Case ID: ohio-st_72/html/0210-01.html
Source: Caselaw Access Project
Author: {"author": "Shauck, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The State of Ohio v. Gage.
    
      Act of April 19, 1898 — Defining trusts and prohibiting them— Is a valid act — Authorizing punishment and imprisonment— Valentine-Stewart law — Constitutional law.
    
    The act of April 19, 1898, defining trusts and prohibiting them under penalties (93 O. L., 143) by a valid exercise of the police power, authorizes the punishment by fine and imprisonment of a person who is an active member of, and assists in carrying out the purposes of, an association formed to prevent competition in the sale of an article of merchandise.
    (No. 8681
    Decided March 21, 1905.)
    Error to the Circuit Court of Delaware county.
    Gage was indicted in Delaware county under the act of April 19,1898, entitled “An act to define trusts, and to provide for criminal penalties and civil damages, and punishment of corporations, persons, firms1 and associations, or persons connected with them, and to promote free competition in commerce and all classes of business in the state. ’ ’
    The indictment charged “that Perley W. Gage of said county, on the first day of November-in the year of our Lord, one thousand nine hundred and two, with force and arms, in said county of Delaware, and state of Ohio, and until this sixth day of January in the year of our Lord, one thousand nine hundred and three, said Perley W. Gage, late of said county of Delaware, was an active member of, acted with and in pursuance of, aided and assisted in carrying out the purposes of The Delaware Coal Exchange, an association of persons organized for the purpose of preventing competition in the sale, and to maintain a uniform and graduated figure for the sale of coal, and to directly preclude a free and unrestricted competition among the members of said association, purchasers and consumers in the sale and transportation of coal, contrary to the form of the statute in such case made and provided, and against the peace and dignity of the state of Ohio.”
    To this indictment the defendant demurred upon the two grounds that the. facts charged do not constitute an offense against the laws of Ohio and that the statute under which the indictment was presented is unconstitutional and void. The demurrer having been overruled, the defendant entered a plea of guilty, and then moved in arrest of judgment upon the same grounds stated in his demurrer. The court overruled this motion and adjudged that the defendant pay a fine of $100 and the costs of prosecution and that he stand committed to the jail of the county until the fine and costs should be paid. On Gage’s petition in error the judgment of the court of common pleas was reversed by the circuit court.
    
      Mr. Wade H. Ellis, attorney general; Mr. E. T. Humes, prosecuting attorney; Mr. E. M. Wickham and Mr. H. Kenneth Rogers, for the State.
    The Valentine law, sections 4, 5, 6 and 7, do not contravene the provisions of either the federal constitution or the constitution of Ohio.
    The affirmative of this proposition we maintain.
    The sections declared by the circuit court to be unconstitutional are 4, 5, 6 and 7.
    On reading the opinion of the circuit court,* it appears that its decision was based on the theory that the law is unconstitutional because it is in general restraint of trade, and makes criminal an act of making an agreement or contract in partial restraint of trade, which is legal at common law.
    It is a sufficient answer to the argument above that the Valentine act affirmatively recognizes partnerships, corporations, and other associations of persons, with their incidents, as legal entities, by naming them in the first section of the act in defining a trust, and also in section 7.
    An additional answer is that such agreements are not within the statute. Courts never construe an act to be within the prohibition of'a statute merely because it comes within the terms of the statute. When a statute is penal it is not enough to make an act criminal that is within the mere terms of the statute; it must come within the logic, reason and spirit of the statute; it must be within the motives and purposes of the legislators. People v. Utica Insurance Co., 15 Johns., 358.
    
      The Valentine act never intended to prohibit and make criminal the formation of partnerships, corporations, or joint stock companies, or to prohibit snch organizations from making any. agreement about their production and prices.
    The reasons given by the circuit court to sustain its decision, in the main, are the same as those given by counsel in their arguments to show that the act is unconstitutional, in all the cases under the federal law, known as- the Sherman anti-trust act, and the anti-trust laws of other states.
    We cite the cases of State v. Smiley, 69 Pac. Rep., 199, decided by the supreme court of Kansas, in which was involved the question of the constitutionality of an act precisely the same as the Valentine law; indeed, it appears from a comparison of the two, that the Valentine law is a copy of the Kansas statute. Domats, Rules; Dwar. St., 138.
    And in answer to the argument of counsel against the constitutionality of the law, the Kansas court expressed itself in this vigorous language: “It is certainly competent for the legislature to make penal the doing of that which the courts themselves recognize as hurtful to the body politic, and for-that reason to refuse to countenance. The legislature of 1897 did that; nor did it do anything more. It is no argument to launch the platitudes of personal liberty, and freedom of contract, and due process of law, etc., against this statute. What specific prohibition does' it contain that the common law has not contained for ages past? Absolutely none. :
    Another reason for holding the act unconstitutional the circuit court said: ‘ ‘ There can be no legal injury to the public, unless there be legal injury to some individual or class of individuals, from the act which is the object of the agreement or combination,” and the case of State ex rel. v. Buckeye Pipe Line Co., 61 Ohio St., 520, is cited to sustain the proposition. There can be no doubt of the correctness of the principle, but it can have no application to the case, except on the assumption that such matters as the formation of partnerships, the organization of corporations and joint stock companies, the sale of the good will of a business concern, and other acts mentioned by the circuit court are within the provisions of the Valentine law. We have already shown that such acts are not within the spirit of the statute, and, therefore, not within its prohibition; the state of Ohio in this case did not prosecute Gage for being a member of a partnership, or for assisting in the organization of a corporation, or joint stock company, or for the sale or purchase of the good will of any business concern, or for making any contract or agreement that is valid at common law; no such case was before the court; and all that was said by the circuit court in its opinion on that head does not exceed in importance the merest obiter dictum.
    
    A corporation has the same right and freedom of contract that an individual possesses, unless it is limited by its charter or the laws that create it; the contracts of a corporation in restraint of trade, or in restriction of competition would be as hurtful to the public, as those of an individual; no substantial difference in their effect could be discovered ^therefore, the law would be equally applicable to both, and the language of the Supreme Court in State v. Buckeye Pipe Line Co., 61 Ohio St., 520, is applicable in any case in which, individuals combine to restrain trade or to restrict competition in business.
    It was held by the circuit court that the Valentine law is an infringement on the freedom of contract. The liberty, or freedom of contract is guaranteed by both our state and federal constitutions. There is no difference in meaning in the guarantee of our state constitution and that of our federal constitution. Section 1 of article 1 of our state constitution is substantially the same as section 1 of article 14 of the constitution of the United States; it was intended to be the same, but is expressed in slightly different terms. Our contention is, that if the Sherman law is a valid enactment, so is the Valentine law for the same reason; that if the federal act does not infringe upon the citizen’s rights under the federal constitution, so neither does the Valentine act conflict with the guarantee of the state constitution.
    Sections 1, 2 and 3 of the criminal part of the federal anti-trust law, are just as drastic and comprehensive in their scope as sections 4, 5, 6 and 7 of the Valentine law. If the ■ liberty of contract is infringed upon by those sections of the. Valentine law, so it is by the first three sections of the federal act. The federal statute prohibits all combinations and contracts, no matter what form they may assume, that are in restraint of trade or commerce among the states, and also prohibits a monopoly of such trade or commerce. The Valentine act prohibits combinations whose purpose is the restraint of trade, or the limiting of competition. The objects of both statutes are the same. The one applies to interstate commerce only, the other to commerce among the citizens of the state of Ohio.
    
      The close relationship of these two laws was recognized in State ex rel. v. Buckeye Pipe Line Co. And to support this view Judge Shauck in that case cites United States v. Trans-Missouri Freight Assn., 166 U. S., 290; United, States v. Joint Traffic Assn., 171 U. S., 505; and United States v. Pipe & Steel Co., 85 Fed. Rep., 271, and he further observed in substance, that the fact that the federal act was limited to interstate commerce, was not material.
    In explicit language the United States Supreme-Court held that the Sherman law did not conflict with any of the provisions of the federal constitution, and was a valid enactment. Frisbie v. United States, 157 U. S., 160.
    Our own Supreme Court, on several occasions, has. expressed itself on the subject of competition in trade. Salt Co. v. Guthrie, 35 Ohio St., 666; State ex rel. v. Standard Oil Co., 49 Ohio St., 137.
    To those who are afflicted with the delusion that, competition may be ruinous to business; that business and trade combinations and trusts are a blessing to the country, because they, temporarily, or permanently, have reduced the prices of some commodities we recommend a perusal of the opinion of the Supreme Court of the United States in the Trans-Missouri case, supra. People v. Sheldon, 139 N. Y., 251; s. c. 34 N. E. Rep., 785.
    After reviewing all the authorities on the question, in our humble judgment the conclusion is irresistible that the Valentine act does not violate the-provisions of either the state or federal constitution. If the Sherman anti-trust law is constitutional, we-repeat, for the same reason the Valentine law is •valid; and the constitutionality of the federal act. can not now be questioned. It was held constitutional by the court in United States v. Addyston Pipe & Steel Co., supra, and tbe judgment of that court was affirmed by tbe Supreme Court in 175 U. S. S. C. Rep., 210, and after a modification of the decree to make it apply only to interstate commerce. The Sherman law has been sustained on constitutional grounds by not less than fifty federal authorities, in addition to the cases above cited.
    
      Mr. George W. Carpenter and Mr. H. W. Jewell, attorneys for defendant in error.
    The indictment simply alleged that defendant was a member of an association without describing in any manner the nature or character of the association. The word “association” is defined in Anderson’s Dictionary of Law as follows: “1. The act or state of. being joined in common interest. 2. An organization of persons without a charter, for business, humanity, charity, culture, or other purposes; any unincorporated society or body.” Among other definitions of a partnership the same author gives the following: “An association for the purpose of prosecuting any lawful business, formed by contract between two or more persons.” This definition is taken from Payne v. Thompson, 44 Ohio St., 204. And in the Standard Dictionary the terms “association” and “partner-ship” are considered synonymous.
    ■"'•The legal effect of the charge in the indictment -:fbMéfóre is not different than it would have been if -it‘had'charged specifically that the defendant was a member of a partnership and that the purpose in forming the partnership was to prevent competition among its members.
    We contend that the statute, 93 O. L., 143, insofar as it creates criminal offenses and prescribes punishment therefor, is in violation of the first section of the fourteenth amendment to the federal constitution and of section 1, article 1 of the constitution of Ohio: Because it makes it a crime to enter into contracts which have always been regarded as embraced within those inalienable rights essential to the liberty of the citizen.
    It is made criminal for two or more persons to combine as partners, corporations or otherwise in ordinary business affairs to prevent competition between themselves, to limit their production or to increase or reduce the price of their commodities. The practical effect of the statute is to prohibit and make criminal all associations for business purposes. The act defines a trust as follows: “A trust is a combination of capital, skill or acts by two or more persons, firms, partnerships, corporations or association of persons, or of any two or more of them, for either, any or all of the following purposes.” (93 O. L., 143.)
    In penal and criminal laws a combination is “a coalition, union, mutual agreement, or other blending for any purpose whatever.” Anderson’s Dictionary of Law, 196.
    A partnership is “the combination, by two or more persons, of capital, labor or skill, for the purpose of business for their own benefit.” Parsons on Partnership (3 ed.), 6; 1 Lindley on Partnership (4 ed.), 3; Anderson’s Dictionary of Law, 750.
    
      What the statute regards as a “purpose” within the meaning of the act is clearly indicated by the provisions of section 5, where the words “purposes” and ‘ ‘ effects ’ ’ are used in the same sense. If there be infraction of the law the intention to break the law must be inferred. * * * A man must' be taken to have had the intention implied from the act. Broome’s Legal Maxims (7 ed.), 307.
    A man is presumed to intend the necessary and natural consequences of his own act. If therefore the effect of every combination is necessarily and naturally to prevent competition, the law must infer that such was the purpose of the combination, and it matters not whether this was the main purpose, a subsidiary purpose or only a necessary consequence. Bishop on Criminal Law, sec. 337.
    There is no possible escape from the obvious and self-evident proposition that any association in business prevents competition among the persons associated and that, if prevention of competition is made .criminal, association is made impossible. Prevention of competition is a purpose or effect of every copartnership, joint stock association, or corporation. It is a purpose or effect of every contract, agreement or understanding by which men associate or co-operate. In re Grice, 79 Fed. Rep., 642.
    We also cite upon this point the brief of counsel for defendant in State ex rel. v. Buckeye Pipe Line Co., 61 Ohio St., 520, which is directly applicable to this case and contains a most able and exhaustive argument upon the questions involved.
    Moreover, agreements are frequently made between two or more persons to form a corporation, partnership or other business association for the express purpose of preventing competition Between them. Such agreements are sometimes made for the purpose of creating a monopoly in which case they are clearly illegal and void and may he prohibited. Ford v. Chicago Milk Shippers’ Association, 155 Ill., 166; Harding v. American Glucose Co., 182 Ill., 551; 55 N. E. Rep., 577; People v. Milk Exchange, 145 N. Y., 267; Richardson v. Buhl, 77 Mich., 632.
    Sometimes such agreements are made for the express purpose of preventing competition, but without any intent to create a monopoly or to unreasonably restrain trade, in which case they are valid and binding agreements. Oakdale Mfg. Co. v. Garst, 18 R. I., 484; Meredith v. New Jersey Zinc & Iron Co.,. 55 N. J. Eq., 211.
    Counsel for the State contend that members of partnerships, corporations and other business associations are not within the prohibitions of the law, for the reason that the “act affirmatively recognizes, partnerships, corporations and other associations, of persons, with their incidents, as legal entities, by-naming them in the first section of the act in defining a trust, and also in section 7. ’ ’ This position is. untenable, and is neither supported by reason nor authorities. On the contrary, it is in direct conflict, with the authorities above cited.
    If the formation of a corporation does not create-such a legal entity as will have the effect of exempting its members from the prohibitions of the law either in their agreements to form the corporation, or those made in the conduct of their business after-wards, does it not necessarily follow that a partnership is not such a legal entity as will exempt its. members from the operation of the law? Corporations have always been regarded as legal entities for many purposes, but partnerships have been so regarded for but few.
    The validity of the anti-trust law of Illinois has recently been passed upon by the Supreme Court of the United States in a case in which it was claimed that it was invalid by reason of discriminations which deprived citizens of the equal protection of the law; and the court held the act unconstitutional. Connolly v. Union Sewer Pipe Co., 184 U. S., 540; 46 Law. Ed., 679.
    ■ When we consider the radical and extreme provisions of this act, is it reasonable to suppose that the legislature did not intend to prevent the creation of a monopoly under whatever form and in whatever manner it might be attempted? The conclusion seems irresistible that the legislature intended the prohibitions of the act to apply to members of corporations, partnerships and other associations.
    The right to form partnerships and to make all reasonable contracts in reference to the conduct of their business has always been recognized by the common law. And contracts of members of partnerships, corporations and other business associations not to compete in the same business in which ■ such associations were engaged, and contracts not to compete made by the parties for the purpose of protecting the good will of the business, which are reasonable and not injurious to the public or other individuals have always been held valid.
    Contracts between partners not to compete in any business have also been sustained. Matthews v. Associated Press of New York, 136 N. Y., 333.
    
      The right to enter into-contracts which are not injurious is comprehended within- the inalienable rights of the citizen; and any statute which deprives the citizen of such right is unconstitutional and void. Palmer et al. v. Tingle, 55 Ohio St. 423; 2 Eddy on Combinations, sec. 658 on page 676 and note 1, also secs. 903, 904, 905 and 906; In re Grice, 79 Fed. Rep., 627.
    The act is unconstitutional' because it makes it a crime for two or more persons to enter into, execute, or carry out agreements, and to do other acts, which are not injurious to the public or to other individuals.
    We have heretofore been considering the right of citizens to make lawful contracts, which has always been held to come within the protection of the constitution. But the right to make lawful contracts is not the limit of the liberty guaranteed the citizen. The liberty guaranteed is unlimited, except so far as it may be found necessary to restrain it for the general welfare. Tiedeman on Limitations of Police Power, 68.
    The right of the legislature to pass laws restraining the liberty of the citizen and making his acts criminal is limited. The power to restrain the citizen in the exercise of absolute personal liberty to do whatever he may choose arises from the necessity of protecting the public and other individuals in the enjoyment of their rights, and is limited by such necessity. Tiedeman on Limitations of Police Power, sec. 1, also page 196; Palmer et al. v. Tingle, 55 Ohio St., 423; 2 Eddy on Combinations, see. 681.
    The legislature cannot under the pretense of exercising the police power, or under any other claim or pretense enact laws, prohibiting harmless acts not concerning the health, safety, or welfare of society, and the courts may examine into and annul such illegal legislation. Railway Co. v. Jacksonville (City), 67 Ill., 37; State ex rel. v. Buckeye Pipe Line Co., 61 Ohio St., 520; Ruhstrat v. People, 185 Ill., 133.
    If an act is injurious only when done at a certain place or under certain circumstances, and is not injurious when done elsewhere or under different circumstances, the place where or the circumstances under which the act is done are, if the act is injurious, essential elements of the injury, and must be made the grounds of the prohibition. State v. Speyer, 67 Vt., 502; In re Ah Jow, 29 Fed. Rep., 181.
    The statute prohibits agreements of every kind and description made for any such purpose. Anderson’s Dictionary of Law, 45.
    The word “agreement” is undoubtedly used in that sense in the statute as “contracts,” and “obligations” are previously mentioned.
    The statute, therefore prohibits an ag’reement between two farmers to hold their farm1 products until the market price shall reach a certain figure; an agreement between two merchants to ship together in .order to secure car load rates; and numerous others of a like character, from which no reasonable apprehension of injury can arise. Niagara Fire Insurance Co. v. Cornell, 110 Fed. Rep., 816.
    The language of the statute is plain and unambiguous. It comprehends within' the same terms, without discrimination, acts which are injurious and acts which are not injurious. Contracts and agreements, the terms of which are in all respects identical, the innocent or injurious character of which depends entirely upon the circumstances under which they are made, are embraced within the same provisions of the statute. In the face of this declaration, how is the court to determine that the legislature intended to prohibit some acts of agreements of the character mentioned but not others ? It either prohibits all or none. It is an undoubted rule of construction that, where the language used in the statute is capable of two interpretations, one of which would render the act invalid and the other not, such interpretation should be adopted as would sustain' the act. But that rule clearly has no application here. The same words can not be held to have different significations when applied to different contracts and agreements which are in terms identical.
    We submit that none of the acts or agreements mentioned by us can.be exempted from the operations of the law under established or recognized rules of construction. On the contrary, to exempt them would be in direct violation of all such rules. United States v. Fisher, 2 Cranch, 358; Schooner Paulina’s Cargo v. The United States, 7 Cranch, 52; United States v. Freeman, 3 H., 556; McPherson v. Blacker, 146 U. S., 1; State v. Peck, 25 Ohio St., 26; Brower et al. v. Hunt et al., 18 Ohio St., 312; Endlich on Interpretation of Statutes, sec. 180; State v. Smiley, 69 Pac. Rep., 199.
    We do not question the well recognized rule that where some of the provisions of an act are valid and others invalid, and the different provisions are separable the entire act will not be held invalid. To give effect to this rule, however, that which is constitutional and that which is unconstitutional must be capable of separation so that each may be read by itself, and so that the constitutional provisions would be capable of enforcement with the language used in the unconstitutional portions entirely eliminated. United States v. Reese, 92 U. S., 214; Baldwin v. Franks, 120 U. S., 678; Daggett v. Hudson, 43 Ohio St., 548; City of Canton v. Nist, 9 Ohio St., 439.
    It is no argument to inveigh against trusts and monopolies. We do not question the authority of the legislature to prohibit them and to make it penal for persons to enter into them. Neither do we claim that the legislature is without authority to prohibit and make penal acts which are in fact injurious to the public whether they were or were not so considered at the common law. But as shown above they must be clearly injurious. Our contention is that the statute under consideration fails to discriminate between acts which are injurious and those which are not, and comprehends both within the same terms and makes both alike criminal. 2 Eddy on Combinations, secs. 901, 902.
    Where, as in this case, the acts within the terms of the statute may be either innocent or injurious, the fact which distinguish them as injurious must be alleged in the indictment. 1 Eddy on Combinations, sec. 433, last clause; Fouts v. State, 8 Ohio St., 98.
   Shauck, J.

The material provisions of the statute under which the defendant was convicted are in substance as follows:

‘ ‘ Section 1. Be it enacted by tl%e General Assembly of the State of Ohio, That a trust is a combination of capital, skill or acts by two or more persons, firms, partnerships, corporations or associations of persons, or of any two or more of them for either, any or all of the following purposes:

“1. To create or carry out restrictions in trade or commerce.

“2. To limit or reduce the production, or increase, or reduce the price of merchandise or any commodity.

“3. To prevent competition in manufacturing, making, transportation, sale or purchase of merchandise, produce or any commodity.

“4. To fix at any standard or figure, whereby its price to the public or consumer shall he in any manner controlled or established, any article or commodity of merchandise, produce or commerce intended for sale, barter, use or consumption in this state.

“5. To make or enter into or execute or carry out any contracts, obligations or agreements of any kind or description by which they shall bind or have bound themselves not to sell, dispose of or transport any article or any commodity or any article of trade, use, merchandise, commerce or consumption below a common standard figure or fixed value, or by which they shall agree in any manner to keep the price of such article, commodity or transportation at a fixed or graduated figure, or by which they shall in any manner establish or settle the price of any article, commodity or transportation between them or themselves and others, so. as to directly or indirectly preclude a free and unrestricted competition among themselves, or any purchasers or consumers in the sale or transportation of any such article or commodity, or by which they shall agree to pool, combine or directly or indirectly unite any interests that they-may have connected with the sale or transportation of any such article or commodity, that its price might in any manner be affected. Every such trust as is defined herein is declared to be unlawful, against public policy and void.”

The second section relates to proceedings in quo warranto in case of the violation of the act. The third section relates to foreign corporations. The fourth section is as follows:

“Section 4. Any violation of either or all of the provisions of this act shall be and is hereby declared a conspiracy against trade, and any person who may become engaged in any such conspiracy or take part therein, or aid or advise in its commission, or who shall as principal, manager, director, agent, servant or employer, or in any other capacity, knowingly carry out any of the stipulations, purposes, prices, rates, or furnish any information to assist in carrying out such purposes, or orders thereunder or in pursuance thereof, shall be punished by a fine of not less than fifty ($50) dollars nor more than five thousand ($5,000) dollars, to be imprisoned not less than six months nor more than one year, or by both such fine and imprisonment. Each day’s violation of this provision shall constitute a separate offense. ’ ’

The fifth section relates to practice and the sixth to evidence in the prosecution. The ninth section is as follows:

“Section 9. That the provisions hereof shall be held cumulative of each other and of all other laws in any way affecting them now in force in this state.”

We have the benefit of the carefully considered opinion of the circuit court which conducted it to the conclusion that the conviction was erroneous, and this conclusion is supported by elaborate arguments by counsel for the defendant in error. It is clearly shown that there are contractual rights with reference to the use of one’s property and faculties which the general assembly is powerless to destroy, that a valid enactment to prohibit the.making of contracts must be within the police power, and that to be within that power the prohibited contract must be hurtful to the public, and hurtful in a legal sense. That view of the subject has been taken by this court in many cases, and in State ex rel. Attorney General v. The Buckeye Pipe Line Co., 61 Ohio St., 520, we applied it to this statute, concluding, nevertheless, that the inhibition involved in that case is valid.

Effective illumination of the present case may be promoted by concentrating the rays of light which have been diffused upon it. Two propositions comprehend all that has been urged against the validity of the conviction in the court of common pleas. They are that the act is void because its terms do not except from its prohibitions contracts, acts and transactions which are protected by the constitution, and that the indictment is fatally defective because its allegations do not exclude them. Obviously that which is not within the terms of an inhibition need not be excepted from it. Confining our view to the provisions of the act upon which the validity of the conviction in. the present case depends, it is quite .clear that they do not prohibit any contract or transaction which according to the view of the subject taken in State ex rel. Attorney General v. The Buckeye Pipe Line Co., the general assembly .may not prohibit in the exercise of the police power. The Delaware Coal Exchange, as its purpose is defined in the indictment, is a trust within both the third and fourth subdivisions of the first section of the act, and that section defines the combinations which the act prohibits. The purposes named in these subdivisions do not relate to any contract with respect to the use of one’s property or his faculties. They are purposes which made contracts void at common law as being opposed tó public policy, which, according to legal views which still prevail,' requires that the conditions of competition be maintained. They are also within the combinations which were prohibited by many ancient statutes. By the use of the distributive terms, “either, any or all,” these purposes are as completely separated as though each subdivision constituted the subject of a different statute and the ninth section of the act provides that all of the provisions shall be held cumulative of each other and of all other laws now affecting the subject. There is, therefore, in the terms of the act authority for the conclusion that the general assembly intended to prohibit combinations for the purposes mentioned in the subdivisions of the first section severally, and to its operation it is only necessary that the particular contract or transaction charged in the indictment be within one of the subdivisions of the first section and that it be a contract or transaction which it is competent for the general assembly to prohibit. In view of these distributive terms and of the ninth section giving an independent and cumulative relation to the different provisions of the act, the language employed requires that the act be interpreted as though the subdivisions of the first section were severally followed by the provisions of the fourth, fifth, sixth and seventh sections which prescribe prohibitions and penalties aud which the circuit court held to be unconstitutional. The case, therefore, offers no opportunity for the' application of the principle urged with vigor and supported by the citation of numerous authorities that where an act contains an indivisible prohibition whose terms include contracts which the legislature is powerless to prohibit the courts cannot save the act by restricting the natural and obvious meaning of its terms. It may be conceded that the principle is sound and that it derives sufficient support from the consideration that, in the cases to which it applies, it prevents the substitution of the judicial for the legislative department of the government.

But it is said that the third subdivision of the first section, “to prevent competition in manufacturing, making, transportation, sale or purchase of merchandise, produce or any commodity,” is void because it would prevent the formation of partnerships and corporations to conduct business, the sale of property which has been used in competition and other like inalienable rights, because of the abatement in competition which would result therefrom, and that this conclusion is so obvious that argument in its support is unnecessary. Brief attention to the development of the law upon the subject will show that argument to that end would be unavailing rather than unnecessary. So long recognized and so frequently applied in the same jurisdictions that their congruity must be admitted are the doctrines that every contract in restraint of trade is void if nothing else appears; but nevertheless, that property used in the competition of trade may be sold, including the good will of the vendor’s business, and that to effectuate the sale of the good will the vendor may make a valid stipulation to abstain from competition if the stipulation is limited to that purpose; and courts of equity have even required members of a co-partnership to abstain from the conduct of a rival business. ' In short, the courts have uniformly denounced' contracts in restraint of trade unless the restraint results as an incident from the use of one’s property and his faculties. The distinction is of easy grasp and it is too late to question its importance. Within the limits of the present case, it is obvious that the effect of the statute is to prohibit affirmatively such contracts and transactions as were previously unlawful, but which could be so adjudged only when the aid of the courts was invoked for their enforcement.

It must be obviously unavailing to urge the constitutionally protected right to make contracts with reference to one’s property and his faculties as an objection to a statute which does not prohibit or restrain the power of making such contracts.

Examination of the numerous cases cited in the briefs shows that legislation having the same object as this and making similar, if not identical, prohibitions has been quite generally sustained as a valid exercise of legislative power. The prohibitions of. the statute of Kansas upon the subject do not differ from those of the present statute in any substantial respect, though we are not informed that it contains the provision of the ninth section of the Ohio act. In the State v. Smiley, 65 Kan., 240, a conviction under the statute was held valid and the judgment of the supreme court of Kansas in that case was affirmed by the Supreme Court of the United States at the October term, 1904. The opinion of the latter court is before us, but in the absence of an authorized syllabus we cannot know to what extent the case should be regarded as authority here. In the opinion the judgment is placed upon two grounds: that the federal court is bound by the interpretation which the state court had given to the statute, although it was alleged to be repugmant to the federal constitution, and that the interpretation of the state court was correct. The case can, of course, .be regarded as an authority only to the extent to which the opinions of the concurring judges were influenced by the belief that the statute had been correctly interpreted by the state court. In support of the conclusion that the conviction in the court of common pleas was proper we think no further additions need be’made to what was said in the case of the State ex rel. Attorney General v. The Buckeye Pipe Line Co.

Judgment of the circuit court reversed and that of the common pleas affirmed.

Davis, C. J., Price, Crew, Summers and Spear, JJ., concur.