Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1899-10-28
Special to the Register

Special TO the Register
WASHINGTON, d. c., October 27-
West Virginia corporation law has
come in for some interesting criticism
on the part OF one or two witnesses be-
fore the Industrial Commission, notably
in the testimony of James B. Dill,
New York lawyer, who appeared as
defender of New Jersey corporation
statutes. In the course OF his testl-
mony, which is here transcribed from
the official report, Mr.. Dill said:
West Virginia grants a charter for
fixed sum for any amount with any
powers, the only restriction being TO
limit the capital to 100000, and
grants what is commonly known as
rowing charter. The stockholders may
meet anywhere on earth. They may
have their offices anywhere on earth
They may transact any business they
choose outside of the State, and there
is nothing that they are obliged to do
in the State. Now, the point of that,
and all the gentlemen of the commits
sion who are members of the bar and
the profession will appreciate that, is
this: The State which grants THAI
kind of charter opens the door fatty
to fraud. Why, it is a recognized prln-
ciple of law that the state of New
Jersey has no power in its courts 20
compel New Jersey corporation, even
nd 4h.a; V@t ,~e
holder, to bring its books into New
York for examination, on the part OF
that stakeholder. This has been uni
formly held, so that the State of Mary
land has not any power whatever, at
the instance of the Maryland citizen,
who is a stakeholder of New York
company, TO compel the New York
company to allow inspection of its
books in Maryland. The moment the
STATE of West Virginia permits its cor
porations to hold their meetings and
keep their books anywhere, they at
once grant them rights 10 take their
books out of the State of West Virginia,
and keep them out of the State of West
Virginia, and put them in States where
no courts have power to compel an
inspection of them; that is what l call
a rowing charter"
Mr.. Dill also said that the Flaw Of
West Virginia permits stock TO be is
sued for that terribly indefinite quaint
ity, that is, services" Later he de-
scribed a meeting of New York syn
dictate where the question was discussed
whether the new corporation should 80
to Delaware, West Virginia or New
Jersey for charter. las to West Vir-
ginia," said Mr.. Dill, 'that matter was
turned down without much considera-
ton, because they believe, as / believe,
that the Supreme Court of the United
States is eventually going to mold that
corporations organized in any of these
States with rowing charter, which do
not, like a live tree, keep their roots
in the soil that created them, are going
to be denounced as partnerships, and
so held
Commenting on the New Jersey law
recurring publicity of transfers of
stocks, Mr.. Dill said the reason for such
legislation was that very many large
corporations desire to have the public
own the stock, but do not want them
to have any voice in the management
Therefore If you and own only ten
shares apiece in some company, and
we do not know who the stockholders
are and the officers do, they can go and
get votes enough and proxies also TO
get themselves reelected; whereas II
the others are known and II we can
go to the stockholders of the organiza-
ton, we can win or at least hold down
an election. That is the objection 70
it. That is the way it is in the Della
ware and West Virginia laws. and men
can perpetute themselves in Office. That
is where you and l can do nothing
about it; we are gone"