CORPORATIONS 967

the said purposes of the common carrier, railroad corporation, street rail-
road corporation, or such corporations, but this provision shall not apply to
any lawful issue of stock, to the lawful execution and delivery of any mort-
gage, or to the lawful issue of bonds thereunder, before the time when this
sub-title becomes a law. For the purpose of enabling it to determine whether
it should issue such an order the Commission shall make inquiry or investi-
gation, hold such hearings, and examine such witnesses, books, papers, docu-
ments or contracts as it may deem of importance in enabling it to reach a
determination. Such common carrier may issue notes for proper corporate
purposes, and not in violation of any provision of this or any other Act,
payable at periods of not more than twelve months, without such consent,
but no such notes shall in whole or in part, directly or indirectly, be
refunded by any issue of stock or bonds, or by any evidence of indebtedness
running for more than twelve months, without the consent of the Commis-
sion; provided, however, that the Commission shall have no power to
authorize the capitalization of any franchise to be a corporation or to author-
ize the capitalization of any franchise or right to own, operate or enjoy any
franchise whatsoever in excess of the amount (exclusive of any tax or
annual charge) actually paid to the State or to a political sub-division
thereof as a consideration for the grant of such franchise or right; nor shall
the capital stock of corporations, formed by the merger or consolidation of
two or more other corporations, exceed the sum of the capital stock of the
corporations so consolidated, at the par value thereof, or such sum and any
additional sum actually paid in cash; nor shall any contract for considera-
tion or lease be capitalized in the stock of any corporation whatever; nor
shall any corporation hereafter issue any bonds, against or as lien upon any
contract for consolidation or merger.

Control of public service commission over a railroad is limited to latter's operations
within this state. Commission may require statements of the facts relating to issues of
stocks, bonds, etc., so that it may be determined whether such issue is bona fide and
for value; where the enterprise is one to be conducted wholly within the state, com-
mission may sanction or disapprove proposition. While an interstate carrier may be
made subject to control of each state as to matters affecting the operations of company
in such state, beyond that, state legislation is powerless. The commission has no super-
visory powers over expenditures of money in other states, nor the apportionment of
expenditures of a railroad's monies as between different states, nor can it pass upon
wisdom of construction work to be performed in other states; neither may a corps of
engineers and inspectors be maintained by the commission in other states. P. S. C.
cannot (in the absence of fraud) override the officers of the corporation in the man-
agement of its affairs or in fixing of prices of its securities. Police power. Baltimore and
Ohio Railroad Company. Laird v. B. & O. R. R. Co., 121 Md. 181.

As to the issue of stocks, bonds, etc., see secs. 214 and 236. As to the consolidation
of corporations, see secs. 33, 220 and 237.

Cited but not construed in Potomac Ed. Co. v. Pub. Serv. Commn., 165 Md. 472.

Cited in dissenting opinion in United Railways v. West, 280 U. S. 258.

See notes to sec. 345 and to art. 3, sec. 33, of Constitution.

An. Code, 1924, sec. 381A. 1933, ch. 381.

392. No corporation subject to the provisions of this sub-title, organ-
ized or existing, or hereafter incorporated, under or by virtue of the laws
of the State of Maryland, shall assume any obligation or liability as lessor,
lessee, guarantor, indorser, surety, or otherwise, in respect of the stock,
bonds, notes or other evidence of indebtedness, payable at periods of more
than twelve months after the date thereof, of any other corporation, or of
any person, partnership or association, without the authorization of the
Commission first obtained, and the determination by the Commission
that such assumption of obligation or liability is lawful and proper and
consistent with the public interest.