Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1915-04-13
COURTS DECISION !.
N EXCHANGE CASE
South St. Paul Live Stock Ex.
change Regulations Upheld.

The right of the South st. Paul Live
Stock Exchange to discipline its mem.
bers for violating its rules and regu.
lations was upheld by Judge Michael
in handing down q decision March 81
when the case Of the Jas. R. Kirk Co.
versus the South st. Paul Live Stock
Exchange, to prevent the exchange
from collecting . fine imposed, was up
for trial in his court. The Jas. R.
Kirk Co. had been accused Of paying
rebates and having several solicitors
at work through the Northwest,
which IL in open violation Of the rules
of the exchange to which every candi.
date voluntarily subscribes when be.
coming a member.
The rules and regulations are 20
constructed as to make dishonesty i'm.
possible when rigidly observed. The
Kirk Co. having been accused of VIC.
lating the rules and regulations had
been cited to appear before the board
of directors of the exchange for in.
vestigation, which on account of no
precedent ever having been estab.
lished for the conduct of any investi:
cation, proceeded along lines that alp.
peared fair and just, but which did
not meet the approval of the court,
who decided that on account Of GER
tain technical irregularities in the
preliminary conduct of the case there
was no proceedings, thus leaving it
open for the exchange to retry in a
more regular manner the pending
charges against the Kirk Co. The full
decision of the court follows:
II don't think the court will ever be
in a better position to decide this
case than right now when the facts
and the argument Of counsel, are fresh
in the courts mind.
a have no difficulty in holding that
the provisions Of Rule II Of this asso'
citation are valid. think their evi.
dent purpose 10 to make for honesty
In the transaction Of business.
"The disciplinary provisions in Rule
~. I think, furnish a reasonably plain
outline Of what must be done when
charges are, filed against a member.
Section l provides for the filing OF
the charges. Section 2 provides for
serving a copy Of the charges on the
accused and fixing q time for hearing.
Section 2 also provides that the board
of directors shall make an examina-
ton OF the charges To my mind, II
this contemplates that the board of
directors are to make an ex.parte ex.
animation, 1t would SO violate the
rules of natural justice a to be
against public policy and be void, be-
cause these disciplinary provisions 90
directly to affect the membership and
property rights Of the, defendant in
those proceedings. I don't believe,
however, that is the correct %construc-
ton Of this rule. l don't, think there
IS any difference in the word 'exami-
nation used in this rule from what
there is in the word trial used in in
surance bylaws. l think they both
contemplate the same thing, and, so
construed, the rule is evidently fair
and valid. That does not necessarily
mean that a trial must be surrounded
| with all the technicalities and formal
tiles of a trial in court, but It does
mean that it must conform to the es.
sential features constituting a trial as
known to the law of the land, viz, the
right to~be confronted with witnesses.
the right to ~cross-examine them.
1.-THE court has no difficulty what
ever In finding that this board Of d.
reetors acted In good faith, and that
It believed it was acting within the
powers conferred upon it by these
rules; but I think Il 10 quite apparent
that the board Of directors honestly
mistook their powers and functions in
the premises.
1T appears from the evidence and
the records that two witnesses were
examined in these hearings In the alb.
sence and without knowledge Of the
accused. 1t also appears that the evil
dence upon which, the board of direc'
tors largely depended in arriving at
its judgment was the statement which
the committee of the board obtained
from Mr.. Johnson. This evidence
If it be such-was taken without no.
tice to the accused and without their
knowledge. So 1t seems to me that
there was such irregularity in, the con.
duct of this examination or trial
whichever it may be called as to
vitiate the judgment arrived at. l
think there has been nothing done by
the accused in this instance to waive
those irregularities. In fact they seem
to have protested against the non-pro-
duction Of the witnesses at the ex-
animation, and also objected to the
character Of the evidence as hearsay.
1T is not necessary to pass upon
the fact Of whether or not this EVIL
dence produced before the board had
any probative value. may say that I
am not particularly impressed with
the attitude that the plaintiffs here