Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1888-08-18
RAILROADS,
5HEY ARE PRIVATE NOT PUBLIC
CORPORATIONS.
Extent of State Authority Over
Them, also Private Rights Which
Cannot Be Impaired.
Herbert B. Turner in Christian Union

Railway companies are private and not
public corporations. They hold certain
powers and grants from the State, in con-
sideration Of which the original incorpo-
rators furnished money and built the roads
These powers and grants are held in trust
for certain purposes. The charters are
contracts made between the incorporators
and the State, and the rights, obligations
and duties on each side are in law we'll
settled and defined.
A railroad charter is granted by the
sovereign people, represented in the Legis-
lature. They are under no obligation to
grant Il, and presumably will not unless
they are to derive some benefit from it. On
granting It they may impose any condi-
tions they please. They may even provide
that the business shall always be so con-
Quoted as to be agreeable to the Knights
OF Labor-that all questions between en-
ployer and employee shall be submitted to
arbitration, and that the State may at any
time take possession of the property as its
own; and then the applicants may deter
mine whether they will accept the grant
and invest their money in it on those
terms or not. But conditions cannot be
imposed after the grant is made. 1t is well
to bear all this in mind when we grow
FESTIVE under the power of our corpora
tions, and regret that such conditions were
not imposed when the right to impose
them existed These bodies have fixed and
vested rights. We may buy them if the
owners will sell. We may built parallel
lines ofour ownif We are willing to pay what
they cost. But we cannot annul the char
tors and take possession of the roads for
ourselves, any more than we can appro-
pirate 70 our own use any other kind of
private property.
Bat some one viii say: Are not rail-
roads public highways and the companies
agents of the State p" Let us not be de-
ceived by words. These expressions are
responsible for much wild theorizing on
the subject Of railroads. Let us see what
they mean.
The right of taking private property for
oar compensation in suitable cases is an
attribute Of sovereignty. But it can only
be taken for public use Very early the
question arose whether such right to take
property could be delegated to a private
railroad corporation. Obviously, that could
not be done unless the use were public
one. But the very fact that the right is
exercised unchallenged shows that the
operation of a railroad is admitted to be a
public use of property. And the use is a
public one because such a road is hiqh-
wdy, whether constructed by the Govern
ment personally or through individuals to
whom the trust is delegated. The func-
tion performed by a railroad is one of
sovereignty, no matter whether the State
perform it through its own officers or dele
gate the franchise to Others The Legis-
lature grants to corporations the right to
build, o'Cn, and operate these highways
the right to perform its own functions in
that regard. But the State, having done
so, cannot revoke the grants and seize and
operate the property ITSELF You may call
the railroad highway, but remember that
the ownership and operation of it is en-
tirely in the hands of a private corpora
ton, and no one can tray ell upon it except
under the corporations rules. You may
call the relation TO the State an agency,
but do not forget that the term thus APP
piled simply means that the corporation
is intrusted with some of the attributes of
the sovereign power. No agency in the
ordinary acceptation of the term exists.
The State does not own, nor is it operating,
the road. 1t is not a principal, liable for
the obligations of the business. Nor is
the road a public highway in any sense
that would recognize the public as having
any larger interest than the right to travel
and send freight, and, in their corporate
capacity, general right of supervision.
When the State charters a railroad COM
papy, it gives to it certain powers and
rights, and imposes upon it certain duties.
The corporation, so far as ownership is
concerned, is altogether private, and the
management of it becomes vested in such
officers or agents as the stockholders and
Directors, under existing laws choose to
appoint. In one sense it may be regarded
as trading private corporation, but this
condition in 10 way conflicts with the obi
cations Of the company to the public. On
the contrary, there is every reason why
the whole working should be harmonious
When the incorporators avail themselves
of their charter, they accept trust from
the people, and it becomes their duty to
perform certain public functions, as COM
mon carriers of freight and passengers. In
performing these functions they receive
their remuneration, and they have there
fore, every impulse to perform them
promptly and efficiently. They agree to
build the road, not in day or week, but
in z reasonable time. The same principle
of reasonahleness applies to their other
contract obligations. If every employe
of road should desert it, and refuse to
perform any service, the company would
not necessarily lose its charter 1t would
be doing its full duty if it supplied their
places as rapidly as circumstances would
allow. The good faith of the company
would be matter to be determined, not
by board of politicians dubbed arbitra-
tors, with perhaps officials of opposing
lines as members, bound by little law and
knowing less, but by Court of Equity.
Railroads have gone very far in recog-
nizing a right on the part of the State to
exercise broad supervisory powers. The
Constitution reserves to the Federal Gov
eminent a right to regulate commerce
among the several States, and the COM
panies have thus far submitted to the di-
rection of a National Board, without STOP
ping to ask any judicial tribunal to con-
strue the meaning of that disputed clause
and settle the limits of the power which ii
reserves. The authority of State Com
missioners is universally respected not
withstanding many display of ignorance
and incompetence. And now, because
snch assertions Of power are quietly sub
mitted TO, we are in danger of thinking
that there is no limit to our authority,
and forgetting fundamental facts and
principles, both as to the limits of our
governmental powers and the rights Of
railroad companies.
Railroad property is just as sacred, just
as much entitled to protection, as any
other kind of property. As you cannot
wholly confscate it, so you cannot par
tally DO so by forcing upon the companies
any change in their management which
you think will be beneficial to employees
All you can demand is that the contract
between the people and the company be
property fulfilled. If you are dissatisfied,
and think the company does not perform
its full duty, you can appeal to the Courts,
and have the company compelled to sup
ply every deficiency. You are out Of
place in the Legislature, and if you go
there the Courts must finally settle every
matter of dispute.
l. j Ill.