Appeal from decree of Court of Common Pleas of Montgomery County, No. 70-11912, in case of Anna C. Meara, administratrix d.b.n.c.t.a. of the estate of William G. Meara, deceased v. Robert A. Hewitt and Mary I. Hewitt, his wife, Prince George Inn, Incorporated and H. Lyle Houpt.
Norman M. Wilson, Jr., with him Duffy, North, Duffy & Wilson, for appellant.
William H. Kinkead, III, and Wright, Spencer, Manning & Sagendorph, for Robert A. Hewitt and Mary I. Hewitt, appellees.
John F. Christie, III, with him Samuel H. High, Jr., and High, Swartz, Roberts & Seidel, for Prince George Inn, Incorporated and H. Lyle Houpt, appellees.
Eagen, O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Opinion by Mr. Justice O'Brien. Mr. Chief Justice Jones took no part in the consideration or decision of this case.
This appeal arises from a decree in equity which denied appellant, Anna C. Meara, Administratrix d.b.n.c.t.a. of the Estate of William G. Meara, Deceased, the relief she sought against appellees, Robert A. Hewitt and Mary I. Hewitt, his wife, Prince George
Inn, Incorporated, and H. Lyle Houpt. Appellant sought the cancellation of a certain mortgage executed by the decedent in favor of Prince George Inn, Incorporated, a Pennsylvania corporation, owned by appellee H. Lyle Houpt. The mortgage was subsequently assigned to appellees Robert A. Hewitt and Mary I. Hewitt (the Hewitts). The case was heard by a chancellor on January 14, 1972, who combined the within action with an action to quiet title, filed by the decedent's heir, Frederick A. Patrick, and an action in mortgage foreclosure filed by the Hewitts. The actions were combined due to the fact that all of the actions turned on the common legal question of whether the mortgage executed by the decedent was valid. After a hearing, the chancellor entered a decree nisi denying the relief sought by appellant, exceptions were taken and denied, and a final decree was entered. This appeal followed.
On April 1, 1968, the deceased, an employee of the corporation and a legal client of Houpt, a former attorney, executed a mortgage on the real estate he owned in Horsham Township, Montgomery County, to the corporation, as mortgagee, in the face amount of $50,000. The mortgage was given in exchange for a $50,000 judgment note of the corporation which was subsequently to be exchanged for stock representing a twenty-five percent interest in the corporation.
The decedent died on April 17, 1968, and Houpt was appointed executor of the decedent's estate, pursuant to the provisions of decedent's will.*fn1 On June 21, 1968, the corporation, by Houpt, its president and sole stockholder, assigned the Meara mortgage to the Hewitts, for a stated consideration of $100. In March of 1970, the mortgagee corporation became insolvent.
The estate argues that the mortgage in question is unenforceable against it because Houpt, while acting as attorney for the decedent, took advantage of the attorney-client relationship when he allowed the decedent to enter into a mortgage in favor of a corporation of which Houpt was the sole owner, and ...