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June 29, 1959

John A. WELKER, individually and trading as Supreme Motor Freight, and Margie Welker

The opinion of the court was delivered by: DUSEN

I. History of the Case

On May 4, 1954, plaintiff filed a complaint against defendants John and Margie Welker, husband and wife, alleging that he had given $ 12,500 to John Welker, trading as Supreme Motor Freight, in September of 1953 as his share of the purchase price of such defendant's business, with the understanding that if plaintiff's co-purchaser, Robert Holland, did not pay his share of $ 12,500 within a reasonable time, the agreement of sale which was signed at the time of the delivery of the above-mentioned $ 12,500 would be destroyed and the plaintiff's $ 12,500 would be returned to him. The complaint alleged further that John Welker wrongfully used the above-mentioned sum to pay off certain of his debts which had been secured by chattel mortgages on automobile trucks and, after releasing these trucks from the lien of the mortgages by such payments, had these trucks transferred into ths name of his wife, Margie Welker, and also had valuable hauling contracts executed in her name to hinder, delay and defraud creditors. Defendants filed an answer, including a counterclaim, to the complaint in June 1954. In October 1954, plaintiff filed a petition (Document No. 6) for (1) a receiver of the assets in the possession of Margie Welker and belonging to her husband and (2) a preliminary injunction restraining Margie Welker from interfering with the assets of her husband, as well as directing her to account for and turn over to the receiver all assets of her husband's trucking business which she had received. As a settlement of the issues created by this petition, a letter stipulation dated November 15, 1954, was signed by counsel for the parties and by Margie Welker. This stipulation (Document No. 14) provided as follows:

 'This letter is intended to confirm the arrangements which we made this morning in Judge Kirkpatrick's chambers.

 'It is our agreement that in the event we obtain a judgment against John Welker, in the above entitled matter, the assets transferred to Margie Welker by John A. Welker, trading as Supreme Motor Freight, and the business conducted by her with the said assets, shall be liable for the payment of the said judgment with the same force and effect as though the judgment had been rendered against her personally.

 'This Stipulation is in addition to and not in lieu of any other rights which the plaintiff may have against Margie Welker, asserted in the proceedings.

 'The original of this letter, when signed by you and Mr. Bennett as counsel for Margie Welker and approved by Margie Welker, is to be filed in the United States District Court as a Stipulation.'

 The case was tried to a jury in January 1957. The verdict was in favor of the plaintiff in the amount of $ 12,500, with interest, on the complaint and also in favor of the plaintiff as defendant on the counterclaim. On January 23, 1957, judgment was entered on the verdict in favor of plaintiff and against John Welker in the amount of $ 15,013.10 (being $ 12,500 and interest of $ 2,513.10, computed at 6% from September 23, 1953, to January 23, 1957).

 In this case, to determine the liability of Margie Welker, *fn1" post-trial depositions have been taken by the parties to determine the value of the assets transferred to her by her husband so that an appropriate judgment may be entered under the terms of the above stipulation. At a conference held with the hearing judge on November 4, 1958, it was agreed by counsel for both parties that the hearing judge was to determine 'the liability of Margie Welker * * * on the basis of the record * * * in accordance with' the above-mentioned stipulation (see first sentence of last paragraph of Document No. 23). Requests for Findings of Fact and Conclusions of Law were filed in the winter of 1959; supplementary letters, with authorities, were received in 1959 on or about January 5, March 31, April 16, and April 20; and oral argument was heard on March 30, 1959.

 II. Findings of Fact

 The hearing judge makes the following Findings of Fact:

 1. John Welker, prior to February 1954, was the owner of a motor trucking business known as Supreme Motor Freight, operating such business as a common carrier subject to the regulations of the Interstate Commerce Commission.

 2. For several years prior to February 1954, while he was operating his business, John Welker had a successful business relationship with a company known as Hammond Iron Works, from which he received for his hauling services in 1953 $ 28,940.73, and for the first five weeks in 1954 $ 3,823.21.

 3. Margie Welker, John Welker's wife, actively assisted her husband in his business from about the middle of 1951 to February 1954 by supervising the bookkeeping, drawing and depositing checks, and generally participating in the operations of the company. She had knowledge of the negotiations and arrangements with Louis Winter and Robert Holland for the purchase of the business, as well as that plaintiff demanded in 1953 or 1954 repayment of his advance of $ 12,500.

 4. Prior to her participation in the business of Supreme Motor Freight, Margie Welker had no experience or special skill in the trucking business.

 5. On or about February 1, 1954, Margie Welker entered into the trucking business under the name M. Welker Truck Leasing, operating such business by renting trucks, without drivers, on a ton per mile basis, without restriction as to points of travel.

 6. M. Welker Truck Leasing was located on the same premises (203 Bridgewater Road, Croyden, Pa.), and listed under the same telephone, as Supreme Motor Freight.

 7. On February 1, 1954, M. Welker Truck Leasing entered into a contract with Hammond Iron Works, which was its first and, throughout its operation, its biggest customer.

 8. This contract was renewed by the parties under substantially the same terms in 1955 and 1956.

 9. On February 1, 1954, Supreme Motor Freight ceased doing business with Hammond Iron Works.

 10. On or about February 1, 1954, Supreme Motor Freight transferred to M. Welker Truck Leasing, through certain finance companies and banks acting on the request of Supreme Motor Freight, three Brockway Tracter Trucks Freight, three Brockway Tractor Trucks

 11. These six pieces of equipment were the first pieces of equipment owned by M. Welker Truck Leasing and were essential to its entering into the contract with Hammond Iron Works.

 12. By the end of 1954, and throughout its operation, M. Welker Truck Leasing possessed other pieces of equipment with which it carried out its business.

 13. The willingness of Hammond Iron Works to enter into a business relationship with M. Welker Truck Leasing was the result of Hammond's satisfactory business relationship with John Welker.

 14. The value to M. Welker Truck Leasing of its relationship with Hammond Iron Works was the result of the efforts of John Welker.

 15. The benefits received by M. Welker Truck Leasing through its relationship with Hammond Iron Works totaled $ 145,646.85, of which $ 70,920.93 was received in 1954, $ 57,238.67 in 1955, and $ 17,487.25 in 1956.

 16. The net profit realized by M. Welker Truck Leasing was $ 14,725.82 in 1954, $ 8,342.32 in 1955, and $ 2,487.41 in 1956. 17. The value of the six pieces of equipment, at the time they were received by M. Welker Truck Leasing in February 1954 From Supreme Motor Freight totaled $ 11,779.97, itemized as follows: 1945 Brockway Tractor (#30) $ 300.00 1951 Brockway Tractor (#34) 3,592.70 1951 Brockway Tractor (#36) 3,973.77 1951 Dorsey Trailer (#33) 1,092.50 1952 Dorsey Trailer (#35) 1,410.50 1952 Dorsey Trailer (#37) 1,410.50 Total $11,779.97


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