Daily tobacco leaf-chronicle. (Clarksville, Tenn.) 1890-1895, 1890-06-26
KNOCKED our.
The Sugar Trust by the New
York Court of Appeals.
That Gigantic Monopoly Given
a Death Blow.

the North River Refining COmpany's
Case Fully Affirmed, and the DissOlu-
tion of the Corporation Ordered-POints
In Judge Finch's Decision.
SARATOGA, N. Y, June 26.-The court
of appeals has handed down decision
in the case of the North River Refining
company, the sugar trust case, dismiss
ing the appeal with costs to appellant.
The decision is strongly against the
trust. The judgments of the lower
courts dissolving the trust are fully
affirmed by the court of appeals. The
decision was written by Judge Finch,
and says:
The Judgment sought against the de-
fendant is one of corporate death. The
state which created it asks us to destroy,
and the penalty Invoked represents the
extreme rigor of the law. It's infiiction
must rest upon grave cause and be war
ralAted by material misconduct. The life
of corporation is indeed less than that
of the humblest citizen, and yet it en-
yelopes great accumulation of property,
moves and carries in large volume the
business and enterprise of the people,
and abundant reason This would be
true even if the legislature should dictate
the destruction of the corporate life 10y
repeal of the corporate charter, but it is
beyond dispute where the state summons
its defender before it's judicial tribunals
and submits its complaint to their judg-
ment and view By that process it as
sumes the burden of establishing the
IL IL. ...A
show us warrant in the facts for the relief
which it seeks. Two of the charges pre-
ferred in the complaint have dropped
out of sight. They were of little
importance, and have been pru-
IDENTIFY dismissed from the in
quiry for that reason and we are left to
consider the one grave and serious accu-
sation to which alone the process and
arguments have been directed. That ac-
cusation is adequate for the purpose for
which it is framed but upon two condi-
tions, which dictate the line of inquiry
and limit the area of discussion.
Two questions open before us-first, has
the defendant corporation exceeded or
abused it's powers, and, second, does that
excess or abuse threaten or harm the pub
lie welfare We find disclosed that it has
become an integral part and element of a
combination which possesses over 1t an
absolute control, and dictates the extent,
and manner, and terms of its entire busi-
ness activity. All its stock is in the cen
tral corporation, dominated by board
consisting of only eleven individuals, who
took and distributed to its own stock
holders certificates of the board, carrying
a proportionate interest in what 1T dis
cribes as its capital stock. 1t has lost the
power to make dividend, and is COM
PEELED to pay over its net earnings to the
master whose servant it has become.
Under the order of that master it has re
fused to refine sugar, and by so much
has lessened the supply upon the mar
ket.
1t is contended that there never was a
sale, but q trust constituted by mutual
agreement; that they who agreed were the
whole body of stockholders, in each cor
poration. necessarily representing and
binding the corporation itself; that they
transferred their shares to the board upon
their trusts declared in the deed that the
certificates issued by the board were the
formal declaration of the trust; that
the corporate stockholders parted with the
legal title of their stock to the chosen
trustees. with the power to vote upon it,
but retained its beneficial ownership
through the operation of the certificates;
and so the corporations entered partner
ship with the board in control. In con-
structing these two theories the court says
that on contracts the buyer which
in this case was the board, should
bind itself to a term of sale, but
according to the stockholderssthis was not
done, the board making no price. In this
case the stockholders alone fixed the price,
and the yenders did not sign the contract,
but left it to be supplied by inference of
their action. They allowed the board,
however, to fix the personal property
price In the light of these events the
board was simply an agent, which is the
characteristic of trust. The action which
placed the stock in the hands of a trustee
shows that no sale WAS intended. but sim
ply transfer in trust. This Is also proved
by the mortgage clause. The growth OF
the trust is then sketched. . In all
Of the points which were reviewed it Is
found that the corporation was doing a
public injury in avoiding the state law
which compels reservation of corporate
rights. and proved unfaithful to it's char
ter and duties. 1t is a violation
of law for corporations to enter into
a partnership. If the trust had been
properly formed as q corporate IN under
, the laws, the twenty separate companies
would have been dissolved, and not re-
! main in existence, as in this case. The
present corporation or trust puts upon the
market a capital stock proudly defiant OF
! actual values and capable of unlimited
expansion.
1t is one thing for the state to respect
| the rights of ownership, and quite another
thing to add to that possibility further
| extension of those consequences by Great
| ing artificial persons to aid in such aggre-
/ cations. If corporations can combine and
J mass their forces in a solid trust with lit
/ tie added risk to capital already in, with
| out limit to magnitude, a tempting and
easy road is open to enormous corporations
vastly exceeding in number and strength
,.any possibilities of individual ownership.
rhe law seeks TO protect individuals
rather than combinations.
Concluding, the opinion says:
The defendant corporation has violated
| its charter and failed in the performance
| OF its corporate duties. and that in re
spects so material aud important as Il
Justify judgment of dissolution. Hav-
ing reached that result, it is needless Il
advance into the wider discussion ovel
monopolies and the problem Of poiitica
! economy. Our duty is to leave them until
s6nse proper urgency compels their con
Neutrality-suspicious. either approval or dis
approval OF tIfe-.yiews expressed by the
court below. We are enabled TO decide
that in this state there can 'fS9 no partner
ships of separate and Independent eorpo
rations, whether directly or indirectl!
through the medium of a trust, no sub