Vermont phÅ“nix. [volume] (Brattleboro, Vt.) 1834-1955, 1907-05-17
A Long Step Forward in state Control Of
Corporations

The decision of the Vermont supreme
court last week confirming the judgment
of the Chittenden county court in hold
ing the Burlington Rendering company in
contempt is of much greater importance
than seems to be generally understood.
1t will be remembered that when the at
torney- general and states attorney began
the investigation of the beef charges"
before the Chittenden county grand jury
last September the Rendering company
refused to produce its books OF account
and the papers called for. claiming that
they had been sent to the general Office Of
the company in Boston and were not
within the jurisdiction Of this state There
being no officers Of the company in the
state upon whom there could be served
subpoena duces tecum the state was
powerless to compel the production Of the
papers required. The attorney-g
asked that the grand jury adjourn for a
month. In the meantime the legislature
met and there was presented 20 the judic-
iary committee a bill which was at once
favorably reported and it passed both
houses and received the approval OF the
governor, all in one day. This rapid fire
legislation created some adverse comment
at the time, but the result has justified
it.
This law provides that corporations do
ing business in this state must. upon be-
ing notified so to do, produce before any
court or tribunal under the Jurisdiction of
the state. any books or papers relating
to transactions in the state Of Vermont
which may be called for. The failure of
the corporation to comply makes it la
bic in contempt and, further, it may be
enjoined from further doing business in
the state. Acting under this law, the
| attorney general notified the Rendering
company to produce the books and pa
pers on the day specified. 1t refused to
do so and proceedings were brought
against it for contempt. Counsel for the
Rendering company put up vigorous op-
! position, claiming that the law was un-
constitutional in that it was an unlawful
search and seizure. that it compelled the
corporation 10 give evidence against IT.
! self, that it was not due process OF law,
and that it was taking the property OF the
| corporation without just compensation.
! Chief Judge Rowell presided and held
the corporation in contempt and imposed
a fine Of $4,000 Exceptions were taken to
the supreme court, where the case was
argued at the January term. The decis-
ion Of the supreme court, rendered last
week, sustains the constitutionalty Of the
law and confirms Judge Rowells judg-
ment. 1t is likely that the case will go
to the supreme court OF the United States.
II the law is finally sustained, as it seems
/ likely to be, it marks a long step for
ward in state control Of coporations. 1t
arms the state authority with the power
to get at the facts from the books and
records OF the corporations themselves
and cures a defect which has long been
| recognized. 1t is safe TO prophesy that
Vermont has set the pace in this impor-
tant measure and that the law which was
rushed through our legislature in its early
days last October within a very few years
will be upon the statute books Of every
state in the Union.