Trusts vs. Public Policy. 
135 
has been applied in a long list of cases and held that trust com¬ 
binations tend to create monopolies, that these restrain trade, 
that this is contrary to public policy and therefore illegal. 
One of the most prominent cases is that in which the Sugar 
Trust was declared illegal by the Supreme Court of New York. 13 
The Sugar Refineries Company was a type of the first form of 
trusts, and the New York Court of Appeals in passing upon the 
case declined to decide the question of public policy, preferring 
to rest their decision upon the inability of corporations to enter 
into co-partnership; but the Supreme Court in deciding the same 
case fully considered the question of public policy and expressly 
decided that the trust was illegal, because it restrained trade in 
an unreasonable manner, and inevitably tended to create a 
monopoly. “ It is a condition on which a corporation is allowed 
to be created and maintained that it shall exercise and use its 
franchise for the benefit of the public, and when it voluntarily 
declines to do that or places itself in a situation in which that 
may be prevented as a consequence of its voluntary action, it 
may be annulled under the statute as well as the decision of the 
court. ” 14 The court held that the North River Sugar Refining 
Company should forfeit its property, and that a receiver should 
be placed in charge of it. The Sugar Trust was incidentally de¬ 
clared illegal, and the Cotton Seed Oil Trust anticipated this 
decision by taking steps to change its form of organization. 
Reference will be made later to the outcome of this decision 
against the Sugar Trust. 
The question now arises, to what classes of business the prin¬ 
ciple of monopoly and restraint of trade as contrary to public 
policy is applicable? In order to answer this question it is 
necessary to examine some of the cases bearing on it, and such 
examination shows that the principle applies only to articles of 
necessity and to businesses of a quasi-public character, that is, 
those in which the general public have a right. 
(1) Articles of necessity. That the principle applies to arti¬ 
cles of necessity or of such general use that the public is inter¬ 
ested in their production, is evident from the definition of 
18 People v. North River Sugar Refining Co., 1889, 54 Hun 354. 
14 People v. North River Sugar Refining Co., 54 Hun 354, page 385. 
