Part III. Industrial Co-operative Legislation in England and the United States. Industrial co-operation has met with but little "legislative countenance and encouragement," as the first New Jersey building and loan association statute put it. This, possibly, may explain to some extent the reason why it has made such little headway here, either to the productive or distributive direction; for organized under our general corporation acts, associations would be joint stock companies, where stock, not individuals control, and whose profits and losses are divided accordingly; while private partnership means unlimited liability. Certain it is that in England, prior to the original "industrial and provident societies act" of 1852, little progress was made by these institutions, which now are such a remarkable success there. Says McCarthy in his "history of our Own Times,"* "the law was much against the principle in the beginning. Before 1852, all co operative associations had to come under the Friendly Societies Act, which prohibited their dealing with any but their own members. An act obtained in 1852 allowed them to sell to persons not members of their body. For many years they were not permitted to hold more than one acre of land. More lately this absurd restriction was abolished, and they were allowed to trade in land, to hold land to any extent and to act as building • P. 409. (393) societies." And in 1876, when the "act to consolidate and amend the laws* relating to industrial and provident societies" was passed, the restriction upon banking, which had hitherto applied to them, was removed, subject only to such conditions as attach to the conduct of this business by joint stock companies and are required for the security of those who are invited to entrust their money to the keeping of others than themselves.† A synopsis of this and the supplementary acts of 1880 and 1883 is given below. This is followed by the co-operative laws in full, in force in those of our States where such have been enacted. That has been done in only ten, and most of these are not very comprehensive. The first State to pass such a measure seems to have been New York, in 1867, when the "An act for the incorporation of cooperative and industrial unions" became law. The next year (1868), Pennsylvania followed with "An act relating to the organization of co operative associations for the purpose of carrying on any mechanical, manufacturing, or trading business," but this was supplanted, in 1887, by the law which is reproduced below. The other States in which similar statutes were enacted, are Massachusetts (1870); Minnesota (1870); Connecticut (1875); New Jersey (1881); Tennessee (1882); Ohio (1884); Kansas (1887); and Wisconsin (1887). In Ohio, under the Revised Statutes of 1879, distributive co-operative associations were authorized to do business, and as the commissioner of the Bureau of Labor Statistics (1886) observed, Many industrial co-operative societies were organized, but as the law was totally at variance with every principle of co-operation, the idea of conducting them as such was soon abandoned. No co-operative society could live under the provisions (Rev. Stat., p. 3245), that each shareholder was entitled to a vote for every share held by him." * The following is a summary of the English acts authorizing the co-operative societies, or, as they are called, industrial and provident societies, namely: "An act to consolidate and amend the laws relating to industrial and provident societies," of August II, 1876; and the supplementary enactments of 1880 (customs and inland revenue act), and of 1882 (Provident nominations and small intestacies act.): *Those of 1852, 1862, 1867 and 1870 being the principal acts. + See The Industrial and Provident Societies Act, 1876, ** published by the Central Corporation Board, Manchester, England. 1876. UNITED KINGDOM.* 1. Application for the formation of a society must be made to the Registrar of Friendly Societies, in London, Edinburg or Dublin, according to the case, on forms supplied by the office, signed by seven persons and the secretary, accompanied by two copies of the rules signed by the same persons. 2. It becomes a body corporate, which can, by the corporate name, sue and be sued, and hold and deal with property of any kind, including shares in other societies or companies, and land to any amount. 3. Its rules are binding upon its members, though they may have signed no assent to them; but may be altered by amendments duly made as the rules provide and registered, for which a fee of 10 s. is charged. The application for registration must be made on a form supplied by the Registrar's office. 4. It can sue its own members, and can make contracts either transferable or withdrawable, and may carry on any trade, includ ing the buying and selling of land, and banking under certain conditions, and may apply the profits of the business to any lawful purpose; and, if authorized by its rules, may receive money on loan, either from its members or others, to any amount so authorized. 5. If it has any withdrawable share capital it may not carry on banking, but may take deposits, within any limit fixed by its rules, in sums not exceeding 5 s. in any one payment, or £20 for any one depositor, pay at not less than two clear days notice—that is, it may establish "penny banks," as they are called in England. 6. It may make loans to its members on real or personal security; and may invest on the security of other societies or companies, or in any except those where liability is unlimited. * As published by the central co-operative board. (395) |