Statement of the Case.

and forbade the company to use any part of its capital stock or other funds in the purchase of stock in any other corporation. Penn. Stats. April 7, 1849, c. 368, §§ 1, 3, 4, 8; April 1, 1853, c. 186, § 2.

In accordance with the requirements of those statutes, the plaintiff's certificate of incorporation, or charter, stated the object for which it was formed, "the transportation of passengers in railroad cars constructed and to be owned by the said company in accordance with the several letters patent," four in all, described by numbers and dates; the place where its chief operations were to be carried on, Philadelphia; the amount of its capital stock, $200,000; and its term of continuance, twenty years, the extreme limit allowed by the statutes.

By a special act of the legislature of Pennsylvania of February 9, 1870, c. 94, entitled "An act to extend the charter of the Central Transportation Company, to empower them to lease their property and increase their capital stock," the plaintiff's charter was extended for ninety-nine years from its expiration; and "said company are hereby empowered to enter into contracts with corporations of this or any other State for the leasing or hiring and transfer to them, or any of them, of their railway cars and other personal property," as well as "to increase their present capital stock two hundred thousand dollars."

On February 17, 1870, eight days after the passage of that act, the indenture sued on was made by and between the plaintiff and the defendant, which had been incorporated three years before, with a capital stock of $100,000, by a special act of the legislature of Illinois of February 22, 1867, (declared to be a public act,) "to manufacture, construct and purchase railway cars, with all convenient appendages and supplies for persons travelling therein, and the same " to "sell or use, or permit to be used, in such manner and upon such terms as the said company may think fit and proper."

The indenture, after the statement of the names of the parties, began with the following recitals:

"Whereas the parties hereto are engaged in the business of manufacturing railway cars, generally known as sleeping cars,

Statement of the Case.

under certain patents belonging to them respectively, and of hiring the same to railroad companies under written contracts, to be used and employed on and over the lines of the roads of said railroad companies, and receiving therefor income and revenue by the sale to passengers of the berths and accommodations therein; and

"Whereas the demands of the public for increased means of personal comfort and convenience in travelling, of avoiding repeated changes of cars over long routes of railroad, the necessity for affording, at fair and reasonable rates, these advantages, which cannot be extended by railroad companies themselves, require that every possible means should be adopted to meet such demands by avoiding the inconvenience and curtailing the expenses incidental to the maintenance of the business management and organization of two separate corporations."

It further recited that the parties (professing to act under the powers conferred upon them respectively by the special acts of the legislatures of Pennsylvania and of Illinois, above mentioned,) had agreed that the plaintiff should demise, transfer and set over to the defendant, and the defendant should take, all the plaintiff's railway cars, contracts, patent rights and personal property.

By that indenture, accordingly, the plaintiff "granted, demised, transferred and set over" one hundred and nineteen railway sleeping cars with their equipment, its contracts with sixteen railroad companies, (copies of which were annexed to and made parts of the indenture,) all its patent rights, (an assignment of which, including the four specified in its charter and thirteen others, was also annexed to the indenture and made part thereof,) and all its "personal property, rights, credits, moneys and effects, rights of action, money due and to become due from licenses heretofore granted," to the defendant, its successors and assigns, "to have and to hold the above demised property, and all income, revenue and profit to be derived therefrom," for the term of ninety-nine years from January 1, 1870, except so far as the contracts, patents and licenses should expire sooner; and the plaintiff expressly cove

Statement of the Case.

and forbade the company to use any part of its capital stock or other funds in the purchase of stock in any other corporation. Penn. Stats. April 7, 1849, c. 368, §§ 1, 3, 4, 8; April 1, 1853, c. 186, § 2.

In accordance with the requirements of those statutes, the plaintiff's certificate of incorporation, or charter, stated the object for which it was formed, "the transportation of passengers in railroad cars constructed and to be owned by the said company in accordance with the several letters patent," four in all, described by numbers and dates; the place where its chief operations were to be carried on, Philadelphia; the amount of its capital stock, $200,000; and its term of continuance, twenty years, the extreme limit allowed by the statutes.

By a special act of the legislature of Pennsylvania of February 9, 1870, c. 94, entitled "An act to extend the charter of the Central Transportation Company, to empower them to lease their property and increase their capital stock," the plaintiff's charter was extended for ninety-nine years from its expiration; and "said company are hereby empowered to enter into contracts with corporations of this or any other State for the leasing or hiring and transfer to them, or any of them, of their railway cars and other personal property," as well as "to increase their present capital stock two hundred thousand dollars."

On February 17, 1870, eight days after the passage of that act, the indenture sued on was made by and between the plaintiff and the defendant, which had been incorporated three years before, with a capital stock of $100,000, by a special act of the legislature of Illinois of February 22, 1867, (declared to be a public act,) "to manufacture, construct and purchase railway cars, with all convenient appendages and supplies for persons travelling therein, and the same " to "sell or use, or permit to be used, in such manner and upon such terms as the said company may think fit and proper."

The indenture, after the statement of the names of the parties, began with the following recitals:

"Whereas the parties hereto are engaged in the business of manufacturing railway cars, generally known as sleeping cars,

Statement of the Case.

under certain patents belonging to them respectively, and of hiring the same to railroad companies under written contracts, to be used and employed on and over the lines of the roads of said railroad companies, and receiving therefor income and revenue by the sale to passengers of the berths and accommodations therein; and

"Whereas the demands of the public for increased means of personal comfort and convenience in travelling, of avoiding repeated changes of cars over long routes of railroad, the necessity for affording, at fair and reasonable rates, these advantages, which cannot be extended by railroad companies themselves, require that every possible means should be adopted to meet such demands by avoiding the inconvenience and curtailing the expenses incidental to the maintenance of the business management and organization of two separate corporations."

It further recited that the parties (professing to act under the powers conferred upon them respectively by the special acts of the legislatures of Pennsylvania and of Illinois, above mentioned,) had agreed that the plaintiff should demise, transfer and set over to the defendant, and the defendant should take, all the plaintiff's railway cars, contracts, patent rights and personal property.

By that indenture, accordingly, the plaintiff "granted, demised, transferred and set over" one hundred and nineteen railway sleeping cars with their equipment, its contracts with sixteen railroad companies, (copies of which were annexed to and made parts of the indenture,) all its patent rights, (an assignment of which, including the four specified in its charter and thirteen others, was also annexed to the indenture and made part thereof,) and all its "personal property, rights, credits, moneys and effects, rights of action, money due and to become due from licenses heretofore granted," to the defendant, its successors and assigns, "to have and to hold the above demised property, and all income, revenue and profit to be derived therefrom," for the term of ninety-nine years from January 1, 1870, except so far as the contracts, patents and licenses should expire sooner; and the plaintiff expressly cove

Statement of the Case.

nanted that it would use its influence to obtain renewals or new contracts in the defendant's name from the railroad companies; and that it "shall and will not engage in the business of manufacturing, using or hiring sleeping cars, while this contract remains in full force and effect."

The defendant, on its part, covenanted to pay to the plaintiff annually the sum of $264,000, in equal quarterly instalments, "during the entire term of ninety-nine years," unless, upon a diminution of the revenue received from the railroad companies, the indenture should be declared void by the defendant, or the annual sums payable by the defendant be reduced, as therein provided; also to pay all the plaintiff's debts up to January 1, 1870, according to a schedule annexed, by which they were not to exceed the sum of $63,998.69, that being the amount of cash transferred by the plaintiff to the defendant; to continue and carry on the business as authorized by its charter, during the existence of the assigned contracts or other like contracts with the same railroad companies; to keep in repair the cars and their equipment, and to renew and reconstruct them when needful; not to assign the indenture without the plaintiff's assent, nor to create any lien or mortgage upon the property that should impair the plaintiff's rights under the indenture; that, upon the defendant's failure to make any quarterly payment for thirty days after due, the plaintiff might avoid the indenture, and thereupon the defendant should surrender the cars and equipment, assign to the plaintiff the contracts with the railroad companies and any unexpired patent rights, and cease to run or employ cars on the same lines of railroad; and, at the end of the ninety-nine years, to deliver to the plaintiff the cars and equipment in good order, and assign to the plaintiff any unexpired contracts with those railroad companies.

At the trial, in May, 1888, the plaintiff offered in evidence its original charter, the statute of Pennsylvania of February 9, 1870, and the indenture of February 17, 1870; as well as evidence tending to show that the defendant, under that indenture, entered into possession of the plaintiff's property, and continued in possession during the period covered by the declaration.