The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1900-03-13
CARNEGIE FILES ANSWER.
And Every Averment Made by Prick
is Met by This Answer in the
Fullest Detail.
(By The Associated Press. }

(By The Associated Press.)
| Pittsburg. Pa, March 12.--Late this
, afternoon the Carnegie Steel Company,
| limited, defendant in the equity suit of
/ II. G. Prick, to determine the value of
his holdings in said company was fled
in Common Pleas Court No. l.
The answers filed are for the Carnegie
Steel Company, limited, and the thirty
individual defendants named in the suit.
/ The document meets every averment Of
the plaintiff in the fullest detail 1t is
denied that the defendants during April
May and June, 1892, executed articles of
association for the Carnegie Steel Com
pany, limited, but they did subscribe to
an amendment of the original certificate
under which Carnegie brothers and Com
pany. limited, had been organized as a
limited partnership association. This
was solely for modifying the terms of
the original certificate, and was effected
at a shareholders meeting at which
Frick was chief actor in carrying out the
plan.
The answer, says Mr.. Prick, is prim-
ariy responsible for any defect, If any
exists, as aFeTreu ny MI fIIch III THESE
articles. as the details of the amend
ment were entrusted to him. 1t denies
that the character of the business has
been changed, though admitting that
business was enlarged capital increased
by $50, 900 900, and more than double that
amount additional paid in and Invested in
the associations business. 1t recites the
requirement of Carnegie, Phipps and
ship association. for $4,000, 900 which
was paid for in the usual manner, and
Prick devised and executed the method of
this payment. 1t sets out that Mr..
Tricks own actions in connection with
the association estop him from question
ing the validity of its organization, as a
partnership association. The history of
Frick's membership in the association
is reviewed in detail, and shows that he
was admitted as other young partners.
his payment for partnership being out
of future profits. His interests were ac-
CURED under the "iron-clad agreement
and consisted of 800, 900 of capital stock.
Through various opportunities he had. in
February, 1895, become owner of eleven
per cent of the capital on which he
owed Carnegie $1,S09,191 balance of pur-
chase price, the interest being Carnegie's
only security. Afraid of the then exist
ing business depression he had asked Mr..
Carnegie to buy at the book value five
of his eleven per cent. which was done.
This is all Mr.. Prick has paid for his in
terests in the Carnegie Steel Company.
With the credits from his stock earnings
the amount paid was only $50 900 all told,
for an interest worth $5,O00,0o0. He ac
copied without question the book value
for five per cent. of his holdings at a
time when he was scared and feared the
stock would depreciate, but now refuses
to accept book valuation for the balance
of his holdings.
The answer also AYERS that since 1895
Mr. Tricks functions have been merely
advisory, the president assuming general
executive power. Mr.. Frick it is alleged.
was dissatisfied, demanded absolute pow
er and with violent outbursts of passion,
attempted to make a personal matter of
business differences. 1t is alleged Mr..
Frick gave most of his time to other en-
terprises and various speculative schemes
for placing the property of the association
in the hands of promoters to be floated in
marketable securities on the public. The
defense admit his ability. The answer
says MT. Carnegie, OH q paper signed DN
all acting members of the board of NAM
ayers, demanded Tricks resignation solely
, to preserve harmony, and Carnegie denies
controlling or seeking to control his asso-
ciate partners. He admits that Tricks
averments as to profits for 1899 are sub
stantially true, but adds that on Decem-
Der 18th, the net value of assets, was
only SO, go 104 1t is denied that animos-
hoe tod tow r1y he
/ plaintiff for his failure to avail
himself of an option given by Carnegie.
In this connection it is stated that the
price to be paid for the property of the
Association and the coke company or
this option was 1920 900 600, being on the
basis of $3.50 900 900 for the property of
the association and the balance for the
coke property. Mr.. Carnegie was to re-
ceive for his interests 500, 000000 in
bonds and the balance, about $57, $50, 900
in cash.
Mr. Frick, it is claimed. has upheld and
enforced the So-called "iron-clad agree
! ment" at all times, opposing an attempt
on the part of Henry Phipps to make a
change in the original and Mr.. Frick IL
the first to attempt to evade 1t.
The answer AYERS that $4,000, 900 is the
full amount due Frick. While in the as
ISOLATION, in addition to an adequate sal
| airy as manager, Mr.. Prick the answer
| AYERS received actual dividends in cash.
which not only repaid him the sum OF
| 1910 900 which he himself paid for his
interest but an additional sum or clear
| profit of 1898 275.S7. The defendants say
| that plaintiff has no reason to complain
| of the operation of a contract which gives
| to him nearly 81, 200 900 for an interest
which involved no investment of capital
| by him, and has already paid him, in
cash. profits of almost $1,000O00.
| The proposition made by Mr.. Frick
to arbitrate his interests is rejected III
! order to maintain the integrity of tho
contract governing since 1887,
Concluding the answer says the So
| called iron clad agreement Is a good ana
valid contract and binding upon the plain
! tiff and asks that the bill be dismissed.
! plaintiff to pay costs.