State v. Virginia-Carolina Chemical Co.

• Decision Date: 22 May 1905
• Citation: 51 S.E. 455,71 S.C. 544
• Parties: STATE v. VIRGINIA-CAROLINA CHEMICAL CO. et al.
• Court: South Carolina Supreme Court

51 S.E. 455

71 S.C. 544

STATE v. VIRGINIA-CAROLINA CHEMICAL CO. et al.

Supreme Court of South Carolina

May 22, 1905

Appeal from Common Pleas Circuit Court of Richland County; Gary Judge.

Action by the state against the Virginia-Carolina Chemical Company and others. Demurrer to complaint overruled, and the Virginia-Carolina Chemical Company appeals. Affirmed.

The following is the complaint in this action:

"The plaintiff, by G. Duncan Bellinger, Esq., its duly qualified Attorney General, complaining of the defendants above named, alleges:

First. That on the 13th day of February, A. D. 1900, the General Assembly of South Carolina adopted the following joint resolution: 'Section 1. Be it enacted by the General Assembly of the state of South Carolina, that the Attorney General of the state of South Carolina be, and he is hereby, instructed and required to forthwith institute an investigation to determine by what authority the Virginia-Carolina Chemical Company is doing business in this state, whether said company and all other foreign corporations have complied with the laws of this state regulating foreign corporations, and whether said company, or any person or corporation who may be engaged in any business within this state, has violated or is violating the provisions of the laws of this state prohibiting trusts and combinations, and that he institute such proceedings, civil or criminal, as may be necessary to prevent and punish the violations of such laws against trusts and combinations.'

Second. That the Virginia-Carolina Chemical Company is a corporation created under and by virtue of the laws of the state of New Jersey, and by its certificate of incorporation, dated 12th day of September, 1895, the purpose and object of said corporation, as set forth in said charter, are as follows: 'The objects for which the company is formed are to carry on the business of buying, manufacturing and selling chemicals, paints varnishes, drugs, fertilizers and all materials or articles used or capable of use in the manufacture, preservation packing and transportation of each, any and all of said products, and of purchasing, leasing or otherwise acquiring and using, operating, caring for and disposing of any such business or businesses, now established or hereafter established, and the property and good will connected therewith, and also any mines, manufactories plants, machinery, appliances, tools, supplies, materials, patents, trademarks, copyrights, brands, formulas and any other real or personal property, rights and privileges of any nature whatsoever, suitable, convenient or necessary for any of the purposes aforesaid, or hereinafter stated, or which can lawfully be used in connection therewith, and of establishing agencies and warehouses for the storage, sale and distribution of the company's products and similar products of other manufacturers and dealers, and of transporting or causing the transportation of such products as articles of commerce, and the doing of any other similar or different business and things incidental to, or which may lawfully and conveniently be done in conjunction with any of the matters aforesaid. The portion of the business of said company which is to be carried on out of this state, and in the states and countries above mentioned, is to carry on the business of buying, manufacturing and selling chemicals, paints, varnishes, drugs, fertilizers and all materials or articles used, or capable of use, in the manufacture, preservation, packing and transportation of each, any and all of said products, and of purchasing, leasing or otherwise acquiring and using, operating, caring for and disposing of, any such business or businesses, now established or hereafter established, and the property and good will connected therewith, and also any mines, manufactories, plants, machinery, appliances, tools, supplies, materials, patents, trade-marks, copyrights, brands, formulas and any other real or personal property, rights and privileges of any nature whatsoever, suitable, convenient or necessary for any of the purposes aforesaid, or hereinafter stated, or which can lawfully be used in connection therewith, and of establishing agencies and warehouses for the storage, sale and distribution of the company's products and similar products of other manufacturers and dealers, and of transporting, or causing the transportation of such products as articles of commerce, and the doing of any other similar or different business and things incidental to, or which may lawfully and conveniently be done in connection with any of the matters aforesaid, to the extent that all the above mentioned matters must necessarily, or can conveniently or advantageously to the company, be transacted out of the state of New Jersey.' That the capital stock of said corporation, as appears by said certificate, is $6,500,000, divided into 65,000 shares, of the par value of $100 each, of which said stock $4,000,000 was general or common stock, and $2,500,000 was preferred stock. That it appears by a certificate of increase of capital stock, dated 21st day of July, A. D. 1898, and filed in the Secretary of State's office of New Jersey, that the common stock of said corporation was increased to $6,000,000, and the preferred stock to $6,000,000, making the total amount of capital stock $12,000,000. That it appears by a certificate of increase of capital stock, dated 20th day of July, A. D. 1899, and filed in the Secretary of State's office of New Jersey, the common stock of said corporation was increased to the amount of $12,000,000, and the amount of preferred stock to $12,000,000, making the total capital stock of said corporation $24,000,000; and plaintiff is informed and believes the capital stock has since been increased to $50,000,000. That on the 22d day of January, 1900, the charter of said company and amendments thereof was filed in the office of the Secretary of State of South Carolina, and it received authority to do business in this state under and in accordance with sections 1465-1471, inclusive, of the Revised Statutes of South Carolina of 1893, and has since been doing business and acquiring property in this state, and continues to do so, and owns property and does business in the county of Richland, as well as in nearly all of the counties of this state.

Third. That the Imperial Fertilizer Company is a corporation created under the laws of the state of South Carolina, and incorporated to manufacture and sell commercial fertilizers.

Fourth. That the Standard Fertilizer Manufacturing Company is a corporation created under the laws of the state of South Carolina, and incorporated to manufacture and sell commercial fertilizers.

Fifth. That the Chicora Fertilizer Company is a corporation created under the laws of the state of South Carolina, and incorporated to manufacture and sell commercial fertilizers.

Sixth. That the Berkeley Chemical Company is a corporation created under the laws of the state of South Carolina, and incorporated to manufacture and sell commercial fertilizers.

Seventh. That the Greenville Fertilizer Company is a corporation created under the laws of the state of South Carolina, and incorporated to manufacture and sell commercial fertilizers.

Eighth. That the Carolina Sulphuric Acid Manufacturing Company, Blacksburg, Cherokee county, is a corporation created under the laws of the state of South Carolina, and incorporated to manufacture sulphuric acid essentially used in the manufacture of commercial fertilizers.

Ninth. The Columbia Phosphate Company is a corporation created under the laws of South Carolina, and incorporated to manufacture and sell commercial fertilizers.

Ten th. That on the 25th day of February, 1897, the General Assembly of South Carolina passed an act entitled 'An act to prohibit trusts and combinations and to provide penalties' (22 St. at Large, p. 434), which said act was by the General Assembly amended on the 19th day of February, 1898 (22 St. at Large, p. 782). The first section of the last-named act is as follows: 'Section 1. Be it enacted by the General Assembly of the state of South Carolina, that from and after the passage of this act all arrangements, contracts, agreements, trusts or combinations between two or more persons as individuals, firms or corporations made with a view to lessen, or which tends to lessen, full and free competition in the importation or sale of articles imported into this state, or in the manufacture or sale of articles of domestic growth, or of domestic raw material, and all arrangements, contracts, agreements, trusts or combinations between persons or corporations, designed or which tend to advance, reduce or control the price or cost to the producer or to the consumer of any such product or article, and all arrangements, contracts, trusts, syndicates, associations or combinations between two or more persons as individuals, firms, corporations, syndicates or associations, that may lessen or affect in any manner the full and free competition in any tariff, rates, tolls, premiums or prices, or seeks to control in any way or manner such tariffs, rates, tolls, premiums or prices in any branch of trade, business or commerce, are hereby declared to be against public policy, unlawful and void.'

Eleventh. That all the defendants hereto except the Virginia-Carolina Chemical Company were at the times hereinafter specified independently engaged in the manufacture and sale of fertilizers in South Carolina, and which had become necessary to and was universally used by the farmers of said state in the cultivation and production of their crops.

Twelfth. That the Virginia-Carolina Chemical Company was organized by a combination of capitalists and other persons, under the guise of

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