§ 133. $141. Where Subject to Congres sional Control. 142. Application of the Rule to the Telephone. 143. Power to Regulate in Case of Patented Property. 144. Application of the Rule to the Baking Business. 145. Application of the Rule to the Laundry Business. 146. Immunity from Governmental Control. 147. A Business Juris Publici Distinguished from a Business Juris Privati. Introduction. It is well established that private corporations, so far as the public has an interest in their business, are subject to governmental control. In certain branches of business, as that of a railroad corporation or telegraph company, a work of a public character is committed to a private corporation. During the earlier periods of English history, the highways were laid out and constructed directly by the government. The government assumed the direct and sole management and control of the public roads. The carrying on of this business was recognized as an essential function of the government. In the grant of a railroad franchise this prerogative is committed to a private corporation. But in carrying on a work of this character, through the instrumentality of a private corporation, the government does not surrender its power of control of the work. It may make such regulations, including the fixing of a maximum rate of transportation, or of freight, as may be demanded by the interests of the public, and it may do whatever else is required by the public welfare, unless its power in this regard has been surrendered in the grant of a charter. In the leading case of Munn v. Illinois, before the Supreme Court of the United States, the general doctrine relating to governmental control of private corporations is stated at length. It was held that under the powers inherent in every sovereignty, a government may regulate the conduct of its citizens toward each. other, and, when necessary for the public good, the manner in which each shall use his own property. It has, in the exercise of these powers, been customary in England, from time immemorial, and in this country, from its first colonization, to regulate ferries, common carriers, hackmen, bakers, millers, wharfingers, innkeepers, etc., and, in so doing, to fix a maximum of charge to be made for services rendered, accommodations furnished and articles sold. Down to the time of the adoption of the fourteenth amendment of the Constitution of the United States, it was not supposed that statutes regulating the use, or even the price of the use, of private property, necessarily deprived an owner of his property without due process of law. Under some circumstances they may, but not under all. The amendment does not change the law in this particular; it simply prevents the States from doing that which will operate as such deprivation. When the owner of property devotes it to a use in which the public has an interest, he, in effect, grants to the public an interest in such use, and must, to the extent of that interest, submit to be controlled by the public, for the common good, as long as he maintains the use. He may withdraw his grant by discontinuing the use. Rights of property, and to a reasonable compensation for its use, created by the common law, cannot be taken away without due process; but the law itself, as a rule of conduct, may, unless constitutional limitations forbid, be changed at the will of the legislature. The great office of statutes is to remedy defects in the common law as they are developed, and to adapt it to the changes of time and circumstances. The limitation by legislative enactment of the rate of charge for services rendered in a public employment, or for the use of property in which the public has an interest, establishes no new principle in the law, but only gives a new effect to an old one.1 In the case of Railroad Com 1 Munn v. Illinois, 94 U. S. 113. In the course of the opinion in this case, Chief Justice Waite uses this language: "This brings us to inquire as to the principles upon which this power of regulation rests, in order that we may determine what is within and what is without its operative effect. Looking, then, to the common law, from whence came the right which the constitution protects, we find that when private property is affected with a public interest, it ceases to be juris privati only.' This was said by Lord Chief Justice Hale, more than two hundred years ago, in his treatise, De Portibus Maris, 1 Harg. Law Tracts, 78, and has been accepted without objection as an essential element in the law of property ever since. Property does become clothed with a public interest when used in a manner to make it of public consequence, and affect the community at large. When, therefore, one devotes his property to a use in which the public has an interest, he, in effect, grants to the public an interest in that use, and must submit to be controlled by the public for the common good, to the extent of the interest he has thus created. He may withdraw his grant by discontinuing its use; but, so long as he maintains its use, he must submit to the control. Thus, as to ferries, Lord Hale says, in his treatise, De Jure Maris, 1 Harg. Law Tracts, 6, the king has ‘a right of franchise or privilege that no man may set up a common ferry for all passengers without a prescription time out of mind, or a charter from the king. He may make a ferry for his own use, or the use of his family, but not for the common use of all the king's subjects passing that way, because it doth, in consequence, tend to a common charge, and is become a thing of public interest and use, and every man, for his passage, pays a toll, which is a common charge, and every ferry ought to be under a public regulation, viz.: that it give attendance at due times, keep a boat in due order, and take but a reasonable toll, for if he fail in these he is finable.' So if one owns the soil and landing places on both banks of a stream, he cannot use them for the purposes of a public ferry, except upon such terms and conditions as the body politic may from time to time impose, and this because the common good requires that all public ways shall be under the control of the public authorities. This privilege or prerogative of pany v. Davis, the rule is expounded, as follows: "Upon the supposition that the legislature may take the property to the public use, it is next said that this taking is not legitimate, because the property is bestowed on private persons. It is true that this is a private corporation; its outlays and emoluments being individual property; but it is constituted * the king, who in this connection only represents and gives another name to the body politic, is not primarily for his profit, but for the protection of the people and the promotion of the general welfare. And, again, as to wharves and wharfingers, Lord Hale, in his treatise, De Portibus Maris, already cited, says: A man, for his own private advantage may, in a port or town, set up a wharf or crane, and may take what rates he and his customers can agree for cranage, wharfage, housellage, pesage, for he doth no more than is lawful for any man to do, viz.: makes the most of his own. * If the king or subject have a public wharf, unto which all persons that come to that port must come and unlade or lade their goods as for the purpose, because they are the wharfs only licensed by the queen, or because there is no other wharf in that port, as it may fall out where a port is newly erected; in that case there cannot be taken arbitrary and excessive duties for cranage, wharfage, pesage, etc., neither can they be enhanced to an immoderate rate; but the duties must be reasonable and moderate, though settled by the king's license or charter. For now the wharf and crane and other conveniences are affected with a public interest, and they cease to be juris privati only, as if a man set out a street in new building on his own land, it is now no longer bare private interest, but is affected by a public interest.' This statement of the law by Lord Hale was cited with approbation, and acted upon by Lord Kenyon at the beginning of the present century, in Bolt v. Stennett, 8 T. R. 606. And the same has been held as to warehouses and warehousemen. In Aldnutt v. Inglis, 12 East, 527, decided in 1810, it appeared that the London Dock Company had built warehouses in which wines were taken in store at such rate of charge as the company and the owners might agree upon. Afterwards the company obtained authority, under the general warehousing act, to receive wines from importers before the duties upon the importation were paid; and the question was, whether they could charge arbitrary rates for such storage, or must be content with a reasonable compensation. Upon this point Lord Ellenborough said (p. 537): There is no doubt that the general principle is favored, both in law and justice, that every man may fix what price he pleases upon his own property, or the use of it; but if for a particular purpose the public have a right to resort to his premises and make use of them, and he have a monopoly in them for that purpose, if he will take the benefit of that monopoly, he must, as an equivalent, perform the duty attached to it on reasonable terms. The question then, is, whether, circumstanced as this to effect a public benefit by means of a road, and that is publici juris. In earlier times there seems to have been a necessity upon governments, or at least it was a settled policy with them, to effect everything of this sort by the direct and sole agency of the government. The highways were made by the public, and the use was accordingly free company is, by the combination of the warehousing act with the act by which they were originally constituted, and with the actually existing state of things in the port of London, whereby they alone have the warehousing of these wines, they be not, according to the doctrine of Lord Hale, obliged to limit themselves to a reasonable compensation for such warehousing. And, according to him, whenever the accident of time casts upon a party the benefit of having a legal monopoly of landing goods in a public port, as where he is the owner of the only wharf authorized to receive goods which happens to be built in a port newly erected, he is confined to take reasonable compensation only for the use of the wharf.' And further on (p. 539) 'It is enough that there exists in the place and for the commodity in question, a virtual monopoly of the warehousing for this purpose, on which the principle of law attaches, as laid down by Lord Hale in the passage referred to [that from De Portibus Maris already quoted] which includes the good sense as well as the law on the subject,' and in the same case Le Blanche, J.. said (p. 541) Then admitting these warehouses to be private property, and that the company might discontinue the application of them, or that they might have made what terms they pleased in the first instance, yet having, as they now have, this monopoly, the question is, whether the warehouses be not private property clothed with a public right, and, if so, the principle of law attaches upon them. The privilege, then, of bonding these wines being at present confined by the act of Parliament to the company's warehouses, is it not the privilege of the public, and shall not that which is for the good of the public attach on the monopoly, that they shall not be bound to pay an arbitrary but reasonable rent? But upon this record the company resist having their demand for warehouse rent confined within any limit,' and though it does not follow that the rent in fact fixed by them is unreasonable, they do not choose to insist on its being reasonable for the purpose of raising the question. For this purpose, therefore, the question may be taken to be whether they may claim an unreasonable rent. But though this be private property yet the principle laid down by Lord Hale attaches upon it, that when private property is affected with a public interest it ceases to be juris privati only; and, in case of its dedication to such a purpose as this, the owners cannot take arbitrary and excessive duties, but the duties must be reasonable.' We have quoted thus largely the words of these eminent expounders of the common law, because, as we think, we find in them the principle which supports the legislation |