Appeal, No. 407, Oct. T., 1959, from orders of Court of Common Pleas of Chester County, July T., 1959, No. 2, in case of Adele Umani v. Lester W. Reber. Orders affirmed.
G. Clinton Fogwell, Jr., with him Robert W. Lentz, and Reilly, Wood & Fogwell, for appellant.
William A. Welsh, with him Thomas R. Butler, for appellee.
Before Rhodes, P.j., Gunther, Wright, Woodside, Ervin, and Watkins, JJ. (hirt, J., absent).
[ 191 Pa. Super. Page 187]
This was originally a suit in equity whereby Lester W. Reber, plaintiff, sought to recover two certified checks deposited by Adele Umani with William E. Parke, Esquire, defendant, attorney for Joseph and Adele Umani. After the testimony had been given all parties stipulated that the action be transferred to the law side of the court as an interpleader action and tried by the court, without a jury, on the basis of the testimony taken in the equity case. The court below rendered judgment in favor of Reber and against Adele Umani. Adele Umani then appealed.
A summary of the facts revealed at the trial is as follows: On December 15, 1954 the Umanis, owners of a hotel in Media, Pennsylvania, entered into a written lease with Reber for the hotel. The lease provided for $500.00 rent per month, plus the deposit in escrow of a $10,000.00 judgment note to guarantee payment of all bills and to cover any damages to the hotel during the Reber tenancy. The lease contained no provision for the transfer of the hotel liquor license but later the Umanis transferred the hotel liquor license to Reber. During the summer of 1955 Reber and the Umanis made another oral agreement which modified certain terms of the written lease; the rent was to be reduced by $100.00 during certain months of the year and $150.00 during other months; the $10,000.00 judgment note which had been placed in escrow was to be exchanged for a deposit of $5,000.00; Reber agreed that he would return the liquor license to the Umanis upon the termination of the lease. The rent was reduced and the $10,000.00 note was exchanged for a $5,000.00 cash deposit held by Parke. Thereafter differences arose between the parties and Reber threatened to surrender the liquor license for cancellation unless the Umanis reimbursed him for money he lost in the operation
[ 191 Pa. Super. Page 188]
of the hotel. Reber asserted that the losses were due to misrepresentations made by the Umanis to him about the money revenue from the operation of the hotel under the Umanis. William E. Parke, who was the attorney for the Umanis during all of these times, testified as follows: "There were a number of discussions that had to do with Reber's losses in the conduct of the business. All of the discussions preceded the bringing of those checks into my office. Reber set the price of his losses at $5000, and it was the sum that he demanded for a transfer of his license because the license had originally been transferred to Reber's name. I don't know how long before those checks were actually brought to my office that Reber began talking about some compensation to him for his losses; that it was some little time. Q. Did he indicate to you the basis upon which he sought compensation for his losses? A. Yes. He indicated to me that it was the amount of money that he had lost in operating the hotel. He at many times, both at the establishment - I am speaking of the Hotel Media - and once at least in my office, he had accused Umani, that is, Joseph Umani, of giving him false information about the previous money revenue, the income from the operation of the hotel under Umani's operation. He claimed that those false statements had led him into a bad bargain and that his losses - I think he used a different figure; I think it was in excess of $5000. At any rate, $5000 was the figure he claimed as the price for a transfer." On March 15 or 16, 1956 "two certified checks, one drawn by the aforesaid Adele Umani to Lester W. Reber, Plaintiff, and one endorsed by said Adele Umani to the said Lester W. Reber, were deposited by Adele Umani with William E. Parke, Esquire, Defendant, as escrow agent, in the total amount of $5000, and Defendant agreed with her and with the Plaintiff to hold said checks in escrow and to deliver the
[ 191 Pa. Super. Page 189]
same to the Plaintiff upon the approval of the transfer by the Pennsylvania Liquor Control Board."
By letter dated March 21, 1956 Reber forwarded the liquor license to the Liquor Control Board "for safe-keeping pending action on an application for transfer which is being submitted." On March 22, 1956 Reber and the Umanis entered into a written agreement covering the termination of the lease of December 15, 1954, and, among other provisions, this agreement contained a clause designated Paragraph 6, in which Reber agreed to execute an application for the transfer of the liquor license to the Umanis and to perform certain other acts in connection with the liquor license and with the liquor on the premises. On the same day Mr. Parke wrote a letter to Reber, stating: "It is understood and agreed that the checks I hold in connection with the transfer of the liquor license will be delivered upon approval of the transfer by the Pennsylvania Liquor Control Board." On April 4, 1956 Mr. Parke forwarded to the Liquor Control Board the application of Mrs. Umani for the transfer of the liquor license to her. On June 5 the transfer was approved by the board and the license was forwarded to Mrs. Umani. Almost immediately Mrs. Umani directed Mr. Parke not to deliver the checks he was holding to Mr. Reber. Reber promptly made demand upon Mr. Parke for them and Mr. Parke refused to deliver them. On July 13, 1956 Reber instituted an action in equity against Mr. Parke for the return of ...