The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1893-06-14
HOW TO INVEST In MINES.
Advice From an Expert In Regard to
the Rights of Small shareholders.

Advice From an Expert In Regard to
the Rights of Small shareholders.
In q article IN the Engineering Maya
zine, Mr.. Albert Williams. Jr., an emf
nsnt mining engineer, gives soma hints
for the benefit of investors in gold and
silver mines which are worthy Of general
consideration. He deals In the begin.
ming with those cases In which small
investors are troubled by rumors reflect
ing upon the management OF properties
IN which they have au interest.
First, he writes, ascertain definitely
whether there are reasonable ground 3
for complaint. Hear both sides. Get
commercial rating Of the men accused.
Find out what the local opinion Is
in the district where the mine Is
a good case aud the trouble con-
tinues. the dissatisfied shareholders
should put themselves in communication
with each other. with a view of concerted
action. This can be done by advertise
ment or correspondence in a prominent
mining paper, calling a meeting 60 ex-
change opinions, ascertain facts. estimate
strength, and decide what. IL any steps
mould be taken. II the opposition finds
that it holds a controlling interest in the
stock, remedial measures might be taken
without going 10 law, by deposing the
incumbent officers anu assuming the
management aud responsibility OF the
company's affairs.
The courts have ruled that s%harehold-
ers have a right to examine the books OF
corporations. It has also been held that
shareholders may enter and examine to
their own satisfaction a mine they are
part owners in. Whether they may send
in q professional expert not himself in
terested, Is debataDle. But a representa-
tive committee Of shareholders could be
authorized to make both examinations
(of books and mine). A case having been
made out. the property having been
shown to be worth fighting for. so that it
would not be thro wing good money after
bad, prosecution under the civil code
would be next in order, provided the dis
satisfied shareholders were willing and
able to go to the expense n delays OF
somewhat dubious litigation.
Much depends upon the avs under
which the company has been incorDor-
ated, which are often not those of the
State iu which the mine Is situated.
These laws vary greatly in respect TO the
amount of protection afforded to share
holders. For example, in SOME States
assessment notices have to be served per-
soually and the delinquent sales made
within the State, OF further service OF
notice. In other States, the charter laws
are go lax that a man does not know
whether he owns his stock or not illegally
speaking). aud IL it stands IL the name of
a trustee he has 10 get 1t transferred be-
fore he can vote it. 1t requires expert
enced mining lawyers to unravel the
mysteries Of mining and corporate laws.
At the bottom, the laws and the courts
mean well enough; but it Is expensive to
reach the bottom. Suits in equity are
especially uncertain.
To be perfectly frank, here is the
moral:-Small investors III mining
schemes, who accept the representations
OF prospectuses and advertisements as
gospel, who expect to become million
aires at a jump ny putting in a few dol
lars or hundreds. who do not take the
precaution of finding out beforehand
what they are going into, do not deserve
much sympathy. Many of them would
buy "green goods if properly approach
ed. TIT heavy investors generally have
the advantage of impartial expert advice,
and can at all events protect themselves
in a measure. The little minnows have
small chance, and it is 10 catch them, not
the big fish, that fraudulent mining
schemes are put forth.