The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1896-08-20
CHIEF JUSTICE OF ENGLAND PRES
EMIT AT BAR ASSOCIATIONS
OPENING SESSION.
LAW AS APPLIED TO ROADS.
VOTED TO PROBLEMS OF RAIL
WAY REORGANIZATIONs.
ALL RIGHTS ARE NOW CONSERVED
Tendency of the Courts Is to scru-
tinize More Closely Details of
Such Cases.

SARATOGA, N. Y, Aug. 19.-There
was a large attendance in the conven-
ton hall at the opening of the nine
! teenth annual meeting of the Ameri-
can Bar association today. When Lord
Russell, Sir Francis Lockwood and
Montagu Crackenthrope,t together with
| their ladies, entered the hall, they
were greeted with hearty applause
Judge George S. Bachelor escorted
| them to seats at the front and near
the platform. The president of the
association, Moorfield Storey, conduct
| ed Lord Russell, Sir Francis Lockwood
| and Montagu Crackenthorpe to seats
| on the platform. Among others hon
ored with seats on the platform were
J. Randolph Tucker, Edward J.
Phelps, William Allen Butler, Henry
Hitchcock, Austin G. Fox, Charles
Claffin Allen, Francis Rawle and James
c. Carter. President Storey called
the association to order and delivered
his address.
The address Of the president was upon 1.-THE
Most Noteworthy Changes in Statue Laws
on Points of General Interest Made in the
Several States and by Congress During the
Preceding Year." required by the constitu-
ton. He pointed out that the legislation in
different states, though widely separated and
ilization, strongly showed the essential unity
of this country in dealing with the same
problems that confronts all other states. He
pointed out that while the past year has
been marked by much discomfort among the
people that the laws show only profound
peace and general prosperity. Discomfort does
not affect legislation.
Another noticeable point is the s'rapid
growth of disposition to assert the general
interests OF the community at the expense of
individual freedom" The underlying princi-
pie Of socialism, that everything that a man
owns he holds for the state, is asserted more
and more frequently. The statutes of every
state contain laws that would have seemed
unwarrantable invasions of private rights not
many years ago. Such legislation is the col
lateral inheritance tax, the graduated income
tax, the graduated tax in the estates of de-
acter and number of uses for which money
is now raised by taxation.
The most important and longest part Of
the address is devoted to railway reorganiza-
| ton, and which the address considers as
| step in the right direction, as 1t enables the
courts to protect the interests of investors
| the subject Of judicial investigation and Sc
| curing for every interest hearing.
Ihe address points out that the great rail-
! way systems of this country have been built
| VI nd equipped with borrowed capital. Many
| of n ne securities represent investments Of
more than their face value. Capital stock has
| been frequently issued without payment; often
| as bonus to go with the bonds In this
| way the money of creditors has been invested
and the control Of the property retained by
| the debtor-the railway company.
| The failure of the railroad company finds
| the managers united and fully prepared for
the emergency which they inevitably have
| foreseen, while 1t finds the creditors scat
tered, ignorant, frightened and entirely I'M
ready to act What has happened in practice?
We have seen the managers while stoutly
| denying up to the last moment that any
such step was contemplated or that the prop
| erty was in any way embarrassed secretly
prepare bill in equity, and without any
1 10 fV@4r
| of the United States, asking for the appoint
ment of a receiver. AS matter of fact
| in every case the efforts have been collusive
The managers of the insolvent company have
| controlled both sides of the litigation. The
selection Of receivers is matter of great
concern to great many persons. There should
| be no undue haste in the choice of such off,
| GERS. restraining order will hold every
| thing until after notice and hearing leaving
! the property meanwhile to be managed by
| it's officers as before Every bankrupt or in
| choice Of assignee to the creditors and no
| reason exists for not applying this rule to
| railway receiverships.
The former officers are interested in main
| tanning the system which they have brought
together, they hold lucrative positions which
| they do not wish to lose, they are deeply in
| terested parties. Such men. Of all Others
should be disqualified to hold the scales be-
| tween conflicting interests, nor is there any
practical reason for their selection. The re-
ceiver can employ them, and thus get the
| benefit OF their skill and experience Yet
with scarcely an exception whenever a great
| railway has passed into the control Of the
| court. the creditors have first learned the
| fact through the newspapers.
After a long and expensive contest. the
| self-constituted reorganization committee ap-
| pears and boDdholders are offered their choice
| between contest conducted at great disad-
| vantage and expense, and the accordance of
such terms be offered. While in
| not dare to refuse. The expense of the re-
| organization has been in many cases enor-
nous. and in fixing 1t there is no one to
| audit the accounts. no one to represent the
creditors who suffer while their trustees
profit.
Proceedings like this are of very evil ex-
ample. Many a sees the savings of a
| lifetime swept away by the msmanagement
of corporation, and the managers con-
| tinue in charge, in spite of all opposition
| that creditors can make. To the reckless use
of power by the managers of great corpor-
| atoms. and by those who profit In their
! downfall, we must attribute much Of the dis
content, the hatred of capital, and capitalists
of corporations and their officers, which
underies the movement which now excites
our alarm.
1t is to the courts that we must look for
protection. Their authority rests peculiarly
| on the respect of the people for their abso-
Lutte impartiality, and in the long run they
serve the well settled rules of judicial pro-
cedure and unless they respect and enforce
every legal claim. Parties must be left
| to determine for themselves whether their
interests will or will not be served by the
assertion Of their rights. The moment that
the courts undertake to vary their contracts
! or deny their rights, that moment the con-
| fidence of the community receives a shock,
and no man knows on what he can rely.
If the courts had always refused to enter
| tain these applications for receivers when
made by the debtor corporation or even if
| they had selected impartial receivers and
| facilitated the enforcement of every agree
ment, railroads would have been reorgan-
/ lied more promptly and enduring
basis than is now possible, while the confid-
| enee Of the community in the efficacy of law
| and the sanctity of contracts would have been
| far greater. Judicial action which impars
| the obligation Of contracts is more dangerous
| than any statute which aims at the same re-
| suit. When the court through its officers
undertakes to manage a railroad for years
and that chiefly without hearing the ques-
] lions which arise in it's operation; when it
| appoints these officers and in SO doing grants
I the final relief sought without notice. It vio-
/ lates the fundamental rule of our constitu-
| tional system.
After President Storey had concluded his
address, the executive committee reported