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HARRY SCHREIBER v. REPUBLIC INTERMODAL CORPORATION AND LAZARD FRERES (07/08/77)

decided: July 8, 1977.

HARRY SCHREIBER, SCHREIBER TRANSPORT, INC., AND SULLIVAN LINES, INC., APPELLANTS,
v.
REPUBLIC INTERMODAL CORPORATION AND LAZARD FRERES, APPELLEES, AND UNION NATIONAL BANK OF PITTSBURGH, GARNISHEE. SULLIVAN LINES, INC., APPELLANT, V. DORIS LEASING COMPANY, INC., AND REPUBLIC INTERMODAL CORPORATION, APPELLEES, AND UNION NATIONAL BANK OF PITTSBURGH, GARNISHEE



COUNSEL

Judd N. Poffinberger, Jr., David H. Ehrenwerth, Daniel D. Dinur, Kirkpatrick, Lockhart, Johnson & Hutchinson, Marvin Schreiber, Schreiber & Schreiber, Pittsburgh, for appellants.

Marcus Aaron II, John P. Edgar, Berkman, Ruslander, Pohl Lieber & Engel, Pittsburgh, Michael T. Sullivan, Bartel, Engelman & Fishman, New York City, for Republic Intermodal Corporation, appellee.

M. Bruce McCullough, Buchanan, Ingersoll, Rodewald, Kyle & Buerger, Pittsburgh, for garnishee.

Jones, C. J., and Eagen, O'Brien, Roberts, Pomeroy and Manderino, JJ. Jones, former C. J., did not participate in the decision of this case. Nix, J., did not participate in the consideration or decision of this case.

Author: Roberts

[ 473 Pa. Page 616]

OPINION OF THE COURT

Appellants Harry Schreiber, Schreiber Transport, Inc. (Schreiber Transport), and Sullivan Lines, Inc. (Sullivan Lines), obtained writs of foreign attachment directing

[ 473 Pa. Page 617]

    the sheriff to sequester an irrevocable letter of credit in favor of appellee, Republic Intermodal Corporation (R.I.C.), held by Union National Bank (Union Bank) at its Pittsburgh office. On February 10, 1976, Judge Smith of the Court of Common Pleas of Allegheny County dissolved the two writs of attachment, holding that the procedures governing foreign attachment in Pennsylvania*fn1 violate constitutional due process. U.S. Const. amend. XIV.

The same day appellants presented to Judge Louik of the same court a petition for an order for a writ of foreign attachment conditioned upon following procedures which would meet the requirements of due process. Judge Louik refused to grant the petition. Appellants have appealed the orders of Judge Smith and Judge Louik. We affirm.*fn2

Appellants assert that Judge Smith erred in dissolving the attachments because he gave retroactive effect to Jonnet v. Dollar Savings Bank, 530 F.2d 1123 (3d Cir.1976), which declared Pennsylvania's Rules of Civil Procedure relating to writs of foreign attachment unconstitutional. Alternatively, they argue that Judge Louik

[ 473 Pa. Page 618]

    erred in refusing to issue an order for a writ of foreign attachment which would avoid the procedural flaws in the existing rules. We hold that: (1) Jonnet did not establish a new principle of law which might be given nonretrospective effect; and (2) in the absence of any statute or rules of court which satisfy constitutional standards, foreign attachment is not presently available in Pennsylvania. Therefore, Judge Smith properly dissolved appellants' writs of foreign attachment and Judge Louik properly denied their petition for the writ.

I

This dispute arises from a contract, entered into on August 15, 1975, by appellant Harry Schreiber, an individual and Pennsylvania resident, and appellee, R.I.C., a New York corporation not registered in Pennsylvania. Schreiber agreed to pay $1,465,000 for all the capital stock of R.I.C.'s wholly-owned subsidiary Sullivan Lines. Schreiber subsequently assigned his rights under the contract to Schreiber Transport, a Pennsylvania corporation.

At the closing, Schreiber paid $615,000 to R.I.C. with $550,000 of the balance secured by an irrevocable letter of credit in favor of R.I.C. The letter of credit was held by garnishee, Union Bank, at its Pittsburgh office.

After an audit, appellants alleged that R.I.C. had breached the contract. Appellants also alleged that R.I.C. was contemplating liquidation to defraud appellants. In September, 1975, appellants filed suit in New York against R.I.C., seeking rescission or reformation of the contract and damages. In October, 1975, the New York trial court enjoined R.I.C. from drawing upon the letter of credit, pending trial. After a two month trial, the court held that appellants were entitled to $42,124.00 in damages, but denied rescission ...


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