William Cowper, the 18th century English poet, called charity "a plant divinely nursed, fed by the love from which it rose." But not all charitable contributions come from motives quite so pure, and that has led the Justice Department to battle in court some schemes for corporations to give major cash donations to do-good organizations. At stake in the battle is how punishment should be meted out to companies found guilty of breaking federal laws.

There's a widely held belief that traditional methods of punishing offenders--fines and jail terms--are not working very well, and many reformers loudly applaud judges who come up with innovative alternatives. The Justice Department would, by and large, like to stick to the old devices, especially in white-collar crimes; even a month in jail can be tremendously sobering to an executive who is a big wheel in his community and is caught in clandestine meetings with competitors to fix prices. But Justice does not challenge the power of judges to fashion alternative remedies, such as the demand once imposed by former District Court judge Charles B. Renfrew that price-fixers deliver speeches to civic clubs on the evils of stifling competition in the marketplace.

When it comes to corporations, however, the Justice Department says that judges have no such leeway. A corporation is not a real person, so it can't be rehabilitated, the government is arguing; the only proper penalty is a fine paid directly into the U.S. Treasury. The government is taking that position in two cases now before two different appellate courts. In both cases, the judges are being asked to take a second look at a controversy on which they ruled last month; on that first go-round, Justice won one and lost one.

One dispute involves Prescon Corp. and VSL Corp., two companies that chose not to contest criminal charges that they rigged bids on construction projects in 10 Western states. Judge Zita L. Weinshienk fined the companies a total of $552,000. But she also said she would suspend that part of the sentence if the two companies would ante up $125,000 for the court's probation department to spend on programs to help reduce crime. Washington convinced the Court of Appeals in Denver that Weinshienk had overstepped the considerable power given a judge, and (in the order they are now being asked to reconsider) the appellate judges sent the question back to her for a new sentence.

That ruling came out in early December. Just nine days later, the Court of Appeals in St. Louis reached just the opposite conclusion. That case, too, involved bid-rigging on construction projects: highway jobs in Nebraska. Again, the companies were told that they could get out of paying fines to the government if they made contributions to local community service organizations--and did not take tax deductions for the gifts. But in this case, the appellate judges reviewing the matter not only upheld the plan but praised trial judge Warren K. Urbom for being clever enough to think up the proposal. (The Nebraska Center for Sentencing Alternatives had worked with Urbom on the idea.)

Both cases involve interpretations of the law laying out just what a judge can do in suspending sentences or imposing terms of probation. Among the things a person or company convicted of a crime may be made to do while on probation is "to make restitution or reparation to aggrieved parties for actual damages or loss caused by the offense for which conviction was had."

To the Denver judges, that means that payments cannot be ordered to some other group, no matter how worthy, that was not hurt by the illegal actions. In 1976, the same court had struck down a sentence where the charity was more closely related to the crime than in the current case: the judges had thrown out an order telling retail liquor dealers who had agreed unlawfully not to compete on prices to give a total of $233,500 to the county Council on Alcoholism.

But the St. Louis judges feel, as Senior Judge Edward Dumbauld put it, that "this formalistic contention smacks of medieval antiquarianism." Saying that a corporation cannot be rehabilitated by forcing it to give to charity "resembles the arguments that a corporation could not be a trustee because it had no soul," Dumbauld wrote. The statute listing restitution to victims is only giving an example of the kind of tools available to a judge in sentencing, the St. Louis court ruled; it is not a complete list of all powers.

The Department of Justice, of course, would like to get the fine money for the U.S. Treasury. But the government's lawyers think more is at stake. If a judge can lift a fine for substantial payments to a charity, that could mean that he or she has the power to suspend fines in return for much less significant--or much less worthy--donations. "This poses the potential for a corporation to get off the hook," worries Abbott Lipsky, deputy assistant attorney general. Because the government depends on the threat of punishment to keep companies on the straight and narrow, he believes an indication that punishment wouldn't be so bad--even if a judge never hands out a really soft alternative--would diminish the deterrent effect that big fines have on others wondering whether or not to abide by the law.