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G. H. MCSHANE CO. v. TRAVELERS INDEMNITY COMPANY (12/28/78)

decided: December 28, 1978.

G. H. MCSHANE CO., INC., A CORPORATION, APPELLANT,
v.
THE TRAVELERS INDEMNITY COMPANY, A CORPORATION, APPELLEE



Nos. 310 and 475 April Term, 1978, Appeal from an Order of the Court of Common Pleas of Allegheny County, Pennsylvania, Civil Division, entered September 30, 1977, and a Judgment of that court entered December 20, 1977, in Case No. G.D. 76-23714.

COUNSEL

James R. Sweeney, Pittsburgh, for appellant.

Edmund K. Trent, Pittsburgh, for appellee.

Jacobs, President Judge, and Hoffman, Cercone, Price, Van der Voort, Spaeth and Hester, JJ. Spaeth, J., files a concurring opinion, in which Price, J. joins. Hoffman, J., did not participate in the consideration or decision of this case.

Author: Hester

[ 262 Pa. Super. Page 81]

Before the court are consolidated appeals by J. H. McShane Co., Inc. (McShane); the appeal at No. 310 being from the order of the court below denying McShane's Motion for Judgment on the Pleadings; the appeal at No. 475 being from the order of the court below granting The Travelers Indemnity Company (Travelers) Motion for Judgment on the Pleadings.

The facts may be briefly summarized as follows:

On October 31, 1973, McShane, a Pennsylvania corporation engaged in business as an insurance agency, entered suit against Warren A. McFadden, a Florida resident, in the Court of Common Pleas of Allegheny County, Pennsylvania,

[ 262 Pa. Super. Page 82]

    at No. 1105 January Term, 1974 (the McFadden suit) to recover premiums allegedly totaling $30,784.00 on policies of insurance which McShane had placed for McFadden with various insurance carriers. The McFadden suit was instituted by the filing of a Praecipe with the prothonotary and obtaining and serving a Writ of Foreign Attachment on three garnishees in Pittsburgh, Pennsylvania, all in compliance with the then Pennsylvania Rules of Civil Procedure relating to actions in foreign attachments (Pa.R.C.P. 1251-1279). Shortly thereafter, McShane filed its Complaint in Foreign Attachment. On December 14, 1973, a general appearance was entered for McFadden and his Answer to Complaint in Foreign Attachment was filed on January 22, 1974.

In order to obtain the release of the property from the McShane attachment, McFadden on January 14, 1974 filed a bond in the penal amount of $61,568.00 with appellee, Travelers, as surety which bond (No. 295A5070) was executed and delivered that date by Travelers. Said surety bond titled "Undertaking on Release of Garnishment" provides that Travelers:

". . . does hereby, pursuant to the Statute in such case made and provided, undertake that the said defendant (McFadden) will, on demand, pay to the plaintiff the amount of any judgment which may be recovered in the action against the said defendant not exceeding the sum of SIXTY ONE THOUSAND FIVE HUNDRED SIXTY-EIGHT and 00/100 DOLLARS ($61,568.00)." (R.11 a).

Immediately after the Travelers' bond was filed with the court, the garnishments which had been obtained against rents due to McFadden were released, and the McFadden suit then continued as one in assumpsit, which suit was ultimately resolved when McShane obtained a consent judgment on September 17, 1976 against McFadden in the amount of $22,000.00. (R. 12a, 27a).

Despite demand by McShane, the $22,000.00 consent judgment was never paid by McFadden. Thereafter, McShane instituted the present action in the Court of Common Pleas

[ 262 Pa. Super. Page 83]

    of Allegheny County, Pennsylvania, Civil Division, at No. G.D. 76-23714 against Travelers as the surety on the attachment bond claiming $22,000.00 plus interest from the date of the consent judgment entered against McFadden (September 17, 1976). Travelers filed an Answer and New Matter on November 3, 1976 wherein specific "due process" and "equal protection" constitution issues were raised. Following McShane's reply ...


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