Vermont watchman and State journal. [volume] (Montpelier, Vt.) 1836-1883, 1881-08-17
State Regulation OF Railroads.

An exchange, noticing an article in the
July North american Reuiew upon the above
topic, written by Mr.. j. M. Mason, says truly
that it throws a good deal of light on the
question whether thestate has therightto reg
ulate railway charges. 1t is one of the main
arguments of the railroad managers that the
management of railroad is business, in
no way different from any other business;
that the question Of charges should be de-
cided by the law of supply and demand,
regulated by natural competition and that
for the state to interfere with this natural
method of regulating charges is as indefen-
sible as state interference with any other
kind of business would be. In other words,
it is urged that the state has no more right to
say at what price bushel of wheat shall be
carried than to say at what price it shall be
sold. This is certainly plausible state
ment of the case, and the author of the arti-
Gle referred to labors to show that it is
fallacious and untenable.
After showing that, merely as a corpora
tion, railway company differs in no respect
from any other corporation, Mr.. Mason says
that in order to determine the powers and
immunities of railway we must ascertain
the specific rights conferred on it by legisla-
tive charter. These rights are rights Of
public property as distinguished from rights
OF private property, and are two in number
the eminent domain, or the power to take
private property for public use without con-
sent of the owner, and the right to take toll.
1t is this second right with which the arti-
Gle is mainly concerned. The allegation
that a railway is purely a business, and its
charges to be regulated by business princi-
pies, rests on the assumption that the rail
way is private property, and the charge
made and paid is a consideration for the
use Of such private property by other per
sons. But the legal view of the case, Mr.
Mason urges, is that the railroad is high
way, and as such public property, and that
the charge demanded and paid is strictly
and emphatically toll. If this latter view
is sound law, it follows as matter of course
that the state may and should fix the
maximum of these tolls. But even in iti
capacity of common carrier, Mr.. Masor
holds that the railroads charges are subject
to the state. The carrier, according to law
may name his own price AT his peril if il
is unreasonable, he is liable for damages
Whether it is unreasonable or not is a ques
tion for judicial decision, but it is compe
tent for the legislature to pass a schedule o
rates which will be obligatory on the court
as rule of evidence.
But it is further urged by the railroad
that their charters are of the nature of
contract, and cannot be impaired by subse
quent state legislation about charges. MI
Mason replies that the statutes which con
ferred the charter consist OF two clauses
first, the gift of the right to take toll an,
secondly, Legislative declaration of tn
amount OF toll to be considered reasonable
The point at issue has never been decided
but it is competent for the courts to hole
, in the present state of the law, that the gil
of the right to take toll is contract whic
cannot be impaired by subsequent legisli
/, ton, but that the schedule is only rule G
evidence, and as such may be modified a
the discretion of the legislature
In conclusion, the author makes this pra'
tical application of his views
/. As the amount Of toll is within the discretio
Of the sovereign, the aim should be TO make thi
Q discretion ~ WISE as intelligent, and as enligh
a ened as possible. The people OF this country wi
never abandon the tme-honored doctrine OF ii
J. common law, that toll must be reasonable, and ii
n true danger Is that the legislature not ben
properly advised, will err in the wrong direction
s and by making the rates unreasonaby low, pa
alyze this important branch OF industry. Raj
. roads have far more To fear from honest gnoran,
i than from that enlightened statesmanship whiC