The sun. [volume] (New York [N.Y.]) 1833-1916, 1902-10-26
PANAMA CANAL TITLE Is GOOD,
RESiLT or ATTORNEY
kNOX'S INQUIRY ~ PARIS.
iiis Opinion j. That the United States
Would Receive a Good. Valid and
tnincunbered Title" 10 the New
canal dompany's Rights and Prop.r,y

I.ll ifI'plN W us ltNt'NliSallOll 10 deter
nine she character of IA" title to the Panama
anal rights and property which the new
Panama Canal Company proposes TO s..l
- tire lult'd states, and which Congress
hds cordltionally authorized the President
90 purchase. The opinion of tie Attorney
General. "a already told in TlrE SuS, il
that the United States would receive n
good, valid and uiiucuinberrd title" All
he objections that have been urged In the
name Of law and equity against the bur
chase Of tie canal rights and property are
swept away by Mr.. Knox, and there are abb
.o'rtclv 10 strings tied TO the property
proposition of saie conveyance az laid down
hy him.
This legal opinion of the Attorney
General, with tn. conclusion of a salts
factory treaty for right of way with the
Government of Colombia, clears the wav
Tor the actual construction of the canal
The act Of Congress passed at the last
session aut huriaei the President to 20
ahead a. soon a. the two conditions should
be complied with
Mr knoA's opinion, with ACCOMMODATING
"enhlhus,' covers about three hundred
printed pages, but an official al -tract
vas prepared in ia" Department of Justice
this afternoon, which is a. follows:
The Az" ney-,'en"rals opinion opens
with u history Of g.. concessions made by
olomhia in 1919, Isa0, h , the formation Of
me De b"~-cp- Panama Canal 10 npanv %
France, the failure of this ,o'nIanv in ISIS
M" transfer ia 1894 oi all its rights 80 .hr
'r"~"nt Panama Canal Company Of tran,
hN ih" lluUidator appointed hv the French
mt To Wind up the affairs oi the old com
pany, and of the laws passed by France
concerning IN" liquidation # the old com
lany tn" opinion hen takes up the prin-
'ipal objections which have boon made in
ms count ~ 10 he III 10 proposed 10 hn given
80 the Uni'"l States Tla.e obie ion. it
say-, r"-oly" themselves into reasons in
support 81 III" following propositions.
90 That thn New Panama Canal COMPANY
IN not power to s"h N" canal and railway
a. That the hQuidator of the old pausrn,
Canal company ha- not roaer 10 consent TO
a That the French court. have not power
% uu'i orIIc ~" ,Iguidator and tie, now COM
rany or either Of them,to enter ,rto the sale
- That. ~ an -vert-. the limited states
0nuid take the property ~ a tru fund -iIb-
,"Ct 20 ~" total obligations 10 the stock
holdersi the bordholder- and III" other cr.di
TORS OF both companies
tn" history ana Latur" OF Frnnch COM
paiies ~ the Kind in question ara explained
~ hers 9Th They arr said II ho altogether
different from our corporations. but 10 be
easily understood il looked upon a. private
partnerships, which il their essential char
acter. The opinion says thi' they ara IN
some RESPECTS regulated by law. but that
these regulations SO not change the essen.
tia character of the concerns "a partner
ships, do not establish any tie between
them and the GorcrMlneit, or any obliga-
tons from them to tn" Government aud
uo not forbid the exercise of the liberty
10 dispose of their property az freely as
All II di.ldua uispO-es of his. If no special
Jaw iorbids and If he l. solvent and not
under som" particular C"niractual OF other
ike obligation tn retain the property The
New Panama Company j. quit" solvent
and there IL no law forbldding It 10 sell
The powers Of IN" general meeting If
t'ockioIdors of that company are dis
c,issed and il is hold 10 have derived from
The partnership agreement ample power
to. sell a. it is proposing 10 do
The lGuldator Of IN" old company, when
he turned over the assets To the now COM
nany, stipulated for 90 per cent Of the
profits of the canal when finished and
his power to consent 70 the sale and give
mp his right to tn" ~ por cent. l. discussed
IN tho light of tho French law concerning
me winding MP of such ae~uca'iou> aud
y is held that under he" general law Il
rance and ~" special act Of 1893 con-
corning the liquidatlnu of his COMPANY.
b. has full power to dispose Of the assets
~ tho concern and consequently To con-
sent 10 the sal" of the 80 per cent. which
i a part of tho-" assets
II i held that the old company i not In
bankruptcy, or IN what j. similar 10 bank
luptcy under French law. hu' i, governed
lr IN" general llw or civil Code. which
IN" special iaW of 1893 already referred
'", partially modif"~ That law requires
the approval of the civil tribunal Of the
seine for all sales or alterations of the
's'r'~, but does NOT prevent such aliena-
'l"n-. That tribunal has approved the
consent ~ tha iiJuidator 20 IA" sale. and
ON appeal 10y NIUdholier Of the Old COM
udny ~" Court ~ Appeals Of Paris con-
'l'n"d M" decision, which held that under
'hc spec dl Law ut 1893 legal representative
"i 'h" hondhJldrr~ had been appointed bv
'h" court 20 represent them ali. and that
'"'r' sentative who had formally an
''i'"d his consent 10 ~" sale was the
only on" au'horIlrd by the special law TO
oppo-" ~" judgment Of approval on be-
h'f e 'l' loudhol!"rs
III" opinion next discusses the power
"' 'h" French court to declare n law of
maj KIND void ~ unconstitutional, and
,pd, that no French court or other au-
'hority ia~ power 10 declare any French
>'a'u'" void The opinion says. however,
'hdl ~" French special act ought not To
w." d"0lar"d void, and IL it j. 20 b" crit iciscd
~ al, II l. for being too tender of he private
rights and remedies of those Interested,
ana not sufficiently like a bankruptcy law.
A. To tho proposition that the United
states would be subject TO the debts and
claims of the stockholders and bondholdrrs
aud other creditors of both of the companies,
the opinion says,
" 4 g"ucr irolo~itiOu, II j. not per
'"'Nod ow ere could hr any law or equity
Tor sub "'thg t uurrr -'r Of Uu HItloi" sold
~ asset 81 l1ilu par L'r-llp tsucl -
0" oid comp NV, to 80 Icbts at ~" part
h'T>Nlp " ~uCI were tHc law. there Would'l
~ no tNru' ~oT- OF -grI assets, and tn"
.r"diCr would roo" v. 20 payment o. their
N"his oGt Of 49," iro .r"d-, nor stockholders
my ~ d"rd oi e residue
Nevertheless, ihc opinion cNhaustively
considers all possible mortgages and otlor
I"ns Affecting the property itself. real or
PERSONAL, uud"r French or Colombian law.
II SAYS there have been mort cages and
riedg''s Of personal property, and shows in
l"lAll what b"Came of them,
A. 70 IN" proposition that the United
states cannot take title TO the shares OF
lock Of the Panama Railroad Company, !
N"W YORK corporation, ~ ldCh the Panama !
company proposes to sell with H." canal |
property, the opinion holds that the Gov |
eminent can take and hold any kind Of |
property II may hav" need IF III The sane !
manner IL an individual can; that II would |
h"ld III" shores ~ an individual would hold |
hem. A. for H." suggestion that tie !
United States At all events could not destroy !
me railroad, II il POINTED CGt that IL Was |
I.. ,t.t tt,.t,