of a privilege to erect, establish and construct gas works, and make and vend gas in a municipality for a term of years does not exempt the grantees from the imposition of a license tax for the use of the privilege conferred.30 And a brewing company may be liable to a corporation privilege tax notwithstanding it is liable for a brewer's license tax.31 Nor was the Fourteenth Amendment to the Constitution of the United States intended to prevent a State from adjusting its system of taxation in all proper and reasonable ways, or through its undoubted power to impose different taxes upon different trades and professions; and imposing a license tax upon meat packing houses is not an arbitrary and unreasonable classification invalidating the tax as denying the equal protection of the law; nor is it such a denial because the tax is not imposed on persons not doing a meat packing house business but selling products thereof, or because it is not imposed on persons engaged in packing articles of food other than meat.32

§ 362. Imposing New Conditions-Police Power.-Where the grant of a franchise to an electric railway company authorizes its construction, subject to the consent of certain city councils and of the judges of certain county courts and of counties, with the power delegated to such bodies to subsequently impose conditions and limitations concerning the exercise of the privileges conferred, the company will be bound by subsequent conditions to the same extent as if they had been originally a part of the grant.33 And where a city grants consent to the use of its streets by a telephone company and reserves the right to regulate the manner of occupation, there is included in such reservation the power to compel the adoption of such reasonable and accepted improvements as may tend to increase the public safety or convenience, or which will decrease the 30 Memphis Gas Co. v. Shelby 200 U. S. 226, 26 Sup. Ct. 232, 50 L. County, 109 U. S. 398, 27 L. ed. 976, ed. 451.

3 Sup. Ct. 205.

33 Richmond, R. & E. Co. v.

31 Spira v. State (Ala., 1906), 41 So. Brown, 97 Va. 26, 32 S. E. 775, 1 Va. 465.

32 Armour Packing Co. v. Lacy,

S. C. Rep. 213.

obstruction to the city streets incident to the telephone corporation's use thereof; but the city cannot, after acceptance of the franchise and the erection of works, ordinarily impose new conditions.34 So where the sole authority of a municipality is by the proper exercise of its police power, inherent in it, to protect the public from unnecessary obstructions, inconveniences, and dangers, and to determine where and in what manner a telephone company may erect its poles and stretch its wires so as to accomplish that result it cannot impose other or new conditions.3

35

§ 363. Conditions Subsequent - Construction of -Performance.-Conditions subsequent which work a forfeiture are to be construed liberally, but still the grantee is bound to a substantial performance. If the estate has once vested, it is sufficient if the substance of the condition be performed, and if the condition subsequent be impossible to be performed, or performance be prevented by the act of God, the grantee is excused.36 Where the consent of a city is one of the conditions precedent upon which the State grants a franchise for the use of the streets of a municipality to a railroad company and such consent is obtained, the city cannot impose a condition subsequent which will bind the company to the extent of forfeiting its right in case of non-compliance therewith.37

34 Commercial Bell Teleph. Co. v. Warwick, 185 Pa. 623, 40 Atl. 93.

As to use of safety appliances and improvements, see Joyce on Electric Law (2d ed.), §§ 460, 476, 477.

35 Michigan Teleph. Co. v. City of Benton Harbor, 121 Mich. 512, 80 N. W. 386, 7 Am. Elec. Cas. 9, 14, per Grant, C. J.

36 State v. Real Estate Bank, 5 Pike (5 Ark.), 595, 41 Am. Dec. 509.

37 Galveston & W. R. Co. v. Galveston, 91 Tex. 17, 39 S. W. 920, 36 L. R. A. 44, 90 Tex. 398, 39 S. W. 96, 36 L. R. A. 33, 7 Am. & Eng. R. Cas. (N. S.) 72, which reverses 73 S. W. 27.

CHAPTER XXII.

REGULATION AND CONTROL.

§ 364. Regulation and Control-General Statement.The right of a corporation to exercise its lawful franchises

or privileges is essential to its very existence, and courts will protect such franchises or privileges and prevent their being unlawfully or unconstitutionally impaired or destroyed, and this protection will be extended to prevent the enforcement against corporations of unlawful and unconstitutional governmental regulations and rules which would, if not thus subject to lawful restriction and supervision, deprive corporations of their franchises and property rights either in part or wholly. But the courts will also exercise equal vigilance to enforce all lawful and constitutional regulations and rules intended, without injury or loss to franchise rights or privileges, to safeguard the public by the proper control of corporations. These principles are sustained throughout all the decisions. The following words of the court in a Federal case are pertinent here; they are: "It must be borne in mind that a court may not, under the guise of protecting private property, extend its authority to a subject of regulation not within its competency, but is confined to ascertaining whether the particular assertion of the legislative power to regulate has been exercised to so unwarranted a degree as in substance and effect to exceed regulation, and be equivalent to a taking of property without due process of law, or a denial of the equal protection of the laws." 1

§ 365. Regulation and Control-Generally.-While we have considered this subject elsewhere we may substantially restate here the following propositions: A State may adopt such public policy as it deems best, provided that it does not in so doing come into conflict with the Federal Constitution; and if constitutional the legislative will must be respected, even though the courts be of opinion that the statute is un

1 Atlantic Coast Line Rd. Co. v. North Carolina Corp. Commission, 206 U. S. 1, 20, 51 L. ed. 933, 27 Sup. Ct. 585, per White, J.

Obligation of contracts-Police pow-
-Regulations. See § 335, herein.

ers

Obligation of contracts-Conditions Regulations-Reserved power to alter etc. See § 336, herein.

Obligation of contracts-Street paving by street railways-Conditions and regulations. See §§ 337, 338, herein.

wise. So a corporation is subject to such reasonable regulations as the legislature may from time to time prescribe, as to the general conduct of its affairs, serving only to secure the ends for which it was created and not materially interfering with the privileges granted to it. And state legislation which regulates business may well make distinctions depend upon the degrees of evil without being arbitrary and unreasonable. It is declared in a case in the Federal Circuit Court that the right of a State to regulate by law the business of common carriers, so far as that business is impressed with a public use, does not depend upon the fact as to whether the company received its charter or right to do business from that State, or whether it is incorporated or not; nor does it depend upon the state constitution; but that such right to regulate, in so far as that business affects the public, has its foundation and source in the right of the State to protect its commerce, and that laws which regulate the relation of the carrier to the public, and provide against discriminations and abuses, do not interfere with the private business of the common carrier. Again, in another Federal case where the power of the State to control public service corporations was before the court, it is said that: "There are certain principles involved in the consideration of the questions arising in this case which have been so clearly and definitely settled that it is unnecessary to review the various decisions of the courts supporting

2 Whitfield v. Ætna Life Ins. Co., 205 U. S. 489, 51 L. ed. — 27 Sup. Ct. rev'g 144 Fed. 356. See Munn v. Illinois, 94 U. S. 113, 24 L. ed. 77; Western Union Teleg. Co. v. Myatt, 98 Fed. 335; McGuire v. Chicago, B. & Q. R. Co., 131 Iowa, 340, 108 N. W. 902.

3 Chicago Life Ins. Co. v. Needles, 113 U. S. 574, 5 Sup. Ct. 681, 28 L. ed. 1084.

Ozan Lumber Co. v. Unión County National Bank of Liberty, 207 U. S. 251, followed in Heath

v. Milligan Mfg. Co. v. Worst, 207 U. S. 338, 356. The first of these cases, however, relates only to the power of the States to legislate; classification for governmental purposes; equal protection of the laws; notes for patented articles; and the point stated in the text. The second case relates principally to the adulteration of articles and is important here only as stating the point set forth in the above text.

5 Platt v. LeCocq, 150 Fed. 391.