commerce which comes within the regulating power of Congress." The contracts before us constituted and caused commercial intercourse between citizens of different states. Their chief purpose and their principal effect were the importation of sound articles of commerce into the State of Colorado from other States, and they necessarily constituted transactions of interstate commerce. Caldwell v. North Carolina, 187 U. S. 622, 629, 23 Sup. Ct. 229, 47 L. Ed. 336. [Citing Cases.] The decision of the Supreme Court of Kentucky to the contrary in Commonwealth v. Parlin & Orendorff Co., 118 Ky. 168, 80 S. W. 791, has been thoughtfully read, but it does not command itself to our judgment.

As the contracts were transactions of interstate commerce, any prohibition or obstruction to the making of them, or to the enforcement of them in the national courts, by the legislation or action of the State of Colorado, was beyond the power of the State and futile. Where the Congress has passed no law regulating interstate commerce in well-recognized articles of commerce, that fact is conclusive evidence that it intends such commerce to be free, and any law of a State which prohibits or restrains it at all is unconstitutional and void. [Citing cases.]

The declaration of the Colorado statute that the fact that a foreign corporation has been doing business in the state without its license shall constitute an absolute defense to any action arising out of such business is ineffectual to restrain or modify the power or duty of the national courts to hear and decide the controversies of such corporations arising from its transactions of interstate commerce according to the very right of the matter. The un

avoidable result is that, if the constitution and statutes of Colorado are to be interpreted to mean, as they clearly read, to prohibit every foreign corporation from exercising any corporate power whatever, or doing any business whatever, in the State, unless they pay the fees and the annual license tax which this legislation requires as a condition thereof, they are unconstitutional and void, so far as they apply to interstate commerce conducted by foreign corporations or suits for and against them in the national Courts.

Let us now turn to the contracts, observe what the rubber company agreed to do and what it actually did under them, and determine, if possible, whether or not in making or in performing these agreements it was guilty of doing any business within the meaning of the Constitution and statutes of Colorado. It agreed to ship

the goods from its warehouse, or its mill, upon the orders of the appellee, to that company in Denver; and it did so. It contracted to do, and it did, nothing more. It never had any office or place of business in Colorado. It never received, stored, handled, or sold any goods, or collected any money for the sales of any goods, in that State under this contract. It never incurred, assumed, or paid any expenses of doing all these things, or of conducting any of the business. The shoe company had and maintained a place of business in Colorado, it rented or owned the place in which the business in Colorado was done, and it agreed to bear all the expenses and losses of receiving, storing, and selling the goods; and it did so. The purchasers of the goods were purchasers from it, solicited and secured by it. They were its customers, and liable to it for the purchase price of the goods. The goods were billed to them in the name of the shoe company as consignee. The profits of the business and the work of the business, the labor of receiving, storing, and selling the goods, were the shoe company's. The profits constituted its factorage, its compensation, for carrying on the business. There is no question here between the State and the shoe company, or between the shoe company and the purchasers of the goods, or between the rubber company and the purchasers of the goods. The question here is between the consignor and the factor, and it is whether the consignor, which did not agree to do, and did not in fact, do the business of receiving, storing, and selling these goods, or the factor who did contract to do, and did actually do, the business of receiving, storing, and selling these goods, in Colorado, and who received the factorage therefor, was doing that business. In a simple transaction the true answer seems clear. A farmer sends to a commission merchant in a city a dozen barrels of apples for him to sell. The factor puts them in his store, sells them, receives the proceeds, and remits them, less his factorage. The farmer from time to time sends 1,000 barrels during the season, and they are sold and the proceeds are remitted in the same way. The farmer is not carrying on the business of selling apples in the city, but the factor is. The transaction in hand is larger, but in every element which conditions its legal character and effect it is not different. The transaction between the parties to this suit was interstate commerce. The rubber company did not agree to do, and did not actually do, any of the business of receiving, storing, and selling the goods in Colorado. The shoe company did agree to do, and

did do, that business. These facts have driven our minds with compelling force to the conclusion that within the true intent and meaning of the Constitution and statutes of Colorado, the rubber company was not doing business in that State, and the contracts between these litigants are valid and enforceable.

PEOPLE v. CHICAGO I. & L. RY CO. (1906)
Supreme Court of Illinois

223 Ill. 581, 79 N. E. 144.

The word "commerce" has its limitations and there are transactions which, though touching the field of commercial operation, do not enter into it in such a way as to become a part of the commerce.

VICKERS, J. This is an original petition for mandamus in this court in the name of the people of the State of Illinois, on the relation of W. H. Stead, as Attorney General, against the Chicago, Indianapolis & Louisville Railway Company (hereinafter called the "Company"), a nonresident railway corporation, and W. H. McDoel, president and general manager of said company, praying for a peremptory mandamus commanding respondents to report to the railroad and warehouse commission, as required by section 6 of an act to establish a board of railroad and warehouse commissioners and prescribe their duties, approved April 13, 1875.

*

First. Respondents contend that section 6 of the railroad and warehouse commission act has no application to this company, as the petition shows on its face that the company is a foreign corporation engaged in interstate commerce, and that said section. should be so construed as to exclude this company, thereby obviating a construction that would render the section void, as being an attempt by the State to interfere with the exclusive jurisdiction of Congress over the subject of interstate commerce.

Section 6 of said act is as follows: "Every railroad company incorporated or doing business in this State, or which shall hereafter become incorporated, or do business under any general or special law of this State, shall, on or before the first day of September, in the year of our Lord 1871, and on or before the same day in each year thereafter, make and transmit to the commissioners appointed by virtue of this act, at their office in Springfield, a full and true statement, under oath of the proper officers of said corporation, of the affairs of their said corporation, as the same existed

on the first day of the preceding July." Then follow 41 clauses designating, in detail, the subjects upon which the report shall furnish information.

Section 7 of this act authorizes the commissioners to propound any additional interrogatories to such railroad companies, which shall be answered in the same manner as those specified. Section 8 makes sections 6 and 7 applicable to the president, directors, and officers of every railroad company now existing or which shall hereafter be incorporated or organized in this State, and to every lessee, manager, and operator of any railroad in this state. Section 10 of said act makes it the duty of the railroad and warehouse commission to report at least once a year all its doings to the Governor, giving such facts, statements, and explanations as will disclose the actual workings of the railroad systems of the State in their bearing and relation to the business and prosperity of the people of the State. Section 11 requires the commissioners to examine into the management and all other matters concerning the business of railroads, as far as the same pertain to the relation of such roads to the public and to the security and accommodation of persons doing business therewith, and to ascertain whether such railroad companies, their officers, managers, lessees, and agents, comply with the law of the state concerning them. These provisions are all referred to for the reason that all of them seem to have some bearing upon the proper construction of section 6.

The language of section 6 is so broad and comprehensive that it is difficult to see how it can be interpreted so as to exclude any railroad company doing business in this State. "Every railroad company incorporated or doing business in this State" clearly includes companies incorporated under the laws of Illinois and companies incorporated under the laws of other States and which are engaged in the usual business of a railroad corporation within this State. The expression "doing business in this State" occurs in section 26 of chapter 32 and is used with respect to foreign corporations. This language has been defined to mean doing the business or character of business for which the corporation was organized. * * In addition to the general averment in the petition that the company was doing business in this State, facts are set out from which it is manifest that this company was extensively engaged in the operation of a railroad line in this State and carried on generally the business of a common carrier of both freight and passengers.

We come more readily to the view that all railroads doing business in this State are included within the purview of section 6 of this act when we consider the object of this legislation as gathered from

the general scope of the act and the impossibility of attaining its purposes if it is to be limited to those roads that are exclusively engaged in intrastate commerce. Among the objects to be attained by the creation of the railroad and warehouse commission and in giving to it a supervisory and administrative power over the maintenance, management, and operation of railroads, is to protect the lives and health of the traveling public, to guard against discrimination and oppression, and generally to promote the efficiency of railroad companies in the discharge of their duties to the State and the people. If railroads engaged in interstate commerce are for that reason exempt from the duty imposed by section 6, then they must be excluded from all other provisions of the act for the same

reason.

In the application of this law we see no reason for a distinction based on the legal residence of the corporation. If a railroad company chartered in Illinois is engaged in interstate commerce, the prohibition of the commerce clause of the Federal Constitution applies to the State of Illinois with respect to such company equally with every other State prohibiting one as well as another from imposing any restrictions or burdens on commerce between the States.

Since, in our opinion, section 6 must be held ex vi termini applicable to all railroads which are doing business in this State, without reference to the State from which they derive their charters, and wholly regardless of whether they are engaged in interstate or intrastate commerce, we come next to the question whether this section is void under the commerce clause of the Constitution of the United States. This clause provides that Congress shall have power to "regulate commerce with foreign nations and among the several States and with the Indian tribes." (U. S. Const., art. 1, § 8, par. 3.) No well-defined classification has been made of the laws which a State may properly pass under its taxing or police power and those which it may not pass because of the exclusive power of Congress over interstate commerce. Indeed, the difficulties inherent in the subject are such that, so far, Courts have dealt with each case. by its points of agreement or disagreement with previous cases and deduced therefrom a decision of the case in hand. The cases in the United States Supreme Court on this subject may be classified under one or the other of the following heads: (1) Cases where the power of the State is exclusive; (2) cases in which the State may act in the absence of conflicting legislation by Congress; (3) cases where the power of Congress is exclusive and the State cannot act at all. ✶✶✶ This classification is not very helpful in the decision of any given