Reasonableness of requirements. The qualifications exacted by the legis lature must be reasonable and apt to promote the public interests. If they are purely arbitrary and not conducive to the public welfare, they must be condemned as constituting an unwarrantable interference with the right preserved hereby to follow a lawful calling. People v. Griswold, (1914) 213 N. Y. 92, 106 N. E 929, L. R. A. 1915D 538, affirming 151 App. Div. 933, 135 N. Y. S. 1132; People v. Ringe, (1910) 197 N. Y. 143, 90 N. E. 451, 18 Ann. Cas. 474, 27 L. R. A. (N. S.) 528, affirming 125 App. Div. 592, 110 N. Y. S. 74. Section 6a, chapter 572, Laws of 1905 (§ 295 of Public Health Law), is an unnecessary and unwarrantable interference with constitutional rights insofar as it provides that “ a person not already engaged in the business of undertaking shall not engage in such business unless he shall have been duly licensed as an embalmer. The public health does not require that an embalmer be an undertaker, or that an undertaker be an embalmer. The business of undertaking has been carried on for generations, particularly in rural districts, by persons not holding embalmers' licenses and who have no special knowledge of the work of embalmers. There is nothing that occurs to us, or that has been called to our attention, to indicate any danger to public health in permitting a person otherwise qualified to carry on the business of undertaking solely because he is not a licensed embalmer." People v. Ringe, supra.

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Prescription of exclusive mode for acquiring requisite qualifications.— Section 6a, chapter 572, Laws of 1905 (§ 295 of the Public Health Law) is an unwarrantable interference with constitutional rights insofar as it stipulates that no person shall be licensed as an undertaker unless he has been employed as an assistant to a licensed undertaker continuously for a period of at least three years. "The provisions of the statute requiring that the service must be continuous and arbitrarily prohibiting the issuing of a license to a person to engage in the business of undertaking unless such person has been an assistant to a licensed undertaker for the time therein specified unnecessarily interferes with the common-law right to engage in a lawful business. It makes a particular form of acquiring skill and knowledge essential and forfeits the right to count the time so engaged in that particular education at each time when there is a break in the continuity of the service." People v. Ringe, (1910) 197 N. Y. 143, 90 N. E. 451, 18 Ann. Cas. 474, 27 L. R. A. (N. S.) 528, affirming 125 App. Div. 592, 110 N. Y. S. 74.

(4) Regulation of Public Business.

Generally." When the owner of property devotes it to a use in which the public has an interest, he in effect grants to the public an interest in that use and must, to the extent of that interest, submit to be controlled by the public for the common good, so long as he maintains the use. Within the same principle, if a business in which the citizen engages is one of a public nature, or in which the public have an interest, he must submit for the public purposes to the regulation of his business by the authority of the state." Board of Fire Underwriters v. Whipple, (1896) 2 App. Div. 361, 37 N. Y. S. 712. To the same effect Musco v. United Surety Co., (1908) 196 N. Y. 459, 90 N. E. 171, 134 A. S. R. 851, affirming 132 App. Div. 300, 117 N. Y. S. 21; People v. Formosa, (1894) 131 N. Y. 478, 30 N. E. 492, 27 A. S. R. 612, affirming 61 Hun 272, 16 N. Y. S. 753; People v. Budd, (1887) 117 N. Y. 1, 22 N. E. 670, 682, 15 A. S. R. 460, 5 L. R. A. 559, affirmed 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247; People v. King, (1888) 110 N. Y. 418, 18 N. E. 245, 6 A. S. R. 389, 1 L. R. A. 293, affirming 42 Hun 186, 5 N. Y. St. Rep. 138; People v. Boston, etc., R. Co., (1877) 70 N. Y. 569; Buffalo v. Buffalo Gas Co., (1903) 81 App. Div. 505, 80 N. Y. S. 1093; Matter of Annon, (1888) 50 Hun 413, 2 N. Y. S. 275, affirmed (1889) 117 N.. Y. 621, 22 N. E. 682, 148 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247;

Wallack v. New York, (1874) 3 Hun 84, affirmed 67 N. Y. 23. See alse People v. Public Service Commission, (1912) 153 App. Div. 129, 138 N. Y. S. 434; Rochester, etc., Turnpike Road Co. v. Joel, (1899) 41 App. Div. 43, 58 N. Y. S. 346; Phillips v. Ritter, (1897) 20 App. Div. 34, 46 N. Y. S. 547; Coney Island, etc., Co. v. Kennedy, (1897) 15 App. Div. 588, 44 N. Y. S. 825. See further, infra, this note, p. 115, c. Police Limitations on Property Rights. And see art. 3, § 1, infra, p. 210.

Basis of right of regulation.- The right of the legislature to regulate the conduct of a business affected with a public interest, does not have its foundation in, or emanate from, any grant or privilege conferred by the state. "The attempts made to place the right of public regulation in these cases upon the ground of special privilege conferred by the public on those affected cannot, .. be supported. The underlying principle is that business of certain kinds holds such a peculiar relation to the public interests that there is superinduced upon it the right of public regulation." People v. Budd, (1887) 117 N. Y. 1, 22 N. E. 670, 682, 15 A. S. R. 460, 5 L. R. A. 559, affirmed 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 347. Compare Board of Fire Underwriters v. Whipple, (1896) 2 App. Div. 361, 37 N. Y. S. 7′12. A railroad company is evidently engaged in a business affected with a public interest. People v. Boston, etc., R. Co., (1877) 70 N. Y. 569. See also Buffalo E. S. R. Co. v. Buffalo St. R. Co., (1888) 111 N. Y. 132, 19 N. E. 63, 2 L. R. A. 384; People v. Public Service Commission, (1912) 153 App. 'Div. 129, 138 N. Y. S. 434; People v. Public Service Commission, (1911) 143 App. Div. 769, 128 N. Y. S. 384; Phillips v. Ritter, (1897) 20 App. Div. 34, 46 N. Y. S. 547; Coney Island, etc., Co. v. Kennedy, (1897) 15 App. Div. 588, 44 N. Y. S. 825. "Railroad corporations hold their property and exercise their functions for the public benefit, and they are therefore subject to legislative control. The legislature which has created them may regulate the mode in which they shall transact their business, the price which they shall charge for the transportation of freight and passengers, the speed at which they may run their trains, and the way in which they may cross or run upon highways and turnpikes used for public travel. It may make all such regulations as are appropriate to protect the lives of persons carried upon railroads, or passing upon highways crossed by railroads. All this is within the domain of legislative power, although the power to alter and amend the charters of such corporations has not been reserved." Boston, etc., R. Co., supra.

People v.

Gas and electric company.-A company supplying gas to the public is engaged in a business of public interest and is, therefore, subject to legislative regulation. Saratoga Springs v. Saratoga Gas, etc., Co., (1908) 191 N. Y. 123, 83 N. E. 693, 14 Ann. Cas. 606, 18 L. R. A. (N. S.) 713, reversing 122 App. Div. 203, 106 N. Y. S. 1148; Richman v. Consolidated Gas Co., (1903) 114 App. Div. 216, 100 N. Y. S. 81, affirmed 186 N. Y. 209, 78 N. E. 871; Buffalo v. Buffalo Gas Co., (1903) 81 App. Div. 505, 80 N. Y. S. 1093. So, too, a person furnishing electricity to the public follows a public pursuit. Saratoga Springs v. Saratoga Gas, etc., Co., (1908) 191 N. Y. 123, 83 N. E. 693, 14 Ann. Cas. 606, 18 L. R. A. (N. S.) 713, reversing 122 App Div. 203, 106 N. Y. S. 1148.

Insurance.— The business of insurance obviously is of public concern and hence is subject to legislative supervision and regulation. Hauser v. North British, etc., Ins. Co., 206 N. Y. 455, 100 N. E. 52, 1914B 263, 42 L. R. A. (N. S.) 1139; People v. Formosa, (1892) 131 N. Y. 478, 30 N. E. 492, 27 A. S. R. 612, affirming 61 Hun 272, 16 N. Y. S. 753; Board of Fire Underwriters v. Whipple, (1896) 2 App. Div. 361, 37 N. Y. S. 712. See also New York Fire Department v. Stanton, (1898) 28 App. Div. 334, 51 N. Y. S. 242. "Life insurance companies perform very important functions in modern society. They operate in all parts of the state, and a very large number of people are interested in them. They are resorted to for the purpose of making

provisions for families and dependents after the death of the insured, and for that purpose many persons invest in them the accumulations of their labor and their thrift. The nature of insurance contracts is such that each person effecting insurance cannot thoroughly protect himself. He is not competent to investigate the condition and solvency of the company in which he insures, and his contracts may run through many years and mature only, as a rule, at his death. Under such circumstances, it is competent for the legislature, in the interest of the people and to promote the general welfare, to regulate insurance companies and the management of their affairs, and to provide by law for that protection to policy holders which they could not secure for themselves." People v. Formosa, (1892) 131 N. Y. 478, 30 N. E. 492, 27 A. S. R. 612, affirming 61 Hun 272, 16 N. Y. S. 753. Thus, chapter 846 of the Laws of 1867, imposing upon the persons engaged in the business of insurance in New York city a proportion of the expense incident to maintaining a fire patrol therein, is constitutional. Board of Fire Underwriters v. Whipple, (1896) 2 App. Div. 361, 37 N. Y. S. 712. Similarly, the provisions of the Act of 1889 (ch. 282, Laws of 1889), in relation to life insurance companies doing business in this state, which forbids them or their agents from paying or allowing any rebates of premium as inducement to any person to insure, and declaring any person violating the prohibition guilty of a misdemeanor, is constitutional. People v. Formosa, (1892) 131 N. Y. 478, 30 N. E. 492, 27 A. S. R. 612, affirming 61 Hun 272, 16 N. Y. S. 753.

However, section 142 of the Insurance Law, the purpose and effect of which is to confine the business of broker in procuring insurance to those who should make that their principal business, or who should be real estate agents or brokers, is unconstitutional. Hauser v. North British, etc., Ins. Co., (1912) 206 N. Y. 455, 100 N. E. 52, 1914B 263, 42 L. R. A. (N. S.) 1139, affirming 152 App. Div. 91, 136 N. Y. S. 1015. In that case the court said: "We may readily concede that, as a measure regulative of a business pursuit, which, from the extent to which it is carried on, is, presumably, affected with a public interest, the requirement by the legislature of a license would not be an unreasonable exercise of power. That would afford an opportunity for inquiry into antecedents and fitness of character, and be a reasonable enough precaution in the public interest. But the legislature has prescribed in this statute a condition for the issuance of the license, which is a purely arbitrary restriction. There is no good reason, and no public interest can, conceivably, be subserved, in prohibiting persons from conducting the business of an insurance agent, or broker, in connection with any other lawful business, or occupation, in which they may be engaged."

Transmitters of money.- "The regulation of the business of receiving deposits is plainly within the power possessed by the state to regulate the conduct of various pursuits when necessary for the protection of the public." A statute (ch. 185, Laws of 1907), providing that " all corporations, firms and persons now or hereafter engaged in the selling of steamship or railroad tickets for transportation to or from foreign countries, who in conjunction with said business carry on the business of receiving deposits of money for the purpose of transmitting the same, or the equivalent thereof, to foreign countries, shall, before entering into said business, or before continuing said business, except as hereinafter provided, make, execute and deliver a bond to the people of the state of New York in the sum of fifteen thousand dollars, conditioned for the faithful holding and transmission of any money, or the equivalent thereof, which shall be delivered to it or them for transmission to a foreign country," does not contravene this clause. Musco v. United Surety Co., (1909) 196 N. Y. 459, 90 N. E. 171, 134 A. S. R. 851, affirming 132 App. Div. 300, 117 N. Y. S. 21.

Elevating grain.—“There are elements of publicity in the business of elevating grain which peculiarly affect it with a public interest. They are found in the nature and extent of the business, its relation to the commerce

It is

of the state and country, and the practical monopoly enjoyed by those engaged in it. . . . The business of elevating grain is an incident to the business of transportation. The elevators are indispensable instrumentalities in the business of the common carrier. It is scarcely too much to say that, in a broad sense, the elevators perform the work of carriers. They are located upon or adjacent to the waters of the state, and transfer from the lake vessels to the canal boats, or from the canal boats to the ocean vessels, the cargoes of grain, and thereby perform an essential service in transportation. by means of the elevators that transportation of grain by water from the upper lakes to the seaboard is rendered possible. It needs no argument to show that the business of elevating grain has a vital relation to commerce in one of its most important aspects." People v. Budd, (1889) 117 N. Y. 1, 22 N. E. 670, 682, 15 A. S. R. 460, 5 L. R. A. 559, affirmed 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247; Matter of Annon, (1888) 50 Hun 413, 2 N. Y. S. 275, affirmed (1889) 117 N. Y. 621, mem., 22 N. E. 682, 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247.

Regulation of rates and charges.- By virtue of its general supervisory power over a business affected with a public interest, the legislature is competent to regulate the rates or charges to be made by a person engaged therein; and such regulation, so long as it does not deny the right to a · reasonable return on the business, is not violative of this provision. Saratoga Springs v. Saratoga Gas, etc., Co., (1908) 191 N. Y. 123, 83 N. E. 693, 14 Ann. Cas. 606, 18 L. R. A. (N. S.) 713, reversing 122 App. Div. 203, 106 N. Y. 8. 1148; People v. Budd, (1889) 117 N. Y. 1, 22 N. E. 670, 682, 15 A. S. R. 460, 5 L. R. A. 559, affirmed 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247; People v. Boston, etc., R. Co., (1877) 70 N. Y. 569; People v. Public Service Commission, (1913) 159 App. Div. 531, 145 N. Y. S. 503, People v. Public Service Commission, (1912) 153 App. Div. 129, 138 N. Y. S 434; Richman v. Consolidated Gas Co., (1906) 114 App. Div. 216, 100 N. Y. S. 81, affirmed 186 N. Y. 209, 78 N. E. 871; Matter of Annon, (1888) 50 Hun 413, 2 N. Y. S. 275, affirmed (1889) 117 N. Y. 621, mem., 22 N. E. 682, 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247. See also People v. Public Service Commission, (1911) 143 App. Div. 769, 128 N. Y. S. 384; Buffalo v. Buffalo Gas Co., (1903) 81 App. Div. 505, 80 N. Y. S. 1093; Rochester, etc., Turnpike Road Co. v. Joel, (1899) 41 App. Div. 43, 58 N. Y. S. 346. Thus, an Act of 1888 (ch. 581, L. 1888), fixing the maximum charge for elevating grain and making a violation of the act a misdemeanor, is not violative of this provision, but is legitimate exercise of the police power of the state over a business affected with a public interest and so is constitutional. People v. Budd, (1889) 117 N. Y. 1, 22 N. E. 670, 682, 15 A. S. R. 460, 5 L. R. A. 559, affirmed 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247; Matter of Annon, (1888) 50 Hun 413, 2 N. Y. S. 275, affirmed (1889) 117 N. Y. 621, 22 N. E. 682, 143 U. S. 517, 12 S. Ct. 468, 36 U. S. (L. ed.) 247. Again, the legislature is competent to fix commutation rates to be charged by carriers and it may require them to allow commuters rates lower than those generally prevailing. Such a requirement is not unconstitutional as discriminating against the carriers and the public in favor of a particular class. The service given commuters is essentially different from other passenger service. "It is so universal, of such large proportion, has become so necessary to the public that it cannot be said that the fixing of reasonable and just rates for it is unusual or unreasonable, or the granting of a benefit to individuals and not for convenience to the public." People v. Public Service Commission, (1913) 159 App. Div. 531, 145 N. Y. S. 503. Similarly, section 69 of the Transportation Corporations Law (Laws of 1900, ch. 566), which provides that "no gas light corporation in this state shall charge or collect rent on its gas meters, either in a direct or indirect manner," is constitutional. Buffalo v. Buffalo Gas Co., (1903)

81 App. Div. 505, 80 N. Y. S. 1093.

Prescription by legislature of terms of labor contract.- By virtue of this clause a person has a right to contract for the purchase and sale of labor. Lochner v. New York, (1904) 198 U. S. 45, 25 S. Ct. 539, 49 U. S. (L. ed.) 937, 3 Ann. Cas. 1133, reversing (1904) 177 N. Y. 145, 69 N. E. 373, 101 A. S. R. 773, affirmed 73 App. Div. 120, 76 N. Y. S. 396; New York Cent., etc., R. Co. v. Williams, (1910) 199 N. Y. 108, 92 N. E. 404, 139 A. S. R. 850, 32 L. R. A. (N. S.) 549, affirming 136 App. Div. 904, 120 N. Y. S. 1137; People v. Marcus, (1906) 185 N. Y. 257, 77 N. E. 1073, 113 A. S. R. 902, 7 Ann. Cas. 118, 7 L. R. A. (N. S.) 282, affirming 110 App. Div. 255, 97 N. Y. S. 322; Wright v. Hart, (1905) 182 N. Y. 330, 75 N. E. 404, 3 Ann. Cas. 263, 2 L. R. A. (N. S.) 338, reversing 103 App. Div. 218, 93 N. Y. S. 60'; People v. Coler, (1901) 166 N. Y. 144, 59 N. E. 776, affirming 56 App. Div. 459, 68 N. Y. S. 767; People v. Coler, (1901) 166 N. Y. 1, 59 N. E. 716, 82 A. S. R. 605, 52 L. R. A. 814, affirming 56 App. Div. 98, 67 N. Y. S. 701. Accordingly, section 171a of the Penal Code, which in effect is an enactment that a person shall not make the employment or the continuance of any employment of a person conditional upon the employee not joining or becoming a member of a labor organization, is an unauthorized restraint upon the freedom to contract in relation to the purchase and sale of labor and is unconstitutional. People v. Marcus, (1906) 185 N. Y. 257, 77 N. E. 1073, 113 A. S. R. 902, 7 Ann. Cas. 118, 7 L. R. A. (N. S.) 282, affirming 110 App. Div. 255, 97 N. Y. S. 322. Similarly, a provision under the Labor Law (L. 1897, ch. 415), forbidding employers in bakeries and confectionery establishments to work more than ten hours a day, has been held to be beyond the police power possessed by the legislature, and hence invalid. Lochner v. New York, 198 U. S. 45, 25 S. Ct. 539, 49 U. S. (L. ed.) 937, 3 Ann. Cas. 1133, reversing (1904) 177 N. Y. 145, 69 N. E. 373, 101 A. S. R. 773, affirmed 73 App. Div. 120, 76 N. Y. S. 396. However, statutes (§§ 10 and 11 of the Labor Law, Consol. Laws, ch. 31) requiring railroad companies to pay the wages of their employees semi-monthly and in cash, are not unconstitutional as working a deprivation of liberty, but may be enacted by the legislature under article 8, section 1, wherein the power to amend corporate charters is reserved. New York Cent., etc., R. Co. v. Williams, (1910) 199 N. Y. 108, 92 N. E. 404, 139 A. S. R. 850, 32 L. R. A. (N. S.) 549, affirming 136 App. Div. 904, 120 N. Y. S. 1137.

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Similarly, by virtue of section 1 of article 12, the legislature can regulate and fix the wages or salaries, the hours of work or labor, and make provision for the protection, welfare and safety of persons employed by the state or by any county, city, town, village or other civil division of the state, or by any contractor or sub-contractor performing work, labor or services for the state, or for any county, city, town, village or other civil division thereof," and can thus abridge the rights of those engaged on public works to contract with respect to the sale of their services. Thus, a statute (L. 1906, ch..506, §3) which enacts that no workman employed on state or municipal work or by a contractor or subcontractor doing work for the state or a civil division thereof shall be permitted or required to work more than eight hours in any one calendar day," except in certain specified emergencies, is free from objection hereunder, being allowed by the section set out above. People v. Metz, (1908) 193 N. Y. 148, 85 N. E. 1070, 24 L. R. A. (N. S.) 201, reversing 126 App. Div. 912, 110 N. Y. S. 1141. Prior to the adoption of the portion of article 12 quoted, a different rule obtained with respect to the legislative power to curtail the right of contract of those employed on public works. People v. Coler, (1901) 166 N. Y. 1, 59 N. E. 716, 82 A. S. R. 605, 52 L. R. A. 814, affirmed 56 App. Div. 98, 67 N. Y. S. 701; People v. Coler, (1901) 166 N. Y. 144, 59 N. E. 776, affirming 56 App. Div. 459, 68 N. Y. S. 767. The latter cases, of course, no longer apply.