Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1899-12-04

In Relation 10 the Incorporation Of
Stock Companies Brought to the
Attention of the Industrial Com
mission.
Special to the Register.

WASHINGTON, d. c., December o.
The loose character of the West Vir-
ginia corporation laws and the man
ner in which the State is used for the
manufacture of corporations were re-
Gently ventilated by the Industrial
Commission through the testimony of
Andrew P. Nevins, of New York City,
counsel for the Corporation Trust Com
pany of West Virginia. This corpora
ton has it's principal Office in Charles
ton, where it is represented by Harri-
son B. Smith. Mr.. Nevins explained to
the commission how easy it was to OBJ
tain charter in West Virginia through
his company. This company" he
said, sis organized to facilitate the or
ganization of corporations under the
laws of West Virginia. For example,
we must have five incorporators to OBJ
tain charter. If they want to organ
ize, they tell me the objects for which
they want to incorporate. Necessarily,
they inquire about the expense.
give them what information l can.
keep blank forms, and we draw up the
charter. We send it to our representa-
tive at Charleston, and he attends to
seeing that these articles of agreement
are filed and that the charter is OBJ
tanned, whereupon the charter is sent
to me and hand it over to the COM
pany. It is very simple matter"
With this charter the incorporators
may organize wherever they please,
may do business wherever they please
without rendering report to anybody,
paying no taxes and responsible to no
authority. This valuable privilege may
be obtained by the payment of fee OF
$50 TO the Secretary of State. Under
the West Virginia law, corporation
must have an agent or representative
in the State His specific function is.to
accept process in case process is neces-
sary against the company he repre-
sents. This requirement has become
the source of private emolument to the
Secretary of State of West Virginia,
who, says Mr.. Nevins, represents
great many of the companies incor-
porated in West Virginia.
"Will you explain a little further
about that?" Mr.. Nevins was asked
by member Of the commission.
LAS l said before" he replied, I'VE
must have a representative down there
in West Virginia, and if any man here
should write for information with ref
erence to the corporation law of West
Virginia, you would naturally write to
the Secretary of State. He will furnish
you with the necessary blank forms,
perfectly correct, and he will act as
your attorney of record down there if
you so wish
"And he will, in addition to the usual
fee for filing the articles of incorpora-
ton, charge you special personal fee
for acting as your personal legal rep
resentative?"
YES
"You might say that in the State of
West Virginia the Secretary of State
is very freqently appointed as State
agent?"
$50 I understand"
Mr. Nevin commended the West Vir-
ginia incorporation law for its SIM
plicity, publicity and cheapness. By
publicity he ment merely the publicity
given to the fact of organization. He
admitted that the State was very large
ly used as creative power for the
manufacture of foreign companies at
small cost for doing business outside
of the State. There was no way to
prevent the, companies from doing a
wildcat business, issuing stock for
merely speculative purposes, or being
run by dummy incorporators for fraud
ulent purposes. But the per cent. of
the capital stock is required to be paid
in, and this stock may consist of
cash., property or even services. Mr..
Nevins was asked this question:
Surprising the incerporators have
formed their corporation largely for
the purpose of specializing in the stock,
and that it would be a desirable thing
for themselves not to be readily
located, not to have their place of bust
ness readily located is there any way
by which the laws of the State of West
Virginia will prevent them from any
fraudulent action?"
Il do not know of any, possibly by
quo warranto proceedings"
Mr.. Nevins said he would approve an
amendment to the West Virginia law
requiring companies incorporated
there to keep on file in the State
statement of the place in which their
business is carried on.