Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1905-04-04
Decision to Dismiss Northern
Securities Case In U. s. SUI
preme Court
FIX ISSUANCE FOR APRIL
End of the Famous Case Brought by
Hartman Against tho Hill Interests
Decree is Affirmed by United
States Supreme Court, and Bill Will
Be Dismissed.

the supreme court i'm the case of Har-
riman VS.. the Northern Securities
Company, on the decision which was
announced several weeks ago, handed
down yesterday is Of much interest
in financial circles. The motion for
the immediate issuance of the man
date was denied, the date for issuance
being fixed for April 10.
After stating the case at length, the
chief justice said:
I'm the present case complainants
seek the return of property delivered
to the Securities company, pursuant to
an executed contract of sale on the
ground of the illegality of that con-
tract. but the record discloses no spec
ial consideration of equity, justice or
public policy which would justify the
courts in relaxing the rigor of the rule
which bars recovery. The circuit
court DEGREES and the action of the
attorney general of the United States
put at rest any question that the rat
able distribution resolved upon was
in violation Of public policy and 1T Is
clear enough that the delivery to COM
plainants of majority of the total
Northern Pacific stock and ratable
distribution of the remaining assets to
the other Securities stockholders would
not only be in itself inequitable, but
would directly contravene the object
of the Sherman law ana the purposes
Of the government suit.
Would Smother Competition.
"The Northern Pacific system, taken
in connection with the Burlington sys-
tenn, is competitive with the Union
Pacific system. and 1t seems obvious
to us, the entire record considered.
that the decree sought by complalnants
would tend to smother that competlt-
ion, while the superior equities, as
against compliments present claim, OIL
the many holders or Securities shares
who purchased In reliance on the be-
lief that they thereby acquired a rat
able interest in all Of the assets OF the
Securities company are too plain to
be ignored.
"The illegal contract could not be
made legal by estoppel but the owner
ship of the assets, unaffected by
special interest in compliments could
be placed beyond dispute on their part
by their conduct In holding the Secur-
tiles company out to the world as un-
conditional owner.
And without repeating in detail
what has already been set out, 1t is
plain that the right of rescission OF the
executed contract OF Nov. is, 1901, even
IL rescission could have otherwise been
sustained, had been lost by acquies~
cence and laches at the time this bill
was filed.
Since the transfer of that date Sc
curties stocks had passed into the
hands of more than $500 holders, many
of them in Great Britain, France and
other parts of Europe; nearly year
after the filing of the government bill,
$4,000 shares were sold for cash, COM
plainant Hartman concurring; some
months after Hartman and Pierce ana
the Oregon Short Line Company
pledged their $4,000 shares to the
Equitable Trust Company. notwlth-
standing the decree of April y, l9o3'
they stood on their rights as snare
holders, and it was not until after
March %, 1904, when defendants board
of directors resolved upon a rataple
distribution that compliments under
took to change ar election already SO
pronounced as to be irrevocable IN IL
self in view of the rights of others.
Parties Acted in Good Faith.
1--WE regard the contention that COM
claimants the exernpt from the doctrine
in pari delicto because the parties act
ed i'm good faith and without intention
to violate the law as without merit.
With knowledge Of the facts and OF the
statute the parties turned out to be
mistaken in supposing that the statute
would not be held applicable to the facts.
Neither can they plead Ignorance OF
the law as against the other, and de-
PENDANT secured no unfair advantage
in retaining the consideration volun-
tarily delivered for the price agreed.
We find no evidence of any express
agreement that compliments should
be entitled to the new common stock
and it was certainly not the natural
increase of the Old stock but the exer-
else of the right Of subscription. The
purchase by the Securities company
was on its own account and not in
trust and cannot be disturbed because
of illegal purpose at the clamor of the
parties i'm pari delicto And there is
here no question Of the restoration of
the status quo if that were practic-
able.
DOUBTLESS it became the duty of
the Securities company to end a situa-