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cent case that the owner is not liable except for waters. In the Nichols case the facts were that negligence in handling the water, and held that a series of dams constructed by the defendant an unprecedented flood which washed away the were washed out by an unprecedented flood, and dam did not make the owner of the reservoir the volume of water so released damaged the liable in damages. Sutleff v. Sweetwater Water plaintiff's property. Co., 186 Pac. 766.
The Court distinguished the case of Fletcher In the Sutleff case defendant had erected a v. Rylands by showing that the damage was dam across the Sweetwater River impounding the direct result of the bringing together of the waters of the stream. To one side of the the water while in the Nichols case the proxi. stream was a depression a little lower than mate cause was not the impounding of the wa. the dam. Here an earth dike had been thrown ters (a perfectly lawful act), but the unpre. up to prevent any possible out-flow of the cedented flood. This distinction is sound and water at this point. An unprecedented flood in clearly sustained by the weight of authority. January, 1916, washed away this earth work and precipitated a large volume of water on to plaintiff's land to his serious injury. A judg.
ELEMENT OF FRAUD IN PROSECUTIONS ment for defendant was sustained by the Su
FOR SENDING FALSE REPRESENTATIONS preme Court on the theory that one who im THROUGH THE MAILS.-Fraud as a basis for pounds water in a reservoir is not liable, as an
a prosecution for using the mails to obtain insurer, for the escape of the water. On this
property by means of false representations is point the Court said:
different in one respect from that which con“The defendant's reservoir was a wholly
stitutes fraud in a civil suit. Under the federal proper and lawful thing, and its existence, act it is not an essential element of the offense maintenance, and use worked no injury to the that the victim of the fraudulent scheme should plaintiff's land, invaded no right of his, and
suffer pecuniary loss. Wine v. United States, could not for a moment be said to be a nuisance. The proximate and immediate cause of the
260 Fed, 911. flooding of the plaintiff's land and its conse. quent injury was not the existence of the de.
In this case the defendant secured an option fendant's reservoir or the manner of its main. on 3,320 acres of land in Texas at $9.22 per tenance or use, which were wholly lawful and acre or $3,000. He wrote two of his friends innocuous, but the overwhelming of the reser
in Oklahoma that he had secured an option voir by an agency beyond the defendant's control-in fact in this case beyond human con.
on the land for $58,000 or $17.47 per acre and trol."
saying that he could not handle the whole deal Lawyers are familiar with the old English
but would be glad to join with them in purcase of Fletcher v. Rylands, L. R. 1 Exch. 265.
chasing the property and would pay for half of cited as a leading case in all the text-books
the land at $17.47 per acre if they would take to the broad proposition, found in the opin
the other half at the same price. The deal was ion of Lord Blackburn, that the person, who for
put through on that basis, after which defenhis own purposes brings on his lands and col
dant's false representations were discovered lects and keeps there anything likely to do 1 and he was indicted under the provisions of mischief if it escapes, must keep it in at his
Sec. 215 of the Penal Code (Act of Congress, peril, and, if he does not do so, is prima facie
March 4, 1909, C. 321, 35 Stat. 1130). There answerable for all the damage which is the
was no allegation that the victims of defendant natural consequence of its escape.”
had suffered any pecuniary loss and defendant
was not permitted to show that the land was In the Fletcher case defendant had con.
worth the price of $17.47 per acre at which it structed a reservoir, the waters of which broke
was sold. In holding that in this respect no through the bottom into some ancient under.
error had been committed, the Court of Appeals ground workings whose existence was unknown,
(8th Cir.) said: and thence escaped into and flooded the plaintiff's colliery. For this the defendant was held
“This statute declares that anyone who de. liable regardless of any negligence upon its
vises a scheme 'to defraud,' or 'for obtaining
money or property by means of false or fraudpart.
ulent pretenses, representations or promises,' In the later English case of Nichols V.
and uses the mails to execute it, shall be fined
or imprisoned. The indictment and the eviMarsland, L, R. 2 Ex. Div. 1, the broad propo. dence are alike replete with charge and the sition of Lord Blackburn was restricted to the latter with proof that this defendant devised facts of that case and held not to make the im
a scheme to obtain for himself the east ranch pounder of waters an insurer against all dam
free of all cost to himself by means of false and
fraudulent pretenses, representations and promages caused by the unforseen release of the lises, and that he used the mails to execute that scheme. This was a plain violation of the lit | ington. They sought to escape from the order eral terms of the statute, and even if this vio.
under the rule announced in the case of Hitchlation had caused no pecuniary loss or damage
man Coal & Coke Co. v. Mitchell, 245 U. S. 229, to Van Dyke or Slifer, the defendant could not escape punishment for so glaring a deceit with
38 Sup. Ct. 65, L. R. A. 1918C 497. But the out a repeal or disregard of this law; and it is Chancellor calls attention to the mistake of the duty of the Court not to repeal or disregard
defendant's attorney in appearing and defendthis statute, but to enforce it. This section of
ing generally to the merits and not objecting the statute does not make damage or loss to the victims of a scheme to defraud, or to obtain
to the jurisdiction until after final argument on money or property by false pretenses, repre. the application for preliminary injunction. In sentations or promises, a sine qua non of its
the Hitchman case the nonresident defendants violation, and such damage or loss is not indis
appeared specially to object to the jurisdiction. pensable to the commission of an offense under it. Harris v. Rosenberger, 145 Fed. 449, 76 C. C. A. 225, 13 L. R. A. (N. S.) 762; Durland
The order of the Court in the present case v. United States, 161 U. S. 306, 315, 16 Sup. Ct. | affords some valuable suggestions as to what 508, 40 L. Ed. 709; United States v. New South
may properly be included in a decree in a case Farm Co., 241 U. S. 645, 36 Sup. Ct. 505, 60 L.
of this kind. The injunction restrained the Ed. 890, Ann. Cas. 1917C, 455; Chambers v. United States, 237 Fed, 521, 150, C. C. A. 395." defendants as follows:
"First. From knowingly and intentionally
causing or attempting to cause, by threats, ofINJUNCTIONS AGAINST ILLEGAL ACTS
fers, of money, payments of money, offering to OF STRIKING UNION MEN.—There is a no I pay expenses, or by inducement or persuasion ticeable stiffening on the part of the Courts of any employe of the complainant under contract their orders restraining acts of striking union
to render service to it to break such contract
by quitting such service. men. The boycott, the right to picket, while still admitted as abstract rights, are so re-i "Second. From attempting to cause any perstricted that practically they no longer exist. son employed by complainant to leave such emThis tendency is apparent in the recent case
ployment by intimidating or annoying such
employes by annoying language, acts or conof Thomson Machine Co. v. Brown, 108 Atl.
duct. Rep. 116, where the New Jersey Court of Chancery held that even where a strike by plain
“Third. From causing persons willing to be
employed by complainant to refrain from so tiff's employes was unaccompanied by violence,
doing by annoying language, acts or conduct. the strikers could be prevented from annoying plaintiff by parading before his place of busi "Fourth. From inducing, persuading or ness with placards asking plaintiff's employes causing to attempt to induce, persuade or cause
the employes of complainant to break their connot "to scab," etc. Such acts were in themselves
tracts of service with complainant or quit their declared to be illegal. On this point the Court
"Fifth. From threatening to injure the busi"I am still of the opinion that the act of the
ness of complainant or of any corporation, cusrespondents, maintaining in close proximity to tomer, or person dealing or transacting busithe plant of the complainant a building upon
| ness or willing to deal and transact business which they maintained placards, upon which with complainant, by making threats in writwere printed statements of the following na
ing or by words for the purpose of coercing ture: 'Don't scab. Honest jobs are plenty.
such corporation, customer or person, against Strike at Thomson Mch. Co.,' etc.--distributing
his or its will so as not to deal with or transact generally and handing employes and prospec
business with the complainant. tive employes of complainant cards, drawing attention to the fact that there was a strike "Sixth. From displaying or circulating cards, on, and that those who labored for complainant placards, pictures or other devices, either printwere scabs, and that complainant was unfair, ed, painted or written, in any place, reflecting communicating with users of machinery manu upon the ability of the Thomson Machine Comfactured by complainant and with labor em pany to make and fulfill contracts, or in any ployed on such machines in the use or repair | way casting reflection upon the reputation. thereof with the purpose of establishing a ability or conduct of the present employes of boycott, were illegal and should be enjoined. the Thomson Machine Company, or any of them, Jonas Glass Co. v. Glass Bottle Blowers' Asso or any persons willing to become such employes. ciation, 77 N. J. Eq. 219, 79 Atl. 262, 41 L. R. "Seventh. From communicating with the A. (N, S.) 445; Gompers v. Buck Stove & R. users of the machinery manufactured by comCo., 221 U. S. 418, 31 Sup. Ct. 492, 55 L. Ed. 797, plainant or with labor unions whose members 34 L. R. A. (N. S.) 874; Hitchman Coal & Coke work with said machines or on the repair there Co. v. Mitchell, 245 U. S. 229, 38 Sup. Ct. 65, of in such manner as to induce or persuade 62 L. Ed. 260, L. R. A. 1918C, 497, Ann. Cas. such users to discontinue the use of such ma1918B, 461."
chinery and prospective customers to refrain The order was served on the Grand Lodge
from purchasing such machinery and labor to
| refuse to work with such machines or on the of Machinists whose headquarters are in Wash- I
SUITS AGAINST RAILROADS | Federal control) of certain railroads and UNDER FEDERAL CONTROL.* systems of transportation (called herein
carriers).” and in which there was conIt is difficult to understand why an ad- tained authority for an agreement with the ministrative agency of any government carriers for "just compensation” for use of should permit uncertainty in the method bv | the roads. which citizens may obtain redress for viola- ! This statute required the making of contions of their rights. A citizen who has tracts between each road and the governby a railroad been injured, or whose prop ment and provided the conditions of the erty has been taken, either before or since use. It may be admitted, for the purpose the Federal government assumed the oper here, that Congress might have taken and ation of the railroads cannot know with cer- operated the railroads, making just comtainty whom to sue. This condition has pensation, and excluded their owners from been produced by orders of the Director all control, or obligations and at the same General of Railroads.
time declined to permit the citizens to sue About a year ago the Central Law Jour- | the governmental agency so created. Connal published opposing views of the validity gress did not see fit to deprive the public and effect of orders of the Director Gen of rights growing out of this national opereral. In those publications, it was shown ation of the railroads, but enacted:3 "Acthat the courts likewise had disagreed; a. tions at law, or suits in equity, may be disagreement still existing in a large num
brought by and against such carriers and ber of judicial opinions since rendered.
judgments rendered as provided by law; It is not the purpose of this discussion
and in any action at law or suit in equity either to go over ground covered in a for
against the carrier, no defense shall be made mer article or to refer to all the decisions
thereto upon the ground that the carrier that have been made. Suffice it to recall
is an instrumentality, or agency, of the Fedthe basic statute and orders and to cite all
eral Government. Nor shall any such carpublished Federal and some state court
rier be entitled to have transferred to a Feddecisions.
eral Court any action heretofore or here
after instituted by or against it, which acThe President took control of the rail
tion was not so transferable prior to the roads by proclamation, in which he said:
Federal control of such carrier.” “Suits may be brought by and against said carriers and judgments rendered as
In the contracts authorized by the statute hitherto until and except so far as said
it is provided :* Director may, by general or special orders, | “The Director General shall pay, or save otherwise determine."
the company harmless from, all expenses Later Congress enacted a statute in which incident to, or growing out of the possesit was recited, “That the President, having
sion, operation, and use of the property
taken over during Federal control. * * * in time of war taken over the possession,
He shall also pay, or save the company use, control, and operation (called herein harmless from * * * all judgments, or de
crees that may be recovered or issued * Mr. Watkins, the writer of this article, con- | against, and all fines and penalties that may tributed an article on this same subject which
be imposed upon the company by reason of was published in this Journal about a year ago. (88 Cent. L. J., 157.) This article was highly
any cause of action arising out of Federal commended by our readers. Mr. Watkins is the control, or anything done or omitted in the author of Watkins on Shippers and Carriers, a leading text-book and authority on the subject
(3) Id., p. 158. of which it treats.--Editor. (1) Henry C. Clark, Vol. 88, p. 100, Feb. 7,
(4) United States Railroad Administration 1919; Edgar Watkins, id., 157, Feb. 28, 1919.
Director General of Railroads, Bulletin No. 4. (2) Cent. L. J., Vol. 88, p. 157.
possession, operation, use or control was to meet war needs by unification of of the company's property during Federal
operation, common use of terminals, elimcontrol."
ination of unnecessary trains, and related Congress expressly gave the right to sue methods having as their object to lessen the as thereto "provided by law” and the gov waste of energy and increase the effectiveernment and the carriers by contract recog ness of the service. The statute did not nized the right and the government agreed make the government either owner or lessee, to “save harmless” the carriers from “judg- the government is merely an operator. The ments and decrees” which might result from law, in effect, said to the railroads, "Unity the exercise of that right. The statute and of operation is a war necessity and therethe contracts expressly annulled any right fore there shall be one head of the Board to limit the bringing of suits otherwise than of Directors of all railroads." The coras theretofore provided by law, if there was porate life was not affected, compensation such right, contained in the President's
was provided for, the continued right to proclamation quoted above.
file suits was stated and indemnity guaranNotwithstanding the statute and the con teed for judgments that might be rendered tracts, the Director General ordered that against carriers. That execution cannot be suits should be brought against the Director | issued to collect the judgments was a necesGeneral of Railroads and not otherwise. sary protection, the power to sue existing.
The statutory provision is so clear as to The provision for indemnity against judgleave no room for construction. Some of ments has no place in the statute, if there is the opinions holding valid the orders of the no right to sue. Suits must precede judgDirector General have relied on the deci ments. Further, if no suit lies, it was unsions of the Supreme Court holding the rate necessary for Congress to say: making power of the Director General ex “But no process, mesne or final shall be clusive over state power to prescribe intra levied against any property under such state rates.
Federal control.” Such decisions have no support from the The two reasons answered above comSupreme Court. The power to sue is ex- | prise the chief arguments holding valid the pressly reserved “as now provided by law.” orders of the Director General. The deciIn the same section the power to fix rates is sions to the contrary are firmly grounded expressly granted to the President in lan on the letter of the statute.? guage as follows:
(7) District Judge Walter Evans, March 2. "That during the period of Federal con
1918. Muir v. L. & N. R. Co., 247 Fed. 888: The trol, whenever in his opinion the public interest requires, the President may initiate erty of which was taken into possession." rates, fares, charges, classifications, regula
District Judge Trieber, October 22, 1918, Waintions, and practices.”
valid the order of the Director General fixing a Other courts have said that the employes District Judge Mayer, June 15, 1918, Cocker v
New York, O. & W. Ry. Co., 253 Fed. 676, holding now operating the railroads are the agents venue and stay orders (18, 18A, and 26) valid.
District Judge Haight, November 30, 1918. of the Director General and not of the par United States v. Metropolitan Lumber Co., 254
Fed. 335, holding that federal control does not ticular carrier owning the road and equip
suspend Elkins Act or Act to Regulate Conment. This reasoning disregards the stat
Judge Manton, June 12, 1918, Harwick v. Penn. ute and the purpose of Federal control. R. Co., 254 Fed. 748, Order 26 authorizing star The purpose of taking over the railroads District Judge Munger, December 27. 1918.
Friesen v. Chicago, R. I. & P. Ry. Co., 254 Fed.
Director General is "but the head of the Board of Directors of the railroad company, the prop
wright v. Penn. R. Co, 253 Fed. 459, holding
of proceedings valid.
(5) Id., pp. 334, 335.
(6) Northern P. Ry. Co. v. North Dakota, 250 U. S. 135, 39 Sup. Ct. 502, 63 L. ed.
875, order fixing venue invalid
District Judge Munger, January 11, 1919, Rutherford v. Union Pac. R. Co., 254 Fed. 880, holding Director General may be substituted as defendant in lieu of the carrier.
In Transportation Act, 1920, Congress nated by the President, in that court in by Section 206, Paragraph a, has provided which the action might have been brought that actions at law, suits in equity, and against such Carrier, had there been no proceedings in admiralty based on causes of Federal control. This is definite and refaction arising out of Federal control shall erence need only be had to state and Fedbe brought against an agent to be desig cral statutes to determine where suits shall
be filed in the future. District Judge Hand, Feb. 1, 1919, Jensen v. Lehigh Valley R. Co., 255 Fed. 795, denying a
| Paragraph b of the same section provides motion to substitute the Director General as a
a method for service in suits to be filed. defendant and saying: "It is, of course, true that normally we should expect the liabilities Paragraph c provides how complaints for to be those of the Director General, who is in control, but Congress has prescribed otherwise." reparation shall be filed and prosecuted.
Circuit Judges Walker and Batts and District Judge Grubb, Feb. 13, 1919, Postal Telegraph
In paragraph d, of Section 206, it is proCable Co. v. Call, 255 Fed. 850, C. C. A., * * * right to condemn land of railroad for use of tele
vided, graph company not suspended by federal con
“Actions, suits, proceedings and reparatrol. In discussing the controlling statute, that of March 21, 1918, the Court said: "It permits tion claims, of the character above deactions at law or in equity to be brought against the carriers, and judgments to be rendered as
scribed pending at the termination of Fednow provided by law and prohibits the carrier eral control shall not abate by reason of from defending upon the ground that it is an instrumentality or agency of the federal gov such termination, but may be prosecuted to ernment."
final judgment, substituting the agent desigDistrict Judge Reed, April 16, 1919, Dahn y. McAdoo, 256 Fed. 549, holding that the Director nated by the President under subdivision General may be sued and that Order No. 50 is
District Judge Beverley D. Evans, May 2, 1919, Pending actions, suits and proceedings Southern Cotton Oil Co. v. Atlantic Coast Line R. Co., 257 Fed. 138, holding that service on an em connote the legality thereof. If such acploye during federal control was no service on the railroad. See, also, District Judge Call, tions, suits, or proceedings have not been Wood v. Clyde S. S. Co., 257 Fed. 879. District Judge West, April 15, 1919, Nueces
filed in the proper court and venue, they Valley Townsite v. McAdoo, 257 Fed. 143, in
are not legally "pending.” junction improper under Act, March 21, 1918.
District Judge Foster. May 8. 1919. Johnson v. McAdoo. 257 Fed. 757. holding: "It was com
The question, therefore, of the proper petent for the federal Director General of Rail
construction of Section 10 of the Federal roads to stipulate in what jurisdiction he might be sued, but his authority to make rules and
Control Act is still open. regulations did not authorize the setting aside of the plain provisions of Act, March 21, 1918 (Comp. St. 1918, § 3115 34 a 3115 34 p, as to the Congress, in Paragraph g of Section 206 railroad companies)."
District Judge Foster, May 8, 1919, Wither of the Transportation Act, 1920, has furspoon & Sons v. Postal Tele. & Cable Co., 257 Fed. 758. Suits can be brought against the
nished further corroboration of the position company, not withstanding federal control.
taken above in this article. By Paragraph g District Judge Youmans, July 17, 1919, Mardis
lines, 258 Fed. 945. No suit can be brought Congress prohibits execution, or process on other than against the Director General.
District Judge Lewis, June 25, 1919, Hatcher & Snyder v. Atchison, T. & S. F. Ry. Co., 258 Fed.
Lands not used in federal control may be 952, company not liable for negligence of em
ed by execution. U. S. R. R. Administration ploye during federal control.
v. Burch, 254 Fed. 140. District Judge Westenhaver, October 3, 1919, Suits may continue to be prosecuted against Haubert v. Baltimore & O. R. Co., 259 Fed. 361, the railroads notwithstanding Order No. 50. railroads not subject to liability for acts of Louisville & Nashville R. Co. v. Steel, 202 S. agents operating them during federal control.
W. 878. District Judge Westenhaver, October 3, 1919. ! Lavalle v. Northern Pac. Ry. Co., 172 N. W. Smith v. Babcock & Wilcox, Actions to enforce 918. liabilities incurred during Federal Control may
McGregor v. Great N. R. Co., 172 N. W. 841. be maintained in such courts and only such courts as had jurisdiction in the absence of the
Gowan v. McAdoo, 173 N. W. 440. Federal Control Act.
Vaugh v. State, 81 So. Rep. 417. Suits against carriers may properly be served West v. New York, N. H. & R. Co., 123 N. E. on an employe of the railroad, although the rail
621. road is under Federal control. Circuit Court of Appeals, 5th Circuit, January 19. 1920, Vicksburg
Orders of Director General do not apply to S. & P. Ry. Co. v. Anderson-Tully Co., 361 Fed. suits antedating the orders. 741-744.
Scarborough v. Louisiana Ry. Nav. Co., 82 So. District Judge Van Fleet, August 13, 1919, Rep. 286. Nash v. Southern Pac. Co., 260 Fed. 280, Order Orders not applicable to mandamus proceedNo. 50 valid and not inconsistent with § 10 of
ings. Act, March 21, 1919.
Re Morris Avenue Bridge, 174 N. Y. Supp. 682. The Supreme Court has held that intrastate rates during federal control cannot be regulated Statute, & 10, Act March 21, 1918, authorizing by the states. Northern Pacific v. North Dakota, suits against railroads invalid. Shumacher v. 250 U. S. 135, 63 L. ed., 39 Sup. Ct. 502.
Penn. R. Co., 175 N. Y. Supp. 84.