The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-11-13

holders, 1t must be borne in mind that in an
ordinary corporation there are some limita-
tions on the power of the stockholders
themselves. Even a majority of them cam
not, over the protest of a minority, dis
solve it or change its fundamental purposes.
But the trustees do not represent the
SaoGaholdets only; they heey are trustees a tho
city of Indianapolis. who are Denefciaries
OF the trusts imposed, and additional llmita-
tons are imposed by law in favor of such
Indeed, in all discussions of the powers
and duties of subscribers, directors, trus-
tees and all officers of the Consumers Gas
Trust Company the limitations growing
out Of the trust features OF the corpora
tions and imposed by law in favor of the
consumers is an important and controlling
consideration.
''The company, as we are advised, has
franchises. pipelines, leases and other prop
erty OF great value. If it is practicable to
utilize its resources so as to furnish gas
to the citizens of Indianapolis-the primary
object OF the corporation-it is not only the
right but the duty of both trustees and d.
rectors so TO utilize them. If ii is no longer
practicable TO supply natural gas, but 1t is
found practicable TO supply gas manufac-
right and the duty of both trustees and d.
rectors to adopt one or the other Of these
methods.
w do not mean by anything that we
nave said as to the practicability or man.
ufacturlng gas or carrying out any or the
purposes OF the organization. to intimate
that either the directors or the trustees, or
Doth combined, may arbitrarily determine
that 1T Is no longer practicable TO carry out
the purposes OF the organization and that
their decision Is final and conclusive and
beyond the control of the courts.
1.-The right TO invoke the aid of the courts
for the protection of his rights is in any one
having an interest in the execution of the
trusts imposed, whether he be n subscriber
or a consumer. Perhaps, though we do not
wish to do more at this time than to make
the suggestion, the city of indianapolis.
representing the citizens at large who are
benehciaries of the trust, has the right to
invoke the power OF the courts TO see that
these trusts are faithfully carried out, on
the principle declared in the case of Mum
Gle Natural Gas Company VS.. City OF Mum
OF Indiana.
LAW AFFORDS REMEDIES.
"In respect to the directors and trustees
Of the Consumers Gas Trust Company, as
it is in respect TO the managing officers of
all corporations, the presumption is, until
the contrary appears. that such officers have
exercised, and will continue to exercise.
the discretion vested in them in good faith
and for the best interests Of those whom
they represent. But if it should appear
that their discretionary powers have been
abused; that an attempt is being made to
wreck the company, or to pervert II from
its fundamental purposes, then, as we
have already stated, the law affords ample
remedies.
within the scope Of their powers as re-
stricted by the articles of association, and
by the limitations imposed by law In favor
OF the beneficiarieS of the trusts created,
there is a wide discretion vested in both
trustees and directors, with which courts
are reluctant to interfere so long as 1T APP
pears TO be fairly and honestly exercised.
But neither the board of trustees nor the
board of directors, singly or combinde, has
any such discretion as authorizes them to
change the fundamental character or the
original organization, or to divert 1t from
Its primary purpose OF supplying gas 10 the
citizens Of Indianapolis. The discretionary
power confided to them is merely TO man.
age the ordinary business transactions of
the corporation, and even this power Is not
unlimited and will be controlled by the
abused, either for the personal advantage
of the managing officers or agents or In
hostility to the fundamental purposes OF
the organization"
MAYORS VIEW.
Mayor Hoffman believes that the fore
going opinion is the correct one and that
Messrs. Walker, Elliott and Howe have
struck the proper key. His comment is as
follows: 1T have read the opinion of Judge
Howe, Judge Elliott and Judge Walker and
it strikes me as sound, common sense and
good law. Every man who subscribed for
stock did so with a full knowledge that as
soon as he was repaid the amount of his
subscription, with S per cent. interest, his
interest as a subscriber and st0cKnolder
was at an END ana InaC thereafter the
company was to furnish gas at cost to the
consumer.
There can be no doubt but that this COM
pany was formed by public-spirited citizens,
not for pecuniary profit, but for the benefit
Of the public. No one should be permitted
now to divert this public-spirited enter
Corporation state as the primary object
Of the corporation the supplying or gas
to its patrons for fuel and illuminating
purposes, and to provide several different
methods of obtaining gas.
"As at present informed this administra-
ton believes that the city of Indianapolis
representing the citizens at large, who are
beneiciaries of the trust, has the right to
invoke the power of the courts to see that
these trusts are faithfully carried out, and
If it should appear at any time that an
attempt was being made to pervert 1t from
its fundamental purposes. this administra-
ton will use all of the power vested in it
by law to protect the rights of the benef-
Charles under the trust"
CITY ATTORNEY TALKS.
City Attorney Henry Warrum said: 81
have only had time to glance over this
opinion hurriedly, but it seems to me that
the conclusion that the Consumers Gas
Trust Company has full and ample author
ity, under its charter and the law, to man.
ufacture gas and furnish it to the public
is beyond reasonable question. I also be-
lieve that the position of these gentlemen
that a trust is imposed on this company.
it's stockholders, trustees and directors, to
furnish gas to the public at cost, when
possible, is a correct one, and that if to
accomplish this trust the changed condi-
tons require the manufacture of gas, this
Vas contemplated in the creation of the
trust.
''The suggestion of these gentlemen that
the city may perhaps have the right to in
woke the power of the courts to see that
this trust Is carried out, l am and have
been investigating. This opinion does not
undertake to declare such right on the part
of a municipal corporation, but the case
of Muncie National Gas Company VS.. City
of Muncie gives strong support to such
doctrine. If there is authority for the in
tervention of the city land / would be glad
to have any suggestions on this subject), I
shall certainly see that it is represented in
this controversy"
Origin of the Present Perplexity.
To the Editor Of the Indianapolis Journal:
The gas trust situation presents some