New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1873-11-10

Ills uOtee lnottkakc tu'
This release Is said 70 be unsatisfactory TO certain
Stockholders who wish to recover than the 10000
shares which at the price would net only about
s21OoOO The answer OF some Of tho Stockwe directors
the complaint admits, In the main, the aheeaohs Vi
Freeman against 6tockwe but AYERS that tho latter
acted without their knowledge and consent The answer
will be found below:
Supreme Court schenectady County. Aaron Freeman
against Alden St0ekwell, Frank e. Markhanl f. w, ~
Bellows Henry H. Baxter Frederick Billings george H.
Kingsland Alexander Masterton. James ID. oml'n'
another and the Pacific Mail Steamship Company
George l.. Kingsland, Alexander MastefJon abu n ~;
Baxter and another, defendants IN the ABOVE ehtea
action Jointly aud severally answering the complaint
therein by Morris and Billings, their attorneys rcSpocS
ss The cfcndSnts admit that they were severaly
directors of said Pacific Mail Steamship company q.
the times mentioned IN Ine say v w = RelIows were.
at the times respectively the Preslueht auu 'loo
Presdent of said Company. 49, y,
airy and February. 1873, and Tor some Tune previous
thereto the said Company was the oSner or Of me
capital stock VI the Panama Railroad Company Nfvn
shares were OF great ya9o IN ne fSr me
stated in the said complaint.
1hrd The defendants also admit that some tiine 10
January or February 1873 about that time Alden IL
Stockwe then being President and dlrector OF saiu
Company. took md carried away from tue once OF sara
Company said $500 shares OF the capa sOcb Oh inc
Panama Railroad Company; but tho SAID oeiendants,
Kngsand and M9stertOn and another, deny tnat tney
had Officially, l0rectOrs, or In any otner way any
notice knowledge OF such act on the part OF the sau
S.Ockwe until about Mach i, 1873, Wnen tuey were
officially informed OF the same by stockwell HIMSELF
claimed that be bad appropriated the sau shares o
stock TO the Of the sand Pacific Mall Steamship CON-
pany in the manner hereinafter stated.
Fourth: The defendints also admit that the sara Aden
b. StoeKwel then being tue Presdent ana director Oh
sald Company lont 10 the SAID Frank C. Markham some
time In February 1873, s55000 or tereabOuts OF the
money Of said Company upon inadequate security out
they deny that they mad officially rs directors or III any
other way any notice knowledge OF sucn loan, unt
March l. 1873 and the said defendants aver that they
have no knowledge information sufficient to form
belief what understanding or agree men existed or
made between the SAID Stoekweli ana me sdld MARX
ham rs the to be made by them or either OF the
TGh: The defendant H. II. Baxter AYERS that between
about Isl day Of February, 1879 and tho lstday Oh
tur 1873 he was vOdaby and continuously absent
from tue state and that he had no notice or knOwledge
officially as director IN any other way OF either OF
the said acts which said complaint arc charged
against the said Stockwel or OF any or elther OF e
matters or proceedings mentioned B the said complaint
on OF either OF the matters or proceedings hereinafter
mentioned until after his return to the Csy OF New
York about the said Ist day OF April 1873, and
that ali his ayerments and admissions in this answer
contained in relation TO either 81 sald matters OF pro-
ce.dngs, are made solely upon MS Information anu
SisM: Tie defendants aver that prior to the times
referred 40 IN the coup amt the sand Pacific Mail Steam
sDip Company was the of 27l9 shares OF It's own
capital sOck, which, by resolution Oh us BOdru oI
Directors Socwel as It's President, authorized TO
sell for the SAID Company at not less tan their
par value of 500 a share. Ihat aIteiNSfd otocAWeu
ndicaIy informed the directors Of said Company that
he had sold at different times the whole of said stock In
pursuance OF sad resolution, ana PAD OF caused 70 DO
aid INTO the treasury of sad Company the sum OF s27li
a tho proceeds of such alleged sales That on March
l. 1879 therea bout, tho directors OF sald company
we've officially informed by otoekwell as us resident
mat he hau not as previously stated BY hni, sod tne
whole Of toned shares or the STOCK OF 5aid
Contrary; that lie had sold only l6li9ishares or SAD
stoee and hat the balance thereof amounting to - 600
SHARES still remained unsOld; that the money whleh
had hsen maid fo said Company as the proceeds OF the
saIe of said I2OO had been borrowed by stock
well for account Of sald Company ana tat tue sed
GOO shares OF the capital stock OF the Panama Railroad
Company mai pledged by him as margin for such
Sece,m The defendants further aver that Il was
theriuOn resolved BY the Board OF Directors OF the
saln Pacific Mail Steamship Company 10 hold the said
kwe individually responsible for the trnth or the
statement by him, tjiat he had sold the whole OF
the stock OF sd Company anu 10 compel n 70 iSacs
from pledge said stock OF the Panama Railroad Com
pany ana restore Che same TO the said Paclnc MAI
Steamship Company. but That IN the course Oh tue hNcs
LEGATION which thereupon cnsued OF tue pecunlary az
fairs OF the said StOckwe II was discovered not Only
thai he WAS utterly unablc 10 command or procure tue
necessary funds redeem the sand stock from pletge
mt tuat he was laDoring under financial embarrass-
nIeuts OF serious . nature as 10 lhahc IL
Ihe unperative duty OF said Board OF Directors
to ACCEPT from MN without delay the best Sc
euI1ty nc was able TO Offer, to indemnify sald Com.
many "A well against the Threatened loss OF the SAID
stock of tle Panama Railroad Company as or the
MONEYS which had been loaned Dy SAIL otOckWe To the
aid MIrkia,n upon inadequate security aforesaid,
mat under tue pressure OF such necessity, and not
otherwise the agreements referred 10 In the SAID com
plant were made with SAD stoeAWeli, ana tho salI
BIS the said Board Of Directors substantially as stated
M said complaint But the SAID defendants deny that
rcctors the said StOekwel Tor the SAID stock OF
the Panama Railroad Company was below the
s,id "' mortgage is Of doubtful validity or OF
ouestionablc value; ana they aver that said
"rtge was accepted by said Board of Directors upon
The written report Of the standing legal counsel OF the
said Pacific Mail steamship company, oolh as 10 It's
adeanncy and as 10 its validity security for the pay
nenL Of The sand OF s,l4oOO0 the aggregate price
which the said Sockwe agreed 20 pay for the sad $500
shares of the ca pital stock OF the Panama Railroad Com
pany aud defendants further deny that they
knew the time the said Board OK Directors agreed
Ia purchase from the said StOekwe the said steamers
Nevada, Nebraska. Dakota, and Moses Taylor, that
they unsuited TO the business OF the said Pacinc
90. HIN. Al
value would not exceed the Of sJj000 On the con-
rary the defendants aver that they were then VI
formed by the officers Of the said Company That the SAID
steaers we're only suited for the business OF sad
COMPANY but that they were urgently required there
for and that the price which the said Board OF Directors
agreed 10 paw for steamers had been i0usy as
ct rtancd and fixed by two experts one OF whom was
me other by the said StOckN w. and that such price was
Al xed upon the assumption that the said steamers
were in mercbaDtabe and seaworthy condition. three
T hem beine az the time at sea- and the remaining one
bang nc San Francisco, In the State OF CALIFORNIA -
Nil hv stockwel In cash, to the said Pacific Mail
Steamship Company on account OF tne prclpa seculea
Roar of directors and that effort wac spared by the
ad Board during the remainder OF the term OF once OF
stockwell Tor the performance OF his y
mold him to the due performance Ilereef ana tnat II
was not possible under the circumstances to do any
thing more than was done by the said Board OF d.
rectors to save the said Pacific Mail Steamship Com.
pany from loss and the sad defendants deny that tney
wrohgh,lly concealed tho alleged misrepresentation
Of III, moneys and OF said stock OF the Panama Rail
rad COMPANY by stoekwe, that they negligently
commtted TO Stockwe the exclusive control OF tue
money or property OF the said Pacific Ma Steamship
company ortnat they wlfully omitted to take meas
rres TO recover the said money and properly which ne
said Stoekwell had misapped, or toat In maEas tne
said agreeme nts with Stookwe they were influenced IN
any way by their interests, or by thelr nalsuua,
spsculailons as In alleged in the SAID complaint ana
tney aver that II any publicity had been gwen 70 the
alters in question before the tnal contamination Oh
the said agreements 1t would in theirludgment nave
been detrimental 10 the interests OF said COMPANY.
XinM The defendants aver that they have no knowi-
lee or Information sufficient to form beneI as 70
whether the plaintiff in this action &C the Tune Oh the
announcements thereof was o stockeouero OF sara IA
itc Mail Steamship Company and the SAID deiendants
DENY Ihat the mortgage vi the Howe Machine com
$50 ss occepred In payment OF the price which Stock
we'll agreed 10 nay the Panama Railroad Companys
and they that SAID mortgage was accepted az
coateral security for tie payment OF the ndlvidnai
hond OF stockwe which he executed ana denvered 10