Court Opinion

ID: 6245086
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:56:22.815109+00
Date Added: 2024-06-11T08:59:16.058106
License: Public Domain

Opinion by
Mk. Justice Mitchell,
This is a bill to declare a trust and secure a return of certain stock, and incidentally for discovery, account, etc. In 1893 plaintiff was the owner of practically all the stock of the West Penn Gas Company and also of all the stock of the Apollo Spring Water Company. The latter company and plaintiff *239individually were heavily in debt, and all his stock in the gas company was pledged as collateral for loans on notes which he could not meet. In this condition of affairs he applied to defendant to assist him, defendant at that time being a creditor to a considerable amount, and contingently liable to a still larger one as indorser for plaintiff. After some efforts to induce the pledgees of the gas company stock to unite in a plan to keep it together and sell the company plant as a whole, the defendant took it up. Without going into details, it is sufficient to quote the finding of the learned judge be.low, that “ the evidence of both plaintiff and defendant clearly establishes the fact that the first plan was abandoned by mutual consent.” Then as already said defendant took up the stock by advancing his own money or giving his notes, so that he became the legal owner of the stock, assumed the management of the company, and now after several years of effort has apparently made it profitable. So far the facts are uncontested, but at this point the plaintiff comes forward with his bill claiming that defendant acted throughout the transaction under an agreement that made him a trustee for plaintiff, and that he is now fraudulently holding the stock, etc., for his own benefit. This alleged agreement is the hinge of the case. It was denied by the defendant and the finding of the court below is that “ by an examination of defendant’s answer it will appear that every material averment of fact upon which plaintiff bases his claim and upon which he seeks to recover is clearly and distinctly denied by defendant, and we are of opinion that nothing has been shown by plaintiff which would justify the court in refusing to give it the ordinary effect of answers responsive to bills in equity. We are led to the conclusion that under the evidence the plaintiff has failed to establish his case by sufficient proof and that therefore his bill must be dismissed at his costs.” An examination of the evidence leads us to concur in this result; a review of the testimony would serve no useful purpose and we might well leave the case here.
But there is another view which is equally conclusive. By the transactions in 1893, now in controversy, defendant became practically possessed of all the plaintiff’s property, and this result was not allowed to go unchallenged by the latter’s creditors. Suits were brought against plaintiff with defendant as *240garnishee to set aside the transfers of stock as in fraud of creditors. One of them reached this Court, Davis v. Yoder, 178 Pa. 138. In none of these was the agreement now set up as the basis of this suit asserted or even admitted. On the contrary it was positively domed by defendant and either denied or studiously concealed by plaintiff. But without discussing the evidence in those cases, though the records or the portions of them containing plaintiff’s testimony were put in evidence in this suit, it is sufficient to advert to the plaintiff’s own admission in this case as to the nature of the transaction. He was asked: “ Q. Up to the time you were turned out of office, you and your son, did Mr. Yoder ever intimate, or claim to you that he proposed to take or appropriate the stock to himself? A. Oh, no, no, if he had he wouldn’t have got it. I supposed of course that the legal title was passing from me into Mr. Yoder, that I intended, because I wanted it where nobody could reach it, I wanted to put it in that shape where I could say that the legal title was in him and not in me, because we wanted it where it couldn’t be reached.” This answer alone is enough to turn plaintiff out of a court of equity. Assuming it to be true it shows that the transaction between plaintiff and defendant was a scheme to hinder and defraud the former’s creditors, and equity will not assist him to get his share of the plunder.
Decree affirmed with'costs.