647

ompany to join them. Unless this contract is within the in-
ibition of the act of Congress of July 2, 1890, declaring illegal
very contract and combination in the form of trust or other-
ise or conspiracy, in restraint of trade or commerce among the
everal states or with foreign nations, it is not necessarily il-
egal. Although on its face it carries an apparent tendency to
tifle competition and is, in that sense, in restraint of trade, it
s not illegal by reason of that act unless it affects commerce
mong the several states or with foreign nations: United States
7. Trans-Missouri Freight Assn., 166 U. S. 290, 325, 17 Sup.
Ct. Rep. 540, 41 L. ed. 1007. This contract relates simply
to the sale of the output of one mine, but it appears from the
evidence in the case that the agent corporation was organized for
the purpose of handling the output of all the companies operat-
ing in a certain vein or seam of coal, and that two other com-
panies had contracts with it like, or similar to, the contract with
the defendant company. But it does not appear that this coal
was to be sold in any particular place nor that under this
contract it must necessarily go beyond the state lines. An ex-
amination of the decisions of the United States supreme court,
construing the act, makes it certain, that to be illegal thereun-
der, it must fall clearly within the terms of the act: Kidd v.
Pearson, 128 U. S. 1, 9 Sup. Ct. Rep. 6, 32 L. ed. 346; United
States v. Knight, 156 U. S. 1, 15 Sup. Ct. Rep. 249, 39 L. ed.
325; United States v. Trans-Missouri Freight Assn., 166 U. S.
290, 17 Sup. Ct. Rep. 540, 41 L. ed. 1007. As this contract does
not do so it must be held valid so far as that act is concerned.
Is it void at common law? The modern rule on that subject
is that, although a contract may be in restraint of trade, if it is
not unreasonably so, it is enforceable. "Some of such contracts
have been held void and unenforceable in the courts by reason of
their restraint being unreasonable, while others have been held
valid because they were not of that nature. A contract may be
in restraint of trade and still be valid at common law." Mr.
Justice Peckham, in United States v. Trans-Missouri Freight
Assn., 166 U. S. 290, 17 Sup. Ct. Rep. 540, 41 L. ed. 1007.
"The sense of the modern decisions is that, if the restraint is only
commensurate with the fair protection of the business sold, tho
contract is reasonable, valid and enforceable": United States
Chemical Co. v. Provident etc. Co., 64 Fed. 946. In that case
one company sold out its competing business to another, agree-
ing not to engage in the business any more during the term of
the lease. There is ample ground for applying this principle

Time of payment, when of the essence of the contract, 271.
performance, fixing time of by notice, 274, 275.

payment, failure to make at the time stipulated, 273.

title, time for making, when of the essence of the contract, 274,

Water Rights, possession of real property as notice of, 333.
Ways, possession of real property as notice of, 334.

Company to join them. Unless this contract is within the in-
hibition of the act of Congress of July 2, 1890, declaring illegali
every contract and combination in the form of trust or other-
wise or conspiracy, in restraint of trade or commerce among the
several states or with foreign nations, it is not necessarily il-
legal. Although on its face it carries an apparent tendency to
stifle competition and is, in that sense, in restraint of trade, it
is not illegal by reason of that act unless it affects commerce
among the several states or with foreign nations: United States
v. Trans-Missouri Freight Assn., 166 U. S. 290, 325, 17 Sup.
Ct. Rep. 540, 41 L. ed. 1007. This contract relates simply
to the sale of the output of one mine, but it appears from the
evidence in the case that the agent corporation was organized for
the purpose of handling the output of all the companies operat-
ing in a certain vein or seam of coal, and that two other com-
panies had contracts with it like, or similar to, the contract with
the defendant company. But it does not appear that this coal
647 was to be sold in any particular place nor that under this
contract it must necessarily go beyond the state lines. An ex-
amination of the decisions of the United States supreme court,.
construing the act, makes it certain, that to be illegal thereun-
der, it must fall clearly within the terms of the act: Kidd v.
Pearson, 128 U. S. 1, 9 Sup. Ct. Rep. 6, 32 L. ed. 346; United
States v. Knight, 156 U. S. 1, 15 Sup. Ct. Rep. 249, 39 L. ed.
325; United States v. Trans-Missouri Freight Assn., 166 U. S.
290, 17 Sup. Ct. Rep. 540, 41 L. ed. 1007. As this contract does
not do so it must be held valid so far as that act is concerned.
Is it void at common law? The modern rule on that subject
is that, although a contract may be in restraint of trade, if it is
not unreasonably so, it is enforceable. "Some of such contracts
have been held void and unenforceable in the courts by reason of
their restraint being unreasonable, while others have been held
valid because they were not of that nature. A contract may be
in restraint of trade and still be valid at common law." Mr.
Justice Peckham, in United States v. Trans-Missouri Freight
Assn., 166 U. S. 290, 17 Sup. Ct. Rep. 540, 41 L. ed. 1007.
"The sense of the modern decisions is that, if the restraint is only
commensurate with the fair protection of the business sold, the
contract is reasonable, valid and enforceable": United States
Chemical Co. v. Provident etc. Co., 64 Fed. 946. In that case
one company sold out its competing business to another, agree-
ing not to engage in the business any more during the term of
the lease. There is ample ground for applying this principle

here. These companies were developing a new coal field. Their product was unknown in the market, and it was necessary, in order to find sale for it, to spend large amounts of money in advertising it and establishing agencies. As they all produced the same kind of coal this could be done more advantageously and economically through one agency than by separate action. In accomplishing this purpose it was necessary that & uniform price, as to the product of each company, should be maintained. Otherwise, the common agent, by discriminating between them, could have sold the coal of one company to the exclusion of that of the others, and the enterprise would have become impracticable and defeated its own purpose. The agreement to maintain uniformity of price seems, therefore, to have been rather an incident to the main purpose, than a design to stifle competition. "The latest decisions of courts in this country and in England show a strong tendency to very greatly circumscribe and narrow the doctrine of avoiding contracts in restraint of trade. The courts do not go to the 648 length of saying that contracts which they now would say are in restraint of trade are, nevertheless, valid contracts, and to be enforced. They do, however now hold many contracts not open to the objection that they are in restraint of trade which a few years back would have been avoided on that sole ground, both here and in England": Matthews v. Associated Press, 136 N. Y. 333, 32 Am. St. Rep. 741, 32 N. E. 981.

In Skrainke v. Scharringhausen, 8 Mo. App. 522, the contract under consideration very much like this one, was held good. The owners of certain stone quarries entered into an agreement to secure "a fair, proportionate sale of the product of all quarries at uniform prices and living rates," the terms of the agree ment restricting the production of stone within certain territory, putting the sales in the hands of an agent for the interest of all parties, appointing a committee of five persons to modify prices and settle complaints, and imposing a penalty for every sale made in violation of the agreement. It is not intended here to affirm the correctness of the decision, but it illustrates the view taken by certain courts and shows that much latitude is allowed to manufacturers and producers of commodities in arrangements for facilitating production and sale. In Diamond Match Co. v. Roeber, 106 N. Y. 473, 60 Am. Rep. 464, 13 N. E. 419; Andrews, J., said: "In the present state of the authorities, we think it cannot be said that the early doctrine that contracts in general restraint of trade are void, without regard to circum

stances, has been abrogated. But it is manifest that it has been much weakened, and that the foundation upon which it was originally placed has, to a considerable extent at least, by the change of circumstances, been removed." Another interesting -case is that of Central Shade Roller Co. v. Cushman, 143 Mass. -353, 9 N. E. 629. In that case the contract was one made by three manufacturers of a certain kind of curtain fixtures, under different letters patent, owned by them severally, for the purpose of avoiding competition. It was held valid. In Cohen v. Berlin-Jones Envelope Co., 9 App. Div. 425, 41 N. Y. Supp. 345, manufacturers of envelopes made a contract with another envelope manufacturer by which they agreed to purchase from him, at the prices to be fixed from time to time by the former, a stated quantity of goods manufactured by him during a stated period, and he agreed that, during such time, he would not sell to others at a less price. Nineteen other concerns throughout the country engaged in 649 manufacturing envelopes, were not parties to the agreement, and their goods were in competition with those of the contracting parties. The contract was held valid, and the court recognized, as facts to be considered, that the agreement included but a small number of the manufacturers of envelopes, and that, at the time it was made, the business of manufacturing envelopes was demoralized through excessive competition. This case well illustrates the nature of the facts and circumstances to be considered in the present state of the law, in determining whether a contract, such as we have here, is void, as being in restraint of trade.

In Horner v. Graves, 7 Bing. 735, Tindall, C. J., said: "We do not see how a better test can be applied to the question, whether reasonable or not, than by considering whether the restraint is such only as to afford a fair protection to the interest of the party in favor of whom it is given, and not so large as to interfere with the interest of the public. Whatever restraint is larger than the necessary protection of the party, can be of no benefit to either. It can only be oppressive, and if oppressive, it is, in the eye of the law, unreasonable. Whatever is injurious to the interests of the public is void, on the ground of public policy."

Applying here this test and the general principles recognized in Cohen v. Berlin-Jones Envelope Co., 9 App. Div. 425, 41 N. Y. Supp. 345, it is impossible to see how the public was, or could have been, injured by this contract. Three small companies, out of the vast number of coal producing companies