THE TRUSTEE DEVICE
The first resort to the trustee device or the "trust," as it will be called to distinguish it from the modern trust, was by the Standard Oil Company. Prior to 1879 Mr. John D. Rockefeller and his associates had acquired a large number of oil concerns in the interest of the Standard Oil Company, but the shares of these concerns (instead of being held directly by the Standard Oil Company) had been registered in many cases in the names of various individuals who held them for the benefit of the company. In order to centralize more fully the control of these properties, it was decided in 1879 to organize the Standard Oil "trust."
The "trust" agreement as revised in January, 1882, included about forty companies, controlling from 90 to 95 per cent of the refining capacity of the country.1 It provided for nine trustees, among whom were Messrs. John D. Rockefeller, William Rockefeller, H. M. Flagler, and John Archbold. The trustees received from each of the parties to the agreement an assignment of their stock with voting power, and in return therefor gave "trust certificates" representing the valuation of the properties. The trustees did not become the owners of the stocks deposited with them; they simply held them in trust for the owners of the trust certificates. It should be noted, however, that these stocks were held by the trustees for the joint account rather than for the individual account of the certificate holders; a stockholder in any one company lost by the trust agreement his title to the stock of that particular company, and secured instead a proportionate____________________