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STULL v. BELLEFONTE STONE PRODUCTS CORPORATION (ET AL. (12/16/64)

decided: December 16, 1964.

STULL
v.
BELLEFONTE STONE PRODUCTS CORPORATION (ET AL., APPELLANTS)



Appeal from judgment of Court of Common Pleas of Allegheny County, July T., 1954, No. 820, in case of Harold R. Stull v. Bellefonte Stone Products Corporation et al.

COUNSEL

Loyal H. Gregg, with him White, Jones and Gregg, for appellants.

Robert E. Mertz, with him David B. Buerger, and Buchanan, Ingersoll, Rodewald, Kyle & Buerger, for appellee.

Ervin, Wright, Woodside, Watkins, Montgomery, and Flood, JJ. (Rhodes, P. J., absent). Opinion by Ervin, J. Dissenting Opinion by Montgomery, J. Wright, J., joins in this dissent.

Author: Ervin

[ 205 Pa. Super. Page 41]

This appeal is concerned with the right of a president of a corporation to recover unpaid salary from stockholders of the corporation. The court below, by its order, entered judgment for Harold R. Stull, president of Bellefonte Stone Products Corporation, against the defendants, E. R. Scheuner and Joseph Mills, two stockholders of the corporation, in the respective amounts of $2,574.00 and $3,332.00, with interest, for unpaid salary due to Stull as president of the corporation. The two stockholders have appealed.

The Act of May 5, 1933, P. L. 364, 15 PS § 2852-514, provides: "A. A shareholder of a business corporation shall not be personally liable for any debt or liability of the corporation, except salaries and wages due and owing to its laborers and employes, for services rendered to the corporation. In such event, every shareholder shall be personally liable in an amount equal to the value of the shares of the corporation owned by him. . . ."

The appellants argue that the above provision does not "apply to the chief executive officer who has complete control of the corporation."

The Act of June 25, 1864, P. L. 947, § 7, provided for individual liability of the stockholders "for debts

[ 205 Pa. Super. Page 42]

    due mechanics, workmen and laborers employed" by the company. By the Act of April 29, 1874, P. L. 73, § 14, the liability of shareholders was limited to "all work or labor done . . . to carry on the operations of each of said corporations." Section 514 of the Business Corporation Law of 1933, above quoted, enlarged the language theretofore used by the use of the phrase " salaries and wages due and owing to its laborers and employes." (Emphasis supplied) The word "wages" is commonly used with reference to pay of laborers and workmen, whereas the word "salary" may be used with reference to the pay of any employe, no matter how big his position or how large his pay. We are of the opinion that the legislature intended, by the 1933 law, to include any employe of the company, whether he be president or common laborer.*fn1

While the 1933 act does not expressly include officers, we believe their inclusion is implicit from the words "salaries" and "employes." Construing the words in their popular sense, the inference to be made is that salaried employes include officers of the corporation.

The 1904 Quebec case of Fee v. Turner, 13 B.R. 435, is not in point because the section involved covered only "clerks, laborers, servants and apprentices." The New York cases of Bristor v. Smith, 158 N.Y. 157, 53 N.E. 42, and Harris v. Lederfine, 196 Misc. 410, 92 N.Y.S. 2d 645 (N.Y. S. Ct. 1949), are ...


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