But in considering this contention the court says that the original purpose of the contract was to regulate the business of manufacturing a product under what was supposed to be a new invention on which letters patent of the United States had been issued, whereby an article then nearly worthless might be converted into an article of large value. The use to which the fish skins were put under this invention gave them their market value. The plaintiff and defendant sought to unite with each other in the purchase of the raw material, so that they might not be tempted to overbid each other and thus to raise it to an unreasonable price, and also to agree on the price at which the manufactured article should be sold so that they might be secure in a reasonable profit. Even if they hoped for gain by their joint exertions or by the possession of a patent as to the value of which they were subsequently disappointed, their contract had no relation to an article of prime necessity, or to staple commodities ordinarily bought and sold in the market, but to a particular article of which both were manufacturers under the same process, and to an article used in the manufacture which was of little value for any other use; that the agreement was not obnoxious to the objection made by the defendant is shown by the case of Central Shade Roller Co. v. Cushman, 3 New Eng. Rep. 505, 143 Mass. 353. In Central Shade Roller Co. v. Cushman, 3 New Eng. Rep. 505, 143 Mass. 353, the contract which is sought to be enforced was made between the plaintiff of the first part and three manufacturers under several patents of certain curtain fixtures known as "wood balance shade rollers" of the second part, in pursuance of an arrangement between the persons forming the party of the second part, that the plaintiff corporation should be created for the purpose of becoming a party to the combination, and purposed to prevent, or rather to regulate, competition between the parties to it in the sale of the particular commodity which they made. It was held that this is a lawful purpose, but it is argued that the means employed to carry it out-the creation of the plaintiff corporation and the terms of the contract with it-are against public policy, and invalid. But the fact that the parties to the combination formed themselves into a corporation of which they were the stockholders, that they might contract with it instead of with each other, and carry out their scheme through its agency instead of that of a pre-existing person, it is said is obviously immaterial, and the only ground upon which it can be argued that the contract is invalid is the restraint it puts upon the parties to it. The court then inquires whether the contract imposes a restraint as to the manufacture or the sale of balance shade rollers, which is void as against public policy, and concludes that the contract certainly puts no restraint upon the production of the commodity to which it relates. It puts no obligation upon and offers no inducement to any person to produce less than to the full extent of his capacity. On the contrary, its apparent purpose is, by making prices more uniform and regular, to stimulate and increase production. The contract does not restrict the sale of the commodity. It does not look toward withholding a supply from the market, in order to enhance the price, as in Craft v. MeConoughy, 79 Ill. 346, and other cases to the same effect. On the contrary, the contract intends that the parties shall make sales, and gives them full power to do so, the only restrictions being that sales, not at retail or for export, shall be in the name of the plaintiff and reported to it, and the accounts of them kept by it, and the provision that when any party shall establish an agency in any city or town for the sale of a roller made exclusively for that purpose, no other party shall take orders for the same roller in the same place. To these restrictions, clearly valid, there is added the one which affords an argument for the invalidity of the contract -the restriction as to price. That restriction is, in substance, that the price for rollers of the same grade, made by different parties, shall be the same, and shall be according to a schedule contained in the contract, subject to changes which may be made by the plaintiff upon recommendation of three fourths of its stockholders. This the court regards as in effect an agreement between three makers of a commodity that for three years they will sell it at a uniform price, fixed at the outset, and to be changed only by consent of a majority of them. The agreement does not refer to an article of prime necessity, nor to a staple of commerce, nor to merchandise to be bought and sold in the market, but to a particular curtain fixture of the parties' own manufacture. It does not look to affecting competition from outside (the parties have a monopoly by their patents), but only to restrict competition in price between themselves. Even if such an agreement tends to raise the price of the commodity it is one which the parties have a right to make. To hold otherwise would be to impair the right of persons to make contracts and to put a price on the products of their own industry. But, it is said, we cannot assume that the purpose and effect of the combination is to unduly raise the price of the commodity. A natural purpose and a natural effect is to maintain a fair and uniform price, and to prevent the injurious effects, both to producers and consumers, of fluctuating prices caused by undue competition. When it appears that the combination is used to the public detriment, a different question will be presented. The contract is apparently beneficial to the parties to the combination, and not necessarily injurious to the public, and it is denied that there is any authority or reason for holding it to be invalid as a restraint of trade or against public policy. CHAPTER IX. MODIFICATIONS OF THE RULE AS TO CONTRACTS IN § 42. Mitchel v. Reynolds-Act of Parliament in 1844, Repealing Statutes Regarding Trade. 43. Modern Doctrine that Restraint is Valid, if Co-extensive only with Interest to be Protected and with Benefit Meant to be Conferred. 44. Public Policy Concerning Trade Restrictions. 45. Examples of Modern Rule Regarding Restrictions. 46. Legality of Consideration, and Reasonableness of Restriction, Questions of Law. 47. Presumption as to Legality of Contracts in Partial Restraint of Trade. 48. Contract in Restraint of Trade Legal in Part and Severable. 49. Partial Restriction of Trade not Permissible by Corporations. $42. Mitchel v. Reynolds-Act of Parliament in 1844 Repealing Statutes Regarding Trade.-As the rule announced in Mitchel v. Reynolds, 1 P. Wms. 181, was intended to apply to then present conditions of commercial and social life, it of necessity must change with altering circumstances and conditions, and the inclination of modern thought and of the decisions, has been no longer to uphold in its strictness the doctrine which formerly prevailed in respect of agreements in restraint of trade. The severity with which such agreements were at first treated became more and more relaxed by exceptions and qualifications. This change was gradual and may be considered, perhaps, as due mainly to and as keeping even pace with the growth and spread of the industrial activities of the world and enlarged commercial facilities, which render such agreements less dangerous as tending to create monopolies. The earlier doctrine, of course, obtained in respect of agreements between individuals. The limitation which became imposed was that the agreement should operate as to a locality, and not as to the whole land. In later times the extreme danger in such agreements seems only necessarily to exist when corporations are parties to them; for their means and strength would usually better enable them to buy off rivalry and to create monopolies. In 1844, a statute was passed in Parliament which removed many of the cumbersome provisions regarding contracts supposed to be restrictive of trade. The Act was as follows: "An Act for Abolishing the Offenses of Forestalling, Regrat ing, and Engrossing, and for Repealing Certain Statutes Passed in Restraint of Trade. "Whereas divers statutes have been from time to time made in the parliaments of England, Scotland, Great Britain and Ireland respectively prohibiting certain dealings in wares, victuals, merchandise, and various commodities by the names of badgering, forestalling, regrating, and engrossing, and subjecting to divers punishments, penalties, and forfeitures, persons so dealing; and "Whereas it is expedient that such statutes, as well as certain other statutes made in hindrance and in restraint of trade, be repealed; and "Whereas an Act of the Parliament of Great Britain was passed in the twelfth year of the reign of King George the Third, intituled 'An Act for repealing several laws therein mentioned against badgers, engrossers, forestallers and regraters, and for indemnifying persons against prosecutions for offenses committed against the said acts,' whereby after reciting that it had been found by experience that the restraint laid by several statutes upon the dealing in corn, meal, flour, cattle, and sundry other sorts of victuals, by preventing a free trade in the said commodities, have a tendency to discourage the growth and to enhance the price of the same, which statutes, if put in execution, would bring great distress upon the inhabitants of many parts of this kingdom, and in particular upon those of the cities of London and Westminster, sundry acts therein mentioned, and all the acts made for the bet. ter enforcement of the same, were repealed, as being detrimental to the supply of the laboring and manufacturing poor of this kingdom; and "Whereas, notwithstanding the making of the first recited Act, persons are still liable to be prosecuted for badgering, engrossing, |