No. 1737 October Term, 1977, Appeal from Order dissolving writs of Execution, dated May 6, 1977, Court of Common Pleas, Trial Division, Equity, Philadelphia, at No. 1884, March Term, 1967.
Bernard J. Smolens, Philadelphia, with him Dennis R. Suplee, Philadelphia, for appellant.
No appearance entered nor brief submitted for appellee, Monaco.
Dudley Hughes, Philadelphia, for appellee, Continental Cas. Co.
Richard W. Hopkins, Philadelphia, for appellee, Ins. Co. of North America.
Watkins, President Judge, and Jacobs, Hoffman, Cercone, Price, Van der Voort and Spaeth, JJ. Watkins, former President Judge, did not participate in the consideration or decision of this case. The decision in this case was made prior to the retirement of Hoffman, J.
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Appellant contends that the lower court erred in dissolving appellant's writs of execution against appellee insurers because appellees breached their duty to defend the insured.*fn1 We disagree and, therefore, affirm the lower court.
This appeal arises from a garnishment proceeding in which appellant, Seaboard Industries, Inc. ("Seaboard"), a judgment creditor of Albert B. Monaco, caused writs of execution in attachment to be issued and named as garnishees Continental Casualty Company ("Continental") and Insurance Company of North America ("I.N.A."), appellees in the instant case. The complex factual background giving rise to the instant attachment proceedings is summarized in Seaboard Industries, Inc. v. Monaco, 442 Pa. 256, 276 A.2d 305 (1971):
". . . Seaboard Industries, Inc. is a closely held Pennsylvania corporation. . . . Albert B. Monaco, served as
[ 258 Pa. Super. Page 173]
the Secretary of Seaboard from June 1963, until February 12, 1964, and was retained as legal counsel for Seaboard from its incorporation in September, 1962, until June, 1965.
"On May 25, 1963, Seaboard entered into a written assignment of lease agreement whereby Seaboard acquired the rights to mine, reclaim and remove coal from certain deposits owned by the Blue Ridge Real Estate Company. Thereafter, in September Seaboard and Blue Ridge entered into a lease directly between themselves under which Seaboard was entitled to the same rights, and was to pay Blue Ridge a royalty of 35 cents a ton. The lease was predated May 27, 1963, and was to run for ten years.
"Seaboard commenced to reclaim and mine the coal in June, 1963. At that time, John D. Howley was the president. He continued in office until July, 1963, when Walter F. Joachim assumed control and management of Seaboard. Prior to Joachim's becoming president and treasurer, Seaboard's operations had been profitable.
"On November 19, 1963, Joachim met with Blue Ridge and stated that the installation of a coal preparation plant at the deposit site was necessary to render the mining and reclamation operation profitable. He also said that a proposal would be submitted to Blue Ridge involving the anticipated change in operations either on the basis of a new royalty fee or else the outright purchase of the coal deposits by Joachim.
"Later the same day, a Seaboard shareholders' meeting was held. Although Joachim advised those present that he had been in contact with two of the larger coal producers in the eastern United States, Pagnotti Coal Interests, Inc. and Correale Mining Company, concerning the possibility of erecting a coal processing plant on the land where Seaboard was mining, he made no mention of the negotiations earlier in the day with Blue Ridge. Monaco attended the meeting and, as he had assumed the office of Secretary of the corporation, recorded the minutes. The three other ...