The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1908-01-20
A Statute Passed by the Legis.
1ature of Missouri.
ASKED BY RAILROADS
10 Prevent the Forfeiture OF
Their Charters
For Transferring Suits to the
Federal Courts.

Kansas City, Mo-. Jan. 20.-Judge
smith Mcpherson, in the United States
district court here, has declared void
and unconstitutional the statute passed
by the Missouri legislature in 1907, for
pldd1ng foreign corporations from
| transferring suits brought against them
from the state to the federal courts
upon pain of forfeiture of their char
ters.
The application of the Rock Island,
the Santa Fe. the st. Louis, Kansas
city & Colorado, the Milwaukee & ST.
Paul, and the Chicago &. Alton railway
companies for an injunction to prevent
John E. Swanger, secretary of state,
from enforcing the law was granted by
the court.
The Missouri law upon which todays
decision is based provides specifically,
that if any foreign, or nonresident rail-
way corporation, created and existing
under the laws of any other state and
doing railway business from one
point In the state to another point
within the state, shall without the
written consent of the other party. re-
move case from the state court to a
United States court or shall without
said written consent institute any suit
against citizen of the state, in any
federal court then the secretary of
state shall revoke the license to do bus
iness from one point within the state
to any other point within the state,
either in carrying passengers or freight.
And doing such business shall subject
1t to q penalty of not less than 1000
and not more than 10000 dollars for
each offense. And such disability shall
continue for five years. 1t is alleged in
this case that complainant Is about re-
| moving case and the secretary will
follow that by revoking it's right to do
business. The defendant contends that
this in effect is an action against the
state, in violation of the eleventh
amendment to the constitution. The
complainant contends that the act or
1907, impairs it's contract with the state,
and denies it the equal protection of
the laws if enforced.
Judge Mcpherson in his decision goes
into the law of the case at great length
and quotes freely from previous de-
cisions to sustain his position.
Different From Wisconsin Case.
Judge Mcpherson cited a decision
of the Wisconsin state supreme
court, which upheld a state statute
under which an insurance company's
charter had been revoked for remov-
| ing case to a federal court. In this
case, however, he says the company
made no investments therein.
| "In the case at bar" he says, "a
| license to do business is not the ques-
ton. Each of the companies invested
millions of dollars and it is now in
| the state and can not remove. To
prevent it from doing business means
appropriating its property or destroy
| ing it without making any compensa-
| ton therefor. It was invited to come
| into the state, and was told by the
| laws then in force, that it should
| have the same and like standing as
resident companies, with benefits as
great, and with burdens no greater.
After these investments had been
made and which can not be with
drawn, it is declared by legislation
| that no kind of litigation shall be car
ried on by it in any court other than
| the state courts, but leaving to the
| railway corporation organized under
| the laws of the state, to go to the ma
tional courts with it's litigation of all
| kinds arising.
| Some of His Reasons.
The decision in part follows:
This court is mindful of the crit1-
cism by many laymen, as well as by
many lawyers, to the effect that Unit
ed States courts have no right. nor
even the power, to decree the invalid
| ity of state statutes. The argument,
I or rather the talk, is that the people
know what they need and that their
representatives in legislature assem-
| bled alone should determine what
statutes we must have. And when SO
| determined and evidenced by legisla-
| tive enactment that the courts should
not interfere by decree and thereby
thwart the legislative will. In other
words that it is we'll to limit the pow
ers of executives and courts, but a
| written constitution restraining legis-
lative bodies is all wrong and that
| Great Britain has the model govern
| ment.''
| "Officers of the state continued
Judge Mcpherson in his decision,
''too often decry the power of the ma
ton. State rights is their shibbol-
eth" He added: 1.-THE most attractive
argument to some lawyers OF recent
days is that the state courts alone in
the first instance should pass upon
the question as to the validity of state
statutes with the right of the defen-
dant party to carry the case for final
| decree to the supreme court OF the
United States. Such arguments are
plausible, are convincing to many
| good people, but are so dangerous as
| to amount to a heresy. 1t is the ex-
| treme of states right in new form
under the laws and constitution OF
the United States. The state corpor-
ation organized under it's laws, may
she or be sued in any court, state or
| national if there is federation ques-
tion but a foreign corporation doing
| business as competitor must at all
times be subject to the state courts
or if it ventures into a national court,
| than all investors lose ALL Judge
| Mcpherson here cited the case OF
| Rarron versus Burnside, 121 U. 8.
I1s6. which arose under an Iowa stat
ute much like and in principle the
same as the Missouri statute. The
| supreme court held the statute to be
Void He adds:
Statute Is Void.
son the foregoing the case at bar
| could be safely grounded. But for an
| other reason the statute is void as
| being in conflict with the national con-
/ stitutfon, in that it is repugnant to the
provision which reads, No state shall