Combinations: Their Uses And Abuses, With A History Of The Standard Oil Trust (1888)
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Samuel Calvin Tait Dodd was an American lawyer. Unlike most of the lawyers of the community he gave his attention mainly to corporation law and equity, foreseeing that the day of big business was at hand and that the cutthroat competition among the oil producers was wasteful and temporary.
Background
Samuel Calvin Tait Dodd was born on February 20, 1836 in Franklin, Venango County, Pennsylvania, United States. He was one of the ten children of Levi L. and Julia Parker Dodd. His father was a cabinetmaker and carpenter, a respected citizen, and a stanch Presbyterian.
Education
Young Dodd had his early education in the schools of Franklin and worked as errand boy and printer’s devil to help finance his college education, which he received in Jefferson College (now Washington and Jefferson), at Canonsburg, Pennsylvania, graduating in 1857. He studied law in Franklin for two years and was admitted to the bar of Venango County in 1859, the year in which oil was discovered in western Pennsylvania.
Career
Dodd's whole career was shaped by this event. A vast influx of capital and business came upon the heels of the great discovery and he found himself immediately involved in the complications and competition growing out of the boom. The seventies found him fighting the battles of the consumers and the independents against the Rockefeller interests, and he acquired considerable reputation as an antirebate lawyer.
In 1872-73 he served as a delegate to the Pennsylvania constitutional convention, where he fathered the anti-rebate clause which that body wrote into the new constitution. During this period he served as counsel for numerous oil operators and transportation companies, especially the transportation companies from which the United Pipe Lines were later formed. This relationship was in one respect an unusual one. He felt that in order to give the best legal advice he should occupy a detached, almost judicial position, uninfluenced by personal financial interests. Accordingly he refused to allow John D. Rockefeller to place to his credit for gradual payment a block of stock which would have made him many times a millionaire; contrary to popular rumor his salary was never more than $25, 000, and he left an estate of less than $300, 000. His business relations with the Rockefellers and other Standard Oil magnates were always cordial, but otherwise he stood somewhat aloof, never becoming an intimate friend.
His reputation rests upon his organization in 1882 of the Standard Oil Trust. The state laws of tne period did not afford a way for corporations to combine and what Dodd was seeking was a means of creating a “corporation of corporations. ” Under the trust agreement which he drew up, the voting stocks of some forty companies were placed in the hands of nine trustees. The change effected was, however, more apparent than real. There had been no competition between the companies thus combined for some, time and the nine trustees did in fact own a majority of the stock of the component corporations. The trust agreement was kept secret for six years. It fell to Dodd’s lot to officiate not only at its birth but also at its death. In 1892 the Supreme Court of Ohio decided that it was an illegal combination in restraint of trade and also that the Standard Oil Company of Ohio, one of the component companies, had exceeded its lawful corporate powers in entering the agreement. Accordingly, in March of that year Dodd presented the resolutions for the dissolution of the trust. This dissolution did not materially alter the actual conditions of the business.
For six years the now dissociated corporations conducted their business under a gentlemen’s agreement, and under the shrewd legal guardianship of Dodd who steered them, as one writer puts it, “through the stormy seas of anti-trust agitation, ” and kept them within the law.
In 1899 he drew up the plans for the organization of the great holding company, the Standard Oil Company of New Jersey. He continued as legal adviser until 1905 when he retired from active service on a pension, retaining the title of counsel for the Standard Oil Company.
Accordingly he criticized the early interpretation of the Sherman Act which penalized all combinations in restraint of trade. He held that only unreasonable combinations should be barred, a view later adopted by the Supreme Court in 1911 in dissolving the very holding company which he had organized. He was a firm believer in the federal incorporation of business companies and favored a constitutional amendment to make that possible.
Dodd was deeply religious, he became in later life a reverent freethinker.
Politics
In politics Dodd was a nominal Democrat, an admirer of Cleveland, but an independent voter.
Views
Dodd was a firm believer in the federal incorporation of business companies and favored a constitutional amendment to make that possible.
Personality
Dodd is sometimes called the inventor of the trust as a form of business combination.
In private life Dodd was genial, friendly, and generous. He shunned publicity and seldom appeared in court. He lived quietly and modestly with his family, a few congenial friends, and his books. He read deeply in history, economics, and philosophy, and Spencer and Huxley were his gods. Deeply religious, he became in later life a reverent freethinker.
Connections
In 1860 Dodd married Mary E. Geer of Waterford, Pennsylvania, who bore him two sons and died. On March 8, 1877 he married Melvina E. Smith, who died in 1906. From this marriage there were two children.