New-York daily tribune. [volume] (New-York [N.Y.]) 1842-1866, 1847-05-15
Corporate Liability.

70 risk part Of his property IN an industrial or
pbilantbropic enterprise without being compelled
20 hazard the wboIef Such is the issue made up
by the more rabid Barnburners in our Senate TO be
tried ont In our coming Elections. Let US recon
sider it
Our New Constitution has very properly forbid
den the passage Of any more sPecid acts oil ihco'
porstion bat directed the Legislature to pass In
stead general laws regulating the formation aud
management of Corporations, exacting such per
sonal and other Liability Of the stockholders as
shall be deemed proper. The Legislature pro-
ceeded to enact such general law with regard to
Companies formed for Manufacturing and kindred
purposes AT once the question arose--W hat LII
ability 70 properl The Assembly by the strong
vote Of 50 to H. passed bill prescribing thste
s,ockholder in such company shall be responsible
to any creditor thereof first to make good the nom
inal amount OF bis stock That is, If the nominal
capital Of the Company is 100000, in shares Of
sl0O each, every stakeholder may be held person
ally responsible by any creditor to make good the
amount Of his shares. Supposehe has one hundred
shares on which he has paid in but $40 per share
he can be sued personally and made to pay to the
amount of 10000. which is the sum required to
make his stock fu Beyond that amount, he can
be held for any fraud. wilful Encouragement or
perversion of the Company's funds 20 bis own
uses and still farther, he can be held responsible
to every lsborer for or person employed by the
Company to the full extent Of his property. Such
were the liabilities and responsibilities OF Stock
holders in Corporations according to the Assemblys
bill
These did not satisfy the more ferocious Barn
burners in the Senate They insisted that each
Stakeholder should be liable, in addition to the
above, 10 every general creditor Of the Company
for farther amount equal to the nominal value OF
his stock in the Company. Thus the owner Of one
hundred shares of 500 each in Company becom-
ing insolvent would be required to lose in addition
to bis investment of $4,000 a farther sum Of
$4,000. beside being responsible to the whole
amount Of his property for the labor employed by
the Company Because the House would not
agree to this the bill is defeated and the organza
ton Of Manufacturing Companies arrested.
Let us look at this difference closely. A. b.
successful merchant, retires at sixty with com
petence, and lives quietly in some country village.
Soon his more active neighbors come to him saying
Mr.. b. we want factory in our place TO give EN-.
ployment TO the surplus female and juvenile labor
1t will be great public and private benefit We
are forming Company with capital OF 100000,
and wish YOU 10 take $4,000 of the stock
"Neighbors," replies Mr.. B. II will be frank with
you. can command the money, and am willing
to risk so much in the enterprise yop contemplate
But i am not willing to risk my all, for ] am
growing old with an expensive family about me
and cannot recall my business if | would. Ifyou
say the 900 shall be the extent of my risk, |
will subscribe otherwise could not
Why, responds the spokesman, there are just
= two additional liabihties-one special for another
sl0 900 to be paid in the enterprise miscar-
.riss and the other generator the full amount Of
the debts due to sborers
Are these Just r. rejoins b. Do they afford
equal profits for equal risks One or more OF you
.neighbors, will doubtless sell the Company ground
and water-power at good prices others expect to
sell goods largely to the workmen others expect
to be agents. overseers, builders, sc. for the Com
'pany--to supply it with timber, brick fuel, &c.
&c. have no such expectations or desires.
put in my $4,000 and have 100000 invested else
where we will say four of you invest 5000
being all they have. Their direct dividend OF pro
FITS to say nothing OF indirect advantages, will be
twice the amount Of mine my hazard will behvt
times great theirs. l do not think this fair
Il dare not so risk the bread of my children pre-
fer to keep my property separate and under m!
own control Good morning, gentlemen"
What is gained by driving him to this decision
Who resps benefit from it
The public know whether we are or are not dis
posed to sacrifice the Rights of the Poor for the ia
vor Of the Rich. They will Judge of our sincerity
when we state our conviction that no more ists
blow was ever aimed at the interests of the Poo
than in this defes, of the General Manufacturing
Law. and the grounds OF it.
Mr.. B. is willing TO invest portion of his me an
on certain conditions, with which everybody con
cerned is satisfied All the parties agree to d
business with each other on specified terms; whe
in steps the State-thatis. Messrs. Barlow, YouDe
Lester & Co-and says, No; you shall not ssre
with each other. or, il you do, nullify the agree
mont and substitute another in its stead 20
course. We do not deny that there are cases i
which the State may thus interfere, and rghtfully
Bat !" "a" such case The presumption ofoours
10 in favor Of the parties understanding their ow
business the contrary is not to be assumed bu
shown. IL it necessary here to substitute by Law
what end VIII any man compare the dealing
o ~ orations with those Of individual bushes
MT. s> 'pects the payment of their lsborers an
the sSesy,s Of their creditors generally Their
u Lowell wsa>h has been manufacturing by Con-
pAniss all under limited liability. for the last qua
ter Of century. Nos, Of the Companies hav
made money some have lost; = very few hav
failed Has the Labor employed there by Corps
rstions, to the amount Of many millions of dollar
Lost one per cent Of it's wages No. nor hun
dredth part Of one per cent. IL has always bee
fully paid once fortnigb,-psid all in cash, to-
Is there anywhere Population OF five to ten thou
sand hired W ykers gmployed by individuals
whom this ca SID or anything as favorable
We challenge III I'D to produce it.
Loco ism proF has tried this warfare o
Corporat'olA I'd Limited Liability IN New Hamr
shire. in WisecA "a and in some other sections
we believe vito a uniform result We have fait
in the good sense and intelligence of our Peopl
wh..S |, Nds as confidently to anticipate like re-
suit here. Let have no compromising or bs,
xaining, but fall discussion of the question O.
its merits and settlement by a popular verde,