The morning news. [volume] (Savannah, Ga.) 1887-1900, 1892-01-05
TO APPOINT A RECEIVER.
JUDGE sPEER's DECISION IN THE
e. @. AND f. CASE.

The Purchase Of the Road by the Sa-
vannah, Florida and Western a Vio-
lation OF the State Constitution and
Declared Void-The DECISIONS Bear
ing Upon the Present Situation OF
Railway Affairs in Georgia.
A decision was handed down yesterday in
the United States circuit court, which Is
perhaps the most important ruling in rail-
road matters that has ever been rendered in
Georgia. The decision bears directly upon
the present situation Of railway affairs in
this state, and is far-reaching.
The facts. briefly stated are these: Ham
ilton g. Bishop, a banking firm Of New
York, filed their bill against the Savannah,
Florida and Western Railway Company
and the East Georgia and Florida Railroad
Company, in which 1t is charged that GER
tain parties had by fraudulent devices, IN
duced Hamilton to sell to them his interest
in the East Georgia and Florida Railroad
Company, and that these parties had then
sold that railroad to the Savannah. Florida
and Western. and prayed that these sales
should be set aside.
Charlton & Mackall were the solicitors
for the compliments and Chisholm, Erwin
81 du Bignon and Goodyear & Kay repre-
sented the defendants. The prime question
involved in the suit was the right Of one
railroad company, under the constitution
and laws Of Georgia, to purchase aud ao-
quire control Of another.
THE COURTS OPINION.
After going over the facts and points of
law involved, the court said: ut remains
to be determined whether the transfer of
the East Georgia and Florida railroad 10
the Savannah, Florida and Western
railway is void because in violation of
the constitution of the state Of
Georgia." and quotes from the former de-
cision Of the court in the case of Langdon
VS.. Branch: "Whatever may be the rules
upon similar topics prescribed in other
states, the people of Georgia have embodied
in their fundamental law this comprehen-
sive and vital clause, clearly intended to
accomplish what they deemed the salutary
and healthful result Of competing lines of
railway transportation. Contracts in vic
l4tion of this clause are not permitted.
When attempted they are utterly void"
Judge Speer then proceeded The oon-
struction placed upon this clause by coun-
sci for the plaintiffs appears to be unan-
swerable. After declaring that the general
assembly shall have no power to authorize
any corporation to buy shares Of stock in
any other corporation, or to make any con-
tended TO have the effect to defeat or lessen
competition, or encourage monopoly. it then
declared that all such contracts a d agree
meats shall be illegal and void. The con-
stitutional clause is. therefore, self opera
tive and needs no legislation to enforce it. "
VOID UNDER THE LAW.
The court also held that from the inhibi.
ton contained in the constitution of Georgia
such contracts aud agreements are void
under the common law, and referred to the
cases of the Central Transportation Com
pany against the Pullman Car Company, re-
Gently decided in the supreme court Of the
United States, where it was held that where
corporation, although empowered by its
charter TO enter into contracts with other
corporations OF any state for the
leasing or hiring and transfer to them of
its railway cars and other De sonal
property, transfers to any corporation all
its cars. railroad tracks, patent rights, and
| other personal properties, for q term of
ninety-nine years. binding itself not to en-
| gage in the business for which it was char
| tered during the continuance of the lease,
nevertheless such contracts are unlawful
and void because beyond the corporate
| powers OF the lessor and involving an
abandonment of its duty to the public
THE MERITS OF THE CONTROVERSY.
The decision concludes: with reference
to the merits OF the controversy 1t will be
sufficient TO say that it appears that the
East Georgia and Florida Railroad Com.
pany and the Savannah, Florida and West
ern Railway Company are competitive in
the sense in which the term is used in the
clause of the constitution of Georgia above
referred to. 1t appears that if the Savan.
nah, Florida and Western railway be
permitted to control or suppress the
East Georgia and Florida railroad
it will have a monopoly of rail.
way transportation in all that sectIo OF
the state from Jesup to the Florida line, As
we are advised, we feel obliged to grant the
injunction prayed for. aud appoint a receiver
| pendente lite in accordance with the pray
ers OF the BILL"