mortgage, deed of trust, contract, or obligation, less the value of such security, shall be assessed and taxed to the owner of the property, and the value of such security shall be assessed and taxed to the owner thereof, in the county in which the property affected thereby is situate. The taxes so levied shall be a lien upon the property and security, respectively, and may be paid by either party to such security; if paid by the owner of the security, the tax so levied upon the property affected thereby shall become a part of the debt so secured; if the owner of the property shall pay the tax so levied on such security, it shall constitute a payment thereon, and to the extent of such payment, a full discharge thereof. SEC. 6. Every contract hereafter made, by which a debtor is obligated to pay any tax or assessment on money loaned, or on any mortgage, deed of trust, or other lien, shall, as to any interest specified therein, and as to such tax or assessment, be null and void. SEC. 7. No corporation, except for benevolent, religious, scientific, or educational purposes, shall be hereafter formed under the laws of this State, unless the persons named as corporators shall, at or before filing the articles of incorporation, pay into the State treasury one hundred dollars for the first fifty thousand dollars or less of capital stock, and a further sum of twenty dollars for every additional ten thousand dollars of such stock; and no such corporation shall hereafter increase its capital stock without first paying into the State treasury twenty dollars for every ten thousand dollars of increase. SEC. 8. No license tax shall be imposed by this State, or any municipality thereof, upon any trade, calling, occupation, or business, except the manufacture and sale of wine, spirituous, and malt liquors, shows, theaters, menageries, sleight of hand performances, exhibitions for profit, and such other business and occupations of like character as the Legislature may judge the public peace or good order may require to be under special State or municipal control. But the Legislature may by law impose any license, or other tax, on persons or corporations owning or using franchises or corporate privileges. SEC. 9. The Legislature shall provide for the levy and collection of an annual poll tax of not less than two dollars, for school purposes, on every male inhabitant of this State over twenty-one and under sixty years of age, except paupers, idiots, insane persons, and Indians not taxed. Said tax shall be paid into the State School Fund. SEC. 10. The power of taxation shall never be surrendered or suspended by any grant or contract to which the State shall be a party. SEC. 11. The Legislature shall provide by law for the payment of all taxes on real property by installments. SEC. 12. The Legislature shall by law require each taxpayer in this State to make and deliver to the County Assessor, annually, a statement, under oath, setting forth specifically all the real and personal property owned by such taxpayer, or in his possession, or under his control, at twelve o'clock meridian, on the first Monday of March. SEC. 13. Assessors and Collectors of State, county, city and county, town, or district taxes, shall be elected by the qualified electors of the county, city and county, town, or district in which the property taxed for State, county, city and county, town, or district purposes, is situated; provided, that vacancies may be filled by appointment, according to general laws. SEC. 14. The State tax on property, exclusive of such tax as may be necessary to pay the existing State debt, shall not exceed forty cents on each one hundred dollars for any one year. MR. ROLFE. I move to amend by adding that five copies be placed upon each member's desk. MR. EDGERTON. I accept the amendment. RESOLUTION OF INQUIRY. MR. RINGGOLD. I have a resolution to offer. Resolved, That the San Francisco Gaslight Company, of the City and County of of the San Francisco Gaslight Company. MR. RINGGOLD. I have been requested to introduce that, and I now move its adoption. Adopted, on a division, by an affirmative vote of 80. MR. ESTEE. Mr. President: I now move that the Convention resolve itself into Committee of the Whole, for the purpose of further considering the report of the Committee on Corporations other than Municipal. PREVIOUS QUESTION IN COMMITTEE OF THE WHOLE. motion to amend Rule Fifty-six, of which I gave notice on Saturday. MR. HUESTIS. I rise to a point of order. MR. HEISKELL. Yes; ten or a dozen of you rise to a point of order. MR. HUESTIS. The gentleman has no right to consume the time of the Convention in discussing a motion to lay on the table. THE PRESIDENT. The point of order is weli taken. The roll was called, and the motion to lay the amendment on the table was lost, by the following vote: Andrews, Caples, Chapman, Cowden, Crouch, Davis, Estee, SEC. 15. A State Board of Equalization, consisting of two members Estey, from each Congressional District in this State, shall be elected by the Fawcett, qualified electors of their respective districts, at the general election to Finney, be held in the year one thousand eight hundred and seventy-nine, and Garvey, every four years thereafter, whose duty it shall be to equalize the valu-Glascock, ation of the taxable property in the State for purposes of State taxation. Graves, The Boards of Supervisors of the several counties in the State shall Gregg, constitute Boards of Equalization for their respective counties, whose duty it shall be to equalize the valuation of the taxable property in the county for the purpose of county taxation. SEC. 16. The State Board of Equalization shall assess the value of all the property of all railroad corporations in this State. For the purpose of taxation, the value of all lands, workshops, depots, and other buildings belonging to or under the control of each railroad corporation, shall be apportioned by said Board to the counties, cities and counties, cities, townships, and districts in which such lands, workshops, depots, and other buildings are situate; and the aggregate value of all other property of such railroad corporation shall be apportioned by said Board to each county, city and county, city, town, or district in which its road shall be located, according to the ratio which the number of miles of such road completed in such county, city and county, city, town, or district shall bear to the whole length of such railroad. SEC. 17. The value of the capital stock of a corporation shall be assessed in the county in which its principal place of business is located, and separately from all other property belonging thereto; and such stock shall be assessed at its market value when the assessment is made. The real and other personal property of such corporation shall be assessed in the several counties respectively in which the same is situate. The value of such stock, over and above the aggregate value of such real and other personal property, according to such assessment, shall be taxed in the county in which the principal place of business of such corporation is located; and the value of such real and other personal property shall be taxed in the several counties respectively in which the same is situate. The shares of stock belonging to the stockholders in such corporation shall be exempt from taxation; provided, that the provisions of this section shall not apply to railroad corporations. SEC. 18. The Legislature shall pass all laws necessary to carry out the provisions of this article. MR. EDGERTON. I move that nine hundred and sixty copies of the draft be printed. Barbour, Barry, Shafter, Terry, Townsend, Tully, Van Voorhies, Wilson, of Tehama, Ringgold, THE PRESIDENT. The question is on the adoption of the amendment as offered by the gentleman from Solano, Mr. Dudley. The Secretary will read it." THE SECRETARY read: "Amend Rule Fifty-six to read as follows: "The rules of the Convention shall be observed in Committee of the Whole, so far as they may be applicable, except that the ayes and noes shall not be taken, and that the previous question shall not be moved." MR. DUDLEY, of Solano. Mr. President: I am not classed as one of the talking members of this Convention, and I make this motion to-day, because I think that I saw a great deal of inconvenience arising last Saturday from moving the previous question. The situation seems to be this: a section is brought up for consideration, and one member moves an amendment, then another member moves an amendment to the amendment. No more amendments can be offered until these are disposed of. They are discussed until the patience of the Convention is exhausted. The previous question is moved, and no more amendments can be offered to the section at all. We have no chance to vote upon any amendments except the first two. I am willing to limit the time of debate, but certainly I think we should have a chance to consider and vote upon more than two amendments. I hope the amendment will be adopted. The ayes and noes were demanded by Messrs. Burt, Tinnin, Kelley, Wellin, and Huestis. MR. ROLFE. Mr. President: I am opposed to the way the rule stands now, and I am opposed to the way it is proposed to be amended; therefore I shall vote against the amendment. It is as the gentleman says: a proposition comes before the Committee of the Whole and some gentleman moves an amendment; another gentleman moves an amendment to that. Then we get tired of discussing it, and the previous question is moved and carried, and then we only have the right, as I understand it, to vote on these three propositions, without giving any opportunity of making other amendments; whereas, it is possible that neither the proposition nor either of the amendments suit the Convention. I think the evil could be avoided in a different way-by allowing the previous question to be put and carried, but with such a modification that after we vote down all the amendments pending, then other amendments may be offered. But I shall simply vote against the amendment changing the rule. The roll was called, with the following result: MR. ESTEE. Will the Secretary please read the section as now amended? THE SECRETARY read: SEC. 14. Every corporation, other than religious, educational, or benevolent, organized or doing business in this State, shall have and maintain an office in this State for the transaction of its business, where transfers of stock shall be made, and in which shall be kept for inspection, by every person having an interest therein, and legislative committees, books in which shall be recorded the amount of capital stock subscribed, and by whom; the names of the owners of its stock, and the amounts owned by them respectively; the amount of stock paid in, and by whom; the transfers of said stock, the amount of its assets and liabilities; and the names and place of residence of its officers. No foreign corporation shall do any business in this State without having at least one place of business and an authorized agent in the same, upon whom process may be served. MR. TERRY. My amendment is withdrawn. THE CHAIRMAN. The question is on the amendment offered by the Committee on Corporations as amended. THE SECRETARY again read the amendment as amended. MR. BARBOUR. If it reads that way there is a repetition, because if the word "or" is used it refers to the foreign corporations, and they are, according to the amendment of Judge Hager, required to keep an office where the business is transacted. The amendment as amended was adopted. SEC. 15. All railroads, canal, and transportation companies shall be common carriers and subject to legislative control. Any association or corporation, organized for the purpose, shall have the right to construct and operate a railroad between any points within this State, and to connect at the State line with railroads of other States. Every railroad company shall have the right with its road to intersect, connect with, or cross any other railroad, and shall receive and transport each other's passengers, tonnage, and cars, loaded or empty, without delay or discrimination. MR. ESTEE. The section I offer was offered by direction of the Committee on Corporations, to precede this section fifteen, and be numbered section fifteen. "Amend section fifteen by adding: A corporation or association may be sued at the county where the contract is made or is to be performed, or where the obligation or liability arises, or breach occurs; or at the county where the principal place of business of such corporation is situated, subject to the power of the Court to change the place of trial as in other cases.' 393 MR. ESTEE. Mr. Chairman: That does not seem to be pertinent to section fifteen that was just handed up. MR. FAWCETT. I think it does. MR. ESTEE. Section fifteen was on foreign corporations. MR. FAWCETT. It may not be pertinent, but before we pass all these sections on corporations I wish to offer that, either as an amendment or as an independent section. THE CHAIRMAN. The gentleman can offer it as an independent section. MR. FAWCETT. I submit that it would be more proper added to THE PRESIDENT. It takes a two-third vote to change a rule. The section four, but inasmuch as we have passed that, I suppose it is too amendment is lost. NOTICE. MR. REYNOLDS. Mr. President: I give notice that I will, on to-morrow, move to reconsider the vote by which the resolution in relation to printing the Journal was this day indefinitely postponed. MR. SMITH, of Fourth District. Mr. President: When this rule was first changed, it was changed by a vote of the minority only. There were no ayes and noes called at that time. According to that the rule still stands. CORPORATIONS. MR. ESTEE. I move that the Convention resolve itself into Committee of the Whole, the President in the chair, for the purpose of further considering the report of the Committee on Corporations other than Municipal. Carried. Three o'clock and fifteen minutes P. M.] IN COMMITTEE OF THE WHOLE. THE CHAIRMAN. The pending questions were the amendments to section fourteen. The gentleman from San Joaquin moved to strike out the words "other than religious, educational, or benevolent," in line one, and insert the words "having capital stock." late. I will therefore offer it as an independent section, after the section offered by the gentleman from San Francisco is disposed of. I withdraw it as an amendment. The section offered by Mr. Estee was adopted. SUITS AGAINST CORPORATIONS. MR. FAWCETT. I now offer that amendment, to be known as section sixteen of the chapter on corporations. THE SECRETARY read: SEC. 16. A corporation or association may be sued at the county where the contract is made or is to be performed, or where the obligation or liability arises, or breach occurs; or at the county where the principal place of business of such corporation is situated, subject to the power of the Court to change the place of trial as in other cases. MR. HERRINGTON. Mr. Chairman: With unanimous consent, why might not that be attached to section four? MR. FAWCETT. Mr. Chairman: I suppose the object of this amendment will be readily apparent to all. Under our system, corporations have a legal residence at their principal place of business. The result is that corporations in this State are legally resident, nearly all of them, at the City and County of San Francisco, and that under our rules of practice, those who have litigation with such corporations must go to the City and County of San Francisco to sue. For instance, if the gentleman from Los Angeles has a cause of action against the Southern Pacific Railroad Company, he must go to the City and County of San Francisco with his cause of action; bring his suit, carry his witnesses, and maintain his litigation there. That operates unjustly and unfairly. I think that the rule ought to be, that a person having a cause of action against a corporation should be entitled to meet at the place where the cause of action has arisen, where the obligation or liability arises, or the breach occurs. We have transportation companies plying on the South Pacific Coast-steamship companies. It often happens that shippers there lay a cause of action against a steamship company, and they have to go to San Francisco at great expense, delay, and inconvenience. The effect of this amendment will be to authorize them to sue at the place where the cause of action arises, or at the principal place of business of the corporation. I think it is eminently just. Perhaps it may be said that it more properly belongs to the Code of Civil Procedure, but it is quite as important to the rights of the people as many of the provisions contained in this report. The section was adopted. RAILROADS. from the decision relative to the power of railroads and their duties to the people. The second proposition is, that "Any association or corporation, organized for the purpose, shall have the right to construct and operate a railroad between any points within this State, and to connect at the State line with railroads of other States." That was merely for the purpose, should the time ever come when there would be an opportunity for a competing line, to give that line an opportunity of running to the State line of this State to connect with any other railroad that might come from any other State or Territory for the purpose of transporting freight and passengers to this State. The next was: " Every railroad company shall have the right with its road to intersect, connect with, or cross any other railroad, and shall receive and transport each other's passengers, tonnage, and cars, loaded or empty, without delay or discrimination." The object of that was to prohibit any railroad company from favoring one competing line over another, and transporting their passengers and freight or their cars to the exclusion of others, and thereby freezing out, if I may use the term, any connecting line. This section was taken almost verbatim from the Constitutions of Pennsylvania and Missouri. In the Pennsyl THE CHAIRMAN. The Secretary will read section fifteen of the vania Constitution it is section one of article seventeen. It reads: report, now numbered section seventeen. THE SECRETARY read: SEC. 17. All railroads, canal, and transportation companies shall be common carriers and subject to legislative control. Any association or corporation, organized for the purpose, shall have the right to construct and operate a railroad between any points within this State, and to connect at the State line with railroads of other States. Every railroad company shall have the right with its road to intersect, connect with,| or cross any other railroad, and shall receive and transport each other's passengers, tonnage, and cars, loaded or empty, without delay or dis crimination. MR. O'DONNELL. I would like to add to that section the following words: "The Legislature shall, by appropriate legislation, establish a tariff of prices to be charged for the transportation of passengers and freights on railways in this State, by which all such railways shall be governed." MR. ESTEE. It does that now. MR. O'DONNELL. I offer it as an amendment. I will send it up. THE SECRETARY read the proposed amendment as above. REMARKS OF MR. BROWN. All railroads and canals shall be public highways, and all railroads and canal companies shall be common carriers. Any association or and operate a railroad between any points within this State, and to corporation organized for the purpose shall have the right to construct connect at the State line with railroads of other States. Every railroad company shall have the right with its road to intersect, connect with, other's passengers, tonnage, and cars, loaded or empty, without delay or or cross any other railroad; and shall receive and transport each the discrimination." Now these were the evils that were attempted to be remedied by your committee in reporting section fifteen, and I will state to the gentleman poses is quite unnecessary, unless he wants to destroy the harmony of from San Francisco, Mr. O'Donnell, that the amendment which he prothis article. If he does, why of course he had better adopt it. The proposition is covered by sections nineteen, twenty, twenty-one, and twenty-two. Section nineteen provides against discrimination, and section twenty provides for Railroad Commissioners, fixing their powers and duties. I hope that all amendments for changing this section, so far as the regulation of freights and fares are concerned, will be voted down. REMARKS OF MR. MCFARLAND. MR. MCFARLAND. Mr. Chairman: I think that this code ought to be amplified a little. We say every railroad company shall receive and transport each other's passengers, tonnage, and cars, loaded or empty. INow in order to make that effective we ought to provide that each railroad company should have a certain width gauge. They might come with narrow gauge cars and our roads would not take them. It does seem to me that if they are going to take the cars from the other States that it should be so arranged that the cars of other States and our own should be the same gauge. MR. BROWN. Mr. Chairman: I was wishing before it came to a vote upon amendments to know more precisely with regard to the meaning of the language in the fifteenth section now before us. acknowledge that I am not able to fully comprehend it with the present lights that I have before me. It says: "All railroads, canal, and transportation companies shall be common carriers, and subject to legislative control. Any association or corporation, organized for the purpose, shall have the right to construct and operate a railroad between any points within this State, and to connect at the State line with railroads of other States." Now, I do not fully comprehend that portion about "organized for the purpose." It seems different when there is a purpose spoken of; but what that purpose is, I am not able to understand. Is it transportation companies that is spoken of? If it is for the purpose of being a transportation company, I am not sure of it by the language. If it means organized for the purpose of being common carriers, any company organized for that purpose, it does not seem to be clear. There is also legislative control spoken of, and it is not clear whether it is for them or not. What follows afterwards seemed at first to explain it: "shall have the right to construct and operate a railroad between any points within this State, and to connect at the State line with railroads of other States." Now, instead of the latter part being the purpose, there are several purposes spoken of, and I thought before voting upon it I would wish to hear what the purpose is, whether organized for the purpose of common carriers, or organized for the purpose of an association, as immediately precedes it. MR. BARBOUR. I move to amend section seventeen by inserting after the word "control," in the second line, the words, "railways and navigable canals heretofore constructed, or which may hereafter be constructed in this State, are hereby declared to be highways, and shall be free to all persons for the transportation of persons and property thereon, under such regulations as may be prescribed by law." THE CHAIRMAN. The first question is on the amendment offered by the gentleman from San Francisco, Mr. O'Donnell. MR. CAMPBELL. I sent up an amendment there. THE CHAIRMAN. That amendment will be the second question. THE SECRETARY read the amendment offered by Mr. O'Donnell. MR. TINNIN. Mr. Chairman: I desire to call the attention of the committee to the amendment. It seems to be the entering wedge to defeat the Commission that the committee have decided upon. merely desire to call the attention of the committee to the fact. MR. WHITE. Mr. Chairman: I hope the Convention will not entertain that amendment. If the gentleman is opposed to the plan of the Committee on Corporations, his time will be when we reach the twentieth section. It will cause a great deal of confusion in the whole argument. I trust that the Convention will observe the object of it and vote against it. REMARKS OF MR. ESTEE. MR. ESTEE. Mr. Chairman: Section seventeen, or section fifteen as it is printed, was drawn up by your committee to meet two or three propositions. First, that all railroads, canal, and transportation companies shall be common carriers, and subject to legislative control. Of course we are aware that they were common carriers, and that common carriers were subject to legislative control, and that expression was taken REMARKS OF MR. O'DONNELL. MR. O'DONNELL. Mr. Chairman: This section embodies a great popular demand. It is a measure which involves simply this proposition: Shall the people control the corporations, or shall the corporations control the people? That is the question now before this Convention. The section I think is a little cloudy, and delegates do not exactly understand the reading of that section. It says here in section fifteen, or section seventeen as it is amended: "All railroads, canal, and transportation companies shall be common carriers and subject to legislative control. Any association or corporation, organized for the purpose, shall have the right to construct and operate a railroad between any points within this State, and to connect at the State line with railroads of other States. Every railroad company shall have the right with its road to intersect, connect with, or cross any other railroad, and shall receive and transport each other's passengers, tonnage, and cars, loaded or empty, without delay or discrimination." Now my amendment is: "The Legislature shall, by appropriate legislation, establish a tariff of prices to be charged for the transportation of passengers and freights on railways in this State, by which all such railways shall be governed." There is an addition. That is the reason that I offer the addition there. As it is now, they have a right to charge their own prices for passengers and freight. The corporations have been controlling the people for the last fifteen or sixteen years. It seems pretty near time that the people were controlling these corporations. I hope that amendment will be added to that section. MR. AYERS. Mr. Chairman: I trust that the members of this committee will incontinently vote the amendment down. This State has trusted long and patiently to the Legislature of this State to handle that question. They have not done it; and it behooves this Convention itself to handle it; and I believe that this report, further on, provides an effective way by which we can gain control of that matter. MR. HOWARD. Mr. Chairman: I wish to say to the gentleman from Sacramento that, so far as the Central Pacific and the Southern Pacific are concerned, the Act of Congress provides that the gauge shall be uniform, and it also provides that they shall receive freights and passengers from other roads and run the cars over their roads. MR. LAINE. I desire to call the attention of the Chairman of the committee to the wording of this section. I think you will find that the word "railroads" ought to be "railroad." You make railroads common carriers instead of railroad companies. MR. ESTEE. That is right. The Secretary will strike out the letter "g" there. SPEECH OF MR. HALE. MR. HALE. Mr. Chairman: I hope that this amendment will not prevail. I see that the vote upon this question must necessarily be a The next section provides: rates, have proven to be abortive. In other words, he proceeds to reason out and reach the conclusion, that for the purpose of regulating fares and freights it is impossible to effect it justly and beneficially, either to the people or the railroad companies, by any statute of the State regulating fares and freights. For instance, it is true, and it will be plain to every gentleman who is familiar with the subject, that it would be utterly unreasonable to expect any railroad company to transport from San Francisco to the State line, or between any points in this State, a cargo or a carload of silk goods at the same price that it would convey for the same distance a carload of barley, or wheat, or potatoes. It needs no illustration to show the truth of this. It is also true that it is not feasible; it is not reasonable to suppose, perhaps, that you can transport over all portions of any given line freights at the same rate. The grade of the road, the facilities for furnishing fuel, and other conditions necessary to transport a train of cars, whether carrying passengers or freight, or both, are immensely different, and the cost depends upon these conditions. Hence, from these as well as other considerations, which I will not now undertake to detail, it is obvious to every one that it is practically useless to lay down a fixed and inflexible rule as to rates for railroad transportation, as it must be done, if done by statute, fixing maximum or minimum, or both maximum and minimum rates, for the transportation of passengers or freights. In view of these circumstances, in view of the fact that a wise management will take into consideration all the facts and all the elements which enter into the account of cost of transportation, it is necessary to have somebody, some Board of men, if you please, who are authorized both for the people and for the railroad companies, to have and exercise this most important discretionary power. The committee have (and I think wisely) presented a plan whereby they propose that the people shall the people of the State and of the railroad companies, and equally bound to do justice to the people and the railroad companies, and they are to fix and regulate all these railroad questions. That is the plan of the committee, and it is one that I heartily favor. Now it will be understood that when I say the vote upon this question must necessarily be a test vote, I allude to a vote upon the pending amendment, which, if adopted, will be equivalent to knocking on the head the committee's scheme of a Railroad Commission. Mr. Chairman, as I have said, we have had some experience upon this subject. We are not alone. Other States have had experience likewise. I think it will be quite out of the question for any gentleman on this floor or elsewhere, to show that any beneficial results have resulted in any case from any attempts at State regulation of railroads, in the form of statute laws fixing maximum or minimum rates for passengers or of freights. But they have in various instances succeeded in the attempt to exercise a wise and just and reasonable power of the State over these railroads, through such provisions as are proposed here by this committee report. Now if any one should question whether this proposed State control will be well and justly exercised, he will have to question the wisdom of the people to make wise selections. That there is need of this control, that the State has power to exercise it, and that it is our duty to do it, I think is obvious to most men at this day. The question is, how should we do it? That is the great question. I think the committee have reported wisely upon this proposition. They have provided that the people shall elect a Board of Commissioners, confer upon them the power and the duty to decide all questions between the people and the railroad companies, and then remove this notorious source of vexation, excitement, and corruption from the halls of our Legislatures, and relieve us from the turmoil which it occasions among the people, and place it where there will be a wise, calm, and just exercise of the power of control by the people of the State over these railroad companies. "SEC. 20. Three Railroad Commissioners shall be elected by the qualified voters of this State, at the regular gubernatorial elections, and whose salary shall be fixed by law, and whose term of office shall be four years. They shall be qualified electors of this State, and shall not be interested in any railroad corporation, or other transportation company, as stockholder, creditor, agent, attorney, or employé, and the act of a majority of said Commissioners shall be deemed the act of said Commission. Said Commissioners shall have sole power, and it shall be their duty, to correct abuses by railroad corporations or other transpor-elect three Railroad Commissioners, who shall be at once the agents of tation companies; establish rates of charges for the transportation of passengers and freight by railroad or other transportation companies, and publish the same from time to time, with such changes as they may make; report to the Governor, annually, their proceedings, and such other facts as may be deemed important; hear and determine complaints against railroad or other transportation companies; affix penalties and enforce them through the medium of the Courts, and perform such other duties as may be prescribed by law. Nothing in this section shall prevent individuals from maintaining actions against any of such companies. It shall be the duty of the Legislature to confer all such further powers on the Board of Railroad Commissioners as shall be necessary to enable them to perform the duties enjoined on them in the foregoing sections." Mr. Chairman, it will be observed from the construction of the sections I have read, that they deal with the matter in detail. The scheme of the committee is substantially this: that so far as the regulation of tariffs for the conveyance of passengers or freight upon railroads in this State are concerned, they shall be determined by the Railroad Commissioners. Now, sir, I am quite aware of the fact that there is a divided sentiment on this subject; that there are two opinions as to the proper mode of reaching this one result, namely, the exercise by the State of its proper supervision and control over railroads in the matter of conveying passengers and freight. The committee's report proceeds upon the assumption, as I take it, that it is unwise to attempt to regulate fares and freights by the terms of statute law. Am I correct, Mr. Chairman? R. ESTEE. Yes. MR. HALE. Now, we have not been without experience in this matter of trusting to the Legislature to control corporations. I say this without reflecting upon any body. While the State, from the first, has claimed the right to control corporations in various acts, public declarations and laws, and I might add, that while the United States and the Courts of this country, both State and Federal, have upheld and sustained as the prerogative and power of the State to exercise this control over the railroads in the conveyance of passengers and freight-while, I say, this is true, this other fact stares us in the face, that we have been attempting, through the medium of the Legislature, to exercise this control for the past fifteen years, and thus far all efforts at success have been abortive. suppose, without being particularly familiar with the views of the committee, that they are of the opinion (judging from the past) that we would be likely to have a similar experience in the future, and they have presented this scheme providing for a commission consisting of three Railroad Commissioners to be elected by the people, to become the agents of the people and the railroad companies, and fix and determine MR. O'DONNELL. Mr. Chairman: The Legislature at its last sesin all cases the scale of prices for passengers and for freight upon rail- | sion passed a law regulating the fare on these railroads in San Franroads in this State. cisco-these street railroads-and it acted splendidly. The fare for a For myself, Mr. Chairman, this plan meets my unqualified approba-single ticket then was ten cents. They made it five. I cannot see why tion. I had the fortune--perhaps I should say the misfortune-at quite the Legislature cannot regulate these steam railroads just as well; but an early day, to introduce into the Legislature of this State the first bill at the same time I will withdraw my amendment until we reach secever proposed for the regulation of fares and freights. It did not become tion twenty. a law. I need not deal with a detail or explanation of it. At nearly every session of the Legislature, from that time until this, efforts have been made to pass bills of that kind, and they have either proven wholly or partially abortive to accomplish any beneficial exercise of State control over these railroads by such means. I do not propose, sir, to discuss the reason, why that has been the case. I may call attention to this one fact, and would allude to a public document, or what is in the nature of a public document, an open letter written by the President of the Central Pacific Railroad Company-I allude to Governor Stanford. I doubt not it was written in the hope that it would be read and appreciated by the members of this Convention. While utterly disagreeing with the conclusions reached in that communication, I recognize, and you will all recognize, the soundness of many of its views. The soundness of many of them, and I think I might say most of them, are most prominently illustrated in our past experience, in our attempts to legislate upon this subject. To regulate fares and freights by the establishment of maximum and minimum Mr. Chairman, I hope this amendment will be voted down, and that in lieu of it the Convention will adopt the scheme presented by the committee as shadowed in section nineteen and twenty of their report. MR. WICKES. Mr. Chairman: I think the gentleman who offered this amendment was premature. I do not think the vote upon this section MR. FILCHER. I have been informed that the gentleman is waiting an opportunity to withdraw it. MR. WICKES. If gentlemen would moderate their zeal to offer amendments it would be better. MR. CAMPBELL. Mr. Chairman: I sent up an amendment there some time ago which I now offer. THE SECRETARY read: "Amend section seventeen by inserting in line four, after the word 'railroad' the words, other than a street railroad.'" MR. CAMPBELL. Mr. Chairman: As the section now reads it would, I am afraid, be liable to the construction that any person might construct a street railroad through the streets of any city at any point that he might desire to do it, and that would be attended with vast public inconvenience and great danger. For that reason I have offered this amendment. I presume there will be no objection to it on the part of the Chairman of the committee. I suppose the clause was not intended to include that class of roads. MR. ESTEE. Mr. Chairman: It was not intended to reach street railroads, and I do not think it could possibly be construed to mean railroads of that kind, but I do not see as there is any objection to the amendment. MR. EDGERTON. Mr. Chairman: I would suggest to the Chairman of the Committee on Corporations, a fact that is probably not in his mind for the moment-that in all this railroad legislation, street railroads are excepted. They are carried on upon an entirely different basis from the general railroad system. It is left very much to the municipalities where they are in use. I think the suggestion from the gentleman from Alameda, Mr. Campbell, a very pertinent one. As the section now stands, it would include street railroads. MR. ESTEE. Mr. Chairman: It was not intended to reach street railroads, and for one of the committee, I see no objection to inserting the words, "other than street railroads." MR. LAINE. Mr. Chairman: I must confess that I am somewhat in the condition of the gentleman from Tulare, Mr. Brown, in regard to the second clause of this section. The way it reads, I do not know that I catch clearly its scope and purpose. I presume it is intended merely to make a provision that railroads may connect with other roads at the State line, but the way it is written, I confess I am not able clearly to understand it. Being in that condition, I have prepared an amendment, to read in this wise, if that is the understanding of the committee: "Any association, or corporation, organized for railroad purposes, except street railroads, shall have the right to connect at the State line with the railroads of other States." That makes it shorter, if that is the purpose, but I confess that it is not at all clear to me. would not be able to read it if I had, to this fact, that the Granger cases, It is their public character as public highways that is the foundation for the authority of the State to control them, whatever we do or whatever shall be decided on. This decision binds every Court, up to the highest tribunal of the land; and this declaration will come within the scope and purview of their own decision upon the subject in the Granger cases and in the Elevator cases. I never understood why the committee should have left it out. It seems to me an indispensable proposition and a declaration that is just as necessary as and more necessary than the declaration that they are common carriers. I do not know, and the people of this State do not know, but that the time will yet come when they will not only want to act upon the declaration that they are public highways, free to all persons for the transportation of their persons MR. ESTEE. I think you have hit one point and missed another. and property theoretically, and under proper control and regulation, Any association, or corporation, organized for the purpose, shall have but that they shall declare that communities and places along the the right to construct and operate a railroad between any points within lines of the road, under proper regulations, can put their own cars and this State, and to connect at the State line with railroads of other States." their own locomotives upon these public highways. Whilst not deprivThe whole section, this clause and the next one, gives them the right to ing anybody of their property, whilst not depriving them of their franmake a railroad and operate it to a certain point, and provides that there chise, pay all due and proper bills that may be coming to them, but at shall be no discrimination between railroads in favor of one or against the same time make the only possible competition in the State of Calithe other. That is the point. Of course, if the gentleman's amend-fornia-perhaps the only kind of competition that is possible under the ment is thought more correct, if it represents the ideas better, or is peculiar geographical formation of this State. I hope that the comstated more clearly, then we have no choice or taste about language, but mittee will adopt the amendment. there are two points in ours-constructing a railroad and operating it between any points within the State, and also to connect with the railroads of other States. 66 MR. FILCHER. Mr. Chairman: It occurs to me that the same explanation might be necessary in other sections of this same article. REMARKS OF MR. BARBOUR. SPEECH OF MR. MCFARLAND. MR. MCFARLAND. Mr. Chairman: I wish to ask the gentleman from San Francisco, Mr. Barbour, if he means, when he provides that portation of goods; whether he means that every person has the right a railroad shall be a highway, that any person can use it for the transto use it for the transportation of general freight, putting cars and locomotives upon it. MR. BARBOUR. Yes; under such regulations as may be prescribed MR. MCFARLAND. I supposed you meant that a railroad shall be MR. BARBOUR. The gentleman misapprehends me. I say this MR. BARBOUR. Mr. Chairman: I ask the Secretary to read the says now that railroads shall be public highways, upon which any per amendment I sent up. THE SECRETARY read: Amend section seventeen by inserting after the word 'control,' in line two, the following: Railways and navigable canals heretofore constructed, or which may hereafter be constructed in this State, are hereby declared to be highways, and shall be free to all persons for the transportation of persons and property thereon, under such regulations as may be prescribed by law."" me. ques Now, each other's passengers refers to the preceding plural. It does The clause seems MR. MCFARLAND. Then I understood the gentleman right. He son can put cars and locomotives, in the manner provided by law. That is what the railroads in this State are to be compelled to do, and the Legislature is to fix up some schedule of time upon which you, or I, I do not care to argue that or anybody can run a train of cars. tion. I merely wanted to know what his idea was. I would like to call the attention of the committee to the two final in some way. The second clause is entirely unnecessary, it seems to sentences or clauses in this section. They certainly ought to be amended MR. BARBOUR. Mr. Chairman: This matter of declaring railways The general law provides that anybody can build railroads in any public highways was discussed in the committee, and the committee part of the State, from one end of it to the other, by paying for private compared various Constitutions of the States, many of which have the property. What is the use of saying that they may connect with other same provision, and at first adopted this language which I have intro-lines outside of the State, for they have that right if they choose to do duced here from the minority report, but on a subsequent day the com-clause reads: "Every railroad shall transport each other's passengers." So, anyway. This clause is simply useless and unnecessary. The last mittee, while I was not present, struck it out. Now, Mr. Chairman, in my opinion, that is one of the most indispensable declarations in this article concerning corporations. In my opinion it brings it exactly within the modern decisions in regard to the power of the State to control railroads. If I understand the decision of the Supreme Court of to need amendment-I hardly know how. Now, if that first word was the United States in the railroad cases, called the Granger cases, follow-"all" and the third word in the plural, it might perhaps help the ing after the decision in the Elevator cases, the People against Scott and Munn-that decision in favor of the right to regulate and control and prevent abuses and discrimination on the part of railroad companies, went upon the principle that they were clothed with a public character. There was nothing in the decision which directly reversed the former decision with regard to the inviolability of these contracts, but it went purely and solely upon the ground of their being clothed with a public character and conveying a public interest. Now, there is nothing in the declaration that a railroad is a common carrier, as I understand it; that is contrary to all the definitions found in the books. Angell on Railways, and many others pronounce them public highways. I consider that a better expression than common carriers, although I have no objection to making use of both expressions. But when you say that they are public highways and free to all for the transportation of passengers and property, you strike at the greatest abuse of all, and that is discrimination. As to the common carrier characters of them, that is all right enough so far as it concerns the right to regulate fares and freights, but you must use the other declaration, that all persons and communities shall have the right, without discrimination, to have their property transported over these public highways under proper regulations. I consider it a very beneficial proposition to declare that they are public highways free to all persons for the transportation of persons and property, subject to legislative control. I would call the attention of the Convention, although I have not the decision here at present, and case some. But, certainly, it does not mean anything to say that every SPEECH OF MR. SMITH. MR. SMITH, of Fourth District. Mr. Chairman: As I understand it, MR. SMITH. I am somewhat surprised at the committee omitting |