The evening times., 1899-07-08
DECISION FAvoRING TRUSTS.
sew Jerseys Highest Court Susfnfns
the oiiphant Contract.

the Oiiphant Contract.
Trenton, n. j.. July S.-The New Jersey
court Of errors and appeals yesterday in
a very sweeping opinion. reversed the de-
cision CT Vice Chancellor Gray in the cases
of the Trenton Pctteries Company, Known
as the Sanitary Ware Trust, against Rich
ard Oliphant and others. The decision Is
of great Importance, as il sustains the
right of trusts organized under the laws
of New Jersey to absorb corporations and
TO bind them to agreements 10 stay out OF
business.
The defendants some years. ago sod
their pottery TO this trust and entered into
an agreement not to engage again in the
pottery business for long period OF years
in any part of the United States outside
Of Arizona and Nevada. Subsequently the
defendants again started in the pottery
business here, and the trust sought an in
junction against them in the court OF
chancery.
Vice Chancellor Gray some time ago de-
cided that such agreements as this one
were a restraint of trade and against pub
lie policy, and therefore Illegal. He dis
missed the bill of complaint, and there
upon the trust took the case to the court
of errors and appeals, and its decision re-
verses that of the vice chancellor.
The court bases its opinion upon two
grounds: First-That a corporation In
New Jersey has legislative authority for
the purchase of the stock OF other corpora
tions, and that the contract with the Oh
plants was a necessary condition to OBJ
tain the full benefit of the purchase OF their
plants and business; and secondly, that
the proofs in the present case do not show
that the public will suffer il the Oliphants
are held to their bargain.
As to the legislative power OF one cor
poration TO purchase and hold the stock Of
ether corporations the court says:
Under such powers il is obvious that
corporation may purchase the plant and
business OF competing individuals and con-
Germs. The legislature might have with
held such powers, or imposed limitations
upon their use In the absence of any pro-
hibitiOn or Limitation Oh their powers Ia
this respect, il is impossible for the courts
tc pronounce acts done under legislative
grant to be inimical TO public policy. The
grant CT the legislature authorizing and
permitting such acts must fix for the courts
a character and limit of public policy in
that regard. It follows that a corporation
empowered to carry on a particular busi-
ness may lawfully purchase the plant ind
business Of competitors, although such
purchases may diminish. or for time de-
stroy, competition
Contracts for such purposes cannot be
refused enforcement. Contracts reasona-
bly, required to make such purchases eff
fecrive b. protecting the purchaser in the
use and enjoyment Of the thing purchased
cannot be declared by the courts to be
repugnant to public policy. The interfer-
ence with competition resulting from such
purchases under legislative commissions
being found not to invaldate contracts for
such purchases, the like interference by
contracts reasonably required for the pro-
lection Cf the purchaser cannot be held to
iuva!idate them"
The Oliphant Company will appeal to
he Uaited States Supreme Court The de-
cisiOE in their favor by Vice Chancellor
+ GRAY lollC2ed the agument OF Joseph
Choate, now Ambassador to Great Britain,
/ who was cf counsel for the Oliphant Conn
pany.