Daily Los Angeles herald., 1878-11-19
trron the evening E.press.)

SACRAMENTc, NOV. 10, loies
For the past two days the Con-
vention has been debating, In Com
mittee Of the Whole, upon an
amendment to section 8 of the arti-
Gle submitted by the Committee on
Corporations. The amendment |
was offered by Judge Terry, and
embraces the principle set forth in
the proposition about Savings
Banks, submitted by Mr.. Ayers in
the early part Of the session. The
am endment makes the Directors or
Trustees of all joint-stock assocla-
tions or trust corporations liable,
severalIy and jointly. to the stock
holders and creditors for any en-
bexziement or misa ppropriation of
moneys by any officer of the asso-
citation. The amendment was
dercely attacked as an attempt to
destroy corporations by indirec-
tion. All the lawyers, with few
exceptions. argued against the
amendment, and claimed that
cases might arise in which 1t
would make innocent Trustees suf-
fer for the faults of their colleagues.
On the other hand, 1t was claimed
that the people who dealt with cor
porations required protection, and
the late swindling bank failures,
both In San Francisco and Sacra-
mento, were cited as specimens of
the working of the presentsystem OF
responsibility. Men of reputation
permitted their names to be used
IS bank directors. and people were
induced to deposit In those banks
because of their knowledge OF the
good standing of the directors.
But it has been found, in every In
stance of disaster of late. that these
directors knew little or nothing of
the affairs of the banks which they
were supposed to control, and their
responsibility. under the law.
amounted to nothing. Such sys-
tenn is little else than obtaining
money under false represe ntation,
and the friends of the amendment
resisted every effort made to mod
ify it. They insisted that respon-
sibility should be somewhere in
these corporations. and determined
that 1t should be placed on the
shoulders of the directors. If they
did not know the condition of the
concerns they were presumed to
manage, they ought to know ii,
and If they were made liable for all
Interpretations they would be
sure to keep themselves convers-
ant with their affairs. The fight
gradually assumed corporation
aud anti-corporation issue, and al
though q number OF delegates who
I know are sound on the railroad
voted against the amend
ment, yet it was carried by very
large majority. On division there
were ninety-eight in favor of it. If
this is an index of the complexion
ofthe Convention on the great mo-
nopoly question, Stanford might as
well stay at home, for the day when
public affairs can be run in his
interest is past, and the people
themselves will hereafter resume
the government ofth State.
The vote is looked upon as great
victory by the friends of the peo-
pie. and I have no doubt it will
have marked effect upon the fur.
ther action of the Convention on
the report of the Committee on
Corporations. There will now be
disposition to go much further than
the Committee have been willing
TO go in their report, and stringent
and even radical restrictions will
be introduced with good prospect
of adoption.
The contest just over has satisfied
me of another important fact. and
tharis. that the popular majority
of the Convention has backbone
OF excee ling rigidity-one which
no amount of gIittering rhetoric
can bend where the issue is square.
ly made as between the rights of
the people aud the assumptions of
the corporations. Whatever mis-
takes this Convention may make,
they will not be i'll favor of the
power of the few and against the
rights of the many. am more
pleased with it as body low than
l have ever been before. 1t has
asserted its manhood and indepen-
dence. 1t has shown itself true to
the people who sent it here, and
worthy Of their highest conf
dence.
Since the close vote in Commit |
tee Of the Whole las. Thursday
evening, by which the press was
delivered over to the tender mercies
nf the Judges, l find that a great
many Of those who voted for that
proposition have seen their error,
and when the subject comes up In
Convention, they will make the
necessary correction, and restore
the clause which gives to juries in
libel cases the determination OF the
law az well as the fact. feel very
certain that this result will be at
tanned. and have therefore no hesi-