforceable. But in another case the State Supreme Court construed the State constitutional provision as not 4 (1902) 183 U. S. 503. VII. Interstate long haul and domes tic short haul. Chapter confined to a case where the long and short hauls were both within the State of Kentucky, and held that it extended to and embraced a long haul from a place outside of to one within the State, and a shorter haul between points on the same line and in the same direction, both of which were within the State. As so construed, the regulation was declared invalid in Louisville, etc., R. Co. v. Eubank, the court saying that the vice of such a provision, thus applied, lies in the regulation of the rates between points wholly within the State, by the rates which obtain between points outside of and points within the State. The court further said, Mr. Justice Peckham writing the opinion, that "the fact which vitiates the provision is that it compels the carrier to regulate, adjust, or fix his interstate rates with some reference at least to his rates within the State, thus enabling the State by constitutional provision or by legislation to directly affect, and in that way to regulate, to some extent the interstate commerce of the carrier, which power of regulation the Constitution of the United States gives to the Federal Congress.' Requiring Rates to Be Fixed Annually and Posted. In Chicago, etc., R. Co. v. Fuller, the question was as to the validity of a statute of Iowa requiring that each railroad company should, in the month of September, annually, fix its rates for the transportation of passengers and of freight of different kinds; that it should put up a printed copy of such rates at all its stations and depots, and cause a copy to re 5 (1902) 184 U. S. 27. • (1873) 17 Wall. (U. S.) 560. VII. main posted during the year; and that a failure to Chapter fulfil these requirements, or the charging of a higher rate than was posted, should subject the offending company to the payment of the penalty prescribed. Mr. Justice Swayne, speaking for the court, said: "In all other respects there is no interference. No other constraint is imposed. Except in these particulars the company may exercise all its faculties as it shall deem proper. No discrimination is made between local and interstate freights, and no attempt is made to control the rates that may be charged. It is only required that the rates shall be fixed, made public, and honestly adhered to. In this there is nothing unreasonable or onerous. The public welfare is promoted without wrong or injury to the company. The statute was doubtless deemed to be called for by the interests of the community to be affected by it, and it rests upon a solid foundation of reason and justice. It is not, in the sense of the Constitution, in any wise a regulation of commerce." And even, added the court, if the State statute is a regulation, it is local in its character, and may be sustained in the absence of Congressional legislation." 7 The Interstate Commerce Act of 1887 requires printed schedules of rates to be posted, and advances and reductions to be made only after public notice. See Act of February 4, 1887, c. 104, § 6, as amended by the Act of March 2, 1889, c. 382, § 1, 3 Fed. Stat. Annot. 827. CHAPTER VIII. TELEGRAPH AND TELEPHONE COMPANIES. Chapter Telegraph as an in commerce. C CONTROLLING POWER OF CONGRESS. OMMUNICATION by telegraph is commerce, and telegraph lines when extending through different States are instruments of comstrument of merce, and are subject to the regulating power of Congress, free from the control of State regulations except such as are strictly of a police character.1 Chief Justice Waite, speaking for the court in Western Union Tel. Co. v. Texas, said: "A telegraph company occupies the same relation to commerce as a carrier of messages, that a railroad company does as a carrier of goods. Both companies are instruments of commerce, and their business is commerce itself. They do their transportation in different ways, and their liabilities are in some respects different, but they are both indispensable to those engaged to any considerable extent in commercial pursuits." 1 Western Union Tel. Co. v. James, (1896) 162 U. S. 650; Western Union Tel. Co. v. Alabama State Board of Assessment, (1889) 132 U. S. 473; Leloup v. Mobile, (1888) 127 U. S. 640; Western Union Tel. Co. v. Pendleton, (1887) 122 U. S. 347; Pensacola Tel. Co. v. Western Union Tel. Co., (1877) 96 U. S. 1. Messages between points in the same State, transmitted over the wires of the same company and in part over the territory of another State, do not constitute interstate commerce. Railroad Com'rs v. Western Union Tel. Co., (1893) 113 N. Car. 213; Western Union Tel. Co. v. Reynolds, (1902) 100 Va. 459. 2 (1881) 105 U. S. 460. 66 4* Chapter as an in commerce. In a few State cases it has been held that the telephone is an instrument of commerce. And from the case of Richmond v. Southern Bell Telephone, Telephone etc., Co., it may be inferred that the interstate strument of business of a telephone company may be subjected to federal regulation, but a reading of the case leaves it very uncertain what degree of control Congress may exercise. In that case the question was presented whether a telephone company is entitled to claim the benefit of the provisions of the Act of Congress of July 24, 1866, referred to below, that is, whether the words telegraph company" included a telephone company. In holding that the privileges of the statute cannot be extended by implication only, the court, Mr. Justice Harlan writing the opinion, said: "If Judicial the act be construed as embracing telephone companies, numerous questions are readily suggested. May a telephone company, of right, and without companies. reference to the will of the States, construct and maintain its wires in every city in the territory in which it does business? May the constituted authorities of a city permit the occupancy only of certain streets for the business of the company? May the company, of right, fill every street and alley in every city or town in the country with 3 See Muskogee Nat. Telephone Co. v. Hall, (1901) 4 Indian Ter. 18; Matter of Pennsylvania Telephone Co., (1891) 48 N. J. Eq. 91. Prohibiting discrimination between patrons and regulating the rental for the use of telephones is valid, as to a company engaged in interstate business. Central Union Telephone Co. v. State, (1888) 118 Ind. 194. 4 (1899) 174 U. S. 761. In Muskogee Nat. Telephone Co. v. Hall, (1902) 118 Fed. Rep. 382, it was held a State could not grant the exclusive right to operate telephone lines within its borders. 4* See infra, p. 190. suggestions as to effect of federal control of telephone |