Appeal, No. 142, Jan. T., 1951, from decree of Court of Common Pleas No. 3 of Philadelphia County, Dec. T., 1949, No. 6752, in case of Mark T. Deibler v. The Chas. H. Elliott Co. et al. Decree reversed.
Henry S. Drinker, with him Francis Hopkinson, and Drinker, Biddle & Reath, for appellants.
Philip C. Herr, for appellee.
Before Stern, Stearne, Jones, Bell, Ladner and Chidsey, JJ.
OPINION BY MR. JUSTICE JONES
This appeal is from a decree in equity ordering the defendant, Harry V. Elliott, to deliver to the plaintiff, Mark T. Deibler, 828 shares of stock in the defendant company (a Delaware corporation) registered in the name of Harry V. Elliott with attached executed power of attorney authorizing the sale, assignment and transfer of the certificates for such shares, and permanently enjoining Elliott, the pledgee of the stock, from voting the shares at any meeting of the stockholders of the company. The appeal is joint by the defendants indicated who claim that the purpose of the pledge has not yet been served and that Harry V. Elliott is entitled to possession of the stock for the remainder of his lifetime and the right to vote it.
The question involved was raised in the court below on preliminary objections by the plaintiff, under Equity Rule 55, to the defendants' answer to the bill of complaint, including new matter. The objections do not seem to fit any of the seven specifications in Equity Rule 48 adopted by reference in Rule 55. All of the material facts appear by the pleadings; none is in dispute. The matter was apparently submitted for the court's final disposition on bill and answer. At
least the learned court below evidently so apprehended, as indicated by its entry of the definitive decree for the plaintiff on the merits merely upon preliminary objections. In any event, the controversy involves no more than a question of law which requires for its solution the proper interpretation of a written agreement whose provisions need be recited with considerable detail.
In 1938, Elliott, then sixty years old, was president of the defendant company for which he had actively worked all of his adult life; he was the owner of 1937 shares of the common stock of the company which was in excess of 80% of its total outstanding stock. Desiring to increase the interest of two employees, namely, Deibler, the plaintiff, and W. Alfred Streamer, in the company by enabling them to purchase a controlling interest in the stock of the company at a low figure and upon convenient terms, Elliott entered into a written agreement with Deibler and Streamer to that end on March 25, 1938.
Thereby, Elliott agreed to sell 828 shares of his stock to Deibler at $5 per share for a total of $4140 to be paid in installments of specified amounts at the end of each three-month period thereafter until paid in full. Deibler completed payment in full for his stock in January 1943. Elliott likewise agreed by the writing to sell to Streamer 552 shares of his stock at the same price ($5) per share for a total of $2760 to be paid for similarly in installments. Deibler and Streamer, on their part, severally agreed to pay Elliott the sums respectively owing for the stock which had a then actual value of $92.38 per share and is now worth $120 per share. The agreement further provided that the shares so sold ...