railroad or steamboat, whether situated or operated within or without the state, except by the agent of the carrier possessing the certificate of authority provided for in the first section of the act.

"The fact that the purchaser of a ticket is prohibited from selling it to whom he pleases does not 'deprive him of his property without due process of law.' The disposition of property may always be limited or regulated where public interests so require. The ticket is not destroyed or taken from the holder, nor is his right to ride on it at all limited. The only limitation is upon his right to transfer it. If he wishes to ride on it, which is the purpose for which a ticket is presumably bought, he can do so; but, if he does not use it, his only course is to require the carrier who issued it to redeem it. As already suggested, a man has no constitutional right to insist that these contracts for transportation shall be transferable; and if the legislature had seen fit to declare that they should not be, and that they could only be used by the party to whom they were originally issued, they might have done so, even without making any provision at all for their redemption by the carrier if not used. This might not be true as to tickets, by their expressed or implied terms transferable, purchased before the passage of the act; but as to the tickets issued and purchased after that it is unquestionably true, for the statute becomes a part of the contract expressed in the ticket, and is inherent in the property in it. Ogden v. Saunders, 12 Wheat. 213.

"The indictment in this case charges defendant with selling the ticket nearly six months after the passage of the act, and, if the law should be regarded as invalid as to tickets issued and purchased before it was passed, it was for the defendant to plead and prove that he comes within the class of persons as to which the law is invalid, and that this ticket was one as to which the statute does not operate. A law may be entirely valid as to some persons and some acts, and invalid as to others, and its invalidity can be raised and taken advantage of only by those who show that they have a right to question the act. They must show that their rights are taken away by the law, and that as to them, in the particular case, there is a higher law in the Constitution which supersedes the statute. In Indiana and Illinois the courts have upheld statutes similar to the one under consideration in all material respects, except that they provide that the acts shall not prohibit any person who has purchased a ticket from any agent authorized as by the act provided, with the bona fide intention of traveling upon the same, from selling it to any other person. Fry v. State, 63 Ind. 552; Burdick v. People, (Ill. Sup.) 36 N. E. Rep. 948. In these cases the courts lay some stress upon this provision. But we are unable to see how the absence of it affects the validity of the act, or how, at least as to tickets issued after its passage, it deprives a person of his property without due process of law.' The law may in that respect be more drastic; but if the legislature thought that such an exception would open the door to evasions of the law, and that the evils aimed at could be effectually remedied only by absolutely prohibiting any sale of tickets within the state except by the carrier himself, through his agents authorized in the manner provided, we think it was competent for them to so declare.

"Neither is there anything in the objection that, while the act prohibits the sale of any tickets except in the manner prescribed, it only provides for the

redemption of unused tickets of railroads or steam boats situated or operated, in whole or in part, within the state. The limitation of the provisions as to redemption may have been because of the supposed inability of the state to compel redemption by foreign or nonresident steamboat or railway companies ; but, as the sale of all tickets might have been prohibited without any provision for their redemption, the act does not deprive the holder of a ticket of a nonresident carrier simply because it leaves him, in case he does not use it, to such remedies, if any, as may be given him by the law of the domicile of the carrier. It is hardly necessary to suggest that it is just as necessary, in order to prevent frauds on the public, to regulate the sale, within the state, of tickets of 'nonresident' carriers as of 'resident' ones. We may add, in passing, that section 5 of the act makes it the duty of a carrier within the state to redeem tickets sold by it in any manner,' no matter whether sold within or without the state; also, that the word 'owners' is evidently used in a comprehensive sense, so as to include all who are operating a railroad or steamboat, whether as owners of the property, or as lessees, receivers or the like. What has been said fully covers the first three objections to the statute.

"There is clearly nothing in the objection that the act unlawfully interferes with interstate commerce. In the first place, the question is not in this case, because the ticket is not for an interstate ride. But, even if it was, there would be nothing in the point. The law is not a revenue law, and is not designed to, and does not, regulate interstate commerce at all. It is a mere police regulation of the sale and transfer of tickets, designed to protect the public from frauds, and its interference, if any, with interstate commerce, is purely incidental and accidental. The grant of power to congress to regulate interstate commerce was never designed to, and does not, at all interfere with police power of the states to promote domestic order, to prevent crime and to protect the lives and property of its citizens, although such regulations may indirectly operate upon and affect interstate commerce. Such regulations are valid in spite of their operation on commerce, and the right to pass them does not originate from any power in the state to regulate commerce. The books are so full of cases to this effect that the citation of authorities in support of the proposition is unnecessary.

'Neither is there anything in the last objection. If defendant is correct in his construction of section 7, that it only imposes a penalty, in favor of the state, upon incorporated carriers for a refusal to redeem unused tickets, this is not an objection which he is in position to raise, as it does not affect him. If any owner of a railroad or steamboat situated or operated, in whole or in part, within the state, refuses to redeem his ticket, as provided in section 5, the purchaser has his civil remedy, wholly independently of section 7. Even if the latter section should be declared wholly invalid, on the objection of an incorporated carrier, it would not affect the validity of the balance of the act."

In State v. Ray, 109 N. C. 736; 14 N. E. Rep. 83, and State v. Clark, 109 N. C. 739; 14 S. E. Rep. 84, it was held that the statute of that state which makes it unlawful "for any person to sell or deal in tickets issued by any railroad company unless he is a duly authorized agent of said railroad company," was not violated by the sale of a single ticket, and that an indictment which merely charged the sale of a single ticket did not set forth the offense defined

in the act. The court said: "The important words that limit and define the grievance thus prohibited, are to sell or deal in tickets issued by any railroad company.' These words imply not simply the sale of a single such ticket as a person may have or obtain not of purpose to sell the same, but the practice or business of selling such tickets for others, or buying and selling them as is ordinarily done by 'ticket dealers or ticket brokers.'"

For some correspondence and opinions upon the subject of ticket brokerage, see Report of Interstate Commerce Commission, 1890, 365-376.

MISSOURI PAC. RY. Co. v. MCFADDEN ET AL.

(Supreme Court of the United States, May 26, 1894.)

1. CARRIERS.

BILL OF LADING.

NEGOTIABILITY. A bill of lading does not partake of the character of negotiable paper, so as to transfer to the assignors thereof the rights of the holder of such paper.

2. LIABILITY UPON BILL OF LADING ISSUED BEFORE RECEIPT OF THE GOODS, WHEN THE GOODS ARE NEVER IN FACT RECEIVED. BONA FIDE HOLDER. Whero bills of lading were issued for cotton which, pursuant to agreement and the course of dealing between the carrier and shipper, remained in the possession of a compress company, as agent of the shipper, to be compressed for the shipper's account, and was destroyed by fire before delivery to the carrier, held, that the carrier was not liable for the loss, by reason of the bills of ladng, either to the shipper or to an assignee of the bills of lading, who received the same without notice of such an agreement and course of dealing.

HIS was an action by George H. McFadden, John H. McFad

THIS

den and Franklin McFadden, composing the firm of George H. McFadden & Bro., against the Missouri Pacific Railway Company, for the loss of certain cotton. On submission of the case without a jury, the Circuit Court rendered judgment for plaintiffs. Defendant brought error.

The defendants in error (plaintiffs below) sued in the Circuit Court of Hunt county, Texas, to recover the value of 200 bales of cotton, alleged to have been shipped from Greenville, Texas, to Liverpool, England, the shipments having been evidenced by two bills of lading, each for 100 bales of cotton.

On application of the defendant below, the case was removed to the Circuit Court of the United States for the northern district of Texas. After filing the record in that court, the pleadings were amended. The amended answer set up the following, among other, special defenses on behalf of the company:

"First. That, while it is true that it had issued certain bills of lading for said cotton, said cotton had not yet, in deed and in truth, been delivered to it. It was the habit and the custom of defendant, and well known to plaintiffs to be such, after cottons were placed on the platforms at the compress in Greenville, before the same was compressed, it would issue bills of lading therefor to consignors desiring to ship. Said cottons would be delivered to the compress for the purpose of compressing, and that, at the time they were so delivered to it, the superintendent of the compress, or the agent of the compress, would check out such cottons intended, and the shipper would make out a bill of lading, which would be O. K.'d by the superintendent of the compress or its agent, and afterwards it would be brought to the agent of the defendant, and by him signed up, and defendant would actually receive said cotton only after it was compressed and delivered upon its cars. This course was pursued as a matter of convenience by the compress company and the shipper, but it was not intended, by either the shipper or the defendant, that the liability of the defendant should attach until the cotton was actually delivered upon its cars. This custom was well known to the plaintiffs, George H. McFadden & Bro., and to A. Fulton & Co., and the bills of lading were made out, according to this custom, by A. Fulton & Co., as herein shown, and accepted by A. Fulton & Co. according to such custom. At the time said bills of lading were made, the cotton was in the hands of the compress, according to the custom aforesaid, and had never been delivered to defendant, the defendant's liability as a common carrier had never attached, nor had any liability attached; but said cotton, while it was in the hands of the compress company, was wholly destroyed by fire, and never came to the hands of defendant. Defendant says said cotton was placed on said platform at said compress for the purpose of being compressed by A. Fulton & Co.; that they well knew, intended and expected said cotton should be compressed before it was shipped. Said cotton, while at the compress, was under the control of A. Fulton & Co. or their agent, the compress company."

The answer thereupon proceeded to set out other matters, to which it is unnecessary to refer.

The plaintiff replied to the amended answer, and excepted to the first count as follows:

"And they specially except to the first count in defendant's special answer, in so far as the same attempts to set up a custom of the manner of receiving cotton and issuing bills of lading, because the same does not show that the custom was such as is recognized and binding in law, but attempts to set up a custom which is contrary to law, and because the same does not show that it was such a custom as would relieve the defendant from liability on a contract in writing."

The reply then proceeded to except to other parts of the defendant's answer.

The court sustained the plaintiff's exception to the first count of the amended answer, to which ruling exception was reserved. Thereupon the facts were stated to be- First, that the bills of lading had been issued to Fulton & Co.; second, that they were assigned to the plaintiffs; third, that the value of the cotton was $8,647.83 at the time it was destroyed, and that the defendant had never paid therefor.

Upon this evidence, the case was submitted to the court without a jury, and the court found for the plaintiffs, and gave judgment for the value of the cotton. The case is brought here by writ of error.

James Hagerman, for plaintiff in error. Geo. Wharton Pepper and J. Bayard Henry, for defendants in error.

WHITE, J. (after stating the facts). Many questions were discussed at bar which we deem it unnecessary to notice, as we consider that the whole case depends upon the correctness of the judgment of the court below in sustaining the exception to the first defense in the amended answer. That defense averred that the cottons for which the bills of lading were issued were never delivered to the carrier; that, by a custom or course of dealing between the carrier and the shipper, it was understood by both parties that the cotton was not to be delivered at the time the bills of lading were issued, but was then in the hands of a compress company, which compress company was the agent of the

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