The Magnolia gazette., 1883-11-08
REGULATION OF CORPORATIONS.
Meridian Observer.

Meridian Observer.
Judge Cooley, Of the United States
Court Of Michigan is universally regard
ed as one OF the soundest judicial think
ers Of this or any other country, and
his opinions carry great weight. In m
article on the above subject in the North
American Review. he makes some inter-
eating points on the question Of State
regulation. which are classified as follows.
/. 1t is just as much within the prop
er police authority of the State to keep q
water company, telegraph company.
railway company, or any other public
corporation from abusing its powers in
the matter of charges as it ie to prevent
other abuses. And this may be done
in strict accord with the principles of
common law, and by virtue of powers
which are inherent in every sovereignty.
2. In comforting upon the operation
the right to charge for the services rem
dered to the public, without expressly
abdicatIng the power of control, tile
State must be understood to have reser-
we'd il. All corporate grants are to be
strictly construed, and it must be as
sumed that the State proposed to give
nothing which it has not given in ex.
press terms, aud that the grantees have
bargained for and secured in express
terms everything they understood they
were to haye. A railway charter, there
fore, which authorizes the company to
establish such freight and passenger
rntes as it shall from time to time deter
mine by it's by, laws, confers the power
subject to the higher authority Of the
State to regulate the rates itself if the
circumstances shall seem to demand its
interposition.
3. 1t may become a question at some
future time, whether M express grant
to a corporation of the exclusive right TO
fix it's own charges, is not subject, like
all other corporate franchises, to the i'm
piled con iition that it shall not be
abused. The penalty for the abuse -of
franchises is forfeiture by judicial pro.
ceedings Mt the instance of the State,
and it is conceivable that cases of such
outrageous extortIon aud palpable in
Justice might occur as would Justly Sub.
lcct corporation to this punishment.
4. The power Of the State is practi.
cally absolute whenever, in granting
corporate franchises, the power to
amend or repeal at will has been reser.
we'd. 1t is Of no Importance that the
charter confers upon the corporation
the exclusive authority to fix its own
charges, for the Legislature may at any
time revoke the grant or set limits TO
il.
5. Iii some kinds of business competi
ton will keep corporations within the
limits Of reason in their charges; in
others, it will not. When it will hot, il
may become necessary to legislate upon
profits. Ii the business is simple, like
the supply Of light or water, this can be
done by prescribing tariff of rates. In
railway transportation, however. this
could only be mischievous except in case
OF mere local roads.
6. II corporate powers are taken away
on judicial forfeiture, the Judgment de-.
termines that there has been corporate
misconduct deserving it; but when the
Legislature acts under its reserved pow
or, it is not necessarily to be inferred
that any corporate misbehavior exists or
is charged.
z. Corporate franchises are granted
on consideration of State policy, aud
they may be taken away upon no other
reason than the legislative view Of State
policy has changed.