The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1891-05-14
ANOTHER BLOW TO CORNERS.

Another decision in the line of the doc
trine of the old common law on the subject
of acts against public policy has just been
rendered by the Court of Appeals in Chi
cagO. Three years ago a party of spec
ulators undertook to corner the corn market
in that city. They made a bargain with a
wealthy firm of grain-dealerS and bankers
named FOss. Strong & Co., by which the
latter agreed to carry all the cash corn
bought by the corneTing syndicate and like
wise to induce 80 grain elevators which
they controlled TO withhold shipments of
corn so long as the corner lasted. The cor
ner failed, and the syndicate was left owing
large sums to FOss. He sued and recovered
judgment in the court below. The defend
ants appealed, and Judge Waterman, speak
ing for the Court Of Appeals, reversed the
decision on the ground that the bargain be-
tween the cornerers and Foss was against
public policy and that the courts will not
compel parties TO such an undertaking to di-
vide the piunder nor share the loss of their
unlawful enterprise.
There is nothing in the common or in
statute law which prevents a party of oper-
atOrs from buying as much merchandise OF
any description as they can pay for But
an artificial scarcity of that article so as to
compel consumers to pay, not the price die
tated by legitimate supply and demand, but
a forced price engineered by their contriy-
ances, they commit an act which is contrary
to public policy and common law. a
century ago that act would have been Grim
inal and would have exposed its authors to
Imprisonment accompanied, at the dis
oF Ia, tbo
pilIory. Our modern criminal codes have
removed from the list of crimes many
wrongs which now merely call for redress
in The civil courts; fOrestalling and regrating
are among the number But the wrong
committed by him who increases the cost Of
a necessary Of life by tricks undertaken for
private gain is as much Of wrong as ever
The decision is the more important as all
corners require the assistance OF banks and
bankers 10 carry the article cornered No
syndicate. however powerful, will advance
all the money that is required in a cornering
enterprise. 1t reckOns TO put up a margin
on the property bought and to borrow the
bulk of its cost from institutions which make
a business Of lending money on merchan-
disc. Under Judge Waterman's decision, if
tie corner winds up in failure, as corners
generally do, and the bankers who backed
the cornering syndicate find when balance
is struck that the syndicate is in their debt,
they may whistle for their money.
Corners, like time bargains in merchan-
disc or stocks, are Of the nature Of gambling
operations, and those who engage in them
have no right to invoke the assistance Of the
courts TO collect differences. It's legitimate
for a merchant to buy coffee or rice or min
ing stock which he can pay for, if he fore
sees a legitimate scarcity Of the article and
reckons 70 sell his purchases at a profit,
but when he creates or helps to create the
scarcity, his action is against public policy;
he becomes a mere gambler, and he must
rely upon the honor of his fellows gamblers
for the fulillment Of any contracts they may
make with them. When the civil war broke
out Connolly, Barrett and others bought all
the tobacco they could find, and sold out
at a profit of several millions. That was
termed legitimate operation. But when
the coal companies of the East meet together
10 restrict production in order to defeat the
operation Of the natural law of supply and
demand in order TO keep up the price of
coal to the consumer, their action is against
public policy, and whenever case comes up
before an Intrepid Judge lie Will decide that
they cannot collect their bills by law, but
must trust to the dealers to pay for coal de
liYered. The law will not attempt TO adjust
differences arising out OF transactions which
it condemns.