Page:Harvard Law Review Volume 12.djvu/512

492 492 HARVARD LAW REVIEW, the property over to a foreign corporation.^ As emphasizing the fact that general language will not apply to an interstate railway when it will apply to a domestic road, there is an interesting deci- sion in New Jersey which holds that a statute in general terms authorizing railroad companies to lease their properties will not authorize a domestic company to lease its property to a foreign corporation,'^ and many other decisions of this character may be found. This review of the cases indicates that a transaction which amounted to nothing more than a sale by an Indiana road of its property to an Illinois company could not be justified under the Indiana statute. The rule is that an Indiana corporation cannot sell its road to a corporation of Illinois. Sale may be defined as the act of parting with property for a consideration, reserving to the vendor no control over the property conveyed. Substituting this definition for the word, we have the rule that an Indiana railway company may not convey its property to an Illinois company without reserving to itself, the Indiana company, some control over the property conveyed. An Indiana corporation may, so far as concerns Indiana, consolidate with an Illinois com- pany, but this consolidation must be of such a character that the domestic corporation will continue to exercise some control over its corporate property. In other words, consolidation which will be supported by the Indiana laws must be something more than a mere sale. Coming now to the Illinois law, we find that a railway corpora- tion of that State is without power to consolidate with a railway corporation of another State, but may purchase the property of a foreign company. This is precisely what Indiana does not allow, and no progress in this direction can be made under the Illinois statute. It is at this point that the difficulties are much increased by the decision of the Supreme Court of Illinois in Chicago, etc. R. R. Co. V. Ashling.^ This case holds that where one corporation transfers all its property to another corporation in consideration of stock in the second corporation issued to stockholders in the first corporation, the transaction amounts to a consolidation, and is not a mere purchase and sale. 1 Cook, Corporations, 3d ed., ii, § 894. 2 Black V. Railroad Co., 24 N. J. Eq. 456. 8 160 111. 373.