The San Francisco call., 1896-12-20
A Flank Attack Made on the
Legal Status of the
Corporation.
LEASES HELD BY IT CLAIMED
TO BE INVALID.
The Combination Said He Is in Vio-
lation of Both the State and
Federal Constitutions.

1t was only demurrer filed by Attor-
ney-General Fitzgerald in the United
States Circuit Court yesterday in the case
OF the Southern Pacific Company against
the Board of Railroad Commissioners of
California. But in that document ques-
tions are raised of the most vital impor-
tance TO the complainant.
The original suit was brought to enjoin
the Railroad Commission from enforcing
its schedule of freights reducing grain
rates per cent.
In the preliminary decision rendered by
Judge McKenna these grain rates were
declared to be unreasonable, and the
temporary injunction granted when the
suit was instituted was ordered to con-
tinue until the case was tried on its
merits.
1t was generally anticipated that the
next step of the Railroad Commission
would be to make a thorough investiga-
ton of the affairs of the complainant cor
poration before Judge McKenna, in order
10 prove that the per cent reduction in
grain rates was just and reasonable.
The filing OF the demurrer Yesterday
came as complete surprise to all not in
the confidence of the heAttorDey-GeneraI.
there is any question of equity to be de-
cided, but claims that the matter should
be iitigated only when any attempt is
made to enforce the Objectionable action
of the Com missioners.
1t is claimed that the action of the COM
mission is legislative and not subject to
review by anv court; that any violation
of the rates fixed by the commission is
criminal matter and not subject to re-
straint by 4 court of equity.
1t is denied that the complainant is
railroad or that it is Empowered to operate
any of the railroads mentioned in its bill
of complaint. 1t is further charged that
all the leases made to the Southern Pacific
, Com pany' are Invalid, and that therefore
the complainant cannot legally concern
itself with the question how any of the
lessor roads would be affected by the
commissions action.
The complainant is charged with icing
an unlawful com bination created in viola
lation of both the State and Federal con-
stitutions. The full text of this inter-
esting demurrer follows:
And now cone the defendants, bv protesta-
ton, and not confessing or acknowledging all
or any OF the matters or things in the bill of
complaint, either as originally filed or as sub
sequently amended, to be true in such manner
ana form as the same are herein set forth
demur to said bill, and for causes of demurrer
show:
That it appears by the complainanrs own
showing as by the said bill amended. that
complainant IS not entitled to the relief prayed
for by the bill against the defendants, or to
any relief.
II.
That said bill, as amended, shows no equity
and does not state facts sufficient to constitute
a cause OF complaint, or to entitle the said
complainant to any relief in equity. And
these defendants specify the particular
grounds OF the cause of demurrer as follows:
l. That 1T appears by the complainant's own
showing, by said bill amended, that there
is no adequate remedy at law for any and all
of the matters and things set forth IN said
bill as amended, TO wit, the remedy of setting
and litgating any and all OF said matters
and things and by way of any defense to
any proceeding or proceedings which may be
brought to enforce the regulations of the
Board OF Railroad Commissioners set forth
in said bill, or to enforce either of such reso-
lutions, or any schedule Or schedules made or
served in pursuance of said resolutions, or
either of them, or 10 enforce any rates of fare
or freights fixed by said board, or to any
proceeding or proceedings which may be
brought against said complainant b. reason
of or based upon any matter or thing averred
in said bill, either as originally filed or
amended;
2 Tina. it appears by the compainants own