Page:The Green Bag (1889–1914), Volume 18.pdf/707

 666

THE GREEN BAG

tion acts are responsible, as the direction of the court is to them as well as to the cor poration and requires not only that the order should be obeyed, but that they should see that it is obeyed. It therefore follows that the remedy of in junction, which is the only effective remedy for stopping and preventing corporate wrongs, cannot be effective unless it is enforced, and it cannot be enforced unless the personal individual responsibility of cor porate officials for the corporate action is declared and enforced. Where an injunc tion against a corporation is violated, some official is responsible, as the corporation could only act by and through its officials, and those in charge of the business at the time are, therefore, properly and necessarily called upon to explain why the injunction was not obeyed, and it is for them to show that they are not responsible for the disobe dience. It is important that this funda mental principle which is essential to the effectiveness of this remedy for corporate abuses should not be obscured by personal or political considerations. These fundamental principles involved in the protection of the public against corpor ate abuses have been effectively illustrated in the legislation of Congress in the regula tion of interstate commerce. The provi sions of the original Interstate Commerce Act for the punishment of rebates and irreg ular practices, though on the statute books for several years, proved practically ineffec tive. This was owing to the absence of any effective preventive remedy, as well as to the

difficulty of procuring the evidence neces sary for criminal prosecutions or recoveries in civil cases by injured parties. The pas sage of the Elkins Bill of 1903 giving the specific remedy by injunction for the en forcement of the act proved, in the language of the chairman of the Interstate Commerce Commission, a most complete and effective measure for the stoppage of illegal prac tices. It was supposed at the time that this remedy by injunction, with the incidental power of enforcement against individuals by process of contempt, would be found suffi cient, and the penalty of imprisonment of individuals was repealed. Practical diffi culties -however were encountered in the enforcement of obedience to injunctions against corporations, and in view of the pressure for illegal practices in granting rebates by officials it was deemed necessary in the Rate Bill of 1906 to restore the pen alty of imprisonment which had been re pealed in 1903. The control of corporations, therefore, other than by the preventive measures above referred to, must be effected primarily through the enforcement of the legal respon sibility of the individuals whom the law has permitted to be associated in the corporate relation. This can be done without prejudice to the public interests, which are assumed to be promoted by the authorization of cor porate organizations. The fiction of the legal entity must find its limitations in the necessity and public policy which are respon sible for its creation. ST. Louis, Mo.. November, 1906.