"1.
That in the month of September, 1891, F. G. Patterson, acting
as agent of the Altoona, Clearfield & Northern Railroad
Company, subscribed for and directed S. J. Westley, treasurer
of the company, to note his subscription to six hundred
shares of the company's capital stock. That such stock so
subscribed for was not an increase of the stock of said
corporation, as alleged in plaintiffs' bill, but was a
part of the original capital stock of said company.
"2.
That no entry was made at that time of such subscription upon
any book or record of the company, nor upon any subscription
list or memorandum of any kind.
"3.
That the company kept no subscription book in which such
entries of subscription so made by any one were noted.
"4.
That no money of any amount whatsoever was then paid or
offered to be paid, neither ten per cent of the par value nor
any other amount.
"5.
That no offer was made by said F. G. Patterson to pay
anything upon said subscription until the 6th day of January
1893, when Mr. Patterson tendered to Mr Westley ten per cent,
or three thousand dollars ($3,000), of the par value of the
six hundred shares so subscribed for, and which was refused
by Mr. Westley, and that, subsequently, on Feb. 23, 1893, Mr.
Patterson tendered to Mr. Westley, as treasurer of the
company, a check of Theo. H. Wigton, cashier of the Altoona
Bank, for thirty thousand dollars ($30,000), in payment of
the par value of the six hundred shares of capital stock so
previously subscribed for.
"6.
That the money covered by said check for thirty thousand
dollars ($30,000) was to be furnished by S. M. Prevost,
general manager of the Pennsylvania Railroad Company, and was
the money of that company, and that an arrangement or
agreement existed between F. G. Patterson and the said S. M.
Prevost for the assignment or transfer of the said
certificate for six hundred shares to the said S. M. Prevost,
for the use of the Pennsylvania Railroad Company.
"7.
That both the stockholders and directors of the Altoona,
Clearfield & Northern Railroad Company had knowledge of the
subscription so directed or made by F. G. Patterson to the
six hundred shares of stock, and, with such knowledge, they,
the stockholders, voted an increase of the company's
indebtedness, and the directors instructed and empowered the
president (Mr. Patterson) and the secretary to issue bonds
and execute the mortgage of the company for sixty thousand
dollars ($60,000).
"8.
That said subscription so made by Mr. Patterson was made for
the advantage of the company and to enable the company to
increase its indebtedness and issue the bonds and execute the
mortgage as aforesaid, and was made as agent of the company.
"9.
That under the decree of the court of common pleas of Blair
county, in certain quo warranto proceedings, the plaintiffs
herein were placed in possession and control of the Altoona,
Clearfield & Northern Railroad Company on the 29th day of
August, 1893, and so continued in possession until the 16th
day of November, 1893, in the management and control and
operation of said road.
"10.
That the plaintiffs herein, while in possession, control and
management of the road as aforesaid, did, by the action of
the acting, or de facto, board of directors, declare illegal
the subscription of F. G. Patterson to the six hundred shares
of stock, and did, by a minute adopted, order and direct that
notice be given to each and all of the stockholders that they
are entitled to subscribe to an issue of six hundred shares
of stock in proportion to their holdings of stock already
subscribed and paid for, and that notice was actually given
to all of said stockholders, and that two hundred and
eighty-seven (287) shares of the six hundred shares claimed
by plaintiffs to have been illegally issued by F. G.
Patterson to himself were subscribed for.
"11.
That for the two hundred and eighty-seven (287) shares of
company's stock so subscribed for and issued to the
several stockholders of the company subscribing, nothing was
paid of value, but the alleged payment was consummated or
accomplished by an exchange of checks between the company and
the stockholders so subscribing, and the certificates for the
stock so subscribed for were acquired by the several
stockholders without value.
"12.
That no indebtedness of the company of any certain or
positive character due the stockholders, and to whom were
given the company's checks, is shown to exist, and that
as far as the evidence goes such checks were without
consideration.
"13.
That the de facto board of directors, by whom such allotment,
or distribution of stock was made, were members of the
company, and either stockholders or directors at the time the
company acquired knowledge of the original subscription of
Mr. Patterson to the six hundred shares of stock, and at the
time the stockholders voted an increase of the company's
indebtedness, and directed the issuing of the bonds and the
execution of the mortgage for $60,000.
"14.
That the Altoona, Clearfield & Northern Railroad is a narrow
gauge road, commencing at Altoona and extended by its charter
line to Fallen Timber, on the Cresson & Coalport Railroad, a
distance of about seventeen (17) miles, and that it is at
this time constructed and operated as far as Dougherty's,
a distance of about twelve (12) miles from Altoona.
"15.
That the Cresson & Coalport road extends from Cresson, in
Cambria county, to Irvona, in Clearfield county, and that the
distance from Cresson to Fallen Timber is about twenty (20)
miles, and that the road is of standard gauge.
"16.
That the Cresson & Coalport Railroad connects at Cresson with
the main line of the Pennsylvania Railroad, and that the
distance via the Pennsylvania Railroad from Cresson to
Altoona is about fourteen (14) miles.
"17.
That the Cresson & Coalport Railroad is a leased line of the
Pennsylvania Railroad Company, and is by said company
operated and managed, and that there is no traffic connection
or contract between the Pennsylvania Railroad and the
Altoona, Clearfield & Northern Railroad, either at Altoona or
at Fallen Timber.
"18.
That there is now in progress of construction a railroad
known as the Altoona & Philipsburg Connecting Railroad,
extending from Philipsburg station, on the Beech Creek
Railroad, in Clearfield county, Pennsylvania, and immediately
adjacent to the borough of Philipsburg and the Tyrone &
Clearfield Railroad, southwesterly to Janesville, in
Clearfield county, and in the direction of, and five miles
distant from, Dougherty's on the Altoona, Clearfield &
Northern Railroad.
"19.
That the Tyrone & Clearfield Railroad is owned and operated
by the Pennsylvania Railroad Company, and is a part of its
system, and that Philipsburg is a point on the Tyrone
Clearfield Railroad, and that Altoona is a point on the
Pennsylvania Railroad.
"20.
That the extension or construction of the Altoona, Clearfield
& Northern Railroad from Dougherty's to Fallen Timber,
the terminus fixed by its charter, does not make it a
competing line with the Cresson & Clearfield Railroad for
either freight or passenger traffic originating at Altoona to
be shipped and carried to Fallen Timber, or the country
tributary thereto, nor for freight and passenger traffic
originating at Fallen Timber and the country adjacent, to be
shipped and carried to Altoona. Nor are the Cresson &
Coalport and the A., C. & N.R.R. Altoona. Nor are the Cresson
& Coalport and the A.,C. & N.R.R. parallel to each other.
"21.
That the Altoona & Philipsburg Connecting Railroad, as now
projected, is not, in any sense, a competitive line, either
with the Cresson & Coalport Railroad, the Pennsylvania
Railroad, nor the Tyrone & Clearfield Railroad nor their
branches, for freight or passenger traffic coming from the
Beech Creek & Reading Railroad from Philipsburg, Osceola
Mills, Houtzdale or Ramey or any other points in Clearfield
county to Altoona, nor with the Pennsylvania systems between
New York and Philadelphia, nor points in Eastern
Pennsylvania, nor in New Jersey to Altoona and vice versa.
"22.
That after the reinstatement of the defendants in the control
of the Altoona, Clearfield & Northern Railroad by resolution,
as appears in the minutes of the board of directors, the
subscription to the six hundred shares of stock made by F. G.
Patterson was recognized, confirmed and ratified, and that
the treasurer of the company was requested to sign a
certificate for such shares, which certificate had been
issued by F. G. Patterson to himself on the 23d of February,
1893, upon the payment to the treasurer of the thirty
thousand dollars ($30,000), being the par value of the said
six hundred shares of stock.
"23.
That at the same meeting the board of directors declared the
shares of stock allotted or distributed by the de facto board
to be wholly unlawful and illegal, and the solicitors of the
company were instructed to take such steps as were necessary
to cancel such certificates and cause the same to be returned
to the office of the company.
"24.
That said F. G. Patterson, as president of the Altoona
Clearfield & Northern Railroad Company, did, in his annual
report of December, 1892, recommend a 5 per...
