The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1891-03-05
VETOED As DANGEROUS.
Governor Toole's Reasons for Not
Signing the Bill Incorporating
Mercantile Concerns.
The Senate Passes It Notwith-
standing the Objections Urged
Against It
In Thu House of Representatives 1t Is
Made the Special Order for
This Morning.

Governor ToolGs first veto of the session
and the first of his official term, was sent tt
the senate yesterday. and was passed not.
withstanding his objections, receiving two
thirds of the votes. The bill vetoed was
that extending the time Of corporations
from twenty to fifty years, and including
mercantile establishments. The vote by
which it was passed over the veto WAS as
follows:
Yeas lO-Bsoker, Goddard, Hedges, Hen
messy, Hoffman. Mats, Power, Redd'
Thompson and Thornton.
Nays 5-Eaylies, Buford. Cardwell, Glib
son and Parberry.
order for 10 o'clock this morning. 1t is not
likely that the house will override the gov
ernor as the senat did.
The Governors message, giving his reas-
ons for vetoinp the bill was as follows:
HELENA. March 4.-To the senate: ]
herewith return, without my approval and
with my objections, senate bill No. 10, A
act to amend sections 446, AGO, 467, 46S, 1863
and 472 Of chapter %. fifth division of gem
eral laws of Montana, relating to corpora
tons for industrial or productive pur-
poses"
The purpose of this bill appears to be to
confer the benefits and privileges of the in
corporation act upon mercantile establish
ments and to extend the time OF lncorpora-
ton to fifty years. The custom of forming
private corporations for the purpose OF en-
racinp in undertakings which are proper
subjects for individual enterprise has ex-
listed for such a length of time that 1T has
come to be regarded by many persons as
competent, under existing law. and while
in my opinion such a construction ls a per-
version of the spirit of the law, l have here
tofore treated it as permissible, and in in
Weighing against 1t scarcely a month ago,
used this language in addressing the leg's-
lative assembly:
''The organization of corporations to
Starry on large enterprises has become a ne
cessitt in this and other states. The de-
velopment of our resources and the carry
ing forward of projects for the public good
in many instances are of such magnitude
and REQUIRE the outlay OF such large sums
of money, hat private capital cannot be
induced to embark in them. The law
should provide for the incorporation of
such. but / condemn as bad legislation the
existing statute, inherited from the terrific
nv, which permits almost every character OF
business and industry to become the sub
ject of an incorporation, whereby the liabil-
ity of the stakeholder is limited. No one
but a creditor is entitled to see tho books of
lU0 y pOldt1Ouy dAu hO0SO q RCAooA SOaA~
ing with such a concern in the first instance
is at q disadvantage"
These remarks were directed against the
propriety of permitting the very concerns.
mercantile establishments, which this bill
proposes to become the object OF an incor-
poration. If under the present law. mer-
camille business may not be incorporated, /
certainly cannot, IN view of the opinion
then and now entertained, approve the
passage of a law which expressly creates
the evil complained of.
Corporations are created to serve good
pm poses. and in many instances to per-
IL. M offices of public benefit and necessity,
that individuals would not or could not &C.
coMpiish. and if such are not already pro-
vlded for they should be. 1t WAS not in
tended, however. that corporations should
usurp or supplant the functions of a citi-
zen or relieve him of personal response
bllity in the ordinary avocations of life.
Nor is it promotive of the common veal
that they should. Public policy m ex-
psdiency will not sanction it.
If | were to set about deliberately to pro-
mote the formation of trusts and combine
tions in the necessaries of life by control
ing the prices OF such colnmoalt !es, tic first
step taken in that din would be to au-
thorize mercantile establishments to incor-
porate. We are building for the future and
it would not be prudent for us to be un-
mindful of the fact that there is danger in
the centralizing tendencies of business and
in the growth of ~monopolies and trusts,
which fortify themselves by the aggregation
of capital and by other influences per
and Classes of society. Unchecked
by any feeling of individual responsibility,
moved solely by a love of gain, unfettered
by the duties of citizenship, they are ena-
bled to perpetuate themselves by the adop-
ton of methods and the use of agents
which often scruple Mt nc means to accom-
plisE their ends. 1he result is the crowd
ing cut of healthy competition, and the
surY4vsi Of the strongest, which, under this
process, Is by no means the fittest. This
result bluLts the sensibIiities of the citizen,
builds up and fosters classes among the
people, and undermines the fundament
principles upon which the government
fabric is based.
If the right to incorporate business enter
prises to the extent proposed by this bill for
mercantile and other pursuits are carried
into the iield of agriculture, the result will
be that large bodies of land will be owned
by incorporated companies and titled by
tenantry. The ownership will not then be
vested in him who cultlvates the land; the
home, if preserved, would be less dear te
him who occupies it.; the best incentive tt
good citizenship would thereby be eradi.
catrd, and patriotism would be subdued, i
not extinQuished.
And again, the effect of section three viii
be to put in the power of those holdin,
two-thirds of the stock OF an existing cor
poration to continue the corporation TO
thirty years beyond the time of the orig
inal corporation. against the consent of tn
other stockholders, who may have ~sutficien
reasons for winding up the affairs of TIL
concern at the time when it would have ex
pired by operation of law. 1t is but TAI
to presume that the stockholders have en-
barked in such enterprise with reference t.
the law as it existed at the time of the in
corporation, namely, that it should con
tinue for a period not exceeding twent
years, and the least of these should not b
precipitated by the law into thirty year
more of corporate control, against his con
sent. Indeed this cannot be done withou
violating the plain constitutional provision
against lmpalrlng the obligations of a son
tract.
The principle is elemental and the au
thorities are numerous to the effect tina
"A state cannot IN any manner alter tn
mutual relationship among the members o
n corporation or their relative rights an,
duties as established by their yoluntar'
agreement when the company was formed
Thus, n law purportinR to authorize tn
majority to extend or alter the business @
a corporation against the will of a minor
lty, would be unconstitutional, although
contained a grant of new franchises to tn
corporators. and no existing franchises b
thereby impaired" Morowetz on Privat
Corporations, section LOIS, and cases citec
The present bill not only authorizes a
entire change in the business upon u two
thirds vote of the shareholders, but extend
the time against the consent of the minor
Jr Tbio nannnt ha NnNA it, Al