138 
Strong—The Legal Status of Trusts. 
353; Sewing machines — Bi-Spool Sewing Machine Co. v. Acme 
Manufacturing Co., Supreme Court of Mass., March 2, 1891. 
A second and most important exception is based on the now 
well established rule that the validity of contracts restricting 
competition is to be determined by the reasonableness of the re¬ 
striction. If the main purpose or inevitable effects of a contract 
is to suppress competition or create a monopoly, it is illegal; 
but contracts made for a lawful purpose, not unreasonably in¬ 
jurious to the public welfare and which impose no heavier re¬ 
straint upon trade than the interests of the favored party re¬ 
quire, have been uniformly sustained, notwithstanding their 
tendency to check competition to a certain extent. The public 
welfare is first considered, and the reasonableness of the restric¬ 
tion determined under these rules in the light of all the facts 
and circumstances of each particular case. It is evident from 
this that there may be still another class of commercial combina¬ 
tions in the nature of trusts to which the principle will not 
apply in case there is no special legislation to the contrary. 
Several decisions which will be considered in connection with 
the federal anti-trust law of 1890 will illustrate this point 
clearly and strongly. The above considerations form the basis 
of the decision of the United States Circuit Court of Appeals in 
the recent case of United States v. Trans-Missouri Freight As¬ 
sociation et al. (58 Fed. Rep. 58). But it is the application of 
this doctrine that makes this decision notable. It was held that 
even railway companies and other quasi-public corporations, 
whose business is of such a character that it has been said they 
cannot be restrained to any extent whatever without prejudice 
to the public interests may, within proper bounds, make such 
contracts and combinations as shall impose mutual restraint, 
though it diminishes competition. 
The matter of combination has been passed upon by the Su¬ 
preme Court of Minnesota (July 20, 1892) in the case of a com¬ 
bination among the lumber dealers of Minneapolis. In giving 
the opinion in favor of the combination, Judge Mitchell said: 
“ This is the age of associations and unions in all departments 
of labor and business, for the purpose of mutual benefit and pro¬ 
tection. Confined to proper limits, both as to end and means,. 
