The Thirty-Second Annual Meeting of the American Bar Association THE thirty-second annual meeting of the American Bar Association, held at Detroit, Mich., August 24-27, owes its chief interest, for the profession in general, to Presi dent Lehmann's notable remarks about the unchecked monopoly of the holding company, "the modern trust," and the dangers of issues of shares without a par value, to the bitter denunciation of faulty methods of legal edu cation which came from several speakers, to the able and striking report submitted by the special committee which is investigating the question of reformed procedure, and to the adoption of the bill favored by this com mittee for the reform of judicial procedure in the federal courts. The convention was called to order by President F. W. Lehmann, of St. Louis. Samuel Douglas, president of the Detroit Bar Asso ciation, made an address of welcome. There were about three hundred and fifty delegates and visitors in attendance, including Secre tary of War Dickinson, Sir Frederick Pollock of London, and George R. Peck of Chicago. THE PRESIDENT'S ADDRESS President Lehmann's address dealt with the subject, "Changes in State and Federal Laws during the Year." Mr. Lehmann de clared that the trust is obsolete. "Out of the ashes of the 'trust' has sprung the holding company, the 'trust' in an improved, per fected form. Is it under the ban of the law? Certainly not in all of the states." The speaker mentioned Montana. "Having slain the senile and debilitated 'trust', they made invul nerable through legitimacy its youthful and sturdy successor, the holding company." As a result any industry or business of the state may be legally monopolized, provided it is well and thoroughly done. This condition of the law exists in other states, he asserted. "States which prohibit 'trusts' and assume to prohibit monopolies, set no bounds to the capitalization of their corporations, or fix the limit so high that under it many indus tries may be completely engrossed. HOW STATES ENCOURAGE THE NEW TRUST "The great industrial corporations are in practical effect as much agencies of inter
state commerce as are the great carrier com panies. If the production of a commodity is under one control, commerce in that com modity is under the same control, but unfor tunately production is held not to be within the commerce clause of the federal Constitu tion, and so combinations to engross produc tion may be effected, because the general government cannot prevent them, and the states in which they are located will not. "But something can be done under the taxing power. What may be aided by the government may also be regulated, for there is no more stretch of federal authority in the exercise of control over our industries than in extending to them a constant fostering care. ISSUE OF SHARES WITHOUT A PAR VALUE "The New York State Bar Association re cently recommended a law permitting corpora tions to issue shares without a par value and as representing only aliquot parts of the owner ship. The proposition, it was said, had attracted a great deal of sympathetic support from business men who were looking for a way of reconciling the necessary methods of business with the interests of ethics and who feel that they have been disturbed by the apparent conflict and more than an apparent conflict between the universal practice that we know in the organization of corporations with capital stocks not perhaps entirely within the bounds of the figures that have been annexed, and the money value of the property. Never was more serious charge conveyed in softer phrase, and never was father confessor more gentle in rebuke. Stripped of its euphemism, the charge is that falsehood universally prevails in the capi talization of corporations, and the utmost extent of the remedy proposed is silence. A watered share having an announced par value is a positive misrepresentation, a share issued as an aliquot part is an equivocation, it gives no information and it cries caution only to the initiated. "Why not have it speak and speak the truth?" The report of the secretary showed that since 1903 the membership has grown from
