Omaha daily bee., 1888-04-27

or telegraph company owning a parallel or
competing line, and in no case shall any con-
solidation take place, except upon public
notice Of at least sixty days 10 all stockhold-
ers, in such manner as may be provided by
law"
Section also provides that mo railroad
corporation shall issue any stock or bonds,
except for money, labor or property actually
received and applied TO the purposes for
which such corporation was created, and all
stock, dividends and other fictitious increase
Of the capital stock or indebtedness Of any
such corporation shall be void The capital
stock of railroad corporations shall not be
increased for any purpose, except after pub
lie notice for sixty days, in such manner as
may be provided by law.
This in an absolute prohibition against
railroad corporation consolidating its stock,
property, franchises or earnings, in whole or
in part, with any other railroad corporation
owning a parallel or competing line. The
word 'c0nsolidaten Is here used in the sense
of ''ioinn or unite" The constitutional
convention aimed at practical matters. The
character Of the title OF the parties operating
railway Ia Of but little moment TO the
general public, while the requirement that
different roads shall continue TO be compet-
ing lines as when they were constructed, is
OF the utmost importance TO all The
law cannot be evaded, therefore,
of conveyance. 1t will be observed that
there are two classes of railroads to which
the prohibition applies, viz: parallel and
competing. AS to what are parallel roads is
not now before the court; but that the de-
fendant was competing road is alleged in
the information, admitted by the demurrer,
and clearly shown from the record. 1t was,
therefore, clearly within the inhibition of
the constitution, and neither its stock, fran
chises or earnings can be joined to any other
competing line. The prohibition against the
1oinder of these prohibits the leasing of such
roads. Competition can only be had by Sc
curing competing lines, and thus prevent a
monopoly in the operation of the roads; and
this 1t did by prohibiting the purchase or
control Of parallel or competing roads under
the same management. AS the defendant
was organized prior to the adoption of the
constitution, 1t Is claimed that 1t would not
be subject to this restriction. There is no
force, however, In this objection. The cor
poratiun was organized to build and operate
railroad from the Kansas line to Lincoln
and Columbus. That was the very purpose
of its being. II had no authority to lease its
road under the statute and was therefore
deprived of no right, and the constitutional
inhibition applies to 1t.
The attorneys for the defendant contend
that section 5, article H. of tho constitution
applies more particularly to stockholders. 1t
has much broader scope, however. 1t was
intended to restrict the issue of stock and
bonds to the actual consideration received.
One OF the objects of the pro-
vision was to enable all parties to
know the actual cost of all railroads within
the state, so that the legislature in providing
for taxing them, and for regulating the
charges for transportation of persons and
property, may be enabled to do so advisedly,
and pass laws which shall be Just, alike to
the railroad companies, the public and indi-
viduals.
In any view Of the case, therefore, the de-
fendant's franchises are subject to forfeiture.
The court will not. in the first instance, how
ever, declare a forfeiture; but the lease will
be declared void
The demurrer is overruled and the defend.
ant has leave to answer by the first day of
the next term of court.
Order accordingly.
The other judges concur.