development; but the trust is to the corporation what the mitrailleuse is to a blunderbuss.
The “trust,” as the word is here employed, meaning by it a combination of property, real or personal, with powers of management or absolute disposal, or of stock in corporations, in the hands of a few persons, is a perfectly new device in the law. There are as yet positively no reported cases in courts of last resort regulating or interpreting them; nor have any statutes been enacted bearing upon the subject. The matter is therefore, an entirely open one, to be determined by lawyers on general principles of law, and by business men entering into such trusts upon ordinary principles of business sagacity. The objects of the “trust” may be broadly stated to be, either (1) monopoly, (2) concentration of power in few hands, (3) evasion of the laws regulating corporations,—any or all of them. Of course, under monopoly we include the pooling of prices and wages, the regulation of production, the extermination of competitors.
We must further distinguish two kinds of these trusts; the first, or more simple kind, where tangible property, real or personal, or stock (meaning stock-in-trade or cattle), or manufacturing property or businesses are given directly to or placed in the hands of a few men for management, control, or disposal; second, where the stock or franchises of corporations are placed in the hands of a few men or of a dominant corporation for the same purposes. The latter class, which is even more complex and of more questionable legality than the first, we shall for convenience term corporate trusts.
The origin of the word “trust” seems to have been the well-known Standard Oil Monopoly. The defenders of the trust point to this as a justification both of the need of the invention and its practical success. In the Standard Oil case there were a few men who had acquired controlling interest in a few (at first) manufacturing or mining properties, situated in different States. How could they manage them all? Not personally, for they wished to avoid personal liability; not through corporations, for, as their acquisitions increased, it was seen that the whole time of these two or three men would be taken up by going about to corporate meetings, publishing notices, placatin g stockholders, and complying with the (to them) vexatious restrictions concerning corporate management of the several States wherein their business lay.
