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could not casily be sold as one parcel to any one person or



company, or sold separately without breaking up the systems. Hence, until the serious questions of reorganization or sale were settled, the receivers of these systems must continue to run the trains in the interest of the public. As these necessary adjustments were often found very complicated, requiring a long time for negotiations and final agreement, the receivers appointed by the courts were placed for the time being in the position of railway managers. They were confronted with technical problems of much practical importance. They were required to become familiar with disputed questions concerning reasonable rates and their ramifications.

of cities and towns' as to charges which should be relatively fair to cach were pressed upon their attention. In formulate for the operation of the properties in their charge a policy which should be cquitable to the capitalists whose money was invested in the road, to all the sections served by Neediess to say the success of such a task required men of through their appointed officers were obliged to decide upon administrative ability with the further result that the courts the details of administration.

It was the practice at first for receivers to be asked for solely by the creditors of the company in order that their property might be held together and protected against the seizure of certain parts of the system, particularly against creditors who might destroy thic value of the property as a opposition to the motion so that, if reccivers were appointed at all, the court acted upon information brought to its knowledge itself could ask for an appointment of a receiver for its own property originated with the late Jay Gould, whose contention in the Wabash cases in this respect was afterwards affirmed by the Supreme Court of the United States, which held that a company could itself ask for the protection of the court if

The conflicting was required that rcccivers should be able to

and to the general traveling and shipping public. Usually the corporation appeared before the court in Severe legal struggle. The idea that the corporation Was for the best interest of all concerned. Under this


the railway




doctrinc few of our large railway systenis arc now placed in any but " friendly" hands. In such cases the matter is all planned out bcforchand and the men chosen. Any creditor of the company, friendly to the administration, may allcge that the corporation owes him money that it cannot pay, and as cvery going concern has plenty of creditors in the ordinary course of business, such a convenient creditor is usually not hard to find. To this complaint, usually prepared in secret, some one of the company's officers arranges a reply confessing the truth of the charge. All parties concerncd, cach with the respective documents, and without notice to the other crcditors or to the public, apply to the judge, perhaps at night, who forthwith grants the application and appoints thc rcccivers already arranged for. That this procedure opens the door to the possibility of great abuse of corporate interests needs no argument. That on the whole the plan has worked fairly well is owing to the high character of our judiciary and also of the officers in charge of our great corporations. Yet it is not reassuring to holders of stocks, bonds or floating debt to know that a conspiracy between any small creditor

one of the principal officers of a corporation may throw the control of the whole property of the company into the hands of the court. Unquestionably, the appointment of former officers of the company as receivers leads to the charye at times that those who had wrecked the company are still left in power.

Morcover, the door is open to abuscs such as the difficulty casily thrown in the way of a thorough investigation into the company's condition, which it may be the wish of the old managers to thwart, but which may be necessary before an equitable plan of reorganization can be envolved. Yet the affairs of our large corporations have become so complicated that only those long familiar with them are capable of administering theni without losses both to owners of the road and to shippers. This business fact has so far controlled the action of the courts in the appointing of old officers of the insolvent corporation as receivers, though usually other men not previously connected with the company, but representing important interests as well as the sections through which the

and any

If the decline continues and a reccivcrship ensues, the passing of the property into the hands of the court is an acknowledgment of facts regarding impairment of income which are true though not before yenerally known. Hence the issue of receivers' certificates commercially represents the impairment of inconic just referred to, but which at the time was not cnforced against the bondholders. Railway mortgages are not sacred because of the strong legal terms in which they are drawn, but are dependent upon success in the business of transportation, differing in this respect from real estate mortgages which rely morc upon the prosperity of the whole community. The local doctrine of certificates is in a state of cvolution, with a tendency to approximate its working to the business circumstances. English debentures are not foreclosable, being mortgages upon the railway income only, and thus inorc truly than American mortgages, represent the real situation. Our practice of railway receiverships is thus a development of our own circumstances and a sort of compromise between the too-strong language of our mortgages and the actual conditions of the business of transportation.

A receiver may decline to pay the rentals due to Icased lines or the interest owing on guaranteed bonds if these lincs are at the time of the reccivership unprofitable, no matter how necessary to the parent company these branches may once have been. But the old contracts are still legally in force against the company, and can be thrown off only by a sale of the franchise and property to a new corporation. Such a sale sometimes would involve a forfeiture of valuable charter rights; and in such reorganizations committees usually try to formulate some plan which shall bring the fixed charges below the minimum profits by allotting the necessary losses among all classes of securities in proportion to their respective values to the system as a whole; a process which does not regard the liens of the mortgages so much as the worth of the lines they cover. But with plans of reorganization, the receiver properly should have nothing to do.



It is the tenth of June, 1788. We are standing in the gallery of the old Richmond Theatre on Shockoc Hill. The heart of a nation newly born is throbbing fccbly, as if struga gling for life, in the gathering on the floor below; for it is the ninth day of the session of the Virginia Convention called to ratify or reject our present Constitution of the United States. Around us in the galleries are clustered thc fashion, beauty, wealth and intellect of Richmond; nay, from every walk of lisc, people have left their employments or their pleasures that they may appear at this stirring crisis. Outside through the windows we look at the city stretched out before us, and tinted in the rays of the summier sun of the South. And as the hushed crowd in the auditoriuro Ican forward to catch the speaker's words, with a stillness so profound that the flutter of fans has ceased, thc very airs outside have pauscd in their sportive whirls, and not a twig or Icaf rustics. A single beam of the noontide sun, piercing the atmosphere, throws a glittering halo about the head of a figure standing in the rostrum, upon whom all cyes arc fixed. A tall, slender, ungainly figure, dresscd plainly in a somcwhat ill-fitting surtout of bluc, is spcaking from this place. The clear-cut, impressive features, not handsome, but striking and bronzed with the sun, arc upturned to niect the light as if hc welcomied this hcaven-scnt omcn of success to the causc for which he is. contending

The black eyes flash with a singular lustre, and the dry. hard voice, drawling and hesitating somewhat at first now speaks with a force as resistless as the thought it convcy's, while a single, awkward gesture, a perpendicular sweep of the right arm, cuts the air at intervals.

"John Marshall, the young delegate from Henrico county,"

is whispered


I differ in

gives utterance to his closing passage.

"The honorable gentleman has told you that your Continental Government will call forth the virtue and talents of power of the State governments? Will our most virtuous and able citizens wantonly attempt to destroy the liberty of the people? Will the most virtuous act the most wickedly? virtuc and talents of the members of the general government will tend to the security instcad of the destruction of our to the existence of the general government, and that it is safe to grant it. If this power be not necessary, and as free from abuse as any delegated power can possibly be, then I say that the plan before you is unnecessary, since it imports not what

A hush, a burst of applause, and the orator has taken his the Constitution of the United States. They but foreshadow the great labors which he afterwards performed upon it. As a soldier he had borne arms in defence of the country of its adoption; as a legislator he had contended for its ratification; the summit of his professional glory, as Chief Justice of the Supreme Court of the United States for thirty-four years, he

We are burning now, in our peace, our happiness, our prosperity and our liberty, the stored sunshine of the intellects decade, but for all posterity. Not to patch a piece of mechanism that it might deal a few stirring strokes and then impo

ncar us, and we hear the speaker's voice as he This being the case, will they encroach upon the

opinion from the worthy gentleman. I think the I think that the power of direct taxation is essential We have, unless it have the power of protecting us in Peace and war."

are the first public statements of John Marshall on diplomat he was to fing back with dignified scorn the

levelled at it by the Empire of France, and finally, at


system time of



as a


built through

up, perfected and cxpounded this same Constitution

a series of decisions unparalleled in the annals of



nourished our republic in its inception. Their povers were at work, perfecting secret forces, to act not for a day, a

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