IX. The Law of Trade Combinations by the Hon. Alfred Lyttelton

THE proximity into which men are now brought, and the almost bewildering ease with which they can communicate with one another, have given a strong impulse in business to the principle of combination. Combination is the motto of modern commerce. More and more is it apparent that industry will in the future be mainly in the hands of associated bodies. On the one side vast companies and amalgamations of companies quarter out the field in which capital circulates; on the other Trade Unions numbering members in thousands and tens of thousands organize and regulate labour. Already companies have practically absorbed the great operations of Land Transport and Fire and Life Insurance; soon Banking will pass also under their sway. The Salt Union, the United Alkali Company, and the proposed Coal Trust mark the advance in this country alone of ideas of even vaster enterprise. Yet outside the serried ranks of these great associations there yet exist a large though perhaps a diminishing number of individual capitalists and a still larger and probably not diminishing number of individual workmen. Combined capital, guided by salaried managers, measures its long purse and its long arms against the individual proprietor operating in a narrower area, but with more concentrated energy. Combined labour, strong in the discipline of the trade union, confronts the single craftsman, and brings irresistible pressure to bear on him, if he ventures to resist its authority. The interests of labour and capital, to those most nearly concerned, appear only too often to be divergent and furnish ample material Edition: current; Page: [278] for misunderstanding. It will be at once seen that there are here the conditions of conflict. This conflict has none of the decorative aspects of war and is waged for no trophy of chivalry. The prizes striven for are common material things, but the struggle for commercial supremacy is a bitter one, and it is easy for the combatants to overstep the limits of order and the boundaries of the peace. To keep the peace is obviously the primary function of law, and law has thus been always concerned in restraining industrial combatants from any semblance of physical violence. But English law has not confined itself to this modest task. Combinations, especially combinations of labour, inspired such terror among our forefathers that, from the middle of the fourteenth century to the reign of George IV, we find statute after statute prescribing penalties upon all alliances and covines of workmen to alter wages, while the laws against forestalling, regrating, engrossing, and monopolies, coupled with the developed law of conspiracy, confined combinations of capitalists within rigid limits43 . These statutes which are out of harmony with modern ideas were deemed by their authors to be in accordance with sound principle, and with the well-known doctrine of English Common Law, that every person has individually and the public collectively a right to require that trade shall be kept free from unreasonable obstruction. But it is obvious that the word 'unreasonable' gives an elasticity to this legal doctrine of which the changing opinion of successive generations has taken full advantage, and indeed a full description of its fortunes would illustrate a very curious and interesting chapter in the history of economic opinion in this country. For it is natural that legal theories as to restraint of trade should fare very differently at the hands of mediaeval lawyers keenly alive to the necessity of securing supply in times when Edition: current; Page: [279] 'stores were small, transit difficult and famine near if supply were delayed,' and at those of a modern judge born in the atmosphere of free trade and steeped from his youth up in the doctrines of the Ricardian economists. The scope of this paper does not permit any historical discussion of this topic. Some recent decisions of the Courts have, however, defined the present law affecting trade combinations in certain difficult and obscure regions, and it may be of use, in view of the great importance of the subject, to ascertain if possible the positions definitely established by their authority. The decisions relate both to the Criminal and the Civil Law, to Statute and to Common Law. In this paper I propose to discuss in the first place the Criminal and then the Civil Law in the light of those decisions. The Criminal Law will fall conveniently into two divisions: (a) The Conspiracy and Protection of Property Act, 1875; (b) The Common Law Crime of Conspiracy.

I. (a) The Conspiracy and Protection of Property Act, 1875.

This Act of Parliament, which hereafter will be referred to as the Statute of 1875, exempts from the operation of the Common Law of Conspiracy all agreements to do any act in contemplation or furtherance of trade disputes between combined employers or combined workmen, which, if committed by individuals, would not be indictable under the common law. So far the Statute gives special privileges to trade disputants which are not enjoyed by any other class;—on the other hand, as it were to redress the balance, it imposes special burdens upon them by making criminal certain acts which may be committed by any citizen but which are in fact peculiarly characteristic of trade combinations. It will be observed that while all subjects of the Queen are affected by the new penalties, trade disputants alone are affected by the new exemptions. I append the actual words of the two sections whose effect I have summarized above.

'3. An agreement or combination by two or more persons to do or procure to be done any act in contemplation or furtherance of a trade dispute between employers and workmen shall not be indictable as a conspiracy if such act Edition: current; Page: [280] committed by one person would not be punishable as a crime.

'Nothing in this section shall exempt from punishment any persons guilty of a conspiracy for which a punishment is awarded by any Act of Parliament.

'Nothing in this section shall affect the law relating to riot, unlawful assembly, breach of the peace, or sedition, or any offence against the State or the Sovereign.

'A crime for the purposes of this section means an offence punishable on indictment, or an offence which is punishable on summary conviction, and for the commission of which the offender is liable under the statute making the offence punishable to be imprisoned either absolutely or at the discretion of the court as an alternative for some other punishment.'

'7. Every person who, with a view to compel any other person to abstain from doing or to do any act which such other person has a legal right to do or abstain from doing, wrongfully and without legal authority,—

'(1) Uses violence to or intimidates such other person or his wife or children, or injures his property; or,

'(2) Persistently follows such other person about from place to place; or,

'(3) Hides any tools, clothes, or other property owned or used by such other person, or deprives him of or hinders him in the use thereof; or,

'(4) Watches or besets the house or other place where such other person resides, or works, or carries on business, or happens to be, or the approach to such house or place; or,

'(5) Follows such other person with two or more other persons in a disorderly manner in or through any street or road,

shall, on conviction thereof by a court of summary jurisdiction, or on indictment as hereinafter mentioned, be liable either to pay a penalty not exceeding twenty pounds, or to be imprisoned for a term not exceeding three months, with or without hard labour.

'Attending at or near the house or place where a person Edition: current; Page: [281] resides, or works, or carries on business, or happens to be, or the approach to such house or place, in order merely to obtain or communicate information, shall not be deemed a watching or besetting within the meaning of this section.'

Section 7, it will be seen, enumerates the various methods of coercion which from time to time have been employed by trade organizations, and may perhaps be said to comprehend the totality of such methods by the word 'intimidate.' It has been objected to this word that it is too vague, and if it be true, as many wise men think, that the criminal law should in all cases be rigidly precise in its definitions, it is a charge which we think is made out; but there is more perhaps to be said in favour of a criminal statute that leaves something to the intelligence of the tribunal which administers its decrees than would at first be supposed. When for instance the word 'intimidate' was limited as in a previous statute to actions which would justify a magistrate in binding over the intimidator to keep the peace, it was only human nature for men to ascertain precisely those actions which would cause the maximum of fear, without giving a magistrate such a jurisdiction.

One of the most effectual penal statutes of modern times is the Corrupt Practices Act, 1883, which imposes fine and imprisonment on persons doing certain acts 'in and about the conduct and management of the election.' Now there is no definition in the statute of the time when an election commences, and during ten years no judge has laid down with precision this fatal hour. The result is that numerous offences subject to severe penalty are left vague. But the objectors to this vagueness are not purists in legal codification but old election hacks, who if the election period had been rigidly ascertained would only have ceased corrupt expenditure at midnight of the day before.

A long stride in the clear definition of the word 'intimidation' has now been made, so that the vice of vagueness, if it be a vice, is largely mitigated. As early as 1880 Mr. Justice Cave ruled that to constitute intimidation within the meaning of the section under consideration personal violence must be Edition: current; Page: [282] threatened; and in 1891 the scope of the section, and in particular the meaning of the word 'intimidation,' were considered and determined by five judges in two cases the importance of which justify a somewhat detailed reference.