Source: https://caselaw.findlaw.com/us-supreme-court/271/583.html
Timestamp: 2019-04-19 19:22:34+00:00

Document:
[271 U.S. 583, 584] Mr. Max Thelen, of San Francisco, Cal., for plaintiffs in error.
[271 U.S. 583, 585] Mr. Carl I. Wheat, of San Francisco, Cal., for defendant in error.
This case involves the constitutional validity of the Auto Stage and Truck Transportation Act of California (Statutes of California 1917, p. 330, c. 213), as construed and applied to plaintiffs in error by the state Supreme Court. The specific challenge is that, as so construed and applied, it takes their property for public use without just compensation, deprives them of their property without due process of law, and denies them the equal protection of the laws, in violation of the Fourteenth Amendment to the federal Constitution. The act provides for the supervision and regulation of transportation for compensation over public highways by automobiles, auto trucks, etc., by the Railroad Commission. The term 'transportation company' is defined to mean a common carrier for compensation over any public highway between fixed termini or over a regular route. By section 3(a) no corporation or person is permitted to operate any automobile, auto truck, etc., 'for the transportation of persons or property as a common carrier for compensation on any public highway in this state between any fixed termini ... unless a permit has first been secured as herein provided.' Permits are issued upon application by the incorporated city or town, city and county, or county within or through which the applicant intends to operate. By section 4, the Railroad Commission is empowered to supervise [271 U.S. 583, 590] and regulate such transportation companies, and to fix their rates, fares, charges, classifications, rules, and regulations, and generally, to regulate them in all matters affecting their relationship with the traveling and shipping public. Section 5 requires, in addition to the permit, that the applicant must obtain from the Railroad Commission a certificate declaring that public convenience and necessity require the exercise of such right or privilege, and it provides that the commission may attach to the exercise of the rights granted such terms and conditions as in its judgment the public convenience and necessity may require. Operation under a permit without such certificate is prohibited. In 1919, the act was amended (Statutes 1919, c. 280. p. 457), so as to bring under the regulative control of the commission automotive carriers of persons or property operating under private contracts of carriage, and the term 'transportation company' was enlarged so as to include such a carrier. It was further provided that no such transportation company shall operate for compensation over the highways without first having secured from the commission a certificate of public convenience and necessity so to do.
It is very clear that the act, as thus applied, is in no real sense a regulation of the use of the public highways. It is a regulation of the business of those who are engaged in using them. Its primary purpose evidently is to protect the business of those who are common carriers in fact by controlling competitive conditions. Protection or conservation of the highways is not involved. This, in effect, [271 U.S. 583, 592] is the view of the court below plainly expressed. 240 P. 26.
That, consistently with the due process clause of the Fourteenth Amendment, a private carrier cannot be converted against his will into a common carrier by mere legislative command, is a rule not open to doubt, and is not brought into question here. It was expressly so decided in Michigan Commission v. Duke, 266 U.S. 570 , 577,578, 45 v. Duke, 266 U.S. 570, 577 , 578 S., 45 also, Hissem v. Guran, 112 Ohio St. 59, 146 N. E. 808; State v. Nelson, 65 Utah, 457, 462, 238 P. 237. The naked question which we have to determine, therefore, is whether the state may bring about the same result by imposing the unconstitutional requirement as a condition precedent to the enjoyment of a privilege, which, without so deciding, we shall assume to be within the power of the state altogether to [271 U.S. 583, 593] withhold if it sees fit to do so. Upon the answer to this question, the constitutionality of the statute now under review will depend.
It would be a palpable incongruity to strike down an act of state legislation which, by words of express divestment, seeks to strip the citizen of rights guaranteed by the federal Constitution, but to uphold an act by which the same result is accomplished under the guise of a surrender of a right in exchange for a valuable privilege which the state threatens otherwise to withhold. It is not necessary to challenge the proposition that, as a general rule, the state, having power to deny a privilege altogether, may grant it upon such conditions as it sees fit to impose. But the power of the state in that respect is not [271 U.S. 583, 594] unlimited, and one of the limitations is that it may not impose conditions which require the relinquishment of constitutional rights. If the state may compel the surrender of one constitutional right as a condition of its favor, it may, in like manner, compel a surrender of all. It is inconceivable that guaranties embedded in the Constitution of the United States may thus be manipulated out of existence.
'While we concede the right of a state to exclude foreign corporations from doing business within its borders for reasons not destructive of federal rights, we deny that the right can be made to depend upon the sur- [271 U.S. 583, 597] render of the protection of the federal Constitution, which secures to alien citizens the right to resort to the courts of the United States.
Since that decision, the same principle has been reiterated many times and never departed from. Pullman Co. v. Kansas, 216 U.S. 56, 63 , 30 S. Ct. 232; International Text-Book Co. v. Pigg, 217 U.S. 91 , 30 S. Ct. 481, 27 L. R. A. (N. S.) 493, 18 Ann. Cas. 1103; Herndon v. Chi., R. I. & Pac. Ry., 218 U.S. 135, 158 , 30 S. Ct. 633; Harrison v. St. L. & San Francisco R. R., 232 U.S. 318, 332 , 34 S. Ct. 333, L. R. A. 1917F, 1187; Looney v. Crane Co., 245 U.S. 178, 187 , 38 S. Ct. 85; International Paper Co. v. Massachusetts, 246 U.S. 135, 142 , 143 S., 38 S. Ct. 292, Ann. Cas. 1918C, 617; Western Union Tel. Co. v. Foster, 247 U.S. 105, 114 , 38 S. Ct. 438, 1 A. L. R. 1278; Public Utility Commrs. v. Ynchausti & Co., 251 U.S. 401, 404 , 40 S. Ct. 277; Terrall v. Burke Constr. Co., supra; Burnes Nat. Bank v. Duncan, 265 U.S. 17, 24 , 44 S. Ct. 427; Fidelity & Deposit Co. of Maryland v. Tafoya et al., 270 U.S. 426 , 46 S. Ct. 331 (decided March 15, 1926).
'But, if we assume that the plaintiffs in error under their present charters could be excluded from the streets, [271 U.S. 583, 599] the consequence would not follow. Acts generally lawful may become unlawful when done to accomplish an unlawful end (United States v. Reading Co., 226 U.S. 324, 357 , 33 S. Ct. 90), and a constitutional power cannot be used by way of condition to attain an unconstitutional result (Western Union Telegraph Co. v. Kansas, 216 U.S. 1 , 30 S. Ct. 190; Pullman Co. v. Kansas, 216 U.S. 56 , 30 S. Ct. 232; Sioux Remedy Co. v. Cope, 235 U.S. 197, 203 , 35 S. Ct. 57. The regulation in question is quite as great an interference as a tax of the kind that repeated decisions have held void. It cannot be justified 'under that somewhat ambiguous term of police powers."
The court below seemed to think that, if the state may not subject the plaintiffs in error to the provisions of the act in respect of common carriers, it will be within the power of any carrier, by the simple device of making private contracts to an unlimited number to secure all the privileges afforded common carriers without assuming any of their duties or obligations. It is enough to say that no such case is presented here, and we are not to be [271 U.S. 583, 600] understood as challenging the power of the state, or of the Railroad Commission under the present statute, whenever it shall appear that a carrier, posing as a private carrier, is in substance and reality a common carrier, to so declare and regulate his or its operations accordingly.
'In the latter case the power to exclude altogether generally includes the lesser power to condition and my justify a degree of regulation not admissible in the former.' 264 U.S. 145 (44 S. Ct. 259).
The questions involved relate solely to matters of intrastate commerce. No complication arises by reason of the power of Congress to regulate interstate commerce. Having built and paid for the roads, California certainly has the general power of control. Plaintiffs in error are without constitutional right to appropriate highways to their own business as carriers for hire. And if, in so [271 U.S. 583, 603] many words, the Legislature had said that no intrastate carriers for hire except public ones shall be permitted to operate over the state roads it would have violated no federal law. So far as the rights of plaintiffs in error are affected, nothing more serious than that has been done.

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