The representative. [volume] (St. Paul, Minn.) 1893-1901, 1899-11-09

have all the six corporations shut down
their manufactures and abandon their
business? Can there be any doubt that
Hamlin, president of the American
Glucose company, knew that the other
corporations were shutting down their
plants with view to conveying them to
| new corporation, and that in the
transfer OF his plant he was aiding in
the consolidation of all the properties in
one gigantic trust?"
Relative to the power of the Illinois
Trust and Savings bank to handle the
financial part of the DEAL the court
says:
The Illinois Trust and Savings bank
is corporation organized under the
laws OF the state of Illinois for the pur-
pose of doing a banking business and
had no power under it's charter to pur-
chase the plants and properties of cor
porat1ons engaged in the manufacture
OF glucose and grape sugar. Therefore,
the option contracts providing for the
sale of these properties to the bank are
absolutely void. The proof tends to
sustain the contention Of the bank that
| 1t was mere repository of these papers
| but it went further in it's assistance of
these parties to carry out their schemee
than merely to act as custodian of the
papers,"
Speaking of the form of trust COM
binations, the court says:
"A trust has usually appeared in the
form of an agreement between stock
holders in many corporations to place
all their stock in the hands of trustees.
but the question in the present case is
whether trust is created where a ma
Jor1ty OF stockholders consolidate their
interests by conveying all their property
to corporation organized for the pur-
pose of taking their property. ANY COM
b1nation of competing corporations for
the purpose of controlling prices or
limiting production or supressing COM
petition is contrary to public policy and
is void. 1t makes no difference whether
the combination is effected through the
1nstrumentality of trustees and trust
certificates, or whether it is effected by
creating new corporation and convey
ing to it all the property of the compet-
ing corporations. The test is whether
the necessary consequences of the COM
bination is the controlling of prices or
limiting of production or suppressing of
competition in such way as to there
by create a monopoly Necessarily
when corporations thus situated unite
to gether all their properties in one new
organization and permit the latter to
operate its properties, competition will
be suppressed and the new corporation
will possess the power to limit produc-
tion and control prices. All the compet-
ing corporations have been put out of
the business by disposing of their plants
with which they conducted their busi
ness. The grantee of said corporation
has no competitor in the market. It
makes no difference that the agreement
for the illegal combination is not a
formal written agreement. 1t may be a
verbal agreement or understanding. or
a scheme not embodied in writing. but
evidenced by the action of the parties"
DESTRUCTION OF COMPETITION
The court holds that these conditions
pertained in the organization of the
glucose trust. After quoting from sew
eral trust decisions, the court continues:
The material consideration in the
case of such combination is as a general
thing, not that prices are raised, but
that it rests in the power and discretion
OF the trust or corporation taking all the |
plants Of the several corporations to |
raise prices at any time If it sees fit to !
do SO. 1t does not relieve the trust of |
its Objectionable features that it NAV |
reduce the price of the articles which It
manufactures, because such reduction |
may be brought about for the express
purpose of crushing out some other COM
petitor or competitors j
The opinion then deals with a portion
of the evidence and with the ALLEGATIONS
of the bill, which, it is said, prove that
the Glucose Sugar Refining company is
a trust within the meaning of the
statutes of 1893. The next question
dealt with the right of stockholder to
file bill to enjoin the sale of the cor
porate property to a concern which he
has reason to believe is trust. de-
cision Is cited to show that shares de-
rive their value from the corporate prop
erty and franchise, and the court OBJ
serves:
'They will have no value practically
when all such corporate property is dis
posed Of and the right to carry on the
business is destroyed. What was here
attempted was an abandonment Of the
business and sale of the assets with
out legal termination or dissolution of +
the company 1t makes no difference
that the stockkholder is to be allowed to
receive his proportionate share of the
Of the property. He has the
right to hold his investment in the form
Of stock, and change Of such invest
ment against his consent is a change
which effects his pecuniary or financial
interests. He has right to be the
Judge whether such . pecuniary status