.

(250 U. S. 163, 63 L. ed. 910, P.U.R.1919D, 717, 39 Sup. Ot. Rep. 507.) 57 L. ed. 1135, 1137, 33 Sup. Ct. Rep. If this act confers the rate-making 639; United States R. Administration power, it confers an arbitrary power. v. Burch, 254 Fed. 140.

Chicago, M. & St. P. R. Co. v. MinneRegulation of telephone rates is an sota, 134 U. S. 418, 456, 33 L. ed. 970, exercise of the police power of the 980, 3 Inters. Com. Rep. 209, 10 Sup. state, consequently a police regulation, Ct. Rep. 462, 702; Re Gardner, 84 Kan. and therefore excepted by the proviso. 264, 33 L.R.A. (N.S.) 956, 113 Pac.

Home Teleph. Co. v. Carthage, Ann. 1054. Cas. 1912D, 308, note; Chesapeake & P. The right, whose existence is or may Teleph. Co. v. Manning, 186 U. S. 238, be abridged by the Postmaster General, 46 L. ed. 1144, 22 Sup. Ct. Rep. 881; is a property right. Cumberland Teleph. & Teleg. Co. v. 16 Cyc. 620, 625; Jones, Teleg. & Louisville, 187 Fed. 637; Hockett v. Teleph. Cos. S$ 249, 258; Munn v. IlliState, 105 Ind. 259, 55 Am. Rep. 201, nois, 94 U. S. 113, 133, 24 L. ed. 77, 5 N. E. 178; Central U. Teleph. Co. v. 86; Allnutt v. Inglis, 12 East, 527, 104 Bradbury, 106 Ind. 1, 5 N. E. 721; Eng. Reprint, 206, 11 Revised Rep. Johnson v. State, 113 Ind. 143, 15 N. E. 482; Smyth v. Ames, 169 U. S. 466, 547, 215; Central U. Teleph. Co. v. State, 42 L. ed. 819, 849, 18 Sup. Ct. Rep. 118 Ind. 194, 10 Am. St. Rep. 114, 19 418; Covington v. L. Turnp. Road Co. N. E. 604; Pioneer Teleph. & Teleg. Co. v. Sandford, 164 U. S. 578, 596, 597, v. Westenhaver, 29 Okla. 429, 38 L.R.A. 41 L. ed. 560, 566, 567, 17 Sup. Ct. Rep. (N.S.) 1209, 118 Pac. 354; State ex rel. 198. Webster v. Superior Ct. 67 Wash. 37, If to uphold the constitutionality of L.R.A.1915C, 287, 120 Pac. 861, Ann. the resolution requires a construction Cas. 1913D, 78; Munn v. Illinois, 94 U. that the government remains under the S. 113, 24 L. ed. 77; Nebraska Teleph. continuing duty to render the public Co. v. State, 55 Neb. 627, 45 L.R.A. 113, adequate service at reasonable rates,

, 76 N. W. 171.

then Congress has not the power, under Wherever the broad rule of power to the Constitution, to fix intrastate rates, enact all necessary and proper legisla

and therefore could not and did not tion has been asserted, it has been delegate that power either to the Presicoupled with the limitation that the dent or to the Postmaster General. means must be such as are not prohib- Black, Const. Law, $ 154; Civil ited, but consist with the letter and Rights Cases, 109 U. S. 3, 27 L. ed. 835, spirit of the Constitution.

3 Sup. Ct. Rep. 18; Western U. Teleg. Legal Tender Cases, 12 Wall. 457, Co. v. Pendleton, 122 U. S. 347, 359, 30 539, 20 L. ed. 287, 308; Legal Tender L. ed. 1187, 1189, 1 Inters. Com. Rep. Case, 110 U. S. 421, 441, 28 L. ed. 204, 306, 7 Sup. Ct. Rep. 1126; New York 212, 4 Sup. Ct. Rep. 122; M'Culloch v. v. Miln, 11 Pet. 102, 9 L. ed. 648; KelMaryland, 4 Wheat. 421, 4 L. ed. 605; ler v. United States, 213 U. S. 138, 144, Logan v. United States, 144 U. S. 263, 145, 53 L. ed. 737-739, 29 Sup. Ct. Rep. 36 L. ed. 429, 12 Sup. Ct. Rep. 617; 470, 16 Ann. Cas. 1066; Re Pacific R. Boske v. Comingore, 177 U. S. 459, 44 Commission, 32 Fed. 241; Cook v. MarL. ed. 846, 20 Sup. Ct. Rep. 701; Flint shall County, 196 U. S. 261, 49 L. ed. v. Stone Tracy Co. 220 U. S. 107, 176, 471, 25 Sup. Ct. Rep. 233; Plumley v. 55 L. ed. 389, 423, 31 Sup. Ct. Rep. Massachusetts, 155 U. S. 461, 39 L. ed. 342, Ann. Cas. 1912B, 1312; Kansas v. 223, 5 Inters. Com. Rep. 590, 15 Sup. Colorado, 206 U. S. 46, 88, 51 L. ed. Ct. Rep. 154; House v. Mayes, 219 U. 956, 970, 27 Sup. Ct. Rep. 655; United S. 270, 55 L. ed. 213, 31 Sup. Ct. Rep. States v. Hoke, 187 Fed. 994; Stewart 234; Covington & C. Bridge Co. v. Kenv. Kahn (Stewart v. Bloom) 11 Wall. tucky, 154 U. S. 204, 209, 210, 38 L. 493, 20 L. ed. 176; United States v. ed. 962, 965, 966, 4 Inters. Com. Rep. Casey, 247 Fed. 362; Miller v. United 649, 14 Sup. Ct. Rep. 1087; Kidd v. States (Page v. United States) 11 Wall. Pearson, 128 U. S. 1, 32 L. ed. 346, 2 268, 20 L. ed. 135; Salamandra Ins. Co. Inters. Com. Rep. 232, 9 Sup. Ct. Rep. v. New York L. Ins. & T. Co. 254 Fed. 6; Hammer v. Dagenhart, 247 U. S. 852.

251, 274, 62 L. ed. 1101, 1106, 3 A.L.R. The taking of private property by 649, 38 Sup. Ct. Rep. 529, Ann. Cas. civil agencies is not necessary to the 1918E, 724. waging of war successfully.

Especially is the police power preMcCray v. United States, 195 U. S. served as to regulation of intrastate 27, 61, 49 L. ed. 78, 97, 24 Sup. Ct. rates. Rep. 769, 1 Ann. Cas. 561.

Chicago, B. & Q. R. Co. v. Illinois,

200 U. S. 561, 592, 50 L. ed. 596, 609, ex rel. Mehrbass v. Harper, 162 Wis. 26 Sup. Ct. Rep. 341, 4 Ann. Cas. 1175; 589, 156 N. W. 941; Kohl v. Beach, 107 Lake Shore & M. S. R. Co. v. Ohio, 173 Wis. 415, 50 L.R.A. 600, 81 Am. St. U. S. 285, 43 L. ed. 702, 19 Sup. Ct. Rep. 849, 83 N. W. 657; Hitchcock v. Rep. 465; Arkansas Rate Cases, 187 Galveston, 96 U. S. 341, 348, 24 L. ed. Fed. 290.

659, 661; Thompson v. Schermerhorn, Regulation of rates by the individ- 6 N. Y. 92, 55 Am. Dec. 385; Birdsali ual states does not in truth or in fact v. Clark, 73 N. Y. 73, 29 Am. Rep. 105; hinder or retard the discharge of the Runkle v. United States, 122 U. S. 543, stated Federal purpose.

557, 30 L. ed. 1167, 1171, 7 Sup. Ct. Cumberland Teleph. & Teleg. Co. v. Rep. 1141. Memphis, 183 Fed. 875; Wainwright The language of the presidential v. Pennsylvania R. Co. 253 Fed. 459. proclamation confers all the discretion

Congress could not delegate to the vested in him. President power to decide between People v. C. Klinck Packing Co. 214 three separate capacities in which he N. Y. 138, 108 N. E. 278, Ann. Cas. might deal with the telephone and tele- 1916D, 1051; Muir v. Louisville & N. graph.

R. Co. 247 Fed. 894. Cincinnati, W. & Z. R. Co. v. Clinton Clauses giving the Postmaster GenCounty, 1 Ohio St. 88; Re Oliver, 17 eral power are evidently a material Wis. 685; Marshall Field & Co. v. Clark, inducement to valid parts of the proc143 U. S. 649, 36 L. ed. 294, 12 Sup. lamation, and therefore the whole Ct. Rep. 495; Minneapolis, St. P. & S. proclamation is void. . Ste. M. R. Co. v. Railroad Commission, Little Chute v. Van Camp, 136 Wis. 136 Wis. 146, 17 L.R.A.(N.S.) 821, 116 526, 128 Am. St. Rep. 1100, 117 N. W. N. W. 905; State ex rel. Buell v. Frear, 1012; 36 Cyc. 976, 977; State ex rel. 146 Wis. 291, 34 L.R.A.(N.S.) 480, 131 Walsh v. Dousman, 28 Wis. 541; WarN. W. 832; State ex rel. Young v. Du- ren v. Charlestown, 2 Gray, 84; Poinval County, Fla. 79 So. 692; dexter v. Greenhow, 114 U. S. 270, 304, State ex rel. Montgomery v. Rogers, 71 29 L. ed. 185, 197, 5 Sup. Ct. Rep. 903, Ohio St. 203, 73 N. E. 461; Sabre v. 962; Sheldon v. Hoyne, 261 II. 222, 103 Rutland R. Co. 86 Vt. 347, 85 Atl. 693, N. E. 1021. Ann. Cas. 1915C, 1269; State ex rel. Messrs. William L. Schaffer, Attor. Rusk v. Budge, 14 N. D. 532, 105 N. ney General of Pennsylvania, and W. 724; State ex rel. Miller v. Taylor, Bernard J. Meyers, also as amici 27 N. D. 77, 145 N. W. 425.

curiæ: The power to fix rates could not be The Postmaster General has been declared.

substituted for the operating heads of Minneapolis, St. P. & S. Ste. M. R. the several companies, and is operating Co. v. Railroad Commission, 136 Wis. the properties in the place and stead 164, 17 L.R.A.(N.S.) 821, 116 N. W. of their former corporate officers, and 905; State v. Parker, 26 Vt. 357.

is subject to the same provisions of Even if the joint resolution be con

law except in so far as the Wire Construed as conferring upon the Presi

trol Act provides otherwise and sets dent the power to fix rates, the Presi

up substitute regulations and procedent has no power to redelegate the dis

dure. cretion confided in him.

Muir v. Louisville & N. R. Co. 247 Lord v. Oconto, 47 Wis. 386, 2 N. W.

Fed. 888. 785; Smith v. Black, 115 U. S. 308, 319,

To construe the resolution as vesting 29 L. ed. 398, 402, 6 Sup. Ct. Rep. 50;

arbitrary authority in the President to Muir v. Louisville & N. R. Co. 247 Fed.

change rates of telephone companies is 894; Rhodes v. Tatum, Tex. Civ.

to hold that Congress repealed pro App. -, 206 S. W. 114; 29 Cyc. 1433;

tanto the provisions of the Interstate Clark v. Washington, 12 Wheat. 40, 6 Commerce Act. Nothing is better L. ed. 544; Kinney v. Howard, 133

settled in the law, however, than that Iowa, 94, 110 N. W. 282; Mechem, Pub.

implied repeals are not favored; and Off. § 567; Jacksonville v. Ledwith, 26 this means that it is the duty of courts Fla. 163, 9 L.R.A. 69, 23 Am. St. Rep. to so construe the acts, if possible, that 558, 7 So. 885; Arnold v. Pawtucket, both shall be operative. 21 R. I. 15, 41 Atl. 576; Mechem, 1 Lewis's Sutherland, Stat. Constr. Agency, § 313; McQuillin, Mun. Corp. 2d ed. p. 465; Union P. R. Co. v. Penis. § 382; Boston Beer Co. v. Massachu- ton, 18 Wall. 5, 21 L. ed. 787. setts, 97 U. S. 25, 24 L. ed. 989; State Congress has no power to regulate

(250 U. 8. 163, 63 L. ed. 910, P.U.R.1919D, 717, 39 Sup. Ot. Rep. 507.) rates for telephone communication or iana Light & H. P. & Mfg. Co. 115 U. traffic between points within the state S. 650, 668, 29 L. ed. 516, 523, 6 Sup. of Pennsylvania.

Ct. Rep. 252. Federalist No. 45; 8 Cyc. 771, 773, Messrs. H. Findlay French and Ogle 774; United States v. Cruikshank, 92 Marbury, also as amici curiæ: U. S. 542, 23 L. ed. 588.

Unless Congress, by the use of the There is no regulatory power over in- words “police regulations,” clearly and trastate telephone and telegraph rates, unequivocally confined this exemption and the Postmaster General cannot do to penal regulations, it must have that which Congress itself says shall meant to exempt the general police not be done.

power over rates which is inherently Missouri P. R. Co. v. Larabee Flour possessed by each state through the naMills Co. 211 U. S. 612, 621, 52 L. ed. ture of its sovereignty, for the govern352, 360, 29 Sup. Ct. Rep. 214; 1 Rob- ment has no authority over intrastate erts, Federal Liabilities of Carriers, rates. pp. 68–71.

Munn v. Illinois, 94 U. S. 113, 24 L. The attempt to regulate rates cannot ed. 77. be sustained as a revenue measure. The police regulations of the several

United States ex rel. Michels v. states are nothing more or less than James, 13 Blatchf. 207, Fed. Cas. No. the police power of the several states 15,464; Hubbard v. Lowe, 226 Fed. 135. translated into terms of action.

The Postmaster General has no power Reagan v. Mercantile Trust Co. 154 to regulate and fix rates of telegraph U. S. 413, 417, 38 L. ed. 1028, 1030, 4 and telephone companies under the war Inters. Com. Rep. 575, 14 Sup. Ct. Rep. powers of the President conferred by 1060; Re Suspension of Increased the Constitution.

Charges for Telephone Service (N. J.) Ex parte Milligan, 4 Wall. 2, 18 L. P.U.R.1919B, 587. ed. 281; Edmonson v. Union Bank, 33 If doubt exists, decision should favor Ga. 91; Horn v. Lockhart, 17 Wall. state control. 570, 21 L. ed. 657; Raymond v. Thomas, Reid v. Colorado, 187 U. S. 137, 148, 91 U. S. 712, 716, 23 L. ed. 434, 435; 47 L. ed. 108, 114, 23 Sup. Ct. Rep. Mitchell v. Harmony, 13 How. 115, 14 92, 12 Am. Crim. Rep. 506. L. ed. 75; Griffin v. Wilcox, 21 Ind. 382; Mr. Albert C. Ritchie, Attorney GenEifort v. Bevins, 1 Bush. 460; Ham- eral of Maryland, also as amicus mer v. Dagenhart, 247 U. S. 251, 62 L. curiæ: ed. 1101, 3 A.L.R. 649, 38 Sup. Ct. Rep. The President, the Postmaster Gen529, Ann. Cas. 1918E, 724.

eral, and the telephone companies have Federal power to regulate rates or not the authority to increase intrastate to prescribe rates, whatever its limits rates without the submission of the may be, is a legislative power exclu- proposed new rates to the various sively.

bodies required by the police regulaKnoxville v. Knoxville Water Co. 212 tions of the several states to approve U. S. 1, 10, 53 L. ed. 371, 378, 29 Sup. the same. Ct. Rep. 148.

Chicago & N. W. R. Co. v. Fuller, 17 Messrs. H. H. Smith, David H. Wall. 560, 21 L. ed. 710; Munn v. IlliCrowley, and Clarence D. Wilcox, also nois, 94 U. S. 113, 24 L. ed. 77; Reagan as amici curiæ:

v. Mercantile Trust Co. 154 U. S. 413, The regulation of rates of railroads 38 L. ed. 1028, 4 Inters. Com. Rep. 560, and public carriers is but the logical 14 Sup. Ct. Rep. 1060; Chicago, B. & result of the application of the principle Q. R. Co. v. Illinois, 200 U. S. 561, 50 that the state through its police power L. ed. 596, 26 Sup. Ct. Rep. 341, 4 Ann. could regulate public callings. The Cas. 1175; United States v. Lee, 106 regulation of rates in the various em- U. S. 196, 27 L. ed. 171, 1 Sup. Ct. Rep. ployments dates back to medieval times. 240. Beale & W. Railroad Rate Regula

Mr. Chief Justice White delivered tion, chap. 1. Nor is it proper to argue that rate

the opinion of the court: regulations are not police regulations

Involving, as this case does, the because the police power cannot be bar

existence of state power to regulate, tered away, and the power to regulate

without the consent of the United rates is bartered away, therefore it is States, telephone rates for business not a part of the police power.

done wholly within the state, over New Orleans Gaslight Co. v. Louis- lines taken over into the possession

of the United States, and which, by alleged that any connection of the
the exercise of its governmental au- companies through their officials
thority, it operates and controls, it or employees with the business was
does not in principle differ from the solely because of employment by the
North Dakota Case, just announced United States. The purpose to en-
[250 U. S. 135, 63 L. ed. 897, P.U.R. force the rates fixed by the Post-
1919D, 705, 39 Sup. Ct. Rep. 502], master General was admitted, and
where it was decided that, under it was averred that the suit was one
like conditions, the state had no such over which the court had no juris-
power as to railroad rates. We con- diction because it was against the
sider this case, as far as may be United States.
necessary, by a separate opinion, The case was heard on the bill

, however, because the authority answer, exhibits, and an admission under which the control was exert- by all the parties that the contract ed is distinct, and because of the annexed to the answer was accuassumption in argument that this rate, and that a similar one had distinction begets a difference in been made with all the other dethe principles applicable.

fendants. In January, 1919, the state of Assuming that Congress had South Dakota, on the relation of its power to take over the telephone attorney general and Railroad Com- lines; that it had conferred that missioners, sued the Dakota Central power upon the President; that the and other telephone companies do- power had by the President been ing business within the state to en- called into play conformably to the join them from putting in effect a authority granted; and that the teleschedule of rates as to local business phone lines were under the complete which it was alleged had been pre- control of the United States,-the pared by the Postmaster General, court yet held that the state had the and which it was averred the tele- power to fix the local rates. In phone companies were about to ap- reaching this conclusion the court, ply and enforce. It was charged assuming argumentatively that the that such rates were higher than right which the United States those fixed by state authority, and possessed gave at least the implied that the proposed action of the com- authority to fix all rates, neverthepanies would be violative of state less held that such power did not law, since the companies were un- embrace intrastate rates because der the duty to disregard the ac- they had been carved out of the tion of the Postmaster General and grant of power by Congress in conapply only the lawful state rates. ferring authority on the President. The duty of the relators, as state of. It was therefore decided that the ficers, to prevent such wrong, was President, the Postmaster General, alleged,-a duty in which, it was and those operating the telephone further asserted, the state had a pe- service under his authority, were cuniary interest springing from the mere wrongdoers in giving effect to expenditure which it was obliged to the rates fixed by the Postmaster make for telephone services.

General, and in refusing to enforce The companies answered, dis- the conflicting intrastate rates made claiming all interest in the contro- lawful by state law. The proceedversy on the ground that, by con- ings to prevent this wrong, it was tract, a copy of which with one of held, did not constitute a suit

,

a the defendant companies was an- against the United States, and the nexed, their telephone lines and injunction prayed was granted. everything appurtenant thereto had The defendants in error do not passed into the possession and con- confine their contention to the questrol of the United States, and were tion of statutory construction below being operated by it as a govern- decided. On the contrary, they mental agency. The answer also press questions of power which the

(250 U. 8. 163, 63 L. ed. 910, P.U.R.1919D, 717, 39 Sup. Ot. Rep. 507.) court below assumed and did not manifested by a proclamation pass upon, and insist upon a con- which, after reciting the resolution struction of the statute contrary to of Congress, declared : that which the court below took for "It is deemed necessary for the granted as a prelude to the question national security and defense to of construction upon which it based supervise and take possession and its conclusion.

assume control of all telegraph and We must dispose of the issues telephone systems and to operate thus insisted upon, before testing the same in such manner as may be the soundness of the interpretation needful or desirable; of the statute upon which the court "Now, therefore, I, Woodrow below acted, and for the purpose of Wilson, President of the United considering them, as well as the States, under and by virtue of the question of construction which the powers vested in me by the foregocourt below expressly decided, we ing resolution, and by virtue of all state the case.

other powers thereto me enabling, On the 16th of July, 1918, Con- do hereby take possession and asgress adopted a joint resolution (40 sume control and supervision of Stat. at L. 904, chap. 154, Comp. each and every telegraph and teleStat. 1918, § 31154 x, Appx.), pro- phone system, and every part viding:

thereof, within the jurisdiction of "That the President during the the United States, including all continuance of the present war is au- equipment thereof and appurtethorized and empowered, whenever nances thereto whatsoever and all he shall deem it necessary for the na- materials and supplies. tional security or defense, to super- "It is hereby directed that the vise or to take possession and assume supervision, possession, control, and control of any telegraph, telephone, operation of such telegraph and marine cable, or radio system or telephone systems hereby by me unsystems, or any part thereof, and to dertaken shall be exercised by and operate the same in such manner as through the Postmaster Genermay be needful or desirable for the al. duration of the war, which super- The proclamation gave to the vision, possession, control, or oper- Postmaster General plenary power ation shall not extend beyond the to exert his authority to the extent date of the proclamation by the he might deem desirable through President of the exchange of rati- the existing owners, managers, difications of the treaty of peace: rectors, or officers of the telegraph Provided, That just compensation or telephone lines, and it was proshall be made for such supervision, vided that their services might conpossession, control, or operation, to tinue as permitted by general or be determined by the President; special orders of the Postmaster Provided further, That noth: General.

It was

declared that ing in this act shall be construed to

"from and after 12 o'clock midamend, repeal, impair, or affect ex

night on the 31st day of July, 1918, isting laws or powers of the states

all telegraph and telephone systems in relation to taxation or the lawful

included in this order and proclapolice regulations of the several mation shall conclusively be deemed states, except wherein such laws, within the possession and control powers, or regulations may affect and under the supervision of said the

transmission of government Postmaster General without furcommunications, or the issue of ther act or notice." stocks and bonds by such system or

Under this authority the Postsystems."

master General assumed possession Six days thereafter, on the 22d of and control of the telephone lines July, the President exerted the pow- and operated the same. On the 31st er thus given. Its exercise day of October, 1918, the President,

O

was