the responsibility of workmen is in no sense increased by incorporating labor unions for benevolent purposes exclusively. Yet persons suggesting incorporation with a view to increasing responsibility have in mind, very probably, incorporation for bene volent and business purposes combined, or possibly incorporation for business purposes exclusively. In this discussion it is conven ient to call a corporation organized with mixed purposes or with exclusively business purposes a business corporation. Let us imagine, then, that a trade union is incor porated for the purpose both of providing for sick or unemployed members and of regulat ing the relations between workmen and their employers. Such a corporation might have officers managing its affairs, stockholders, shares with a certain par value, and a fund composed primarily of the proceeds of the sale of shares. This corporation would not be legally responsible for the wrongs or con tracts of any one or more of its stockholders, but it would be legally responsible for the wrongs or contracts authorized by its officers in the course of its business. Further, the assets of the corporation would be liable for the damages caused by these wrongs and contracts. Finally, there would be a legal liability on the part of the stockholders them selves to pay into the corporate fund such sums as might be necessary to enable the corporation to meet these claims, although, to be sure, this stockholder's liability is subject to qualifications and usually does not extend beyond paying for the stock in full and mak ing an additional payment of the same amount. More specifically, in case of illegal inter ference ordered by the proper representatives of the corporation, or in case of breach of a contract entered into by those representatives as to rates of wages, there would be a new legal responsibility, namely a legal responsi bility on the part of the new legal entity, the corporation itself, and this new legal re
sponsibility would be supported by a new business responsibility, because there would be corporate assets. Yet it must not be inferred hastily that these new responsibilities would be of value. In the first place, although there is differ ence of opinion upon the question whether the legal liability for the wrongs and con tracts described would attach to such cor porate funds as might be raised not by sale of stock but by contributions made clearly and exclusively for benevolent purposes, such as aiding stockholders when sick or unem ployed, there is not the slightest doubt that such contributions would be perfectly pro tected if held by a separate body, for example, a benevolent corporation composed, possibly, of precisely the same persons. To take from the business corporation the control of funds meant to take care of cases of sickness and death would obviously be just. To treat funds for the unemployed in the same man ner would be of doubtful propriety; for the lack of employment would often be due to a strike, and the declaring and managing of strikes in the interest of stockholders would be a considerable part of the work of the busi ness corporation. However improper it might seem to capitalists thus to separate the benevolent funds, the separation would certainly take place, and workmen would deem this course justified by such devices as those whereby the railway companies of Pennsylvania evade the constitutional pro vision forbidding them to mine coal. Now, as the sums required by trade unions for benevolent purposes, including the sup port of strikers, are much larger than the funds required for any other purpose, it is probable that the capital stock of the busi ness corporation would not be large, and that in a business sense such a corporation would hardly be called responsible. Nor is this result changed by the existence of a limited liability of the stockholders them selves, for the actual inefficiency of claims
