The contention that the act in question is valid because it is within the scope of the police power of the state cannot be sustained. Allgeyer v. Louisiana, 165 U. S. 578, 41 L. ed. 832; Chicago, B. & Q. R. Co. v. Nebraska, Omaha, 170 U. S. 57, 42 L. ed. 948. Messrs. Fred A. Maynard, and Henry C. Smith, in proper person, for defendant in error:

The legislature of a state has the power to fix said rates, and the extent of judicial interference is protection against unreasonable rates.

either directly through an act of the legisla-
ture or indirectly through a commission,
reasonable maximum freight and passenger
rates upon traffic wholly within their bor.
ders.

Chicago, B. & Q. R. Co. v. Iowa, 94 U. S.
155, 24 L. ed. 94; Peik v. Chicago & N. R.
Co. 94 U. S. 164, 24 L. ed. 97; Chicago, M. &
St. P. R. Co. v. Ackley, 94 U. S. 179, 24 L.
ed. 99; Illinois C. R. Co. v. Illinois, 108 U. S.
541, 27 L. ed. 818; Railroad Commission
Cases, 116 U. S. 307, 29 L. ed. 636; Dow v.
Beidelman, 125 U. S. 680, 31 L. ed. 841, 2
Inters. Com. Rep. 56.

Chicago & G. T. R. Co. v. Wellman, 143 U. S. 344, 36 L. ed. 179; Stone v. Farmers' Loan & T. Co. 116 U. S. 307, 29 L. ed. 636; *Mr. Justice Peckham, after stating the[686] Chicago, M. & St. P. R. Co. v. Minnesota, facts, delivered the opinion of the court: 134 U. S. 418, 33 L. ed. 970, 3 Inters. Com. *The only subject of inquiry for us in this[687] Rep. 209; New York & N. E. R. Co. v. Bris-case is whether the act of the legislature of tol, 151 U. S. 567, 38 L. ed. 273. the state of Michigan violates any provision of the Federal Constitution. It is not within cur province to review the decision of the suact violates the Constitution of the state. The two questions of a Federal nature that are raised in the record are, (1) whether the act violates the Constitution of the United States by impairing the obligation of any contract between the state and the railroad company; and (2) if not, does it nevertheless violate the Fourteenth Amendment of the Constitution by depriving the company of its property or liberty without due process of law or by depriving it of the equal protection of the laws; if we should decide that this act violates any provision of the Fourteenth Amendment it would be unnecessary to examine the question whether there was any contract between the state and the company as claimed by it. We will therefore first come to an investigation of the legislative authority with reference to that amendment.

Railroad corporations are subject to the legislative control in all respects necessary to protect the public against danger, injus-preme court upon the question whether the tice, and oppression.

Nashville, C. & St. L. R. Co. v. Alabama, 128 U. S. 96, 32 L. ed. 352, 2 Inters. Com. Rep. 238; Georgia R. & Bkg. Co. v. Smith, 128 U. S. 174, 32 L. ed. 377; Minneapolis & St. L. R. Co. v. Beckwith, 129 U. S. 26, 32 L. ed. 585; Dent v. West Virginia, 129 U. S. 114, 32 L. ed. 623; Charlotte, C. & A. R. Co. v. Gibbes, 142 U. S. 386, 35 L. ed. 1051; Minneapolis & St. L. R. Co. v. Emmons, 149 U. S. 364, 37 L. ed. 769; Wabash, St. L. & P. R. Co. v. Illinois, 118 U. S. 586, 30 L. ed. 254, 1 Inters. Com. Rep. 31.

The right to regulate, to some extent, the business of railroads has always been conceded.

Chicago & A. R. Co. v. People, Koerner, 67 Ill. 11, 16 Am. Rep. 599; Com. v. Eastern R. Co. 103 Mass. 254, 4 Am. Rep. 555; Chicago & N. W. R. Co. v. Fuller, 17 Wall. 560, 21 L. ed. 710; New York v. Miln, 11 Pet. 139, 9 L. ed. 662; Munn v. Illinois, 94 U. S. 125, 24 L. ed. 84; Covington & C. Bridge Co. v. Kentucky, 154 U. S. 215, 38 L. ed. 967, 4 Inters. Com. Rep. 649.

The police power is paramount to contracts in charters.

Kansas P. R. Co. v. Mower, 16 Kan. 573; Nelson v. Vermont & C. R. Co. 26 Vt. 717, 62 Am. Dec. 614; Lyman v. Boston & W. R. Corp. 4 Cush. 288; Pratt v. Atlantic & St. L. R. Co. 42 Me. 579; Norris v. Androscoggin R. Co. 39 Me. 273, 63 Am. Dec. 621; Bulkley v. New York & N. H. R. Co. 27 Conn. 479; Louisville & N. R. Co. v. Kentucky, 161 U. S. 700, 40 L. ed. 859; Butchers' Union S. H. & L. S. L. Co. v. Crescent City L. S. L. & S. H. Co. 111 U. S. 746, 28 L. ed. 585; East Hartford v. Hartford Bridge Co. 10 How. 511, 13 L. ed. 518.

In Stone v. Farmers' Loan & T. Co. 116 U. S. 307, 29 L. ed. 636, it is decided that the right of a state to reasonably limit the amount of charges by a railroad company for the transportation of passengers and property within its jurisdiction cannot be granted away by its legislature, unless by word of positive grant or words equivalent in law.

The several states have a right to fix,

If unhampered by contract there is no doubt of the power of the state to provide by legislation for maximum rates of charges for railroad companies, subject to the condition that they must be such as will admit of the carrier earning a compensation that under all the circumstances shall be just to it and to the public, and whether they are or rot is a judicial question. If the rates are fixed at an insufficient amount within the meaning of that term as given by the courts, the law would be invalid, as amounting to the taking of the property of the company without due process of law. Chicago & Grand Trunk Railway Company v. Wellman, 143 U. S. 339, 344 [36: 176, 179]; Reagan v. Farmers' Loan & Trust Company, 154 U. S. 362, 399 [38: 1014, 1024, 4 Inters. Com. Rep. 560]; St. Louis & 8. F. R. Company v Gill, 156 U. S. 649 [39: 567]; Smyth v. Ames, 169 U. S. 466, 523 [42: 819, 841].

The extent of the power of the state to legislate regarding the affairs of railroad companies has within the past few years been several times before this court. Wabash, St. L. & P. R. Company v. Illinois, 118 U. S. 557 [30: 244, 1 Inters. Com. Rep. 31]; Illinois Central R. *Company v. Illinois, 163 U. S.[688] 142 [41: 107]; Lake Shore & M. S. R. Company v. Ohio, 173 U. S. 285 [ante 702], and

cases cited. These cases arose under the which is inherent in every sovereignty. As
commerce clause of the Federal Constitution, stated by Mr. Chief Justice Taney, in the
the inquiry being whether the legislation in course of his opinion in the License Cases, 5
question violated that provision. In the How. 504, 583 [12: 256, 291], in describing
cases in which the legislation was upheld it the powers of a state: "They are nothing
was on the ground that the state was but more nor less than the powers of government
exercising its proper authority under its gen- inherent in every sovereignty to the extent of
eral power to legislate regarding persons and its dominions. And whether a state passes
things within its jurisdiction, sometimes de- a quarantine law, or a law to punish offen-
scribed as its police power, and that in ex- ses, or to establish courts of justice, or re-
ercising that power in the particular cases quiring certain instruments to be recorded,
it did not violate the commerce clause of the or to regulate commerce within its own lim-
Federal Constitution by improperly regulat-its, in every case it exercises the same power;
ing or interfering with interstate commerce.
The extent of the right of the state to legis-
late was examined in these various cases-so
far, at least, as it was affected by the com-
merce clause of the Constitution of the Unit-
ed States.

In Illinois Central R. Company v. Illinois, supra, the state statute imposed the duty upon the company of stopping its fast mail train at the station of Cairo, to do which the train had to leave the through route at a point three miles from that station and then return to the same point in order to resume its journey. This statute was held to be an unconstitutional interference with interstate commerce and therefore void.

that is to say, the power of sovereignty, the power to govern men and things within the limits of its dominion."

This power must, however, be exercised in subordination to the provisions of the Federal Constitution. If, in the assumed exercise of its police power, the legislature of a state directly and plainly violates a provision of the Constitution of the United States, such legislation would be void.

eral power to legislate upon the subject of rates and charges of all carriers? It has no right even under such circumstances to take away or destroy the property or annul the contracts of a railroad company with third persons. (Greenwood v. Union Freight R. Company, 105 U. S. 13, 17 [26: 961, 964]; Commonwealth v. Essex Co. 13 Gray, 239; People v. O'Brien, 11 N. Y. 1, 52 [2 L. R. A. 255]; Detroit v. Detroit & H. Plank Road Company, 43 Mich. 140.)

The validity of this act is rested by the counsel for the defendant in error upon the proposition that the state legislature has the power of regulation over the corporation created by it, and in cases of railroad corporations, the same power of regulation and In Lake Shore & M. S. R. Company v. also full control over the subject of rates to Ohio, supra, a statute of the state of Ohio be charged by them as carriers for the transrequired the company to stop certain of its portation of persons and property. Assum‍[690] trains at stations containing 3,000 inhabiting that the state is not controlled by conants for a time sufficient to receive and let tract between itself and the railroad comoff passengers, and the statute was held to pany, the question is, How far does the au be a valid exercise of legislative power and thority of the legislature extend in a case not an improper interference with interstate where it has the power of regulation, and commerce. In the course of the opinion of also the right to amend, alter, or repeal the the court, which was delivered by Mr. Jus-charter of a company, together with a gentice Harlan, it was said that "the power, whether called police, governmental, or legislative, exists in each state, by appropriate enactments not forbidden by its own Constitution or by the Constitution of the United States, to regulate the relative rights and duties of all persons and corporations within its jurisdiction, and therefore to provide for the public convenience and the public good. This power in the states is entirely distinct from any power granted to the general government, although when exercised it may 389]sometimes *reach subjects over which national legislation can be constitutionally extended." And again, speaking of cases involving state regulations more or less affecting interstate or foreign commerce, it was said that these cases "were sustained upon the ground that they were not directed against nor were direct burdens upon interstate or foreign commerce; and having been enacted only to protect the public safety, the public health, or the public morals, and having a real, substantial relation to the public ends intended to be accomplished thereby, were not to be deemed absolutely forbidden because of the mere grant of power to Congress to regulate interstate and foreign commerce, but to be regarded as only incidentally affecting such commerce, and valid until superseded by legislation of Congress on the same subject."

The police power is a general term used to express the particular right of a government

A railroad company, although a quasi public corporation, and although it operates a public highway (Cherokee Nation v. Southern Kansas Railway Company, 135 U. S. 641 [34: 295]; Lake Shore & M. 8. Railway Co. v. Ohio, 173 U. S. 285, 301 [ante, 702], has nevertheless rights which the legislature cannot take away without a violation of the Federal Constitution, as stated in Smyth v. Ames (169 U. S. 466, 544 [42: 819, 848].) A corporation is a person within the protection of the Fourteenth Amendment. Minneapolis & St. L. R. Co. v. Beckwith, 129 U. S. 26 [32: 585]; Smyth v. Ames, 169 U. S. 522, 526 [42: 840, 842]. Although it is under governmental control, that control must be exercised with due regard to constitutional guarantees for the protection of its property.

The question is presented in this case whether the legislature of a state, having power to fix maximum rates and charges for the transportation of persons and property by railroad companies, with the limita

tions above stated, and having power to al-
ter, amend, or repeal their charters, within
certain limitations, has also the right, after
having fixed a maximum rate for the trans-
portation of passengers, to still further reg.
ulate their affairs and to discriminate and
make an exception in favor of certain per-
sons, and give to them a right of transporta-
tion for a less sum than the general rate
provided by law.

It is said that the power to create this exception is included in the greater power to fix rates generally; that having the right to establish maximum rates, it therefore has 7891]power to lower those rates, in certain cases and in favor of certain individuals, while maintaining them or permitting them to be maintained at a higher rate in all other cases. It is asserted also that this is only a proper and reasonable regulation.

ant in error that the act is a mere regulation of the public business, which the legislature has a right to regulate, and its apparent object is to promote the convenience of persons having occasion to travel on railroads and to reduce for them the cost of transportation; that its benefit to the public who are compelled to patronize railroads is unquestioned; that it brings the reduction of rates of two cents per mile within the reach of all persons who may have occasion to make only infrequent trips; and that there is no reason why the legislature may not fix the period of time within which the holder of the ticket shall be compelled to use it. The reduction of rates in favor of those purchasing this kind of a ticket is thus justified by the reasons stated.

only of the persons who may travel on the
road, while refusing such alleged conven-
ience to all others, nor is the right to obtain
tickets for less than the general and other-
wise lawful rate to be properly described as
a convenience. If that were true, the grant-
ing of the right to some portion of the pub-
lic to ride free on all trains and at all times
might be so described. What is covered by
the word "convenience," it might be difficult
to define for all cases, but we think it doès
not cover this case. An opportunity to pur-
chase a thousand-mile ticket for less than
the standard rate we think is improperly
described as a convenience.

The right to claim from the company transportation at reduced rates by purchasIt does not seem to us that this claim is ing a certain amount of tickets is classed as well founded. We cannot regard this excep- a convenience. As so defined it would be tional legislation as the exercise of a lesser more convenient if the right could be right which is included in the greater one claimed without any compensation whatto fix by statute maximum rates for railroad ever. But such a right is not a convenience companies. The latter is a power to make at all within the meaning of the term as a general rule applicable in all cases and used in relation to the subject of furnishing without discrimination in favor of or against conveniences to the public. And also the any individual. It is the power to declare convenience which the legislature is to proa general law upon the subject of rates be-tect is not the convenience of a small portion yond which the company cannot go, but within which it is at liberty to conduct its work in such a manner as may seem to it best suited for its prosperity and success. This is a very different power from that exercised in the passage of this statute. The act is not a general law upon the subject of rates, establishing maximum rates which the company can in no case violate. The legislature having established such maximum as a general law now assumes to interfere with the management of the company while conducting its affairs pursuant to and obeying the statute regulating rates and charges, and notwithstanding such rates it assumes to provide for a discrimination, an exception in favor of those who may desire and are able to purchase tickets at what might be called wholesale rates a discrimination which operates in favor of the wholesale buyer, leaving the others subject to the general rule. And it assumes to regulate the time in which the tickets purchased shall be valid and to lengthen it to double the period the railroad company has ever before provided. It thus invades the general right of a company to conduct and manage its own affairs, and compels it to give the use of its property for less than the general rate to those who come within the provisions of the statute, and to that extent it would seem that the statute takes the property of the company without due process of law. We speak of the general right of the company to conduct and manage its own affairs; but at the same time it is to be understood that the company is subject to the unquestioned jurisdiction of the leg[692]islature in the exercise of its power to *provide for the safety, the health, and the convenience of the public, and to prevent improper exactions or extortionate charges from being made by the company.

It is stated upon the part of the defend

The power of the legislature to enact general laws regarding a company and its af-[693] fairs does not include the power to compel it to make an exception in favor of some particular class in the community and to carry the members of that class at a less sum than it has the right to charge for those who are not fortunate enough to be members thereof. This is not reasonable regulation. We do not deny the right of the legislature to make all proper rules and regulations for the general conduct of the affairs of the company, relating to the running of trains, the keeping of ticket offices open and providing for the proper accommodation of the public.

This act is not like one establishing certain hours in the day during which trains shall be run for a less charge than during the other hours. In such case it is the establishing of maximum rates of fare for the whole public during those hours, and it is not a discrimination in favor of certain persons by which they can obtain lower rates by purchasing a certain number of tickets by reason of which the company is compelled to carry them at the reduced rate, and thus, in substance, to part with its property at a less sum than it would be otherwise entitled to

charge. The power to compel the company | ing the sale of tickets at less than the gen-
to carry persons under the circumstances as erally established rate, it can compel the
provided for in this act, for less than the company to carry certain persons or classes
usual rates, does not seem to be based upon free. If the maximum rates are too high in
any reason which has hitherto been regarded the judgment of the legislature, it may lower
as sufficient to authorize an interference with them, provided they do not make them un-
the corporation, although a common carrier reasonably low as that term is understood in
and a railroad.
the law; but it cannot enact a law making[695]
maximum rates, and then proceed to make
exceptions to it in favor of such persons or
classes as in the legislative judgment or
caprice may seem proper. What right has
the legislature to take from the company the
compensation it would otherwise receive for
the use of its property in transporting an
individual or classes of persons over its road,
and compel it to transport them free or for
a less sum than is provided for by the gen-
eral law? Does not such an act, if enforced,
take the property of the company without
due process of law? We are convinced that
the legislature cannot thus interfere with
the conduct of the affairs of corporations.

The act also compels the company to carry, not only those who choose to purchase these tickets, but their wives and children, and it makes the tickets good for two years from the time of the purchase. If the legislature can, under the guise of regulation, provide that these tickets shall be good for two years why can it not provide that they shall be good for five or ten or even a longer term of years? It may be said that the regulation must provide for a reasonable term. But what is reasonable under these circumstances? Upon what basis is the reasonable character of the period to be judged? If two years would and five years would not be reasonable, why not? And if five years would be reasonable, why would not ten? If [694]the power exist at all, what are the *factors which make it unreasonable to say that the tickets shall be valid for five or for ten years? It may be said that circumstances can change within that time. That is true, but circumstances may change within two just as well as within five or ten years. There is no particular time in regard to which it may be said in advance and as a legal conclusion that circumstances will not change. And can the validity of the regulation be made to depend upon what may happen in the future, during the running of the time in which the legislature has decreed the company shall carry the purchaser of the ticket? Regulations for maximum rates for present transportation of persons or property bear no resemblance to those which assume to provide for the purchase of tickets in quantities at a lower than the general rate, and to provide that they shall be good for years to come. This is not fixing maximum rates, nor is it proper regulation. It is an illegal and unjustifiable interference with the rights of the company.

But it may be said that as the legislature would have the power to reduce the maximum charges for all, to the same rate at which it provides for the purchase of the thousand-mile ticket, the company cannot be harmed or its property taken without due process of law when the legislature only reduces the rates in favor of a few instead of in favor of all. It does not appear that the legislature would have any right to make such an alteration. To do so might involve a reduction of rates to a point insufficient for the earning of the amount of remuneration to which a company is legally entitled under the decisions of this court. In that case reduction would be illegal. For the purpose of upholding this discriminatory legislation we are not to assume that the exercise of the power of the legislature to make in this instance a reduction of rates as to all would be legal, and therefore a partial reduction must be also legal. Prima facie, the maximum rates as fixed by the legislature are reasonable. This of course applies to rates actually fixed by that body.

There is no presumption, however, that certain named rates which it is said the legIf this power exist it must include the islature might fix but which it has not, right of the legislature, after establishing would, in case it did so fix them, be reamaximum freight rates, to also direct the sonable and valid. That it has not so fixed company to charge less for carrying freight them affords a presumption that they would where the party offering it sends a certain be invalid, and that presumption would reamount, and to carry it at that rate for the main until the legislature actually enacted next two or five or ten years. Is that an ex- the reduction. At any rate, there is no ercise of the power to establish maximum foundation for a presumption of validity freight rates? Is it a valid exercise of the in case it did so enact, in order to base power to regulate the affairs of a corpora- the argument that a partial *reduction, by[696] tion? The legislature would thus permit means of this discrimination, is therefore not only discrimination in favor of the larger also valid. And this argument also loses freighter as against the smaller one, but it sight of the distinction we made above would compel it. If the general power ex-between the two cases of a general estabist, then the legislature can direct the com-lishment of maximum rates and the enactpany to charge smaller rates for clergymen or doctors, for lawyers or farmers or school teachers, for excursions, for church conventions, political conventions, or for all or any of the various bodies that might desire to ride at any particular time or to any particular place.

If the legislature can interfere by direct

ment of discriminatory, exceptional, and par-
tial legislation upon the subject of the
sale of tickets to individuals willing and
able to purchase a quantity at any one time.
The latter is not an exercise of the power to
establish maximum rates.

True it is that the railroad company exer-
cises a public franchise and that its occupa-

174

company has voluntarily sold thousand-mile tickets good for a year from the time of their sale. What the company may choose voluntarily to do furnishes no criterion for the measurement of the power of a legislaturc. Persons may voluntarily contract to do what no legislature would have the right to compel them to do. Nor does it furnish a standard by which to measure the reasonableness of the matter exacted by the legislature. The action of the company upon its own volition, purely as a matter of internal administration, and in regard to the details of its business which it has the right to change at any moment, furnishes no argument for the existence of a power in a legislature to pass a statute in relation to the same business imposing additional burdens upon the company.

tion is of a public nature, and the public therefore has a certain interest in and rights connected with the property, as was held in Munn v. Illinois, 94 U. S. 125 [24: 84], and the other kindred cases. The legislature has the power to secure to the public the services of the corporation for reasonable compensation, so that the public shall be exempted from unreasonable exactions, and it has also the authority to pass such laws as shall tend to secure the safety, convenience, comfort, and health of its patrons and of the public with regard to the railroad. But in all this we find it neither necessary nor appropriate, in order that the legislature may exercise its full right over these corporations, to make such a regulation as this, which discriminates against it and in favor of certain individuals, without any reasonable basis therefor, and which is not the fixing of maxi- To say that the legislature has power to mum rates or the exercise of any such power. absolutely repeal the charter of the com-[698] The legislature having fixed a maximum pany, and thus to terminate its legal existrate at what must be presumed, prima facie,ence, does not answer the objection that this to be also a reasonable rate, we think the particular exercise of legislative power is company then has the right to insist that neither necessary nor appropriate to carry all persons shall be compelled to pay alike, into execution any valid power of the state that no discrimination against it in favor of over the conduct of the business of its creacertain classes of married men or families, ture. To terminate the charter and thus end excursionists or others, shall be made by the the legal life of the company does not take legislature. If otherwise, then the company away its property, but, on the contrary, is compelled at the caprice or whim of the leaves it all to the shareholders of the comlegislature to make such exceptions as it pany after the payment of its debts. may think proper and to carry the excepted In Attorney General v. Old Colony Railpersons at less than the usual and legal road Co. 160 Mass. 62 [22 L. R. A. 112], the rates, and thus to part in their favor with statute required every railroad corporation its property without that compensation to in the commonwealth to have on sale certain which it is entitled from all others, and tickets which should be received for fare on therefore to part with its property without all railroad lines in the commonwealth, etc., due process of law. The affairs of the com- and the statute was held invalid. The pre[697]pany are in this way taken out of its own cise question involved in this case was not management, not by any general law appli- there presented, and the court said it was not cable to all, but by a discrimination made necessary or practicable to attempt to deterby law to which the company is made sub-mine in that case just how far the legisla ject. Whether an act of this nature shall Le passed or not, is not a matter of policy to be decided by the legislature. It is a matter of right of the company to carry on and anage its concerns subject to the general law applicable to all, which the legislature may enact in the legal exercise of its power to legislate in regard to persons and things within its jurisdiction.

This case differs from that which has just been decided, Lake Shore & M. S. R. Company v. Ohio, 173 U. S. 285 [ante, 702]. In that case the convenience of the public in the state was the basis of the decision, regard being also had to the convenience of the public outside of and beyond the state. It included all the public who desired to ride from the stations provided for in the act, and the convenience to the people in taking a train at these stations was held by this court to be so substantial as to justify the enactment in question.

But in this case it is not a question of convenience at all within the proper meaning of that term. Aside from the rate at which the ticket may be purchased, the convenience of purchasing this kind of a ticket is so small that the right to enact the law cannot be founded upon it. It is no answer to the objection to this legislation to say that the

ture could go by way of regulating the busi-
ness of railroad companies, or just where
were the limits of its power.

The power to enact legislation of this char-
acter cannot be founded upon the mere fact
that the thing affected is a corporation, even
when the legislature has power to alter,
amend, or repeal the charter thereof. The
power to alter or amend does not extend to
the taking of the property of the corporation
either by confiscation or indirectly by other
means. The authority to legislate in regard
to rates comes from the power to prevent ex-
tortion or unreasonable charges or exactions
by common carriers or others exercising a
calling and using their property in a manner
in which the public have an interest.

In this case there is not an exercise of the power to fix maximum rates. There is not the exercise of the acknowledged power to legislate so as to prevent extortion or unreasonable or illegal exactions. The fixing of the maximum rate does not. It is a pure, bald, and unmixed power of discrimination in favor of a few of the persons having occasion to travel on the road and permitting them to do so at a less expense than others, provided they buy a certain number of tickets at one time. It is not legislation for the *safety, health, or proper convenience of the[699]