No. 292 Philadelphia 1982, Appeal from the Order of the Court of Common Pleas, Civil Division, Montgomery County, No. 78-07760.
Sidney M. Deangelis, Norristown, for appellants.
Richard S. Watt, Norristown, for appellee.
Cercone, President Judge, and Johnson and Montemuro, JJ. Cercone, J., concurs in the result.
[ 320 Pa. Super. Page 12]
This is an appeal from an Order of the Court of Common Pleas, Montgomery County, granting a motion for judgment on the pleadings on the ground of res judicata.*fn1
The facts and procedural history of this case are set forth as follows. Prior to July 28, 1969, the appellant, Daniel B. Brandschain, and one Robin Tiesler,*fn2 had purchased some
[ 320 Pa. Super. Page 13]
four hundred eighty-three (483) acres of land in Wyoming County, Pennsylvania and formed a company called The Miller Mountain Development Company (hereinafter "Company"). Thereafter, appellant, Tiesler, and appellee, Fred Lieberman, entered into an agreement whereby the acreage of the Company would be transferred to a corporation known as The Miller Mountain Corporation (hereinafter, "Corporation") of which appellee would own seventy-five per cent (75%) of the equity stock and fifty per cent (50%) of the voting stock. A Shareholders Agreement encompassing these and other provisions was entered into on July 28, 1969.
Pursuant to this Agreement, appellee advanced the sum of $452,624.00 to the Corporation for the acquisition of land, engineering fees, economic surveys and the like. Subsequent to the advancement of these funds, appellee requested that the shareholders elect to qualify the Corporation as a sub-chapter "S" Corporation so that he, appellee, could deduct his advances as losses on his personal income tax return. The parties agreed to this and appellant, as Vice President of the Corporation, signed thirty-eight demand notes to the Order of appellee. On December 6, 1972, the appellee instituted an action in assumpsit against the Corporation seeking to recover on the demand notes and sought a judgment against the Corporation for the sum of $452,625.00, the amount of his advances. Appellant and Tiesler intervened in the action and filed an Answer, New Matter and Counterclaim alleging that appellee obtained the notes through fraud and deceit and that the notes were merely evidence of debt without independent legal significance. The appellant also alleged that the appellee breeched the terms of the July 28, 1969 agreement which set forth that appellee would provide the Corporation with 2.5 million dollars for land acquisition and would make available to the Corporation his credit line at Fidelity Bank of eight (8) million dollars. Appellant and Tiesler also claimed that appellee had denied them access to the Corporation books and records and that appellee sought to gain control of the
[ 320 Pa. Super. Page 14]
Corporation by threatening that he would not provide the Corporation with funds to pursue its business affairs unless he was granted control.
The assumpsit action proceeded to trial before the Honorable William W. Vogel and a jury. Upon an agreement signed by counsel for the parties and by the court, the jury was directed to return a verdict in favor of the appellee for the sum of $724,457.90. After a correction in the computation of interest, the verdict was molded and reduced to $632,843.84 by Order of the court dated March 21, 1978. Judgment was entered on the same day. ...