was necessarily involved in the desire to attract to the defendants' ships the entire tea freights of the ports, a portion of which would otherwise have fallen to the plaintiffs' share. I can find no authority for the doctrine that such a commercial motive deprives of "just cause or excuse" acts done in the course of trade which would, but for such a motive, be justifiable. So to hold would be to convert into an illegal motive the instinct of self-advancement and self-protection, which is the very incentive to all trade.

To say that a man is to trade freely but that he is to stop short at any act which is calculated to harm other tradesmen and which is designed to attract business to his own shop would be a strange and impossible counsel of perfection. But we were told that competition ceases to be the lawful exercise of trade, and so to be a lawful excuse for what will harm another, if carried to a length which is not fair or reasonable. The offering of reduced rates by the defendants in the present case is said to have been "unfair." This seems to assume that, apart from fraud, intimidation, molestation, or obstruction of some other personal right in rem or in personam, there is some natural standard of “fairness or "reasonableness "-to be determined by the internal consciousness of judges and juries-beyond which competition ought not in law to go. There seems to be no authority, and I think with submission that there is no sufficient reason, for such a proposition. It would impose a novel fetter upon trade. The defendants, we are told by the plaintiff's counsel, might lawfully lower rates, provided they did not lower them beyond a "fair freight," whatever that may mean. But where is it established that there is any such restriction upon commerce? And what is to be the definition of a “fair freight"? It is said that it ought to be a normal rate of freight, such as is reasonably remunerative to the shipowner. But over what period of time is the average of this reasonable remunerativeness to be calculated? All commercial men with capital are acquainted with the ordinary expedient of sowing one year a crop of apparently unfruitful prices in order, by driving competition away, to reap a fuller harvest of profit in the future; and until the present argument at the bar it may be doubted whether shipowners or merchants were ever deemed to be bound by law to conform to some imaginary "normal" standard of freight or prices or that law courts had a right to say to them, in respect of their competitive tariffs, "Thus far shalt thou go and no further."

To attempt to limit English competition in this way would probably be as hopeless an endeavor as the experiment of King Canute. But on ordinary principles of law no such fetter on freedom of trade can, in my opinion, be warranted. A man is bound not to use his property so as to infringe upon another's rights. Sic utere tuo ut alienum non laedas. If engaged in actions which may involve danger to others, he ought, speaking generally, to take reasonable care to avoid endangering them. But there is surely no doctrine of law which compels him to use his property in a way that judges and juries may consider reasonable. (See Chasemore r. Richards, 1.) If there is no such fetter upon the use of property known to the English law, why should there be any such a fetter upon trade?

It is urged, however, on the part of the plaintiffs that even if the acts com plained of would not be wrongful had they been committed by a single individual, they become actionable when they are the result of concerted action among several. In other words, the plaintiffs, it is contended, have been injured by an illegal conspiracy. Of the general proposition, that certain kinds of conduct not criminal in any one individual may become criminal if done by combination among several, there can be no doubt. The distinction is based on sound reason, for a combination may make oppressive or dangerous that which, if it proceeded only from a single person, would be otherwise; and the very fact of the combination may show that the object is simply to do harm and not to exercise one's own just rights.

In the application of this undoubted principle it is necessary to be very careful not to press the doctrine of illegal conspiracy beyond that which is necessary for the protection of individuals or of the public; and it may be observed in passing that, as a rule, it is the damage wrongfully done and not the conspiracy that is the gist of actions on the case for conspiracy: See Skinner v. Gunton (2); Hutchins . Hutchins (3). But what is the definition of an illegal combination? It is an agreement by one or more to do an unlawful act or to do a lawful act by unlawful means. O'Connell v. The Queen (4), Reg. v. Parnell (5); and the question to be solved is whether there has been any such agreement here. Have the defendants combined to do an unlawful act? Have they combined to do a lawful act by unlawful means? A moment's consideration will

be sufficient to show that this new inquiry only drives us back to the circle of definitions and legal propositions which I have already traversed in the previous part of this judgment. The unlawful act agreed to, if any, between the defendants must have been the intentional doing of some act to the detriment of the plaintiffs' business without just cause or excuse. Whether there was any such justification or excuse for the defendants is the old question over again, which, so far as regards an individual trader, has been already solved. The only differentia that can exist must arise, if at all, out of the fact that the acts done are the joint acts of several capitalists and not of one capitalist only. The next point is whether the means adopted were unlawful. The means adopted were competition carried to a bitter end. Whether such means were unlawful is in like manner nothing but the old discussion which I have gone through, and which is now revived under a second head of inquiry, except so far as a combination of capitalists differentiates the case of acts jointly done by them from similar acts done by a single man of capital. But I find it impossible myself to acquiesce in the view that the English law places any such restriction on the combination of capital as would be involved in the recognition of such a distinction.

If so, one rich capitalist may innocently carry competition to a length which would become unlawful in the case of a syndicate with a joint capital no larger than his own, and one individual merchant may lawfully do that which a firm or partnership may not. What limits, on such a theory, would be imposed by law on the competitive action of a joint-stock company, limited, is a problem which might well puzzle a casuist. The truth is, that the combination of capital for purposes of trade and competition is a very different thing from such a combination of several persons against one, with a view to harm him, as falls under the head of an indictable conspiracy. There is no just cause or excuse in the latter class of cases. There is such a just cause or excuse in the former. There are cases in which the very fact of a combination is evidence of a design to do that which is hurtful without just cause; is evidence, to use a technical expression, of malice. But it is perfectly legitimate, as it seems to me, to combine capital for all the mere purposes of trade for which capital may, apart from combination, be legitimately used in trade. To limit combinations of capital, when used for purposes of competition, in the manner proposed by the argument of the plaintiffs would, in the present day, be impossible would be only another method of attempting to set boundaries to the tides. Legal puzzles which might well distract a theorist may easily be conceived of imaginary conflicts between the selfishness of a group of individuals and the obvious well-being of other members of the community.

Would it be an indictable conspiracy to agree to drink up all the water from a common spring in a time of drought; to buy up by preconcerted action all the provisions in a market or district in times of scarcity (see Rex. v. Waddington (1); to combine to purchase all the shares of a company against a coming settling day; or to agree to give away articles of trade gratis in order to withdraw custom from a trader? May two itinerant match vendors combine to sell matches below their value in order, by competition, to drive a third match vendor from the street? In cases like these, where the elements of intimidation, molestation, or the other kinds of illegality to which I have alluded are not present, the question must be decided by the application of the test I have indicated. Assume that what is done is intentional and that it is calculated to do harm to others. Then comes the question, Was it done with or without "just cause or excuse"? If it was bona fide, done in the use of a man's own property, in the exercise of a man's own trade, such legal justification would, I think, exist, not the less because what was done might seem to others to be selfish or unreasonable. See the summing up of Erle. J., and the judgment of the Queen's Bench in Reg. r. Rowlands (2). But such legal justification would not exist when the act was merely done with the intention of causing temporal harm, without reference to one's own lawful gain or the lawful enjoyment of one's own rights. The good sense of the tribunal which had to decide would have to analyze the circumstances and to discover on which side of the line each case fell. But if the real object were to enjoy what was one's own or to acquire for one's self some advantage in one's property or trade, and what was done was done honestly, peaceably, and without any of the illegal acts above referred to, it could not, in my opinion, properly be said that it was done without just cause or excuse. One may with advantage borrow for the benefit of traders what was said by Erle, J., in Reg. v. Rowlands (1), of workmen and of masters: "The intention of the law is at present to allow either of them

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to follow the dictates of their own wili with respect to their own actions and their own property, and either, I believe. has a right to study to promote his own advantage or to combine with others to promote their mutual advantage." Lastly, we are asked to hold the defendants' conference or association illegal, as being in restrain of trade. The term "illegal" here is a misleading one. Contracts, as they are called, in restraint of trade, are not, in my opinion, illegal in any sense, except that the law will not enforce them. It does not prohibit the making of such contracts; it merely declines, after they have been made, to recognize their validity. The law considers the disadvantage so imposed upon the contract a sufficient shelter to the public. The language of Crompton, J., in Hilton v. Eckersley (2), is, I think, not to be supported. No action at common law will lie, or ever has lain, against any individual or individuals for entering into a contract merely because it is in restraint of trade. Lord Eldon's equity decision in Cousins v. Smith (3) is not very intelligible, even if it be not open to the somewhat personal criticism passed on it by Lord Campbell in his Lives of the Chancellors. If indeed it could be plainly proved that the mere formation of "conferences," "trusts," "associations" such as these were always necessarily injurious to the public-a view which involves, perhaps, the disputable assumption that, in a country of free trade, and one which is not under the iron régime of statutory monopolies, such confederations can ever be really successful-and if the evil of them were not sufficiently dealt with by the common-law rule, which held such agreements to be void as distinct from holding them to be criminal, there might be some reason for thinking that the common law ought to discover within its arsenal of sound common-sense principles some further remedy commensurate with the mischief. Neither of these assumptions are, to my mind, at all evident, nor is it the province of judges to mould and stretch the law of conspiracy in order to keep pace with the calculations of political economy. If peaceable and honest combinations of capital for purposes of trade competition are to be struck at, it must, I think, be by legislation, for I do not see that they are under the ban of the common law.

or

In the result I agree with Lord Coleridge, C. J., and differ, with regret, from the master of the rolls. The substance of my view is this: That competition, however severe and egotistical, if unattended by circumstances of dishonesty, intimidation, molestation, or such illegalities as I have above referred to, gives rise to no cause of action at common law. I myself should deem it to be a misfortune if we were to attempt to prescribe to the business world how honest and peaceable trade was to be carried on in a case where no such illegal elements as I have mentioned exist, or were to adopt some standard of judicial "reasonableness," or of "normal" prices, or "fair freights," to which commercial adventurers, otherwise innocent, were bound to conform.

In my opinion, accordingly, this appeal ought to be dismissed with costs.

FRY, L. J.:

The plaintiff's and defendants in this case are owners of steamships, and the plaintiffs allege in substance that the defendants have unlawfully conspired together and done certain acts in pursuance of their conspiracy whereby the plaintiffs have sustained both damage and injury. Both plaintiffs and defendants were concerned in the trade with China, and their steamsihps visited, amongst other ports, Shanghai, at the mouth of the Yangtsze, and Hankow, which is 600 miles up that great river. The defendants' ships were more regularly employed in the China trade than those of the plaintiffs, which appear only to have visited Hankow at the height of the season for shipping tea-that is, in the months of May and June. In 1884 the defendants had formed a combination substantially like the one which I shall presently mention in detail, but it was part of the arrangement of 1884 that the employment of certain ships of the plaintiffs should not entail on the shippers the loss of rebate.

In 1885 the defendants again formed among themselves an arrangement which they call a conference, and which the plaintiff's call a conspiracy. The terms of that arrangement are embodied in a written agreement dated April 7, 1885. This agreement regulated, as between the defendants themselves, the trade with China and Japan; it provided for a certain division of cargoes and for the determination of the rates of freight. But with regard to Hankow, not only did these general stipulations apply to it, but certain special stipulations were come to, having clearly for their object the prevention of competition for freights at Hankow by any of the class of ships described as outsiders-that is, vessels not belonging to any member of the conference. This object was to be

accomplished in three ways: First, it was stipulated that, if outsiders should start for Hankow, they were to be met by conference steamers and encountered with "effective opposition," the determination of what conference ships should be employed for this purpose being left to the agents at Shanghai of the defendant firms. Secondly, it was stiuplated that the agents of the conference ships should be "prohibited "-and here again I use the words of the agreement “from being interested, directly or indirectly, in outsiders;" i. e., they were to be removed from the agency of the defendants' ships if they took any part in the business of nonconference steamers. Thirdly, the agreement provided for a rebate of 5 per cent being made to firms which shipped exclusively by conference ships-a benefit which was to be denied if a single shipment were made by an outsider, except in case of there not being a conference steamer in port or named for dispatch within a week with available cargo space, in which event shipments by an outsider would not work a loss of the rebate. The only other provisions of the agreement to which it is necessary to refer is that each of the parties to it was at liberty to withdraw from the agreement on notice. Upon this document I pause to make certain observations. In the first place, I am of the opinion that it discloses the real bargain between the defendants, and that its purport is not substantially altered by any evidence in this case. In the next place, I conclude that, at the date of the agreement, the plaintiff's were probably in the contemplation of the defendants as persons who might possibly send ships to compete, but with that exception the plaintiffs were not objects in the minds of the defendants when they entered into the agreement, and that the defendants were actuated by no personal ill feeling, or malice in fact, toward the plaintiffs. Thirdly, in my judgment, the real object of the agreement was the acquisition of gain by the defendants, and the means by which they sought to accomplish this end was a competition on the part of the united shipowners against all the world so vigorous as to drive outsiders from the field, and thus to prevent competition in the future. This was the direct scope of the provisions as to meeting outsiders and as to rebate, and the stipulation as to agents I regard as incidental to it; for the members of the conference might well desire that in such a conflict they should be represented by men entirely devoted to their plans and interests, and not by agents acting for shipowners engaged on both sides of the struggle. Fourthly, I am of opinion that competition was in substance the only weapon which the defendants intended to use against their rivals in trade. No thought of using violence, molestation, intimidation, fraud, or misrepresentation was entertained by the defendants. Briefly speaking, therefore, the scheme of the conference was, by means of competition in the near future to prevent competition in the remoter future.

On April 22 interviews took place between Mr. Gellatly, the managing director of the plaintiff company, and the defendants, Swire, McGregor, Holt, and Sutherland, which have been insisted on as important by both sides in argument before us. Mr. Gellatly tried to persuade the defendants to allow him to have a place in their arrangements and, failing this, threatened-to use his own language to "smash” rates at Hankow. What then passed between the parties does not seem to me very material. Shortly after the agreement was entered into copies of it were transmitted by most or all of the defendant firms to their agents in Shanghai, in order that they might act upon it.

On May 1 it was known to the defendants' agents at Shanghai that the Pathan, one of the plaintiffs' steamships, was going up the river to Hankow to look for a cargo of tea at the height of the season, and she was to be followed by the Afghan, another of the plaintiffs' fleet. On May 8 three of the conference vessels were sent up the river to add to the conference vessels already at Hankow and to take part in competing against the outsiders for homeward freight; and three days afterwards a circular was issued by the conference agents at Shanghai to shippers at Hankow, referring by name to the Pathan and Afghan, and warning shippers that the rebate would be lost by shipment by these or any outside ships. This circular was much insisted on by the plaintiff's counsel as an act of hostility directed against the plaintiffs' vessels in particular and as an act of malice toward the plaintiffs personally; and they further observed that it did not disclose to the shippers the provision of the agreement of April 7 by which, in certain cases, shipments might be made on board outsiders without loss of the right to rebate. In my opinion the circular was the natural result of the agreement of April 7 and does not carry the case of the plaintiffs further than as an overt act giving effect to that agreement. Considering that the Pathan and Afghan had, in 1884, been allowed to receive cargo without its entailing a loss of the rebate on the shippers, I think that the reference to those

ships by name was fair toward the shippers and does not show any personal malice against the plaintiffs.

On the 14th of May the conference agents met at Shanghai and determined on a general reduction of freights at Hankow, as a means of depriving the Pathan and Afghan of the chance of a successful venture, and in the pious hope that they might go down the Yangtsze, as they had come up, in ballast. Instructions were accordingly sent to Hankow, freights were reduced, and the plaintiffs' ships obtained freights, but at rates so low as to leave little or no profitrates which, on the evidence, I conclude were brought down by the action of the defendants, and were lower than would have been obtained if there had been open competition and no combination amongst the defendant firms.

On the 29th of May, whilst the Pathan was full at Hankow and on the point of sailing, and whilst the Afghan was rapidly taking her cargo on board, this action was brought. The parties having agreed to leave the question of damages, if any, to reference or arbitration, I shall assume that the plaintiffs may show that, in point of fact, they have sustained damage from the defendants' acts. The plaintiff's allege that the conference was an unlawful conspiracy; that the agreement then entered into was carried into execution by the sending up of the three ships expressly to compete with the plaintiffs' vessels by the circular and by the reduction of freights; that these acts were wrongful, and have caused damage to them, and consequently were actionable.

I can not doubt that whenever persons enter into an agreement which constitutes at law an indictable conspiracy, and that agreement is carried into execution by the conspirators by means of an unlawful act or acts which produce private injury to some person, that person has a cause of action against the conspirators. Was the agreement in the present case an unlawful conspiracy? "The crime of conspiracy," said Tindal, C. J., speaking for the judges attending the House of Lords in O'Connell's case (1), "is complete if two, or more than two, should agree to an illegal thing; that is, to effect something in itself unlawful, or to effect, by unlawful means, something which in itself may be indifferent or even lawful.”

"A conspiracy," said Willes, J., "consists in the agreement of two or more to do an unlawful act or to do a lawful act by unlawful means." (2) In all cases, therefore, a conspiracy is an agreement to do an unlawful act. It is immaterial whether that act be (a) the principal object and end of the agreement, as an agreement to kill, or (b) a subordinate act toward the principal object, as in an agreement to support a true title by forged deeds or suborned witnesses. Again, the act may be unlawful (a) because it would be unlawful in each of the agreeing parties, even if he did it alone, or (b) because, though lawful in one, it is unlawful in two or more.

The first inquiry, then, which arises, is this: Was the principal object and end of the agreement illegal? I answer that the object and end was the acquisition of gain by the defendants. That is lawful, and, I suppose, even commendable, according to the law of this country, provided the means used be lawful What, then, were the means intended to be used? They were, as I have already said, the exclusion of competition in the remoter future by severe competition in the near future. Was that lawful or unlawful?

It is not necessary to consider whether competition directed by one man or by a combination of men against another man, if instigated and put in motion from mere malice and ill will towards him, as a means of doing him ill service, and for no benefit to the doer, would or would not be unlawful or actionable. There is in the present case no evidence of express malice or of any activity of the defendants against the plaintiffs, except as rival and competing shipowners. The defendants did not aim at any general injury of the plaintiffs' trade, or any reduction of them to poverty or insolvency; they only desired to drive them away from particular ports, where the defendants conceived that the plaintiffs' presence interfered with with their own gain. The damage to be inflicted on the plaintiffs was to be strictly limited by the gain which the defendants desired to win for themselves. In the observations I am about to make I shall, therefore, lay out of consideration this case of competition used as a mere engine of malice, even where I do not in terms repeat the exception. I will only add on this part of the case that the charge of Erle, J., in the case of Reg. v. Rowlands (1) draws the same distinction which I have taken between combinations to promote the interests of those who combine, and combinations of which the hurt of another is the immediate purpose. We have, then, to inquire whether mere competition directed by one man against another is ever unlawful. It was argued that the plaintiffs have a legal