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the failure to observe the distinction is seen in statutory prohibitions intended to include restrictions upon competition merely, but actually including such contracts in restraint of trade as in no sense constitute restrictions upon competition.15 § 161. Inapplicability of test of space limit to restrictions upon competition. That the prevention of restrictions upon competition is not the basis of the doctrine against contracts in restraint of trade conspicuously appears from the

"How is the result different from the simpler case of the sale by an individual of his business and his right to conduct it in a particular part of the land?" The answer, of course, is that in the case supposed the agreement does not, necessarily at least, result in an appreciable restriction upon competition, at any rate, not in a monopoly. This decision is the more surprising in view of the circumstance that in Diamond Match Co. v. Roeber, 106 N. Y. 473; 13 N. E. 419; 60 Am. Rep. 464 (1887), the same court had so clearly recognized the distinction between the doctrines. So, in Dolph v. Troy Laundry Machinery Co., 28 Fed. 553 (C. C. N. Y., 1886), an agreement between two manufacturers of washing-machines, they being the principal, but not the only, manufacturers in this country, for a division of profits on sales, upon the basis of a fixed price, was held not illegal. In Master Stevedores' Assoc. v. Walsh, 2 Daly (N. Y.), 1, 14 (1867), was sustained a bylaw of an association of master stevedores, providing for fixing prices for which members should work. The question whether this was void as tending to prevent competition, was not discussed beyond a statement that the by-law was "not in restraint of trade, for it imposes no restraint upon one

party which is not beneficial to the others, and is not prejudicial to the interests of the public." To what extent the members of the association controlled the business in the locality of their operations does not, however, appear.

15 Thus, so far as the Federal anti-trust act has had any effect, it has, as a rule, been with reference, not to "trusts," or other mere restrictions upon competition, but to contracts in restraint of "trade" or "commerce." See in the different anti-trust acts, prohibitions against combinations to "create or carry out restrictions in trade"; combinations, etc., "in restraint of trade," and the like. As to application of such provisions to ordinary contract of vendor not to engage in business, see under Federal act (§ 192); also under Minn. (§ 218); Neb. (§ 222); Tex. (§ 232). Compare under Ill. (§ 209); Mich. (§ 217). As to application of such provisions to restrictions upon use of property, see under Neb. (§ 222). See under Federal act (§ 194); also under Tex. (§ 232), as to whether such prohibitions include reasonable restrictions. See article in 33 Am. Law Rev. 63 (1899), on "Anti-trust Legislation and the Doctrine against Contracts in Restraint of Trade."

inapplicability of the test of space limit to restrictions upon competition.16 Thus, at least until very recently, the doctrine would have been applied so as to hold illegal the withdrawal (without limit as to space) of one out of a thousand trade competitors in a given city, notwithstanding that the continuance of the other nine hundred and ninety-nine would have effectually prevented the danger of monopoly. On the other hand, it would (as modified with reference to space) have been commonly applied to hold legal the withdrawal of nine hundred and ninety-nine such competitors from carrying on their trade within a given city; 17 while such withdrawal, though valid under the technical doctrine as to space limit, would be

16 The total inapplicability of the test of space limit to restrictions upon competition, was clearly seen in Nester v. Continental Brewing Co., 161 Pa. St. 473; 29 Atl. 102; 24 L. R. A. 247; 41 Am. St. Rep. 894 (1894), where a combination to prevent competition within the city of Philadelphia and the county of Camden, N. J., was held illegal, against the objection that the restraint was but partial. The court said: "It is obviously immaterial whether the restraint be general or partial. The application of the rule does not depend upon the number of those who may be implicated, nor the extent of space included, in the combination; but upon the existence of injury to the public. One combination consisting of but part of those engaged in a given branch of trade, may amount to a practical monopoly; while another, less extensive in its scope, may, as well, bring disaster in its train. The difference lies only in degree, but equally forbids the aid of courts." In Stewart v. Stearns & Culver Lumber Co., 48 So. 19, 26

(Supm. Ct. Fla., 1908), where the restriction was in the business of keeping a general store in a village (see § 173), it was said: "Where an agreement in operation has a necessary tendency to restrain trade or to monopoly to the appreciable injury of the public, limitations as to time, place, or subjects contained in the agreement are immaterial." In Addyston Pipe & Steel Co. v. U. S., 175 U. S. 211, 237; 20 Supm. 96, 106; 44 L. Ed. 136 (1899), the restriction in question was held illegal, though its operation "did not cover the United States." Similarly the test of space limit was rejected in Texas Standard Oil Co. v. Adoue, 83 Tex. 650, 660; 19 S. W. 274, 278; 15 L. R. A. 598, 602; 29 Am. St. Rep. 690, 700 (1892); Bailey v. Master Plumbers, 103 Tenn. 99, 114; 52 S. W. 853, 856; 46 L. R. A. 561, 565 (1899); Chicago, Wilmington, etc., Coal Co. v. People, 114 Ill. App. 75, 113, 115 (1904).

17 See, for instance, Kellogg v. Larkin, infra, and cases cited in Greenhood on Public Policy, p. 709.

contrary to the present doctrine against restrictions upon competition.18

18 In Tuscaloosa Ice Manuf. Co. v. Williams, 127 Ala. 110; 28 So. 669; 50 L. R. A. 175; 85 Am. St. Rep. 125 (1900), an agreement in restriction upon competition was held invalid though confined in its operation to a region of 7,000 inhabitants. This was, however, on the ground that the agreement, regarded as a contract in restraint of trade, was thus not incident to the purchase of any business or plant. But the following are instances of acts held legal, where the court might have decided them to be illegal as creating restrictions upon competition, had it not been for the confusion of thought produced by applying the test of space limit. In Skrainka v. Scharringhausen, 8 Mo. App. 522, 527 (1880), an agreement among twenty-four proprietors of stone-quarries in a portion of St. Louis, providing for the sale of all the rubble building-stone of such quarries by a common agent for a period of six months at prices fixed by the agreement, was sustained. By its terms the agreement was designed to prevent the depression of prices resulting from competition, making it impossible to work quarries at a profit. The court said: "The partial nature of the restraint in the case before us seems to be not colorable, but real. The agreement is amongst the quarrymen of one district of one city, and it does not appear that it embraces all of them.

. . It is limited both as to time and place; and we know of no case in recent times in which a contract such as the one before us has been declared illegal." So in San Diego Water Co. v. San Diego Flume Co., 108 Cal. 549; 41 Pac.

495; 29 L. R. A. 839 (1895), a contract restraining competition in the business of supplying water to a city was held valid, as only partial, being confined to such city. In Downing v. Lewis, 59 Neb. 38; 80 N. W. 261 (1899), the contract sustained as valid was between the proprietors of the only two laundries in a given city. A striking instance to similar effect is Kellogg v. Larkin, 3 Pinney (Wis.), 123, 142; 56 Am. Dec. 164, 173 (1851), where recovery was allowed on a lease of a warehouse, though, to the knowledge of the plaintiff, executed in furtherance of an agreement between proprietors of six wheat mills on the one hand, and the proprietors of twelve warehouses on the other, whereby the warehousemen were to give the former "full, absolute and uninterrupted control of the Milwaukee wheat market, so far as they shall be able to do so by virtue of their capacity as warehousemen or vessel and dock owners." The court said: "The restraint it imposed upon trade, if any, was partial and limited; limited in every particular referred to in the books. It was limited as to persons, as to object, as to place and as to time (though this last is not essential). As to persons, it was limited to the proprietors of eleven (twelve) warehouses; as to object it was limited to the traffic in wheat; as to place, it was limited to the Milwaukee market; and as to time, to a period of about seven months." Compare Herriman v. Menzies, 115 Cal. 16; 46 Pac. 730; 35 L. R. A. 318; 56 Am. St. Rep. 82 (1896).

CHAPTER XVII

§ 162.

REMEDIES

Acts illegal as against public policy and criminal acts.

163. Criminal liability.

164. Civil liability.

165. Proceeding on behalf of public.

166. Injunction in proceeding on behalf of public.

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167. Non-enforcibility of agreement.

168. Injury to party to restriction.

169. Agreement not related to restriction.

170. Non-enforcibility of agreement because of relation to restriction. 171. Remedies by or against agent.

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§ 162. Acts illegal as against public policy and criminal acts. -In the view we have taken, an act illegal as against public policy involves the idea of a wrong committed against a considerable number of persons, vaguely designated as "the public." The same may be said of an act illegal as a criminal act.2 But not all acts illegal as against public policy are criminal. The precise line of distinction may not be easy to draw; the distinction seems to be one of degree rather than of kind. The border territory of doubtful cases includes, to some extent at least, acts illegal as producing or tending to produce restrictions upon competition.

§ 163. Criminal liability.-It seems clear that not all acts in restriction upon competition are criminal; and, indeed, the question of criminality has been raised only as to such acts as

1 See § 106.

2 See 1 Bishop's New Criminal Law, §§ 231, 232.

come under the description of forestalling, engrossing and regrating, which were for centuries statutory offenses in England, a decision of the question whether they were criminal acts at common law being thus precluded. In this country there seems to have been no serious attempt to enforce on common-law grounds any criminal liability for acts producing or tending to produce restrictions upon competition, though the opinion has frequently been expressed that such a liability exists. Another source of such opinion seems to be the exploded doctrine, elsewhere considered, of a criminal liability for com

3 Though the question was not in the case, it seems to have been the view of the court in Mogul S. S. Co. v. McGregor, App. Cas. (1892), 25, 46, 58, that what were here called agreements "in restraint of trade" were not indictable at common law, questioning remarks of Crompton, J., in Hilton v. Eckersley, 6 El. & Bl. 47 (1855). Of forestalling, engrossing and regrating it is said in 1 Bishop's New Criminal Law, § 518: "These are kindred offenses, indictable both under the ancient common law and by early English statutes, yet seldom made the subject of a criminal prosecution in modern times. And in England they were abolished in 1844, by 7 & 8 Vict., c. 24, both as common-law offenses and as statutory." The statutes against these offenses had been repealed by 12 Geo. 3, c. 71 (1772), but, according to Rex v. Rusby, Peake's Additional Nisi Prius Cases, 189 (1800); Rex v. Waddington, 1 East, 143 (1800), they continued as common-law of fenses. See also 2 Wharton's Criminal Law (10th ed.), §§ 1849-51. For an extended discussion of the statute, 5 & 6 Edw. 6, c. 14, see Eddy on Combinations, §§ 40-52. In Ontario Salt Co. v. Merchants'

Salt Co., 18 Grant (Ontario), 540 (1871), an agreement among manufacturers of salt was held not illegal on the ground that its object was to raise the price, but the view was taken that, even if such acts were once illegal at common law, "long usage" has brought about a change in the common law in this respect. See Story on Sales (4th ed.), § 490; also article in 7 Harv. Law Rev. 338 (1894) by W. F. Dana, where it is said that "at common law there was no such offense as 'monopolizing"" (p. 342), and it is denied (p. 345) that "engrossing" at common law had any relation to "monopolizing."

4 See, for instance, Raymond v. Leavitt, 46 Mich. 447; 41 Am. Rep. 170 (1881); Cummings v. Foss, 40 Ill. App. 523 (1891); affirmed in Foss v. Cummings, 149 Ill. 353; 36 N. E. 553 (1894); Strait v. National Harrow Co., 18 N. Y. Suppl. 224 (Supm. Ct., Sp. T., 1891); Klingel's Pharmacy v. Sharpe, 104 Md. 218; 64 Atl. 1029; 7 L. R. A. N. S. 976; 118 Am. St. Rep. 399 (1906); Hammond Packing Co. v. State, 81 Ark. 519; 100 S. W. 407, 1199 (1907). These were all proceedings to enforce a civil liability. It is said in 1 Bishop's New Crim

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