at sea.

CHAPTER VIII.

In the transportation of articles of commerce, the railroad occupies the same position on land as the vessel does As the means of intercourse, its business is commerce, and its employment is necessary to every merchant engaged in extensive operations of foreign trade.1 The increase in ownership of railroads by States has led to the insertion in a number of treaties of commerce of a clause providing for fair treatment in the matter of railway tariffs on imports and exports.2 While this is an additional precaution and doubly safeguards the commercial rights of the contracting parties, it is doubtful from the point of view of most favored nation treatment, if such special stipulations are necessary. Intercourse is as much a part of commerce as traffic, and a regulation of intercourse is a regulation of commerce. A nation therefore enjoying the privileges of most favored nation treatment in matters of commerce can justly claim upon terms of reciprocity rates as low as those extended under

1" Nor does it make any difference whether this interchange of commodities is by land or water, (see Passenger Case). In either case the bringing of the goods from the seller to the buyer is commerce." Case of the State Freight Tax, 15 Wallace, p. 232.

2"The increase in ownership of railroads by the States of Europe has rendered necessary a new clause in commercial treaties. The adjustment by the Government of railway transportation tariffs has become of like importance to the adjustment of the tariffs upon the importation of merchandise. The acquisition of trunk lines of railway by Prussia has given to that Government an important influence over the foreign commerce of AustriaHungary, much of which finds inlet and outlet across Germany." Mr. Kasson to Mr. Evarts, U. S. For. Rel. 1880, p. 48.

like conditions to any other nation. There is a difference, however, between excessive railroad charges and a tax upon exports and imports; and the remedy for one is not the remedy for the other. If a greater charge is made on the transportation of goods of foreign origin or destination than on like articles of native production when the railroad performs the same service for both, the charge would act as a duty upon imports and exports, and a return of the excess charges can be claimed under the special treaty stipulation providing for duties on imports and exports. Discriminations otherwise imposed fall under the broader and more general clause of the most favored nation.

The post, the telegraph and the telephone are established to facilitate the transmission of intelligence and are necessary instruments to commercial transactions.1 They are the carriers of messages as the railroad and the ship are carriers of goods, and are so indispensable to those engaged to any considerable extent in commercial pursuits, that charges for their use are charges upon commerce for the services rendered it. The United States Supreme Court has said of the telegraph, "The electric telegraph marks an epoch in the progress of time. In a little more than a quarter of a century it has changed the habits of business, and become one of the necessities of It is indispensable as a means of inter-com

commerce.

1 "Now, we have decided that communication by telegraph is commerce, as well as in the nature of postal service, and if carried on between States, is commerce among the several States. Leloup v. Port of Mo

bile, 127 U. S. p. 640.

2 A telegraph company occupies the same relation to commerce as a carrier of messages, that a railroad company does as a carrier of goods. Both companies are instruments of commerce, and their business is commerce itself. They do their transportations in different ways, and their liabilities are in some respects different, but they are both indispensable to those engaged to any considerable extent in commercial pursuits." Telegraph Co. v. Texas, 105 U. S. p. 460.

"

munication but especially is it so in commercial transactions. The statistics of the business before the recent reduction in rates show that more than 80 per cent of all the messages sent by telegraph relate to commerce. Goods are sold and money paid upon telegraphic orders. Contracts are made by telegraphic correspondence, cargoes secured, and the movement of ships directed. The telegraphic announcement of the markets abroad regulates prices at home, and a prudent merchant rarely enters upon an important transaction without using the telegraph freely to secure information." These remarks apply in their entirety to the post and the telephone.

The secondary instruments of commerce are those necessary for the protection of the goods and merchandise in transit from the country of their origin to the foreign market, and to secure payment for them when delivered to the purchaser. Generally speaking, they are the bill of lading, and the bill of exchange. The bill of lading is most intimately associated with the goods to which it refers, so intimately in fact, that a tax upon the bill is a tax upon the goods. In Almy v. The State of California2 it was held that: "A tax or duty on a bill of lading, although differing in form from the duty on an article shipped, is in substance the same thing; for a bill of lading, or some written instrument of the same import, is necessarily always associated with every shipment of articles of commerce from parts of one country to those of another. The necessities of commerce require it. It is hardly less necessary to the existence of such commerce than casks to cover tobacco or bagging to cover cotton, when such articles are exported to a foreign country; for no one would put his property in the hands of the ship-master, without taking written evidence of its receipt on board the vessel,

1 Pensacola Telegraph Co. v. Western, etc., Telegraph Co., 96 U. S. p. 1. 224 Howard, p. 169, affirmed by the same court in April, 1901.

and the purposes for which it was placed in his hands." The bill of exchange does not relate so particularly to imports and exports, and a tax upon the bill could not be called a tax upon the goods whose value it represents. It is, however, a necessary instrument to commerce and a fair use of it is secured by the provisions of the most favored nation clause, provided the citizens or subjects of another foreign State are permitted to employ it.

CHAPTER IX.

All commercial transactions are conducted subject to the police and inspection laws of the State where they take place. These laws are justified by the application of the maxim, salus populi suprema lex,1 which demands the enactment of legislation necessary for the protection of the lives, health and property of the citizens or subjects and to the preservation of good order and public morals." A police regulation may apply to individuals, their occupation and their property, while an inspection law deals only with goods and merchandise. By virtue of its police power every State possesses the right to determine who shall compose its members, and may exclude from its boundaries all persons whose presence is deemed prejudicial to the public welfare, such as criminals, paupers,

1 "Whatever differences of opinion may exist as to the extent and boundaries of the police power, and however difficult it may be to render a satisfactory definition of it, there seems to be no doubt that it does extend to the protection of the lives, health and property of the citizens and to the preservation of good order and public morals. The legislature cannot, by any contract, divest itself of the power to provide for these objects. They belong emphatically to that class of objects which demand the application of the maxim, salus populi suprema lex; and they are to be attained and provided for by such appropriate means as the legislative discretion may devise. That discretion can no more be bargained away than the power itself." Beer Company v. Massachusetts, 97 U. S. p. 25.

2" In expressing these views, we have no purpose to impugn anything heretofore said by the Court as to the power of the States to establish inspection, quarantine, health, and other regulations, within the sphere of their acknowledged authority. The Constitutional validity of such regulations is as clear as the power of Congress to establish regulations of comIt is no objection to the former that both operate upon the same subject." Foster v. Master, etc., of New Orleans, 94 U. S. p. 246.

merce.