Barre evening telegram. (Barre, Vt.) 1898-19??, 1902-10-27
Attorney General knoX's Report Con.
firms Its Validity.
NEW COMPANY CAN SELL.
The LiquidntOr Is Authorized 10 Con-
sent and the French Courts
Have Power to Confirm
the Sale,


valid and unencumbered title to the
property. This decision was arrived ut
after a thorough and exhaustive inves-
tigation of the situation in Paris first
by Special Attorney Charles W. Rus
sell and later by the attorney general
himself. The attorney general formal
ly submitted the opinion to President
Roosevelt. 1t makes about 300 pages.
The following is Il synopsis of the opin-
ion:
The attorney generals opinion to the
president on the title which the new
Panama Canal company Of France Of
fers to the United States of all its
rights and property on the isthmus of
Panama opens with a history of the
concessions made by Colombia in 1878,
1890, etc; the format ton of the De Les
seps Panama Canal company OF
France, the failure of this company in
1888. the transfer in 1894 of all its
rights to the present Panama Canal
company Of France by the liquidator
appointed by the French court to wind
up the affairs of the old company and
of the laws passed by France concern
ing the liquidation Of the old company.
The Principal Objections.
The opinion then takes up the princi-
pal objections which have been made
in this country to the title proposed to
be given to the United States. These
objections, it says. resolve themselves
in reasons in support of the following
propositions:
First.-That the new Panama Canal
company has no power to sell the canal
and railway property.
Second.-That the liquidator of the
old Panama Canal company has no
power to consent to such sale.
Third.--That the French courts have
no power to authorize the liquidator or
the new company or either of them to
enter into the sale.
Fourth That at all events the Unit
ed States would take the property as
trust fund subject to the total Obliga-
tions OF the stockholders, the bond
holders and the other creditors Of both
companies.
The history and nature OF French
companies of the kind in question are
explained at length. They are said to
be altogether different from our corpO-
ratons, but to be easily understood il
looked upon as private partnerships,
which is their essential character.
The opinion says that they are in
some respects regulated by law. but
that these regulations do not change
the essential character Of the concerns
as partnerships. do not establish any
tie between them and the government
or any obligations from them to the
government and do not forbid the eXer-
else Of the liberty to dispose OF their
property as freely as an individual dls-
poses Of his il no special law forbds
and if he is solvent and not under some
particular contractu or other like oO-
legation to retain the property. The
new Panama company is quite solvent,
and there is no law forbidding it to
sell
Ample Power to Sell.
The powers Of the general meeting OF
stockholders of that company are dis
cussed and it is held to have derived
from the partnership agreement ample
power to sell as it is proposing to do.
The liauidaror of the old company
when he turned over the assets to the
new company stipulated for 80 per
cent of the profits of the canal when
finished, and his power to consent to
the sale and give up his right to the w
per cent is discussed in the light OF the
French law concerning the winding up
of such associations, and it is held that
under the general law of France and
the special law of 1893 concerning the
liquidation of his company he has full
DOwer to dispose of the assets OF the
concern and consequently to consent to
the sale of the 90 per cent, which is a
part of those assets.
1t is held that the old company is not
in bankruptcy or in what is similar to
bankruptcy under French law. but IS
governed by the general law or civil
code. which the special law of 1893, al
ready referred to- partially mOdities
That law requires the approval OF the
civil tribunal of the Seine for all sales
or alterations of the assets. but does
not prevent such alterations. That
tribunal has approved the consent OF
the luuidator to the sale, and on APP
peal by a bondholder of the old COM
pany the court of appeals of Paris CON
tirmed the decision. which held that
under the special law of 1893 Il legal
representative of the bondholder> had
been appointed by the court to repre-
sent them all and that that representa-
tive. who had formally announced his
consent to the. sale. was the only ?n >
authorized by the special law I" o,'
pose the Judgment or approval on b.
half of the bondholdprS.
The opinion next discusses taA pow.
of the French court to hrclare Il i'W
of that kind void as unconstitutional
and holds that no French court or 9th
er authority has power to declare any