and your means of recovery against a corporation. What is the distinction? The railroad company or any corporation that stands in that relation to an individual can hold him at defiance, for this reason, if for no other: How is a small debtor, a man who has supplied this corporation with the means of its existence and with the means of carrying on its work, who has furnished it fuel for its locomotives or any other matter of that kind-how is that man to vindicate his right and to recover his indebtedness? You say he is to do it by sequestration, by proceeding with a writ of fi. fa., which can only operate, however, under the decisions, as a writ of sequestration. The man with a debt of twenty-five or thirty dollars is to contend against a great corporation with a capital of millions, and put those millions under a proceeding in sequestration and to have a general distribution made of the whole fund, and in no other way can he do it! How can the poor man encounter that expense? How can he meet it? Is he to be obliged to employ counsel to do all this work? Where is he to get the means of employing counsel to do a work of this character? Sir, their is an old rule of law, vigilantibus non dormientibus leges subveniunt; and this principle which you apply of discrimination in favor of the corporation and against the individnal is directly in contradiction of that rule of law, because where a man gets his judgment and undertakes to apply his execution against me as an individual, he levies upon my property at once, and having the first levy he takes it and satisfies himself; but he has no remedy in a case of this kind against a corporation except to go to work, and after having gone to the expense of obtaining his judgment and putting the machinery of the law in operation, he is bound to divide all its fruits with all the other creditors of the corporation. We are told of practical inconveniences that are to flow from the adoption of a principle of this kind. The simple answer to that is, let the corporation pay its debt, just as the individual pays his debt, as the gentleman from Philadelphia (Mr. Woodward) said. There is the rule. There is no reason why these men who have furnished materials for all these corporations, of whatever character they may be, and are left out in the cold while the great loan-holders are protected by mortgages piled upon mortgages, should be put to this inconvenience-that this discrimination should be made against them. Mr. MANN. Would the gentleman from York apply that principle to municipal corporations? Mr. COCHRAN. This is a report from the Committee on Private Corporations. Mr. MANN. I simply asked the gentleman if he would apply that principle of collecting debts against municipal corporations. Mr. COCHRAN. There is no reason why it should not be if they do not pay their debts; but, as I understand, this section applies to private corporations; corporations which are created for private emolument, as well as for public service, and in which the element of private emolument is made the principal consideration by those who manage the corporation. They stand on an entirely different footing from municipal corporations, and therefore the principle ought to be applied to them that these parties who are clothed with great power not possessed by an individual should be at least brought down to the same footing with natural persons. That is simply the principle of this section, view it in any way that you may. We are told of great public benefits to be derived from the construction of railroads. No one denies that, nor doubts Sir, the distinction is unjust and unfair it. It cannot be disputed or denied. But, as between the individual who sues an- sir, these great public benefits ought not other and the one who is compelled to to be realized at the expense of private claim his right from a corporation. A interests or individual rights. That is the gentleman near me refers me to the law point. The individual citizen of this of domestic attachment. That is an ex- Commonwealth has a right to be protecceptional law. It is only applied to the ted against its policy with regard to the fugitive creditor, the man who has ab- protection of corporations or any other sconded. But, sir, the general law of the bodies which are clothed with powers that State is that where you have an execution are not common to all. Every corporaagainst an individual, your execution, if it tion which is constituted is in itself an is the first, takes the property until you organization which has its being in deroare satisfied. Why should it not be so in gation of common right, and it is only bethis case? cause the public interest requires it that they should exist, and when they are created they should be placed under such trammels and restrictions that they should not be able to so use their powers as that private interests should be made to suffer. On that principle I shall vote for this section. Mr. LILLY. All this discussion appears to have very little reference to the amendment actually pending. I take it there is no man on the floor of this Convention or in the Commonwealth of Pennsylvania who does not want every corporation to pay its debts, and who does not agree that its private property should be open to levy and sale the same as the private property of an individual. Gentlemen say they want to put them on the same platform with individuals. By adopting the amendment of the gentleman from Northampton, striking out the word " "franchise, you put them on exactly the same platform as individuals, in my opinion. The franchise is the right of the road to live; and yet here you propose to kill this artificial person, to take away its life, in order to pay its debts! Take its property if you please, but leave the organization for other paties who have debts contracted and other matters probably at stake on that; leave the franchise with the company. Mr. CORBETT. I hope that neither the amendment nor the original section will be adopted. If you suffer the rolling stock of a railroad company to be sold, I do not see why you should not allow the franchise also. I do not see, Mr. Chairman, why we are asked to adopt this section. It is purely legislative in its character. The subject matter ought to be left to the Legislature in the future, and they ought to have entire control of it. Adopt it, and you tie their hands. It will then have become a part of the organic law and the Legislature cannot possibly change it. Why disturb all the principles settled with reference to this species of property by the highest courts of our State? I feel an interest in this subject, although I am far from being a corporation man, because I come from a section of the State-the same section from which the distinguished member from Centre (Mr. Curtin) and my friend from Potter (Mr. Mann) come-where we are struggling along and doing everything in our power to build railroads. The eastern portion of the State now can probably get along without new railroads, because they already have so many in successful operation. Now what will be the effect of this section on the companies that are struggling for an existence or struggling to complete lines which they have recently commenced? It is evident to my mind that the Pennsylvania railroad or the Reading railroad might easily afford to pay a large sum of money for the passage of this section. It will not in any way incommode them; it will not cripple them in their operations. They are already in successful operation; and what will it enable them to do if they so desire? Let me tell you. I make no charge against these corporations, or any others; but I do say that if these great companies wish to seize upon the franchises of roads that are struggling through difficulties, all they have to do is to procure a sale of the rolling stock or franchises of these struggling corporations, and they will finally get possession of them, and own them and control them. There is but little difference between seizing the franchise and seizing the rolling stock. The very moment that the rolling stock of a railroad is sold, that moment it is crippled so that it cannot do its business. It ceases effectually to become a common carrier, and its franchise necessarily must go into other hands. If it be not sold in execution, it must be sold in some other way and go into other hands, and a new corporation must be formed to carry on its business. I hope that this whole section will be voted down. I say that it is legislation in the worst shape. I say further it is legislation against all portions of the State of Pennsylvania to-day that are without railroads. I fully concur with the remarks of my friend from Centre; and although I am really in my feelings anticorporation, I cannot support this section. I will vote for every reasonable restriction upon corporations that I think is right; but I cannot give my vote to anything of this kind. Mr. MACCONNELL. Mr. Chairman: I should be in favor of this section if it were necessary to insert any provision in the Constitution in order to put corporations on the same footing in regard to the payment of their debts with individuals. I cannot see, however, that any provision of this kind is necessary for that purpose. Let me illustrate by reference to a particular case or a particular set of cases that have been adjudicated by our courts. Some quarter of a century ago a firm in Pittsburg had a very large rolling mill. They had in that mill a set, consisting I think of some twenty or thirty different rollers, for the purpose of rolling different kinds of iron that were required for vessels. No portion of those rollers was ever on the housing, except one pair; the others were all laid aside to be used when an order should come in making their use necessary. The firm got into debt; judgments were obtained against them; and an execution was issued on a junior judgment against the personal property. Those rollers that were not in the housing were levied upon and sold as personal property. Then on an older judgment, the factory itself, the rolling mill, with the ground on which it was erected, was levied upon, sold and purchased by a different person from the one who had purchased the rollers at the first sale. The question arose, which of those purchasers took the rollers. The Supreme Court decided that those rollers, although they were not on the housing and were not in actual use, were a part of the real estate, a part of the rolling mill, and did not pass by the sale of the personal property, but did pass by the sale of the realty. That has been followed up by a series of decisions; and the rule has never been altered, but is well settled, that where there is anything connected with a factory that is necessary for the operation of the factory, whether it is in actual use or not, whether it is actually joined to the factory at the time or not, is still a part of the realty and is to go with the realty. If you apply that rule to railroads and to the rolling stock of railroads, you must come to the conclusion that the rolling stock is realty, because it is just as necessary to the operation of the railroad as a train of rollers is to the operation of a rolling mill. How could you operate a railroad without rolling stock? You could no more operate it than you could operate a rolling mill without rollers, no more than you could operate a carding mill without cards; and in that case the cards were held to be realty although they were not actually in use or connected with the machinery of the mill. Where is the difference? If that rule applies to natural persons in regard to their property used in their business operations, why should it not be applied to railroads in the case of rolling stock? This strikes at railroads principally; but are they not precisely on the same footing? Why should you adopt a new rule for railroads that would put them on a different footing from that which applies to natural persons? I can see no reason for it. The CHAIRMAN. The question is on the amendment of the gentleman from Northampton (Mr. Brodhead) to strike out the words "the franchise." The amendment was agreed to, there being on a division, ayes, thirty-six ; noes, fifteen. The CHAIRMAN. The question now is on the section as amended. Mr. JOSEPH BAILY. J submit to the Chair that there was not a quorum on the last vote. The CHAIRMAN. The Chair cannot be interrupted in putting the question. The question is on the section as amended. The section was rejected, ayes, twentyfive, being less than a majority of a quorum. Mr. CAMPBELL. I call for a count of the other side. The CHAIRMAN. There was not a majority of a quorum in favor of the section. The next section will be read. Mr. CAMPBELL. Is it not in order to call for the negative vote? The CHAIRMAN. The section has been rejected. The sixteenth section will now be read. The CLERK read section sixteen as follows: SECTION 16. Any general banking law which shall be passed shall provide for the registry and countersigning by an officer of the State of all notes or bills designed for circulation, and that ample security to the full amount thereof shall be deposited with the State Treasurer for the redemption of such notes or bills. The section was agreed to, ayes, fortyfive; noes, not counted. The seventeenth section was read as follows: SECTION 17. No suspension of specie payments shall permitted or sanctioned by law, and no banking or other corporation shall receive, directly or indirectly, a greater rate of interest than is allowed by law to individuals. Mr. BROOMALL. I move to insert after the word "received," in the second line, the words "or pay," so as to read: "No banking or other corporation shall receive or pay, directly or indirectly, a greater rate of interest than is allowed by law to individuals." I called attention yesterday, Mr. Chairman, to what I concieve to be a very considerable existing evil; and that is the absorbtion of the capital of the country by corporations. The scarcity of capital, which has existed and which has interfered with individual enterprise for the last half-dozen years, may be traced to a considerable extent to the demand for capital by corporations. If the corporations were compelled to go in the market upon an equal footing with individuals, the evil would not be so great; but it is well known to every gentleman here that corporations are allowed to give for money any rate of interest that they may choose to bargain for, whereas individuals are restricted to a given, fixed rate. That is an evil. It allows to those who least need the capital, those who can best do without it, a better chance to get it than those who most need it. Individual enterprise should be fostered rather than corporate enterprise where any distinction is made. If a difference is made between the two, it should be made in favor of individuals. 1 believe, therefore, that we should either unchain the individual and allow him to bid in the money market upon an equal footing with the corporation, or chain down the corporation and compel it to go into the money market on an equal footing with the individual. I do not care which is done. I have moved, therefore, to insert these words, so that any restriction you impose upon me in the money market shall be imposed upon the corporation that goes into the money market; that if it is allowed to go there without a limit upon its power to bargain, I shall be allowed to go there without a limit upon my power to bargain; that if I am controlled it shall be controlled. The reason why corporations borrow at seven and eight per cent. when individuals have to give ten or twelve, as is the case now, is because corporations can bargain in open day; they can talk to the lenders face to face, whereas individuals, being hampered by restrictive laws, are compelled to resort to a circuitous mode of borrowing, to do it through brokers, to do it secretly, and hence they have to give more for capital than corporations have to do. This is wrong; and it should be remedied, as I remarked before, by setting free the individual or by chaining down the corporation. Mr. DALLAS. Mr. Chairman: I rise only for the purpose of saying that if the delegate from Delaware had not obtained the floor before I was able to do so, I should have offered the identical amendment which he has submitted. I concur most heartily in every word that he has said upon this subject, and I desire only to add to what he has so well said that the evil of which he complains is not a theoretical or fanciful evil, but one which, in my humble judgment, has become in the State of Pennsylvania an evil of practical importance and of great magnitude. We have the capital of the State of Pennsylvania sought by corporations for the purpose of carrying on business which need not necessarily be carried on under corporate franchises, but classes of business which individual enterprise, equally well fostered, may as well conduct. We give them the special power, not only of rasing money by issuing securities that are particularly satisfactory to investors, but we have the Legislature constantly giving them the power of borrowing money at special rates which offer special inducements to lenders of money; and the consequence is that these corporations now go into all classes of business, from the highest to the lowest; they undertake to conduct all the business transactions of Pennsylvania for the people of the State; and no man can sustain himself in any business where the corporate finger can be placed in the pie, unless he is willing to wear the yoke of some corporation or other. It is done day after day and in all kinds of business; and unless we do provide that corporations shall not raise their capital for the purpose of conducting all manner of business, on terms more advantageous than individual enterprise can raise capital for the same purposes, we can put no check upon that which I believe to be a grievous wrong in this particular. Mr. DODD. I wish to ask the gentleman from Philadelphia whether, if the Constitution makes any limit on persons receiving money above a certain rate, it does not by the known acceptation of the terms make it equally unlawful for any person to pay more? Mr. DALLAS. I do not understand the Constitution to make any such provision. Mr. DODD. Is not that the provision to which this is offered as an amendment? Mr. DALLAS. Oh! no. The gentleman has misconceived the section under consideration, I think. Mr. HARRY WHITE. Mr. Chairman: I have but a word to utter in connection with this section. I call the attention of the committee to the fact that it involves an exceedingly important principle. I sympathize entirely with the amendment offered by the gentleman from Delaware, if we are to have a section of this kind in the Constitution at all. If he and I were in the Legislature and he should offer an amendment to a section of this kind in a bill, I would stand with him; indeed, I would go further and make it illegal for all banks to pay any interest on deposits, and in so doing, for the reasons which I cursorily gave yesterday, I should accomplish a public good. I will vote for the amendment offered by the delegate from Delaware, and then I shall vote against the entire section. It occurs to me that we want no section of this kind in our Constitution. This anticipates that that will occur which none of us know will ever occur in our lifetime or in the lives of the generation to follow us. It anticipates the recurrence of specie payments. Heaven only knows; I do not, and no member of this Convention knows, when specie payment will be resumed in this State or in this Union. "Sufficient unto the day is the evil thereof." If that day never comes this section will be brutum fulmen; and if it ever should come, it seems to me that will needlessly tie the hands of the Legislature and prevent them from doing that which has been proved in the past to be both useful and wise. Why, sir, in my short career, within my memory, I can recollect two or three instances in which a suspension of specie payments was legalized by the Legislature. In the great financial panic of 1857 the Executive of the Commonwealth yielded to the popular demand and convened an extraordinary session of the Legislature for the purpose of administering some remedy to the then existing business demands of the times; and then in 1857, in obedience to the universal wish of the business public of Pennsylvania, the suspension of specie payments was legalized by the Legislature, and it also enacted a stay law which saved hundreds of men, which saved industrial interests in this Commonwealth, which kept quiet the hammer of the sheriff in every county of this Commonwealth for many months, and the consequence was great advantage to the business community and great benefit to the public at large. Then came the crisis of 1861. The great political convulsion which is so familiar to us all was attended by financial results which we all only too well remember. Again the suspension of specie payment was legalized, and a stay law was enacted. We have suffered no evil consequences therefrom, so far as I am aware. I hope then, Mr. Chairman, in view of the history of this subject in the past, we shall refuse to place any inexorable rule in the Constitution. The experience of our State has demonstrated that the judicious exercise of this power by the Legislature is proper for our industries, and its restraint in all after time by constitutional prohibition will be improper. Mr. CAREY. Mr. Chairman: Being a little older than my friend White, I have lived through five suspensions-that of 1817-18, that of 1837, that of 1839, that of 1857, and that of 1860, on all of which occasions the Legislature was compelled to sanction the suspension. It had no choice. It was ruin to the community if the suspension was not legalized. Such suspensions have always come when we were blessed with British free trade. I do not think we shall have that back again, or certainly not very soon; but just so sure as it does come, we shall have then to provide for a suspension of specie payments if they shall have been resumed, which I hope will not be the case. I trust in heaven never again to see specie payments myself, and I hope there is no gentleman present who will live to see them. If, however, we shall ever resume specie payments and shall be again cursed with British free trade, we shall before very long after that need a suspension of specie payments. I pray the Convention not to tie the hands of the government in this respect. Where, let me ask, would the country have been if in the year 1861 we had had such a provision in our Constitution, so that our banks would have been broken up and our people ruined? Where then would this State, the bulwark as it proved to be of the Union, and where would the Union itself have been? Why, sir, such a section in our Constitution in 1861 would have given success to the rebellion! Sir, this provision is mere legislation and has no place here. We just now passed a most extraordinary section by which it is provided what we shall do when we get banks issuing circulating notes. Why, sir, the federal government has taken charge of that whole matter, and it is a subject that can never again come within the reach of the legislation of our State; and yet we are loading down the Constitution with a section |