The herald-advance. (Milbank, S.D.) 1890-1922, 1903-08-07

Wltnlh the meaning or that word as used
in the act of 1874, and became thereby
disabled from acquiring. as it afterwards
did, a controlling majority of the stock
OF the Great Northern company.
And upon the subject of purchasing
a railroad by buying all the stock, l am
cited to. chapter 81, General Laws Of Min
%nesota,. 1881. which provides that any
railroad corporati3n may lease or pur-
hold stock of any other railroad, when
their respective railroads can be con-
nected together and form a continuous
line with or without branches. But in
that case the purchase Of the stock would
be by a railroad corporation having ca
pacity to operate the railroad, even aside
pressly or impliedly granted by this stat
ute; and such railroad could therefore
rightfully assume the control, manage
ment and operation of the railroad. the
stock of which it had so acquired.
Penrsall Case.
sail VS.. Great Northern Railway. 161 U.
S. GAG.
The case is far from sustaining the
idea. that II a single investor in railroad
corporation without railroad franchises,
should acquire by purchase a majority
or the whole of the stock of both the
Northern Pacific company and the Great
Northern company that would work n
consolidation Of those two companies,
or that such purchaser would have any
power to manage or operate the railroads
of both or either OF said railroad COM
panies.
I'm the case under consideration the
court Is careful to note the difference In
ing majority of the stock of a railroad
corporation by a rival railroad corpora
tion which might control. manage and OPP
crate erate It, It, and a purchase OF the same
though holding whatever amount Of stock
In the same rival railroad company. The
court says:
"'Doubtless these stockholders (of the
Great Northern company could lawfully
acquire by individual purchases a ma
jority, or even the whole of the stock
Of the reorganized Northern. Pacific
company, and thus possibly obtain it's
ultimate control. but the companies would
still remain separate corporations with
no interests. as such. In common
1T follows that as the Northern Sc
C~urities company Is merely an investor
in the stocks Of these railroad corpora
tions, not being itself a railroad corpora
ton. and being without franchise. power
crate any railroad. its ownership of a ma
jority of the stocks of these two railroad
companies does not come within the pro-
hibitive language Of the statute OF 1874.
Separate Corporations.
The two companies still remain sep
arate corporations with no interests, as
such, in common The case would not be
different if one natural person with album
~'iiI Ncfito .idobl' II III liO lil -
of the stocks Of one of these companies,
and another like person should invest in
the majority of the stocks of the other
company. The interest of the two, if
they chose to act in harmony, would be
the same as the interest of one person
owning the whole.
State Fixes Rates.
The policy of the state in respect to
the operation and management Of rail-
roads is disclosed by it's statutes; espe-
cially by sections $40 to 403, vol. 1, Cen
eral Statutes of Minnesota. under the
beading of Railroad and Warehouse
provisions of congressional legislation re-
specting interstate commerce., and under
clearly specified regulations places the su-
pervision. oversight and control of those
matters, particularly the rates for trans
portation, in the hands Of the designated
state officials.
1T is plain from these statutes as con-
strued by the supreme court of the state,
that it is the policy Of the state that the
railroads, with their rolling stock and
appliances shall be kept in a high state
of safety and efficiency; and that rates
of transportation, while kept ample to
secure such result, shall always be fair,
reasonable. stable and uniform. Sched-
ules of rates are, to be kept publicly post
ed at every station, and no change or de-
Walton from such published rates is per-
mitted, nor any rebates allowed or adj
vantage to one shipper over another, and
10 change in such rates is permitted un-
til after ten days previous published no.
tice has been given.
Under this system shippers can count
accurately the cost of transportation as
an expense in their business, with the
assurance that others engaged in like
business must incur exactly the like eX-
pense; and u~ntrammeled competition be-
tween rival railroads resulting in rate
wars. sporadic struggles for particular
contracts or consignments, as well as all
rebates. open or secret, all alike unfair or
ruinOus to carriers and shippers, are pro-
hibited under penalties, and intended to
be entirely eliminated and done away
with: leaving as the only bases Of COM
petition between rial carriers the fur
nishing of the better accommodations,
and the greater safety and CELEBRITY or
carriage.
"Au complaints that published rates are
unreasonable are heard and determined
by these state officials, who may fix rates
binding on the railroads; thus necessarily
making rates uniform as between rival
railroads.. AS a result Of this policy, and
the absolute power of the state officials
to fix rates. and keep them at the low
est reasonable figures. competition. be-
tween rival railroads no longer reduces
rates, as it did when railroad companies
alone controlled them. On the contrary
where two or more railroads divide the
transportation between two places the
necessity of considering greater liked
charges and greater cost Of administra-
ton and operation may make the reason
able rate for transportation greater than
If the whole business could De zone anu
was in fact done by one railroads:
No Law Violated.
However that may be, the Northern
Securities company is but an lnvestins
III in these two railroad compa-
MES, without power to consolidate them
or to interfere with the management or
control of either. Because of It's large
holdings Of these stocks it may elect the
board Of directors of each, who must De
composed of entirely different persons.
Zach board will appoint the officers
and control the business ana aHalrs OF
its own corporation and will naturany
seek to increase it's business ana proper
tv. Neither has any power TO control tne
other nor to contract with the other IN
restraint OF trade. There Is no presufnp-
ton that either will disobey the law or
be guilty of the commission OF penal OF
lenses. Should they do these things, tfen
the antitrust act of Minnesota VIII %
for the first time violated. and the ran-
road corporations and their ~ofendins ON,
Gals will be amenable to PUNISHMENT, ~
to appropriate legal or equitable proceeo-
ingS.
Decree Will be entered dismissing the
bin. William Lochren, Judge.
New Rain
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