| ‘CINCINNATI. PORTSMOUTH, BIG SAN¬ DY, & POMEROY PACKET COMPANY, Plff , in Err.,
v.
GEORGE W. BAY and William Bay.
(See S. C. Reporter’s ed. 179-186.)
1. Error to state conrt— Federal Ques¬
tion — wlien raised in time — effect of certificate of state court.— A certificate of the highest court of a slate to the effect that it necessarily considered the Federal question relied upon to sustain a writ of error from the Supreme Court of the United States, which the record shows was raised, removes any objection that such question was raised too late under the local procedure.
2. Contracts — unlawful restraints on
interstate commerce — incidental re¬ straints.— The interference, if any, with in¬ terstate commerce, contemplated by a con¬ tract for the sale of certain river craft, which permits a suspension of payment of instal¬ ments of the purchase price in case of serious
Note. — On illegal trusts under modern anti¬ trust laws — see note to Whitweli v. Con¬ tinental Tobacco Co. 64 L.R.A. 689.
Certificate of state court as showing presence of Federal question.
A certificate of a chief or presiding justice of the highest court of a state cannot relieve the Supreme Court of the United States from determining for itself wiiether the record shows that the suit really involves any question which will entitle it to review the judgment of the state court. Newport Light Co. v. Newport, 151 U. S. 527, 38 L. ed. 259, 14 Sup. Ct. Rep. 429 ; Powell v. Brunswick County, 150 U. S.
433. 37 I., ed. 1134. 14 Sup. Ct. Rep. 166.
Such a certificate is incompetent to confer Jurisdiction not shown on the record (Felix v. Scharnweber, 125 U. S. 54, 31 L. ed. 687, 8 Sup. Ct. Rep. 759 ; Mississippi & M. R. Co. v. Rock, 4 Wall. 177, 18 L. ed. 381 ; Powell v. Brunswick County, supra; Sayward v. Denny, 158 U. S. 180, 39 L. ed. 941, 15 Sup. Ct. Rep. 777 ; Henkel v. Cincinnati, 177 U. S. i70, 44 L. ed. 720, 20 Sup. Ct. Rep. 573 ;
Home for Incurables v. New York, 187 U. S. 155, 47 L. ed. 117, 63 L.R.A. 329, 23 Sup. Ct. Rep. 84), though it may have the effect of making more certain and specific what is too general and indefinite in the record (Parmelee v. Lawrence, 11 Wail. 36, 20 L. ed. 48 ; Brown v. Atwell, 92 U. S. 327, 23 L. ed. 511 ; Yazoo & M. Val¬ ley R. Co. v. Adams, 180 U. S. 41, 45 L. ed. 415, 21 Sup. Ct. Rep. 256 ;
Dibble v. Bellingham Bay Land Co. 163 U. S. 63, 41 L. ed. 72, 16 Sup. St. Rep. 939).
The certificate may induce the Federal court, where the question is a close one, not to con¬ strue the pleadings so strictly as to hold that they do not sufficiently present a Federal question. Roby v. Colehour, 146 U. S. 153, 36 L. ed. 922, 13 Sup Ct. Rep. 47.
A certificate of the chief justice of a state court, stating that the validity of state legis¬ lation subsequent to the charter of a corpora¬ tion was drawn in question upon the ground that it impaired the obligation of a contract, 428
competition in the freight and passenger traffic over a route between two named Ohio ports on the Ohio river, and requires the vendors to withdraw from such competition for five years, is too insignificant to render the contract invalid under the act of July 2, 1890 (26 Stat. at L. 209, chap. 647, U. S. Comp. Stat. 1901, p. 3200), as imposing a restraint on interstate commerce.
3. Contracts— unlawful restraints on in¬
terstate commerce— rights and liabil¬ ities of parties.— A purchaser of river craft cannot invoke the antitrust act of July 2, 1S90 (26 Stat. at L. 209, chap. 647, U. S. Comp. Stat. 1901, p. 3200), to relieve him from his obligation to pay the purchase price, because of his covenant to maintain the present traffic rates, which is not declared by the contract to enter into the consideration of the sale, — especially where, the rates re¬ ferred to primarily, if not exclusively, relate to domestic, and not to Interstate, business.
[No. 174.]
Argued December 15, 1905. Decided Jan¬ uary 2, 1906.
and that the decision was in favor of the valid¬ ity of such legislation, may be resorted to, in the absence of an opinion, to show that a Federal question which was otherwise raised in the record was actually passed upon by the court. Gulf & S. I. R. Co. v. Hewes, 183 U. S. 66, 46 L. ed. 86, 22 Sup. Ct. Rep. 26.
The certificate of a state court of last re¬ sort may serve to remove any doubt whether rights under the Federal bankrupt law were so relied upon and passed upon in affirming, without opinion, a judgment dismissing a suit brought by a trustee in bankruptcy to recover an alleged asset of the bankrupt estate, as to sustain a writ of error from the Federal Su¬ preme Court.
Rector v. City Deposit Bank Co. 200 U. S. 405, post, 527, 26 Sup. Ct. Rep. Rep. 289.
And where the record shows that the juris¬ dictional question may have been involved, a certificate by the presiding judge of a state court, certified by the clerk as part of the rec¬ ord, that one of the questions mentioned in the 25th section of the judiciary act was de¬ cided in the manner prescribed by that act, will be presumed to have been made by au¬ thority of the court, and the Supreme Court of the United States must take jurisdiction. Armstrong v. Athens County, 16 Pet. 281, 10 L. ed. 965.
A certificate signed by the clerk and certified by the presiding justice of a state court, though entitled to great weight as showing that a Federal question was decided by the court, which gives it in the manner required to give the Supreme Court of the United States juris¬ diction, is not conclusive that such a ques¬ tion was raised in the case. Caperton v. Bow- yer, 14 Wall. 216, 20 L. ed. 882.
And it certainly cannot be regarded as con¬ clusive when the same judge, in the opinion on file in the case, places the decision entirely on a ground independent of a Federal ques¬ tion. Adams County v. Burlington & M. River R. Co. 112 U. ,S. 123, 28 L. ed. 678, 5 Sup. Ct. Rep. 77.
A certificate of the presiding judge of a state court is Insufficient to show that a
200 U. S.
] 005.
Cincinnati, P. B. S. & P. Packet Co. v. Bat.
IN ERROR, to the Supreme Court of the State of Ohio to review a judgment which affirmed a judgment of the Circuit Court of Lawrence County, in' that state, in favor of plaintiffs in an action to re¬ cover the purchase price of certain river craft, in which the defendant alleges that the contract of sale was illegal under the Federal antitrust act. Affirmed.
The facts are stated in the opinion.
Mr. Ledyard Lincoln argued the cause, and, with Mr. Julius L. Anderson, filed a brief for plaintiff in error:
Repeated attempts have been made to re¬ strict the broad and general language of the Sherman antitrust act, but the Federal courts, and especially this court, have uni¬ formly held that the act means just what it says, and cannot be confined to unreason¬ able restraints nor such as were condemned by the common law before its passage.
United States v. Trans-Missouri Freight Asso. 166 U. S. 290, 312-341, 41 L. ed. 1007,
Federal question was raised and decided, where the recorded opinion of the court shows that the decision was based on a ground that did not involve a Federal question.
Dibble v. Bellingham Bay Land Co. 163 U. S. 63, 41 L. ed. 72, 16 Sup. Ct. Rep. 939.
Where, from the entire record, it appears that the decision of the state court depends upon the construction, and not the constitu¬ tionality, of a state statute, the certificate of the state court is unavailing to show that the constitutional question was involved. Lawler v. Walker, 14 How. 149, 14 L. ed. 364 ; Com¬ mercial Bank v. Buckingham, 5 How. 317, 12 L. ed. 169.
Something more definite than a certificate of the highest court of a state that certain statutes, challenged as in violation of the Federal Constitution, were held valid, with¬ out naming those statutes, is necessary to satisfy the requirement that the record should show that such a question was involved. Law¬ ler v. Walker, supra.
And see note to Hooker v. Los Angeles, 63 L.R.A. 471, on What the record must show! respecting the presentation and decision ot a Federal question in order to confer jurisdic¬ tion on the Supreme Court of the United States of a icrit of error to a state court.
A certificate of the state court that such questions arose and were decided as required by S 25 of the judiciary act to give the Su¬ preme Court jurisdiction to review the deci¬ sion of the state court is unnecessary, where the record •shows on its face that such ques¬ tions arose, and how they were decided. Able- man v. Booth. 21 How. 506, 16 L. ed. 169.
Home for Incurables v. New York, 187 U. S. 155, 47 L. ed. 117, 63 L.R.A. 329, 23 Sup. Ct. Rep. 84, lays down tjie rule that a certifi¬ cate of the chief justice or presiding officer of the highest state court that a Federal question was involved is not properly a part of the record.
Although the contrary nowhere seems ex¬ plicitly to have been stated, Mr. Justice Wayne uses some language in Lawler v. Walker, supra, from which it might be inferred that he re-
200 U. S.
1017-1027, 17 Sup. Ct. Rep. 540;
United States v. Joint Traffic Asso. 171 U. S. 505, 573-575, 43 L. ed. 259, 288-290, 19 Sup. Ct. Rep. 25; United States v. Addyston Pipe & Steel Co. 46 L.R.A. 122, 29 C. C. A. 141, 54 U. S. App. 723, 85 Fed. 271, Af¬ firmed in 175 U. S. 211, 44 L. ed. 136, 20 Sup. Ct. Rep. 96; Northern Securities Co. v. United States, 193 U. S. 197, 331, 402, 48 L. ed. 679, 697, 726, 24 Sup. Ct. Rep. 436; Chesapeake & O. Fuel Co. v. United States, 53 C. C. A. 256, 115 Fed. 610.
It cannot be questioned that the trans¬ portation of persons and property from one state to another is interstate commerce.
United States v. Trans-Missouri Freight Asso. 166 U. S. 290, 312, 325, 41 L. ed. 1007, 1017, 1022, 17 Sup. Ct. Rep. 540; Gloucester Ferry Co. v. Pennsylvania, 114 U. S. 196, 29 L. ed. 158, 1 Inters. Com. Rep. 382, 5 Sup. Ct. Rep. 826; Lottery Case (Champion v. Ames) 188 U. S. 321,
garded such a certificate as part of the record. But such a certificate, though it may help out the failure of the record to show beyond all question the presence of a Federal con¬ troversy, seems generally to have been re¬ garded as something distinct from the record itself. Newport Light Co. v. Newport, 151 U. S. 527, 38 L. ed. 259, 14 Sup. Ct. Rep. 429 ; I’owell v. Brunswick County, 150 U. S. 433, 37 L. ed. 1134, 14 Sup. Ct. Rep. 166; Felix v. Scharnweber, 125 U. S. 54, 31 L. ed. 687, 8 Sup. Ct. Rep. 759 ; Mississippi & M. R. Co. v. Rock, 4 Wall. 177; 18 L. ed. 381; Henkel v. Cincinnati, 177 U. S. 170, 44 L. ed. 720, 20 Sup. Ct. Rep. 573; Parmelee v. Lawrence, 11 Wall. 36, 20 L. ed. 48 ; Brown v. Atwell, 92 U. S. 327, 23 L. ed. 511 ; Yazoo & M. Valley R. Co. v. Adams, 180 U. S. 41, 45 L. ed. 415, 21 Sup. Ct. Rep. 256 ; Roby v. Colehour, 146 U. S. 153, 36 L. ed. 922, 13 Sup. Ct. Rep. 47 ; Armstrong v. Athens County^ 16 Pet. 281, 10 L. ed. 965 ;
Dibble v. Bellingham Bay Land Co. 163 U. S. 63, 41 L. ed. 72, 16 Sup. Ct. Rep. 939 ; Gulf & S. I. R. Co. v. Hewes, 183 U. S. 66, 46 L. ed. 86, 22 Sup. Ct. Rep. 26.
And see note to Home for Incurables v. New York, 63 L.R.A. 329, on The record for the purpose of showing jurisdiction in the Supreme Court of the United States of a writ of error to a state court.
Other notes respecting the review of deci¬ sions of the state court in the Supreme Court of the United States are : What adjudications of state courts can be brought up for review in the Supreme Court of the United States by ivrit of error to those courts, Apex Transp. Co. v. Garbade, 62 L.R.A. 513 ; How and when questions must be raised and decided in a state court in order to make a case for a writ of error from the Supreme Court of the United States, Mutual L. Ins. Co. v. McGrew, 63 L.R.A. 33 ; What questions the Federal Supreme Court will consider in reviewing the judgments of state courts, State ex rel. Hill v. Dockery, 63 L.R.A. 571 ; The practice and procedure governing the transfer of causes to the Federal Supreme Court on writ of error or appeal, Wedding v. Meyler, 66 L.R.A. 833.
429
Supreme Court of the United States.
Oct. Term,
345-352, 47 L. ed. 492, 496-499, 23 Sup. Ct. Rep. 321.
The transportation of goods on a through bill of lading from one point in a given state to another in the same state by way of an adjoining state or territory is in¬ terstate commerce.
Hanley v. Kansas City Southern R. Co. 187 U. S. 617, 47 L. ed. 333, 23 Sup. Ct. Rep. 214.
The states of Kentucky and West Vir¬ ginia extend to low-water mark on the Ohio side, so that even boats plying direct¬ ly from Syracuse to Cincinnati, without stopping at intermediate points, would nec¬ essarily, at ordinary stages of the river, pass through parts of West Virginia and Kentucky.
Indiana v. Kentucky, 136 U. S. 479, 34 L. ed. 329, 10 Sup. Ct. Rep. 1051; Handly v. Anthony, 5 Wheat. 374, 5 L. ed. 113; Booth v. Shepherd, 8 Ohio St. 243; McFall v. Com. 2 Met. (Ky. ) 394.
It has been held by this court in a num¬ ber of cases involving contracts which did not relate directly to interstate commerce, but were local in their nature, that they were not within the prohibition of the Sher¬ man act, although the parties contracting in fact sold commodities or solicited busi¬ ness beyond the state line; but the contract must affect interstate commerce directly, and not remotely or incidentally.
United States v. E. C. Knight Co. 156 U. S. 1, 39 L. ed. 325, 15 Sup. Ct. Rep. 249; Hopkins v. United States, 171 U. S. 578, 43 L. ed. 290, 19 Sup. Ct. Rep. 40;
Anderson v. United States, 171 U. S. 604, 43 L. ed. 300, 19 Sup. Ct. Rep. 50.
But in the case of United States v. Trans- Missouri Freight Asso. 166 U. S. 290, 325, 1007, 1022, 17 Sup. Ct. Rep. 540, the court uses the following language: Transporta¬ tion of commodities among the several states or with foreign nations falls within the description of the words of the statute with regard to that subject, and there is also included in that language that kind of trade in commodities among the states or with foreign nations which is not confined to their mere transportation. It includes their purchase and sale. Precisely at what point in the course of the trade ir or man¬ ufacture of commodities the statute may have effect upon them or upon contracts re¬ lating to them may be somewhat difficult to determine, but interstate transportation presents no difficulties.
It is not necessary that the restraint upon trade should be entire, or the monop¬ oly aimed at complete.
United States v. E. C. Knight Co. 156 U. S. 16, 39 L. ed. 330, 15 Sup. Ct. Rep. 249; Addyston Pipe & Steel Co. v. United 430
States, 175 U. S. 211, 244, 245, 44 L. ed. 136, 148, 149, 20 Sup. Ct. Rep. 96; North¬ ern Securities Co. v. United States, 193 U. S. 407, 48 L. ed. 729, 24 Sup. Ct. Rep. 436; United States v. Addyston Pipe <£ Steel Co. 46 L.R.A. 122, 29 C. C. A. 141, 54 U. S. App. 723, 85 Fed. 278; Chesapeake. & O. Fuel Co. v. United States, 53 C. C. A. 256, 115 Fed. 619; Lufkin Rule Co. v. Fringeli, 57 Ohio St. 607, 41 L.R.A. 185, 63 Am. St. Rep. 736, 49 N. E. 1030; Har¬ ding v. American Glucose Co. 74 Am.- St. Rep. 235, note, 182 Ill. 551, 64 L.R.A. 738, 74 Am. St. Rep. 189, 55 N. E. 577.
The provisions of the contract in the case at bar — especially those looking to a sup¬ pression of competition oy strangers — go far beyond the fair protection of the Big Sandy Company.
Horner v. Graves, 7 Bing. 735; 24 Am. & Eng. Enc. Law, pp. 850, 851; United States v. Addyston Pipe & Steel Co. supra.
In Ohio it is well settled that all restraint of trade is presumptively invalid. That a partial restraint may be enforced only where it appears that it is founded upon a valuable consideration, and is reasonable and not oppressive.
Lange v. Werk, 2 Ohio St. 519; Lufkin Rule Co. v. Fringeli, 57 Ohio St. 596, 41 L.R.A. 185, 63 Am. St. Rep. 736, 49 1ST. E.
1030.
The supreme court of Ohio and other courts have repeatedly held that contracts in restraint of competition, and tending to monopoly, are against public policy and void.
Central Ohio Salt Co. v. Guthrie, 35 Ohio St. 666 ;
Emery v. Ohio Candle Co. 47 Ohio St. 320, 21 Am. St. Rep. 819, 24 N. E. 660; State ex rel. Watson v. Standard Oil Co. 49 Ohio St. 137, 15 L.R.A. 145, 34 Am. St. Rep. 541, 30 N. E. 279; South Chicago City R. Co. v. Calumet Electric Street R. Co. 171 Ill. 391, 49 N. E. 576; Anderson v. Jett, 89 Ky. 375, 6 L.R.A. 390, 12 S. W. 670; Texas & P. R. Co. v. Southern P. R. Co. 41 La. Ann. 970, 17 Am. St. Rep. 445, 6 So. 888. See note to Harding v. American Glucose Co. 74 Am. St. Rep.
235.
The two packet companies wrho signed the contract w'ere not engaged in private, but in quasi public business, and therefore any restraint upon such business would be preju¬ dicial to the public interest, and cannot be sustained.
United States v. Trans-Missouri Freight Asso. 166 U. S. 333, 335, 41 L. ed. 1025, 1026, 17 Sup. Ct. Rep. 540; Gibbs v. Con¬ solidated Gas Co. 130 U. S. 396, 32 L. ed. 979, 9 Sup. Ct. Rep. 553; United States v. Addyston Pipe & Steel Co. 46 L.R.A. 122,
200 TJ. S.
1905.
Cincinnati, P. B. S. & P. Packet Co. v. Bat.
29 C. C. A. 141, 54 U. S. App. 723, 85 Fed. 291.
It is claimed that the illegality of the contract should have been specially plead¬ ed by the defendant. To this there are two answers. First, that the facts bring¬ ing the case within the condemnation of the act of Congress and of the common law appear upon the face of the pleadings and are admitted by them. Indeed, the petition is demurrable. Second, we submit it is hot the law that illegality must be plead¬ ed, where the plaintiff cannot prove his case without disclosing the illegality; as, for instance, where it appears upon the face of the contract which is the basis of his cause of action.
Lange v. Werk, and Lufkin Rule Co. v. Fringeli, supra ; 4 Enc. PI. & Pr. p. 952;
1 Enc. PI. & Pr. p. 844; 2 Beach, Modern Law of Contracts, § 1443; Oscanyan v. Winchester Repeating Arms Co. 103 U. S 261, 26 L. ed. 539; Emery v. Ohio Can die Co. supra ; Field Cordage Co. v. Ra¬ tional Cordage Co. 6 Ohio C. C. 615.
The covenants in restraint of commerce were not ancillary.
Davis v. A. Booth & Co. 65 C. C. A- 269: 131 Fed. 37; Tuscaloosa Ice Mfg. Co. v. Williams. 127 Ala. 110, 50 L.R.A. 175, 85 Am. St. Rep. 125, 28 So. 669.
The question of the illegality of the con¬ tract was presented to the circuit court of Lawrence county.
Weaver v. Columbus, S. d H. Valley R Co. 55 Ohio St. 491, 45 N. E. 717.
If the Federal or jurisdictional question is raised for the first time in the assign¬ ments of errors in the supreme court of the state, the question is presented m
time. TT
Farmers’ & M. Ins. Co. v. Dobney, 189 U. S 301 47 L. ed. 821, 23 Sup. Ct. Rep. 565; San Jose Land d Water Co v. San Jos6 Ranch Co. 189 U. S. 179, 47 L. ed^ 766 23 Sup Ct. Rep. 487 ; Chicago, B. & Q. R • Co. v. Chicago, 166 U. S. 226, 231, 232, 41 L. ed. 979, 982, 983, 17 Sup. Ct. Rep. 581; Rothschild v. Knight, 184 U. S. 334, 339, 46 L. ed. 573, 579, 22 Sup. Ct. Rep. 391; Furman v. Nichol ( Green v. Nichol) 8 Wall. 44, 56, 19 L. ed. 370, 375.
V.-. Joseph Spencer Graydon argued the cause, and, with Mr. Lawrence Maxwell, Jr., filed a brief for defendants in error:
The contract is valid under the laws of Ohio and at common law.
Lange v. Werk, 2 Ohio St. 520; Thomas v. Miles, 3 Ohio St. 274; Morgan v. Perhamus, 36 Ohio St. 517, 38 Am. Rep. 607; Lufkin Rule Co. v. Fringeli, 57 Ohio St. 596, 41 L.R.A. 185, 63 Am. St. Rep. 736, 49 N. E. 1030- Oregon Steam Nav. Co. v. Winsor, 20 Wall. 64, 22 L. ed. 315; California Steam
20<y v. s.
Nav. Co. v. Wright, 6 Cal. 258, 65 Am. Dec. 511 ; Dunlop v. Gregory, 10 N, Y. 241, 61 Am. Dec. 746; Fowle v. Park, 131 U. S. 88, 97, 33 L. ed. 67, 74, 9 Sup. Ct. Rep. 658 ; Har¬ rison v. Glucose Sugar Ref. Co. 58 L.R.A. 915, 53 C. C. A. 484, 116 Fed. 304; Fish¬ eries Co. v. Lennen, 116 Fed. 217 ; Eursen v. Gavin, 59 Ill. App. 66, Affirmed in 162 Ill. 377, 44 N. E. 735; Hedge v. Lowe, 47 Iowa, 137; Nordenfelt v. Maxim Norden- felt Guns & A. Co. [1894] A. C. 535; S. Jarvis Adams Co. v. Knapp, 58 C. C. A. 1, 121 Fed. 34; United States v. Addyston Pipe d Steel Co. 46 L.R.A. 122, 29 C. C. A. 141, 54 U. S. App. 723, 85 Fed. 271.
In this case it is immaterial whether the separate covenant of the plaintiff in error to maintain the rates charged by the par¬ ties of the first part on business above Portsmouth, Ohio, is legal or illegal. The suit is not on that covenant, but on the covenant to pay $3,600. The other cove¬ nant is not mentioned in the pleadings.
Pigot’s Case, 11 Coke, 27 b; Bank of Aus¬ tralasia v. Breillat, 6 Moore, P. C. C. 152; State ex rel. Laskey v. Board of Education, 35 Ohio St. 519; Lange v. Werk, supra; Harriman, Oontr. 134; Thomas v. Miles, supra; Oregon Steam Nav. Co. v. Winsor , 20 Wall. 64, 70, 71, 22 L. ed. 315, 319.
The contract is not illegal under the Sherman antitrust act.
United States v. Joint Traffic Asso. 171 U. S. 505, 568, 43 L. ed. 259, 287 ; Ander¬ son
v. United States, 171 U. S. 604, 615, 43 L. ed. 300, 306, 19 Sup. Ct. Rep. 50;
Hopkins v. United States, 171 U. S. 578, 43 L. ed. 290, 19 Sup. Ct. Rep. 40; North¬ ern Securities Co. v. United States, 193 U. S. 197, 360, 48 L. ed. 679, 709, 24 Sup. Ct. Rep. 436; E. Bement & Sons v. National Harrow Co. 186 U. S. 70, 46 L. ed. 1058, 22 Sup. Ct. Rep. 747; Brett v. Ebel, 29 App. Div. 256, 51 N. Y. Supp. 573; Whitioell v. Continental Tobacco Co. 64 L.R.A. 689, 60 C. C. A. 290,
125 Fed. 454; Phillips v. Iola Portland Cement Co. 61 C. C. A. 19, 125 Fed. 593; Davis v. A. Booth & Co. 65 C. C. A. 269, 131 Fed. 31.
On a petition in error in the supreme court of Ohio to reverse the judgment of a circuit court affirming the judgment of the court of common pleas, the court is not re¬ quired to consider objections to the judg¬ ment of the common pleas that were not as¬ signed for error in the circuit court.
Pollock v. Cohen, 32 Ohio St. 514 ; Union Ins Co. v. McGookey, 33 Ohio St. 555; Springfield, J. & P. R- Co. v. Western R. Constr. Co. 49 Ohio St. 681, 32 N._ E. 961.
The writ of error should be dismissed for want of jurisdiction.
Caro v. Davidson, 197 U. S. 197, 49 L. ed. 723 25 Sup. a. Rep. 428; Fullerton v.
• ’ 431
182-18
Oct. Term,
Supreme Court of the United States.
Texas, 196 U. S. 192, 49 L. ed. 443, 25 Sup. Ct. Hep. 221 ; Chicago, 1. & L. R. Co. v. Mc¬ Guire, 196 U. S. 128, 49 L. ed. 413, 25 Sup. Ct. Rep. 200.
The court will not assume facts to make the contract illegal; on the contrary, the presumption, in the absence of allegation or proof, is in favor of its validity.
Eerpolsheimer v. Funlce, 1 Neb. (Unof.) 304, 95 N. W. 687; C. F. Jewett Pub. Co. v. Butler, 159 Mass. 517, 22 L.R.A. 253, 34 N. E. 1087; Mills v. Dunham [1891] 1 Ch. 576.
Mr. Justice Holmes delivered the opin¬ ion of the court;
This is an action upon a contract, brought by the defendants in error to recover an in¬ stalment of money due by its terms. A judg¬ ment in their favor was sustained by the supreme court of the state, although the petition in error to that court set up that the contract was illegal under the act of Congress of July 2, 1890, chap. 647. 26 Stat. at L. 209, U. S. Comp. Stat. 1901, p.
3200. No opinion was delivered, but a
certificate that this objection was relied up¬ on, and that it necessarily was considered, was made part of the record by that court. Therefore the present writ of error prop¬ erly was allowed. The record shows that the question was raised, and the certificate shows that it was not treated as having been raised too late under the local pro¬ cedure, — - a point upon which the state court is the judge. It is enough that the Federal question was raised and necessarily decided by the highest court of the state. Farmers’ <& M. Ins. Co. v. Dobney, 189 U. S. 301, 47 L. ed. 821, 23 Sup. Ct. Rep. 565.
The contract was an indenture between the Portsmouth & Pomeroy Packet Com¬ pany, George W. and William Bay, of the first part, and the Cincinnati, Portsmouth, Big Sandy, & Pomeroy Packet Company, of the second part. By this instrument the parties of the first part sell to the latter two steamers, two deck barges, two coal fiats, and $500 in the stock of the Coney Island WTharf Boat Company, for $30,500, to be paid as therein provided. The party of the second part also agrees to pay to the Bays $3,600 annually in advance for five years, provided, however, that in case of opposition to its boats by other boats run¬ ning from Cincinnati to Portsmouth, Ohio, or to points above Portsmouth, not includ¬ ing points above Syracuse, Ohio, causing it to carry freight and passengers at certain exceedingly low rates, the time of payment of the instalments shall be postponed ufitil 183] the opposition has ceased. It is "further agreed that if the opposition continues for two years without interruption, and no an- 432
nual payment be made, the Bays may can¬ cel the agreement.
“It is also agreed as a part of the con¬ sideration of this agreement” that for five years the parties of the first part, or either of them, shall not be “engaged in running or in operating, or in any way be interested in any freight and passenger packet or business, or either of ' them, at and from Cincinnati, Ohio, to Portsmouth, Ohio, and intermediate points; nor at and from Ports¬ mouth, Ohio, to Cincinnati, Ohio, and in¬ termediate points ; nor at and from Syra¬ cuse, Ohio, or points between Syracuse and Portsmouth, Ohio, to or for points below Portsmouth, Ohio,” with a qualification as to the towing and barge business, so long as it does not interfere with the other party’s freight and passenger business from Portsmouth to Cincinnati. “It is also un¬ derstood in this agreement that the party of the second part will maintain the rates charged by the parties of the first part on business above Portsmouth, Ohio, said rates, however, never to exceed railroad rates between said points.” The last-men¬ tioned covenants, set forth in this para¬ graph, are especially relied upon as making the contract illegal, as in restraint of trade.
The previously mentioned suspension of in¬ stalments in case of opposition rising to a certain height also is referred to as a com¬ bination to aid the purchaser in getting a monopoly of river trade between Ports¬ mouth and Cincinnati, including, it is said, some Kentucky ports.
It might be enough, perhaps, to answer the whole contention, that it does not ap¬ pear on the record that the contract neces¬ sarily contemplated commerce between the states. It would be an extravagant conse¬ quence to draw from Hanley v. Kansas City Southern R. Co. 187 U. S. 617, 47 L. ed. 333,
23 Sup. Ct. Rep. 214, — a case of a state at¬ tempting to fix rates over ~ railroad route passing outside its limits, — that the con¬ tract was within the Sherman act because the boats referred to might sail over soil belonging to Kentucky in passing between two Ohio points. It may be noticed further that Ohio equally has jurisdiction on the river. Wedding v. Meyler, 192 U. S. 573,
48 L.. ed. 570, 66 L. R. A. 833, 24 Sup. Ct.
Rep. 322. *A contract is not to be assumed