such agreement. And this is so whether or not the remedy sought is for breach of an agreement. But an agreement a combination among carriers, Milk Shippers' Assoc., 155 Ill. 166; illegal as restricting competition, s. c., 39 N. E. Rep. 651 (1895), an appliwas held to create no legal obstacle cation of the provision of the Illito a contract between a shipper, nois anti-trust act of 1891, that the and one of the parties to the com- purchaser from one transacting bination, providing for a rate lower business contrary to its provisions, than that provided by the agree- should not be liable for payment. ment among the carriers. See, however, Wiley v. National Wall Paper Co., 70 Ill. App. 543 (1896). The provision of the Kansas anti-trust act of 1889, making it a defense that the plaintiff is a member or agent of a combination unlawful under the act, was held, notwithstanding the generality of the language, not to apply, where it did not appear that the contract and transactions upon which the action was based, formed any part of the illegal combination, or promoted it in effect or design; and, furthermore, the plaintiff was merely a small stockholder in a corporation that was a party to the combination. Barton v. Mulvane, Kan. -; s. C., 52 Pac. Rep. 883 (1898). In an action by a foreign corporation to enforce a stockholder's liability, held, that the question whether it had forfeited its franchises by entering into an illegal trust combination, could not be raised. United States Vinegar Co. v. Schlegel, 67 Hun (N. Y.), 356; s. c., 22 N. Y. Suppl. 407 (1893). Held, also, that it could not be shown that it was orally agreed among the promoters, that the organization should be for an illegal purpose. Id.; Globe Sewer Pipe Co. v. Otis, 22 N. Y. Suppl. 411 (Supm. Ct., Gen. T., 1893). 1 Thus, the remedy for infringement of a patent, is not impaired by the circumstance that the holder of the patent is a party to an agree ment in restriction of competition in the business to which the patent relates. Strait v. National Harrow Co., 51 Fed. Rep. 819 (Cir. Ct. N. Y., 1892; injunction to restrain such a suit denied); Sawyer-Man Electric Co. v. Edison Electric Light Co., 11 U. S. App. 712, 747; s. c., 53 Fed. Rep. 592, 598 (2d Cir., 1892). So held no defense to a proceeding to enforce liability for services rendered by tugs, that the tug-owners were parties to such an agreement. The Charles E. Wise wall, 74 Fed. Rep. 802 (D. Ct. N. Y., 1896); affirmed in 57 U. S. App. 179; s. C., 86 Fed. Rep. 671 (2d Cir., 1898). So such a defense is not available in a proceeding to enforce liability to pay for goods purchased. National Distilling Co. v. Cream City Importing Co., 86 Wis. 352; S. C., 56 N. W. Rep. 864 (1893). On the same principle in Dennehy v. McNulta, · U. S. App. —; S. C., 86 Fed. Rep. 825 (7th Cir., 1898), was denied the right to recover back money paid to an illegal combina tion. But such a defense has in some cases been made available by statute. See, in Ford v. Chicago between a third person and a party to the agreement in restriction of competition, may be so related to the latter agreement, as to make such third person a party to it, within the operation of the rule preventing the maintenance of a proceeding between parties to enforce such an agreement.1 1 In Bishop v. American Preservers' Co., 157 Ill. 284, 306; s. c., 41 N. E. Rep. 765 (1895), in an action of replevin, it appearing that the plaintiff was a party to an illegal combination in restraint of trade, held error to exclude evidence offered to sustain a defense that "the transfer of defendant's goods and machinery and business, by means of a bill of sale to the plaintiff, and the delivery of the shares of stock to defendant, and the redelivery thereof to the trustees of the combination in exchange for trust certificates, and the appointment of defendant as custodian of the property and agent to carry on the business, theretofore exclusively his own, were all parts of the illegal scheme, and aids in the accomplishment of the unlawful objects of the trust." So, in Arnot v. Pittston & Elmira Coal Co., 68 N. Y. 558, 566 (1877), recovery was not allowed for coal sold under an agreement that was part of an illegal scheme of the buyer to enhance prices. It bound the buyer to take all the coal that the seller might desire to send "north of the State line," to the extent of two thousand tons a month, it being, however, optional with the seller to deliver, and the only consideration for the agreement of the buyer being the agreement of the seller not to sell coal to any other party, to come north of the State line. To the knowl edge of the seller, the design of the buyer was to control the supply and price of coal, and but for that purpose the buyer would not have entered into the agreement. The product of the seller largely exceeded two thousand tons a month. The court say: "Under certain limitations, a vendor of goods may recover for their price, notwithstanding that he knows that the vendee intends an improper use of them, so long as he does nothing to aid in such improper use, or in the illegal plan of the purchaser. But if the vendor does anything beyond making the sale, to aid the illegal scheme of the vendee, he renders himself particeps criminis, and cannot recover for the price." In Clancey v. Onondaga Salt Manuf. Co., 62 Barb. (N. Y.) 395 (1862), recovery was not allowed for the price of salt sold to a corporation formed ostensibly for the purpose of manufacturing salt, but in reality to form a combination to fix and control the price, it appearing that the sellers knew that the object of the combination was to increase the price, and that they were to receive the benefit of it. But in Carter-Crume Co. v. Peurrung, U. S. App. ; s. C., 86 Fed. Rep. 439 (6th Cir., 1898), was sustained an agreement for the sale of the entire product of the seller, in the absence of knowledge by him that this was So, as a rule, an agent of a party to an agreement in restriction of competition, is not himself a party, so as to be within the operation of the rule just considered. Besides the difficulty of determining whether a person is a party to the agreement, it is sometimes a matter of difficulty to deter intended by the buyer as but one step in such an illegal combination. And in Van Marter v. Babcock, 23 Barb. (N. Y.) 633 (1857), an agreement of sale was held not illegal merely by reason of a provision that it should be void, provided the other growers of the same product should not enter into an agreement with the buyer. In Anheuser-Busch Brewing Assoc. v. Houck, 27 S. W. Rep. 692 (Tex. Civ. App., 1894); affirmed as Houck v. Anheuser-Busch Brewing Assoc., in 88 Tex. 184; s. c., 30 S. W. Rep. 869 (1895), the illegality of an agreement, under the Texas anti-trust act of 1889, was held to justify a refusal to carry out an agreement to sell to such parties, but not to prevent recovery for goods sold, though with knowledge that they were to be used for the purposes of such combination. This on the ground that the buyer could claim no benefits under the contract, though it might be valid as to the seller. See as to effect of knowledge of seller that goods are to be used for an unlawful purpose, Oliver v. Gilmore, 52 Fed. Rep. 562 (Cir. Ct. Mass., 1892). 1 See generally as to liability of agents of such parties, Clark on Contracts, § 213. In Murray v. Vanderbilt, 39 Barb. (N. Y.) 140, 152 (1863), recovery was allowed against an agent for money received by him for the principal's use, against the objection that the money was paid on an agreement illegal as in restriction of competition. In Wright v. Crabbs, 78 Ind. 487 (1881), recovery was allowed for services as broker in procuring contracts for the purchase of wheat, in ignorance of the fact that the employer was utilizing such contracts for creating a "corner" in the wheat. But in Samuels v. Oliver, 130 Ill. 73; s. c., 22 N. E. Rep. 499 (1889), recovery was not allowed, either by agent against principal, or vice versa, for money received or advanced in promotion of a "cornering" transaction. And in Gibbs v. Consolidated Gas Co. of Baltimore, 130 U. S. 396; s. c., 9 Supm. Ct. Rep. 553 (1889), recovery was not allowed for services rendered in negotiating a contract known by the plaintiff to be illegal. And in Leonard v. Poole, 114 N. Y. 371; s. C., 21 N. E. Rep. 707 (1889), an action for an accounting was held not maintainable, notwithstanding the objection that the parties from whom the accounting was sought, were mere agents of the others; this on the ground that the parties, being engaged in a criminal scheme to advance prices, were all principals. But this reasoning seems inconclusive, the proceeding being for the enforcement, not of a criminal, but of a civil liability. See also Keene v. Kent, 4 N. Y. State Reporter, 431 (Supm. Ct., Gen. T., 1886), where the same contract was involved. mine whether an agreement is such as to be within the operation of the rule. Ordinarily this is to be determined by the rules generally applicable in determining whether an agreement is illegal as in restriction of competition. But where there exists a concededly illegal restriction upon competition, the question sometimes arises whether an agreement is so related to the illegal restriction, as to partake of its illegality. If so, it comes within the operation of the rule above considered; otherwise, not.2 1 See on the general subject of agreements partly illegal, Clark on Contracts, § 204, and other treatises on contracts generally. Thus, in Santa Clara Valley Mill & Lumber Co. v. Hayes, 76 Cal. 387; S. C., 18 Pac. Rep. 391 (1888), recovery was not allowed for breach of an agreement by a manufacturer of lumber for sale thereof, it appearing that the agreement was part of a scheme on the part of the plaintiff, to form a combination among all the manufacturers of lumber in the vicinity, for the purpose of increasing the price, limiting the supply, and giv. ing the plaintiff the control thereof. By the agreement the defendant 2 For examples of provisions held enforceable as separable from agreements in restriction of competition, see Hartford & New Haven R. R. Co. v. N. Y. & New Haven R. R. Co., 3 Robt. (N. Y.) 411 (1865); Western Union Tel. Co. v. Burlington & S. W. Ry. Co., 11 Fed. Rep. 1 (Cir. Ct. Iowa, 1882). See Hoffman v. Brooks, 23 Am. Law Reg. (N. S.) 648 (Super. Ct. Cinn., 1884). For a case where an accounting was allowed for money received as profits on an illegal cornering contract, see Wells v. was not to manufacture other lumber to be sold in the region, under a penalty. The scheme included similar contracts between the plaintiff and other manufacturers in the region. So in Pacific Factor Co. v. Adler, 90 Cal. 110; & c., 27 Pac. Rep. 36 (1891), recovery was not allowed for breach of an agreement to sell and deliver 187,500 grain bags or burlaps, it appearing that the agreement was part of a scheme on the part of the plaintiff to control the supply of grain bags within the State, for the purpose of increasing the price. In Drake v. Siebold, 81 Hun (N. Y.), 178; s. C., 30 N. Y. Suppl. 697 (1894), a case of McGeoch, 71 Wis. 196; s. c., 35 N. W. Rep. 769 (1888). In Sampson v. Shaw, 101 Mass. 145 (1869), where the agreement between parties to a cornering agreement was, that one should apply the funds of the other already in his hands, so far as should be necessary for the payment of the latter's share of the expenses, the latter was held not precluded from recovering the unexpended balance of the fund, but not allowed to recover for what had actually been expended. § 31. Restrictions by corporations upon competition.Formerly, at least, an illegal restriction upon competition was commonly the result of acts of a combination of individuals, partnerships or corporations. But it is frequently overlooked an illegal combination among coal dealers to fix the price, a contract between two parties thereto for the sale of coal at the price fixed by the combination, was held nonenforceable, though it was intimated that the seller was not necessarily precluded from all remedy for non-payment of coal delivered under the contract. So in Burlington, C. R. & N. Ry. Co. v. Northwestern Fuel Co., 31 Fed. Rep. 652 (Cir. Ct. Minn., 1887), an agreement to make a special rate for shipments of coal reaching a certain amount, being held void, as in restriction of competition, was also held not separable from a provision in the same agreement, not to ship less than a certain amount for less than a certain rate. So in State v. Nebraska Distilling Co., 29 Neb. 700; s. C., 46 N. W. Rep. 155 (1890), a conveyance of property was held illegal, as made to a combination formed to restrict competition. So in Houck v. AnheuserBusch Brewing Assoc., 88 Tex. 184; S. C., 30 S. W. Rep. 869 (1895), an agreement by a seller to sell to none but the buyer, was held illegal, as calculated to aid the buyer in producing an illegal restriction upon competition, overruling on this point decision below in 27 S. W. Rep. 692 (Tex. Civ. App., 1894). In National Harrow Co. v. Hench, 84 Fed. Rep. 226 (Cir. Ct. N. Y., 1898), a suit between the same parties as in 76 Fed. Rep. 667; 83 Fed. Rep. 36 (for facts see § 22), a suit upon the theory that, holding the legal title to the patents, the complainant could sue the owners of the equitable title, not as licensees, but as infringers, was held not maintainable, the assignment under which the complainant claimed being regarded as part of the general illegal scheme. It may be a question whether the rule that an agreement, legal considered by itself, may be illegal by means of its relation to an illegal restriction upon competition, was not overlooked in the decisions sustaining agreements by which purchasers from the combination known as the Distilling and Cattle Feeding Company, were to receive rebates, provided they purchased exclusively from such combina. tion. Stress is laid in such decisions on the circumstance that it was merely optional with the purchaser to so purchase exclusively. Re Corning, 51 Fed. Rep. 205, 211 (D. Ct. Ohio, 1892); Re Terrell, Id. 213 (Cir. Ct. N. Y., 1892); Re Greene, 52 Id. 104, 117 (Cir. Ct. Ohio, 1892); the case last cited holding such acts not to constitute either an "attempt to monopolize" trade or commerce, or "contracts in restraint of trade" under the Federal antitrust act. So also independently of such act. National Distilling Co. v. Cream City Importing Co., 86 Wis. 352; s. c., 56 N. W. Rep. 864 (1893); Olmstead v. Distilling & |