Kansas City journal. [volume] (Kansas City, Mo.) 1897-1928, 1899-11-15


Eve years. 2s55 per cent.
As to Valuation.
The attorney general claimed that the
horse and mule market should be eliminat-
ed from the controversy for the reason
that It Is a separate institution entirely, is
in the state of Missouri and that the law
does not attempt to regulate prices con-
nected with it.
He also contended that the only value
OF the property 10 be considered is the
tangible, physical property of the COM
pany, its location and the limited area
of land in the vicinity available for such
purposes to be considered
In this case wherein is to be determined
the reasonableness Of the rates & to ID, De
standing Is admitted to be far in excess
of the amount of cash actually invested
and of the value of the tangible property
combined no value of capital stock can
be considered above its face value can be
determined. Mr.. GODDARD said:
The value Of the good will or live business IS
element Of value TO be considered in this case
for the reason that the of Kansas in wise
seeks TO take anything from the appellants or the
business Is to be in no manner or degree regu.
rated. disturbed or diminished by the operation OF
the Kansas statute
The attorney general contended that the
market value of the capital stock is not
a fair basis for determining the value OF
the plant. -,----
The stock yards company has monopoly Of
the business which is done there" he declared.
THE dealers compelled TO patronize these yards
and TO pay prices which the. company may see Mt
charge for its services in the absence of statute
the contrary consequently. the greater the extor
tion perpetrated at the yards the greater the In
come from its business and the greater the market
value Of its capital stock The fact that the COM
pany has made enormous profits and declared enor-
nous dividends in cash and stock has given the
capital stock 4 market value somewhat above par,
notwithstanding the fact that it is capitalized for
approximately four times what the property has
cost. and notvithstendng the fact that II has in
recent made improvements and bought property
in the Of Missouri which yield but q very
moderate return upon the capital invested II is
evident that the market value of this stock has been
created because Of the fact that the corporation has
and accommodations furnished and to force the COL
lection of these charges. The business of the Kan
sas City Stock Yards Company is done practically
without risk. The stock yarded and fed is Of
great value The company does not surrender the
possession OF the animals until its charges paid
or assured.
The Dividend Question.
The fact that the stock of the Kansas City Stock
Yards Company has had q U1rket value
greater than sIH per share is conclusive evidence
that investors do not believe the actuaI value Of
the property owned by the company to be equal to
the par value of It's stock, anything near that
amount The shares Of q corporation which has
paid an average dividend for twenty-five years Of
se.s5 per upon the cas. invested therein and
an average dividend for the same period of q Il
per cent upon all outstanding capital stock ana
particularly where. in this case the corporation
has a certainty that its volume of business will
continue. and certainty of being able to collect
It's charges without oss-the stock should be worth
several times its value and would be worth
that amount II II the Judgment Of Investors
mat such stock was based very largely upon wind
The market value Of railroad and other stocks and
fecurlties-mAtters within the common knowledge
OF ai-fgrnish comparisons which show a lack OF
Yards Company ~
We DO not ask that the Kansas City Stocks Yard.
company be permitted to earn only reasonable per-
eentage Of profit upon the money which has been
actually Invested In its business upon the actual
csSt o. ts property. We recognize the fact that
this property has greatly increased value since t.e
organization Of the stock yards. and we are willing
that the company be permitted to reasonable
interest upon the value OF Its property but In de-
termining this anestion to the reasonabe OF
rates. we ask the court to consider the table on
figures showing the dividends paid set forth In ,I,
statement OF facts above. and determine whether or
not reduction Of $500. s5I.57 for the business Of
1886 would have been an unjust and uureasousbIe
exercise OF legislative power
II VIII be from this table that in 1855 divI
dends declared the amount Of $50 $40 eau.I
10 12.H per cent upon the entire capital stock ~
the company. If the statutory rates had heen IN +,
force then the amount Of this dividend would have
seen reduced TO s5s1s5s23 equal TO 81 per cent of
,hs outstanding capital In the faee-cf these ag-
can urge that the reduction provided By the statue,
OF issl VIII not permit a reasonable return to the
ftockholoers Of that company.
The federal quarantine Law regulations arr. in m
way effected by the Law passed by the Kansas Iecis
effected and the viii therefore not euioIn The
operation OF the law on account Of such law and
regulations.
As TO the question of the stock wards
being engaged in the interstate commerce,
Attorney General GODDARD said:
1t Is difficult TO how Il claimed that an
set OF the legislature of the OF Kansas Designed
70 prevent the imposition Of exorbtant charges for
the yardsge and feeding OF animals in stock wards
be held void because of any interference with the
interstate commerce law CT the federal government
II II be deterninted that the business done at Kan
sas City stock yards constitutes interstate commerce
still IL does not follow thu the state has no mower
20 pass such q Law as the one in question II has
been repeatedly held by this that the power Of
congress ever Interstate commerce in all branches
and ramifcations is exclusive but that upon
many subjects the state act where congress has
not seen Mt TO do such is the in regard to
quarantine charges and upon subject of the req
ulation Of wharfage charges the same ruling has
been made The latter subject is clearly akin TO that
Of stock yards.
Tho last point made by the attorney gen.
eral was that this really a suit
against the state and therefore could moi
be maintained under the federal constitu-