The daily morning journal and courier. [volume] (New Haven, Conn.) 1894-1907, 1907-07-12
connecticut Special
CHARTER POLICY
An Earnest Attempt to Bal
ance Up States
Records.
SAID TO BE CARELESS.
Judge Pearne Recommends
Striking Off Hundreds
of Corporations.
SAID TO BE CARELESS.

IOWuy WIZ AdS lldu ullNUL AlNS9tlGo-
ton specially chartered companies of
this State, has presented his report in
the legislature. His work. as the re-
port says, is the first attempt to clean
up the records and dispose of defunct
corporations. A number Of reasons
are given as to why the work has been
difficult, slow and complicated. These
include: The State has been granting
special charters since 1890 and up to
1884 no record was required 10 be
made of any organization; general
carelessness and ignorance upon the
part of the people directly interested;
lack of proper records; lack of care. in
the granting of charters; confusion of
corporate names with regard to the
business to be carried on and the de-
partment to which reports are to be
made.
The report continues as follows:
In the case of a very few corpora
lions their charters require an annual
report to be made to the comptroller,
which is claimed to exempt them from
making reports to the secretary. The
compHoller's office is by it's character
no place for such reports, they are an
Inconvenience there and serve no good
purpose.
The machinery of the law to enforce
annual reports has not seemed to
work satisfactorily. One reason is
that the record has been numbered
with so many dead corporations that
it has been next to impossible to get at
the live delinquents, and unless fire.
quent action is taken to dispose of the
defunct corporations it will not be
long before such condition will exist
again.
The corporation is the creature Of
the State; it may do only what the
State says it may do. It's stockholders
have certain immunities and privileges
which are valuable and the corporate
form of doing business is convenient.
The requirement of the State as to re-
ports is not great and there can be
no reason for failure to make them.
In the matter Of dissolving corpora
tons the way is now easy and mex
pensive, but there is no provision for
compelling such dissolution. In Mass
achusetts, in addition to a greater
penalty than we have here for failure
to make annual reports, it is provided
that after failure for two successive
years to report, application may be
made to the court for a decree Of dis
solution, In New Jersey an annual
franchise tax is imposed; If this is not
paid annually, corporate existence
ceases upon default
In the case of Insurance companies,
railroads and railways, banks, trust
companies and building associations,
the reports are vital to their existence
and they are all under State super
vision besides. In the case of manu-
featuring and commercial corporations
although millions of money Is so in
vested, there is no State supervision
and their compliance with the pro
visions Of the law in their relation to
the state has largely been a matter Of
their will.
1t Is not within the scope of the au-
thority under which this Investigation
has been made but some facts ohserv-
ed may DC Of use. The volume of spe-
cial legislation has very materially in
creased in the last quarter century. The
printed volumes show that from 17S9
to 1887 inclusive, the session of 1882
being the last annual session, with an
nual and sometimes semi-annual ses-
sions all the special legislation is con-
tanned in 1900 pages, while from 1889
to 1905 inclusive, with eight biennial
sessions, the special legislation fills ap-
prcximately $500 pages, that of 1885
being one volume of 1,16O pages. The
subsequent volumes show slight de-
crease, that containing the special laws
Of 1903 and 1905 having only LOO pages
Up to the present time the State ha,
had no settled policy with regard to
special legislation, unless the granting
Of pretty much all that is asked for in
varying form, and to a varying extent
as the sessions come and go, can be
called policy. Some time the STATE
will be compelled to adopt some def.
mite policy with regard to this matte,
to keep this special legislation within
reasonable bounds as to volume ant
substance 1t is not possible to accom-.
plish much in this direction under the
present system. There is no good rea.
son why an ordinary manufacturing OF
commercial corporation or corpora.
ton without capital stock may not be
organized and conducted under The
general law. If this were done it would
save the time of the sessions, the mon.
ey of the State, and reduce the size Of
our special laws.
Accompanying the report were ST,
lists or schedules of corporations, a:
follows;
Schedule "a" contains the names Of
such corporations as claim to be il
active existence.
Schedule "B" contains the names OF
such corporations as are supposed t,
be required to report to the secretary
annually and are now believed, from
the best information obtainable, not tt
be in active existence.
Schedule CO. contains the names O.
insurance companies which do not re-
port to the commissioner and are be
lieved not to be in active existence.
Schedule 3D. contains the names n,
railroad companies, steam and street
which from the best information OBJ
ltainable are believed nor ia have hoo,