Appeal, No. 130, Jan. T., 1957, from judgment of Court of Common Pleas of Carbon County, Jan. T., 1954, No. 43, in case of E. McLain Watters v. Gregory De Milio. Judgment affirmed.
George M. D. Richards, for appellant.
C. L. Cushmore, Jr., with him W. Joseph Engler, for appellee.
Before Jones, C.j., Bell, Chidsey, Musmanno, Arnold, Jones and Cohen, JJ.
OPINION BY MR. CHIEF JUSTICE JONES
This appeal arises out of an action of assumpsit on a promissory note given by the defendant to the plaintiff's assignor. The case was tried to the court below without a jury. The court made extensive findings of fact and rendered a verdict for the plaintiff for the face amount of the note which, by its terms, was noninterest bearing. Exceptions by the defendant to the adjudication were dismissed and the judgment from which the defendant has appealed was entered on the verdict.
The note in suit was executed and delivered in the following circumstances. The defendant had made an offer by letter to the plaintiff, then the receiver under appointment by the Federal District Court of Anthracite Gas Co. and Mahanoy City Gas Co., and to the receiver's attorneys, for the purchase, on behalf of a corporation to be formed, of the assets and franchises of both companies. The offer was accepted by the receiver subject to the approval of the United States Court whose subsequent order of approval specifically made the sale subject to the approval of the Pennsylvania Public Utility Commission.
By an interchange of letters, the receiver and his two attorneys on the one part, and the defendant on the other, entered into an agreement whereby the receiver agreed to accept notes of the defendant or the corporation or corporations obtaining title to the properties administered by the receiver in amounts not exceeding a specified total sum. A note for that amount signed by the defendant and made payable to the receiver (which is the note presently in suit) was delivered by
letter from the defendant's attorney to one of the attorneys for the receiver upon the conditions recited therein. This letter of delivery was approved by a responding letter of the receiver's attorney. One of the conditions specified was that the offer by the defendant for the assets of the companies was to be without liability individually to the defendant. The defendant expressly engaged to deposit with the receiver collateral acceptable to the latter to the full amount of the purchase price as security for an undertaking, inter alia, to pay the full purchase price upon approval of the sale by the Public Utility Commission. While the note hereinabove referred to was originally given as a part of such collateral, it later became part payment of the purchase price and in the final settlement of the receiver's account in the United States District Court the note became the individual property of the receiver by virtue of the order of distribution to creditors of the companies entered by the United States Court.
The appellant bases his defense to the note principally on the Act of April 8, 1861, P.L. 259, as amended, 15 PS § 571, which provides, inter alia, that purchasers of a "gas ... company ... under and by virtue of any process or decree of any court ... of the United States ... shall be and they are hereby constituted a body politic and corporate ... with all the rights, powers, immunities, privileges, and franchises of the corporations [so purchased] ... and with all the rights, powers, immunities, privileges, and franchises granted to or conferred by acts now existing upon corporations of a similar kind ..." Thus, it is the appellant's contention that, inasmuch as he purchased ...