The weekly clarion. [volume] (Jackson, Miss.) 1863-1882, 1878-04-03
The Power "f Congress and Oh
Ihe H.eGi~Ts-G0re over (orPor-
aTiOBs..ssVesGed Rights"

more or less Dcdi1iiS uPOn SdoJCCe0 eHt
engaged the attention of our Legislature
at the last session, and will require con-
sideration in the-4uture The discussion
originated in the introduction of a bin 10
create out of the earnings OF the Unlon
and the Central Pacific companies sink
ing fund to pay their Obligations to the
government at maturity. The govern
meut has loaned to these companies bonds
which, with interest that it is now pay
ing. will constitute an Indebtedness when
the principal Is due that will amount to
about sl20 000, 600 aud as they have
made no provisions for meeting these
dues, and are not paying the accrulng
interest, it is believed that the proposed
legislation is necessary. The advocates
Of the measure are met at the threshold
by the partisans Of the corporations, with
the stereotyped argument that it would
interfere with "veete.. rights and inn
pair the obligati II 1t cpntr,cts. What
strikes the reader with peculiar force is
that the lawyers in the Senate differ
among themselves upon this question !;
and even differ as to the Interpretation
and proper application of the judicial
decisions which each, according to the
side on which he has enlisted, has adduced
in support of his theory.
an, = I
clares that the property Of corporations
for pecuniary profit shall be taxed in the
same manner and to the same extent as
that of individuals and that taxation
shall be uniform Several railroad com
panies, notably the Mobile & Ohio have
evaded the constitutional requirement
and escaped taxation on the ground that
prior to the adoption of this Constitution
in 1869, they had obtained charters eX-
emptiDg them from taxation until their
net earnings amounted to a fixed per
cent on their capital stock not yet
attained To determine this latter point
the Legislature at its last session passed
an act for the appointment of a commits
sioner to investigate the matter as to the
Mobile & Ohio Company.
Another important question affecting
the railroads also engaged the attention
of the Legislature-viz The suspended
bill to regulate charges for the transpor-
tation of cotton.
We have reproduced from the debates
on the bill above referred to Gin refer
ence to the Union and the Central Pacific
Companies) some citations which will
probably throw light upon the subjects
that were before our Legislature, and
which will be considered at its next
meeting:
EXTRACT FROM THE SPEECH OF SENATOR DA-
WIS, OF ILLINOIS.
The constitution of Wisconsin in force
when the several railroad charters were
granted provides that ''All acts for the
creation OF c operations within the State
may be altered or repealed by the Legisa-
ture at any time after their passage" The
LEGISLATURE passed an act fixing the limit
of lare for the transportation of any per-
son, classifying freights, and prescribing
the maximum rates therefor. The holders
OF The first mortgage bonds in one case and
the stockholders IN another case. filing
their bill against the railway company and
The officers of the State to restrain the COM
pauY from ob -ying aHd the authorities of the
state from enforcing the act, alleged that
the bDudS and the III prtgaSe OF tn" comp /
ny to secure the payment OF thea were exc
cuted pursuant To law; that the IaCes
charged by the company before the pas
sage of the act did not produce sufficient
income TO pay interest OIL its debT, divi-
denus and expenses, and that the enforce
meut OF the law prescribing reduced rat $
would cause the DIES ructiOn OF the Securj-
ties Of the com anY and i'm pair the obiig i
ZION o uhe contract between the holders OF
them and the company. lie was conteBded
hat as long rs the company operated its
road il had the right g. dem md aud receive
a reasonable com pen.atiJn tor Its services !;
chat what constituted such compensated
was Tor judicial detcrmi Ettion and not
legislative enactment; and that act in queS-
Lion as eIectualy deprived tie company OF
the ben fetal use OF lis property and the
means OF performing its engagements with
its creditors rs ii It's material property and
corporate rights were cohttscatrd.
The court, however, held that the Legis
lature had under the reserved power the
ri ght TO prescribe a maximum OF charges
even although the income OF the comps
may have been previously pledged as Sc
curity for the payment of its obligations
incurred upon the faith of the chart r,
(Peik VS.. Chicago aud Northwestern Rail
way Company, 4, Otto l64 > and in a sub
sequent case held that the company could
uoC recover for the trans portatinn Of prop
erty more than the maximum fixed by the
act by showing that the amount charged
was no more tuan reasonable cOmpensa
ZION for the services rendered. (Chic4g 90.
Milwaukee ana Saint Paul Railway Com
pany vs.. Ackley, tdem l79
The doctriae was during the same term
applied to cases arising in Iowa, Illinois
and Minnesota, and at the present term to a
case IN Ohio. which took effect in Septem-
Der 1851, ordained that mo special privi-
leges shall ever be granted that may not be
altered, revoked, or repealed by the Gener-
al Assem- bly,. (Article l, section p The
General Assembly shall pass no special act
| comforting corporate powers (Article Is,
section IL Corporations may be formed
under general laws, but such general laws
may from time to time be altered or re-
pealed." (Article 3D. section y A rail
tcdy company todS prior to that date tacorpord
ted under charter tchich tired no limitation
as TO The rates for The transportation Of persons
In 1856, the Legislature passed general
law authorizing, upon certain terms and
conditions, the consolidation of railwa V
com panieS. Several corporations, inciu-
ding the one SO operating ander a special
cyarter granted before the adoption of the
couSCitutlohs aNdtieu themselves OF the pro
visions OF that act and formed a consolida-
ted company. An act OF the General As
| sembly in 1870 limited the charges for pas
SengerS to three cents per mile. and the
court held thar this limitation could be i'm
posed wlthoui in.pairfag the obligation of con-
tract Notwithstanding the absence OF any pro-
UiSioR the charter Of one Of the companies re-
seryiRg 10 the Legislature any control oUer farse
aud fretghts.
And here are extracts from the speech
of Senator Christianey in support of the
same positions assumed by Senator Davis
The next case to which call attention is
that of the Chicago. Milwaukee and Saint
Paul Railroad Company VS. Ackley, Otto,
179, were, under the same constitutional
provision and the same law. it was held as /
now read from the head-note of the case:
"A railroad company in Wisconsin cannot