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probably true that the rapid multiplication of monopoly corporations is due, not so much to the desire of their promoters to obey the law as to their efforts to evade it, by bringing their enterprises within its terms in utter disregard of its spirit.

Reference to a few American cases will illustrate the atti. tude of our courts to these combinations and show how radically it differs from the present position of the English courts. In the case of State of Ohio vs. Standard Oil Company, 49 Ohio St., 138, the Supreme Court of Ohio held that an agreement by which all or a majority of the stockholders of a corporation transferred their stock to trustees, in consideration

of agreements by the stock holders of other similar corporations to do the same, all receiving trust certificates to represent their transferred stock and entitle them to draw the dividends on such stock, tended to create a monopoly and control prices and was void as against public policy.

The Supreme Court of Illinois, in the case of The People vs. The Chicago Gas Trust Company, 130 III.,268, held that a corporation, organized for the manufacture and sale of gas and “to purchase and hold or sell the capital stock” and works of other gas companies, did not have power to acquire and hold the stock of the existing gas companies of Chicago, the provision in its charter being void because against public policy at common law.

The Supreme Court of Illinois also held, in the case of Distilling and Cattle Feeding Co. vs. The People, 156 II., 448, 490, that a corporation, to succeed a trust, in fact, organized by the trustees of the stockholders of several corporations, to acquire the properties of such corporations, was illegal because repugnant to public policy just as the trust itself had been. The court say:

"There is no magic in a corporate organization which can purge the trust scheme of its illegality, and it remains as essentially opposed to the principles of sound policy as when


the trust was in existence. It was illegal before and it is illegal still, and for the same reasons."

The United States Circuit Court, in the case of National Harrow Company vs. Hench, 76 Fed. Rep., 667, held that a combination among manufacturers of various patented harrows in pursuance of which each assigned its letters patent to a corporation and took back an exclusive license to make and sell the same harrows as before, all agreeing to sell at uniform prices, was a combination to prevent competition and enhance prices, and therefore an illegal restraint of trade.

The Supreme Court of the United States, in the case of United States vs. Trans-Missouri Freight Association, 166 U. S. 290, held that under the Act of Congress of July 2, 1890, entitled “An Act to Protect Trade and Commerce against Unlawful Restraints and Monopolies,” all contracts in restraint of trade or commerce, among the several States, or with foreign nations, are void, whether in the form of trusts or otherwise and without regard to their reasonableness or whether they would have been unlawful at common law. Under this interpretation of the act an agreement between railroad companies, "for the purpose of mutual protection by establishing and maintaining reasonable rates, rules and regulations," was pronounced invalid.

Many of the States have enacted drastic legislation for the suppression of trusts, the tendency being to increase the stringency of such legislation. A number of these statutes declare that "all arrangements, contracts, agreements, trusts or combinations made with a view to lessen, or which tend to lessen, free competition in the importation or sale of articles imported into this State," "in the manufacture or sale of articles of domestic growth or of domestic raw material," are "against public policy, unlawful and void.” They proceed to provide for the forfeiture of the charters of domestic corporations which shall violate their provisions, for the ex


clusion from the State of foreign corporations (including those of other States) for their violation, and for the punishment by fine or imprisonment of the officers and agents of such offending corporations for conspiracy. They also give persons injured by such combinations a right of action for damages. Such in substance are the anti-trust statutes of Arkansas and Indiana. In Illinois and Missouri it is further provided that no corporation may issue or own trust certificates, or be controlled by any trustee or trustees, with intent to limit or fix the price or lessen the output of any article of commerce. In New York every contract, arrangement or combination, whereby a monopoly in the manufacture or sale of “any article or commodity of common use is or may be created, established or maintained,” or whereby competition is or may be restrained or prevented, or whereby for the purpose of creating or maintaining such monopoly the free pursuit of any lawful business, trade or occupation is or may be restricted or prevented, is declared to be "against public policy, illegal and void."

The foregoing illustrations from the judicial decisious and legislation of the country may serve to indicate the extreme hostility of American law to all combinations to suppress free and open competition. The question arises, why do these combinations flourish here as nowhere else in the face of this hostility? The answer to this inquiry is not obvious but complex. The public policy of the country on this subject must be sought in the entire body of its judicial decisions and the legislation affecting it. The truth is that the public policy which finds such abundant expression in anti-trust decisions and legislation is in direct conflict with the public opinion in the loose incorporation laws of the various States, the contract clause of the Constitution, and the protective duties levied on imported goods. We have already noted the bearing of the first two of these on the trust problem. The tariff is even more important. While Mr. Havemeyer may exagger


ate in pronouncing the tariff "The mother of all trusts," it is beyond all question the efficient wet-nurse of most of them. It would be strange indeed if domestic combinations to control the production and selling price of commodities should not be directly aided by laws imposing duties averaging some fifty per cent ad valorum on competing importations. Mr. Havemeyer, from his point of view, has good ground to criticise those who object to combinations of domestic producers to secure the enhanced prices which Congress--in what we are pleased to regard its wisdom-by its tariff bills, has adjudged to be simply their due. The statutes of every State under which any three or more persons may organize a corporation of any size for any purpose, the general interpretation of the contract clause of the Constitution by which corporations are given a stability unknown to private citizens, and the tariff laws by which American producers are authorized by law to charge fancy prices for their products, are to be regarded as expressions of public policy as truly as are the laws against trusts. To the fact that these public policies are in direct conflict is mainly due the failure of our anti-trust laws. We have, by laws which continue in America a public policy as old as special privilege, raised up powerful combinations of capital, which have thus far made naught of the conflicting public policy which finds expression in the anti-trust legislation and decisions and which seeks to protect the rights of an entire people. This is but the modern form of the old conflict between special privilege and equal opportunity.

The splendid prizes which our tariff legislation has placed within the grasp of successful combination in almost every field of industry and trade, with the way made plain and easy to stable incorporation, has led everywhere to the successful evasion of even the most stringent anti-trust laws. The great decisions of our courts pronouncing trusts and combinations illegal have only accelerated their progress to the goal of monopoly incorporation.


The mighty trusts of today are, almost without exception, simple stock corporations which directly own former competing plants. Their inflated capital stocks are listed on the exchanges and have there become part and parcel of the speculative securities of the day. Enterprises of enormous moment to the people have thus, in evasion of the law, fallen into the hands of adventurers. In some cases they will be managed to earn dividends; in others, those in control will find their advantage in stock manipulations. We have already had a foretaste of the possibilities of insolvencies, receiverships and reorganizations. In view of the fact that no rights are so unprotected by law as those of minority stockholders of corpora tions, the great increase of sur'h securities is not a pleasing incident of this development.

The anti-trust laws having been evaded by the promoters of the monopoly corporation, the trust in this final form stands in open violation of the spirit of the law free from the charge of technical illegality. Unless the principle of the decision of the Supreme Court of Illinois is the case of Distilling and Cattle Feeding Co. l's, The People, above noted, is to receive wide application, the monopoly corporation seems for the present secure. It may be excluded from other states by further hostile legislation; but even this remedy has its limitations in the commerce clause of the Constitution. It was the purpose of that clause to secure absolute free trade among the states; and the courts will probably not permit serious interference with inter-state traffic in commodities,

Cooper ufg. C'0. 18. Ferguson, 113 U, S., 727.
Robbins 18. Shelby Taring District, 120 U.S., 489.
State of Minn. vs. Barber, 136 U. S., 313.

Breman is. City of Titusrille, 153 U'. S., 289. even though produced by monopoly corporations. The difficulties of the problem are much increased by our numerous jurisdictions. It is by no means probable that uniform State legislation can be secured on this subject. It is clear, however,

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