The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1892-12-26
PACIFIC TAIL WINS.

Judge Ingraham of New York has the
reputation of being sound lawyer, but If
his decision in the Panama case is good law,
laymen know less Of the general principles
of trade than they supposed. The facts are
very simple.
twenty years ago the Panama Railroad
Company ran a line of steamers to and from
its terminals on the two oceans to adjacent
ports. Desiring to secure a monopoly Of
that traffic, the Pacific Mail Company bought
the steamers owned by the railroad company,
and. with them. the good will of the latter in
the coastwise trade from and to Colon and
Panama. Under this arrangement the Pa
cfic Mail enjoyed monopoly of that trade;
the railroad refused TO make with other
steamship lines terms which would have
| enabled them 20 compete. This arrangemet
lasted for twenty years, aud under 1t the
grip which the Pacific Mail Company
got on the istbmus traffic enabled it to enter
| the transcontinental pool and gain sub
sidy from the railroads which fell but little
short of million a year. Some months
ago the members of The transeonunental
pool. in consequence Of the new competi-
ton created by the traffic association, con-
cluded that they would not continue to pay
the subs idy. Not long afterward the
Panama Railroad board of directors an
nounced that they would run line of
steamers OF their own in opposition to the
| Pacific Mail. which had so long diverted
| trade from this city. They went further,
! and notified the latter that they wOlld not
recognize its through way bills after a GER
tain date. To this challenge the Pacific
! Mail re,orted 10y applying 10 a New York
| court for an injunction forbiddng the
! Panama company from departing from tile
| terms of the bargain it is alleged TO have
made in 1872 1t is that injunction which
| Judge Ingraham has decided TO sustain.
pendeute LIE.
The mercantile community will regard
| the decision as unfolding t'te doctrine that
a bargain made in restraint OF IL end In
support Of a monopoly may be yalR. "a law.
! This appears 10 be contrary 10 the funda-
mental principles Of the common law, and
! in fat contradiction of the spirit Of the
| interstate commerce act IL railroad can
discriminate between two maritime car
riers, and transport goods fer one at lower
rates than it charges the other, so that the
latter is driven out of business, direct
attack IS made upon the freedom Of mari
| time trade.
Judge Ingraham says that the Pacific
Mail Company bought "the good wilT' of
|
from and to Colen aud Panama. But
had the railroad any good will TO sell? II
certainly did not own the Atlantic oil
Pacific oceans 1t owned nothing but a
line Of communication between the two
| oceans. Had it a right TO say that, in con-
sideration of a sum OF money, it would give
to one maritime carrier an exclusive right
of using its road TO the exclusion of al
other maritime carriers? II IL had. the
public are grossly ignorant of the general
principles which govern channels Of com
municati0n aud transportation.
A hundred years ago the law recognized
monOpoles and exclusive rights Grea
Britain limited the foreign ports with which
the colonies could trade. Spain forbade
Mexico aud her other American colonie:
from buying goods from any European
country. except Spain herself. But it has
been generally supposed that these law:
rested on doctrines which have become
obsolete, and that no nation at the presen
day can claim a monopoly of any genera
| avenue of commerce 10 the exclusion OF
ton which is creature of national legisla
ton.
The text of Judge Ingraham's decision hal
not come to hand. 1t will be interestin.
to note the reasoning by which it is sus
tanned. The public at large are clear tina
no interOeeanic railroad or canal ought 4
be conceded the actual ownership of il,
works 10 such a sense that it can grant The
use Of them to one carrier and deny il tC
others. If under the present laws suel
ownership is justified. il is the law. as vel
as the Panama Company's contracts, which
requires revision.