Raymond Pearlstine, Cassin Craig, Wisler, Pearlstine, Talone & Gerber, Norristown, for appellants.
Moe Henry Hankin, Benjamin R. Shanken, Hankin, Hankin & Shanken, Willow Grove, for appellee.
Before Rhodes, P. J., and Hirt, Reno, Ross, Gunther and Wright, JJ.
[ 175 Pa. Super. Page 38]
This is an action in equity to set aside a conveyance alleged to be fraudulent. The chancellor decreed the conveyance to be a fraud on the plaintiff and authorized a lien to be entered against the property. Both defendants have appealed.
On August 19, 1949, the plaintiff, a contractor, made a written contract with the defendant, Melvin H. Koff, to repair the Glenside Theatre, then owned by Koff. In January, 1951, plaintiff sued Koff in assumpsit for the balance due on the contract, and obtained a default judgment for $1,968.80. When a levy was made on the theatre premises, the defendant, Glenside Theatre Corporation, filed a property claim averring it had title. This suit followed.
The evidence disclosed the following facts. On September 20, 1949, a few weeks after the contract was signed, the Glenside Theatre Corporation was formed. On September 29, 1949, Koff conveyed the theatre premises to the Corporation and received therefor all the issued stock, which he thereupon assigned as collateral to his brother-in-law, Harry Waxman, who was
[ 175 Pa. Super. Page 39]
advancing money for the repairs. At the same time, Koff procured a $75,000 mortgage on the premises, which was subsequently assigned to Waxman and assumed by the corporation. Koff's only other property at the time of the conveyance was a one-quarter interest in a piece of real estate in Delaware County and a one-quarter interest in the stock of another theatre, also in Delaware County. He had no personal bank account and his automobile was in his wife's name.
The chancellor based his decree on § 7 of the Uniform Fraudulent Conveyance Act, May 21, 1921, P.L. 1045, 39 P.S. § 357, which reads 'Every conveyance made * * * with actual intent, as distinguished from intent presumed in law, to hinder, delay, or defraud either present of future creditors, is fraudulent * * *.'
The defendants raise three objections to this decree. First they maintain that plaintiff's complaint alleged only a violation of § 4 of the Uniform Fraudulent Conveyance Act, and not of § 7, and that proof was limited to § 4. That section of the Act, 39 P.S. § 354, refers to conveyances without a fair consideration by an insolvent or which will render one insolvent, regardless of actual intent. The chancellor specifically negatived proof of a cause of action under § 4 by finding that the conveyance was for a fair consideration and did not render Koff insolvent.
Statutes need not be specifically pleaded, but the complaint must set forth sufficient facts to bring the case within the statute in question. Goldberg v. Friedrich, 279 Pa. 572, 124 A. 186. The complaint in this case alleged 'That the defendant, Glenside Theatre Corporation, paid no fair consideration therefor and the purchaser knew at the aforesaid time that the defendant, Melvin H. Koff, made the conveyance to ...