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them a certain per cent. As security for such agreement the parties deposited their checks for $100 each with the defendant. They made to him weekly reports of the amount of grain purchased. If one had purchased more than his share he paid the defendant three cents a bushel for the excess, and that amount was then divided among the other dealers. Upon these facts, under appropriate instructions, the jury found the defendant guilty.
That the transaction was within the letter of the statute, in that it tended to prevent competition in the purchase of merchandise, is not open to doubt. It is also within the spirit of the statute. It imposed an unreasonable restraint upon competition. It is stated by counsel for plaintiff in error in his brief that not far from Bison were a number of other small towns, at which the principal commercial business was the buying and selling of wheat. But where there were four buyers, as in Bison, apparently competing, farmers nearer to Bison than to other villages, if not farmers more remote, would naturally seek that place in order to benefit by the competition. They would find an apparent competition, and yet each buyer was restrained by this contract from seeking to purchase more than his fourth of the wheat coming to the market, or if he purchased more, must necessarily in order to make his profit, buy his wheat at three cents a bushel less than what he might otherwise pay, that being the penalty for an excess purchase. It was not an open agreement in respect to price, nor one that enabled sellers to know in advance exactly what they could get for their wheat.
Undoubtedly there is a certain freedom of contract which cannot be destroyed by legislative enactment. In pursuance of that freedom parties may seek to further their business interests, and it may not be always easy to draw the line between those contracts which are beyond the reach of the police power and those which are subject to prohibition or restraint. But a secret arrangement, by which, under penalties, an apparently existing competition among all the dealers
in a community in one of the necessaries of life is substantially destroyed, without any merging of interests through partnership or incorporation, is one to which the police power extends. That is as far as we need to go in sustaining the judgment in this case. That is as far as the Supreme Court of the State went. If other transactions are presented, in which there is an absolute freedom of contract beyond the power of the legislature to restrain, which come within the letter of any of the clauses of this statute, the courts will undoubtedly exclude them from its operation. As said by the Supreme Court of the State concerning the defendant's criticism of the breadth of this statute (p. 247):
"He cannot be heard to object to the statute merely because it operates oppressively upon others. The hurt must be to himself. The case, under appellant's contention as to this point, is not a case of favoritism in the law. It is not a case of exclusion of classes who ought to have been included, the leaving out of which constitutes a denial of the equal protection of the law, but it is the opposite of that. It is a case of the inclusion of those who ought to have been excluded. Hence, unless appellant can show that he himself has been wrongfully included in the terms of the law, he can have no just ground of complaint. This is fundamental and decisively settled. City of Kansas City v. Railway Co., 59 Kansas, 427, affirmed under the title Clark v. Kansas City, 176 U. S. 114; Supervisors v. Stanley, 105 U. S. 305, 311; Pittsburg &c. R. Co. v. Montgomery, 152 Indiana, 1."
We see no error in the judgment of the Supreme Court of Kansas, and it is
Statement of the Case.
196 U. S.
ALLEN v. ALLEGHANY COMPANY.
ERROR TO THE SUPREME COURT OF THE STATE OF NEW JERSEY.
No. 119. Argued January 11, 1905.-Decided February 20, 1905.
The mere construction by a state court of a statute of another State and its operation elsewhere, without questioning its validity, does not necessarily involve a Federal question, or deny to the statute the full faith and credit demanded by § 709, Rev. Stat., in order to give this court jurisdiction to review.
The statutes of New York and Pennsylvania prohibit foreign corporations from doing business in those States respectively unless certain specified conditions are complied with. In an action in New Jersey the state court held that contracts made in New York and Pennsylvania by a corporation which had not complied with the statutes of either State were not ipso facto void and might be enforced in New Jersey. On writ of error Held: that
The writ must be dismissed as the validity of the New York and Pennsylvania statutes was not denied but the case turned only upon their construction and the effect to be given them in another State.
Whether, aside from a Federal question, the courts of one State should have sustained the action upon principles of comity between the States is a matter within the exclusive jurisdiction of the state court.
THIS was a suit begun in the Supreme Court of New Jersey by the Alleghany Company, to recover the amount due upon a promissory note dated at New York, July 16, 1900, given by the plaintiffs in error, under the firm name of I. N. E. Allen & Co., for $1,989.54, upon which payments amounting to $1,000 were endorsed. The declaration was upon the common counts, but annexed was a copy of the note, with a notice that the action was brought to recover the amount due thereon. The defendants pleaded four several pleas:
1. General issue.
2. That the note was executed and delivered in the State of New York to the plaintiff company, a business corporation created under the laws of North Carolina. That when said note was executed and delivered it was provided by the statute of the State of New York that:
"No foreign corporation shall do business in this State without having first procured from the Secretary of State a certificate that it has complied with all the requirements of law to authorize it to do business in this State, and that the business of the corporation to be carried on in this State is such as may be lawfully carried on by a corporation incorporated under the laws of this State. No foreign stock corporation doing business in this State shall maintain any action in this State, upon any contract made by it in this State until it shall have procured such certificate."
The plea further averred that at the time of the making of the note the plaintiff was a business stock corporation, foreign to the State of New York, and had not theretofore procured from the Secretary of State a certificate that it had complied with all the requirements of the law to authorize it to do business within the State, and that the business of said plaintiff was such as might be lawfully carried on by a corporation incorporated under the laws of said State for such or similar business, according to the form of the statute of New York in such case made and provided.
3. The third plea sets out that the note was made and executed in the State of Pennsylvania to the plaintiff company, a foreign corporation created under the laws of North Carolina.
That when said note was executed and delivered it was provided by the State of Pennsylvania that—
"1. No foreign corporation shall do any business in this Commonwealth until said corporation shall have established an office or offices and appointed an agent or agents for the transaction of its business therein. 2. It shall not be lawful for any such corporation to do any business in this Commonwealth, until it shall have filed in the office of the Secretary of the Commonwealth a statement under the seal of said corporation, and signed by the president or secretary thereof, showing the title and object of said corporation, the location of its office or offices, and the name or names of its authorized
Argument for Plaintiffs in Error.
196 U. S.
agent or agents therein; and the certificate of the Secretary of the Commonwealth, under the seal of the Commonwealth, of the filing of such statement shall be preserved for public inspection by each of said agents in each and every of said offices. 3. Any person or persons, agents, officers or employés of any such foreign corporation, who shall transact any business within this Commonwealth for any such foreign corporation, without the provisions of this act being complied with, shall be guilty of a misdemeanor, and upon conviction thereof shall be punished by imprisonment, not exceeding thirty days, and by a fine not exceeding one thousand dollars, or either, at the discretion of the court trying the same."
The plea further averred that at the making of the note the plaintiff was a corporation foreign to the said Commonwealth, and had not theretofore filed in the office of the Secretary a statement showing the title and object of said plaintiff, the location of its office, and the name of its authorized agent therein, according to the form of said statute; yet notwithstanding the premises, the plaintiff at the time of the making of the said note did business in the said Commonwealth of Pennsylvania, contrary to the form of the said statute.
The plaintiff demurred to the second and third pleas, and the demurrer being overruled, the cause was sent down to the Circuit Court of Hudson County for trial on an issue of fact raised by the fourth plea, which is not material here.
The trial judge there directed a verdict for the plaintiff, and upon appeal to the Court of Errors and Appeals of New Jersey the judgment of the lower court was affirmed. 69 N. J. Law, 270.
Mr. Alexander S. Bacon for plaintiffs in error, cited in support of the jurisdiction: Finney v. Guy, 189 U. S. 335; Manley v. Park, 187 U. S. 547; Chicago &c. R. R. v. Ferry Co., 119 U. S. 615; United States v. Alger, 152 U. S. 384, distinguished; Johnson v. N. Y. Life Ins. Co., 187 U. S. 491; and as to comity Hilton v. Guyot, 159 U. S. 113; Snashall v. Met. R. R. Co., 12