The San Francisco call., 1896-11-18
Now Engaged in Putting the
Finishing Touches on the
Manuscript.
FOUR BIG POINTS INVOLVED.
One of the Leading Law Journals
Roasts District Attorney Foote
for His Course.

United States circuit CourC VIII manu-
down his decision in the case of the South
ern Pacific Company against the Board of
Railroad Commissioners of the State OF
California.
He has been at work on this for some
time past, and his labors are now about
concluded. The decision will be one of
the longest rendered by any court in Cali
fornia.
This suit, involving some of the most
important and interesting questions ever
brought before tribunal. was instituted
early in October, 1885, went to trial on the
10th of December of the same year, and
was submitted for decision May 20 of this
year. The action was brought to prevent
the Railroad Commission from reducing
the grain rates of the complainant 8 per
cent.
1t was contended on the part of the cor
pora tion that certain language in section
% of article XII of the State constitution,
defining the powers and duties of the
commission, rendered that body uncon-
stitutional. The language complained OF
is as follows:
''In all controversies, civil or criminal,
the rates of tares and freig hts established
by said commission shall be deemed con-
clusively just and reasonable"
1t was urged that this virtually gave the
commission contiscatory powers.
1t was also contended by the COMPLAIN
ant that the proposed per cent reduction
on grain rates was unjust and unreason-
able.
On the part of the State, represented by
Attorney General Fitzgerald, ex-Judge
Hayne and w. w. Foote, it was argued
that complainant had no standing in
court; first, because its leases of the lessor
be-
Pacific Company were void, as corporation
franchises granted by Congress or by a
Legislature could not be transferred with
out the consent of the granting power,
and, second, because the consolidation of
ali the interests of these lessor CORPORA
tions was, in violation of section 20 of
article XII of the State constitution
which provides as follows:
No railroad company or common carrier
shall com bine or make any contract with the
owners OF any vessel that leaves port or makes
port in this State, or with any common carrier,
by which com bination or contract the earn
ings OF one doing the carrying are TO be shared
by The other not doing the carrying
Judge McKenna has, therefore, four
great points to decide. Are the leases of
the railroad companies held by the
Southern Pacific Company valid, in view
of the laws requiring the sanction of the
grantors in making transfers of properties
operated under franchises9 Is the
Southern Pacific Company a legally CON-
stitutec corporation. In view of the State
constitutional provision against com bina-
tions by common carrier corporations? Is
the Railroad Commission constitutional
body? Are the grain rates esta ablished by
the com mission Just and reasonable?
The real merits OF the issue lie in the
latter proposition, and before the court
comes to this 1t will have to pass on the
other three questions in the order men,
toned. What most concerns the people
OF California, however, is the status of
the commission, for should all the other
questions be decided in favor of the rail-
road company and the constitutionality
of the corn mission upheld there would
still remain the machinery for bringing
relief TO the shippers of the State.
Ii is the general i'm mpressiop among the
legal pro ession who either heard or read
the arguments in the case that the con-
stituIionality of the commission will be
sustained.
This impression is largely due to the
stand taken and remarks made by the
court during the argument OF Attorney
General Fitzgerald. The Attorney-Gen-
eral argued that if the provision of the
State constitution declaring all rate fixed
by the commission to be "conclusively
Just and reasonable" is in conflict with
the fourteenth amendment of the consti-
tuition of the United States such provision
of the section upheld. He was citing
cases to illustrate this point when the
court interrupted, saying:
General. the principle you are con-
tending for is not denied, SO it
is hardly worth while TO take up time in
reading those decisions"
Widespread attention throughout the
United States has been given to this case.
and the decision of Judge McKenna is
awaited with deep curiosity among the
legal fraternity. In speaking of the case.
and particularly of the intervention OF the
United States to protect its interests in the
Central Pacific Railroad Company. the
American Law Review, one of the leading
publications of Its class in the United
States, in its issue Of January February.
1885, said:
1t is needless to say that public opinion in
California almost unanimously condemned
this move on the part of the nfted States Dis
trict Attorney, and statements were freely
made in the California lay press TO the effect
that the bill OF intervent ton had been con.
cocted In the law oh1ce OF the Southern Pacific
Company.
further along the Review says:
1t would seem that a sincere purpose on the
part OF the law officers of the United States to
right the wrong done to the United Sta ties and
to prevent interference by the State OF Cali
fornia with the rights of the United States
would lead them TO bring the proper action to
dissolve tb is ultra wires lease 1.-THE lie. Sc OF the
Central Pacific Railroad Company to the
Southern Pacific Company, and 10 rehabili.
tate the directors OF the Central Pacific Rail
road Company in the possession of their own
properties and in the discharge of their public
duties.
In its later issue of May-June, 1896, the
Review, referring again 10 the interven
tion of United States District Attorney
Foote says il was .'nominally on behalf
of the United States, but really make
weight for the railroad company" Con-
tinuing it comments as follows:
The arguments of Acknowledgement Fitzger-
aid and his colleague, ex-Judge Hayne, are
SAID 10 nave been most convincing. The argU.
ments, taken together, are said to comprehend
the most thorough and exhaustive presenta-
ton OF the laws relating to the organization
ana existence, earnings and rights of trans
portaton, rights and Liabilities of the Central
racine Railroad Company and the Southern
Pacific Company of Kentucky, alias the ..octo-
pus, that has ever, or Will ever be, presented
in any court.
Referring to ''the lease of the Central
PACING Railroad TO the Kentucky mon
strosity the article concludes as follows:
II the Department of Justice had shown one
tenth of the alacrity in favor of the rights of
a tota c1ubi ioh TT