No. 1217 Pittsburgh, 1981, Appeal from a Final Decree in Equity entered in the Court of Common Pleas of Fayette County, No. 2967, Civil Division.
Thomas R. Wright, Pittsburgh, for appellant.
Charles W. Watson, Connellsville, for appellees.
Rowley, Beck and Montemuro, JJ. Beck, J., files a dissenting opinion.
[ 320 Pa. Super. Page 497]
This is an appeal from a final decree in equity entered by the trial court denying appellant's request for specific performance of a contract for the sale of shares of stock on the ground that the contract was not enforceable because the writings relied on by him to prove the contract do not satisfy the applicable statute of frauds, 13 Pa.C.S. § 8319.*fn1 We do not agree and, therefore, reverse and remand for proceedings not inconsistent with this opinion.*fn2
[ 320 Pa. Super. Page 498]
The facts are stipulated by the parties. Perryopolis Land Company, Inc. and Perryopolis Auto Auction, Inc. are two closely held Pennsylvania corporations which share a common group of stockholders. On January 10, 1977, a special stockholders' meeting of each corporation was held. At that meeting appellant, Leonard J. Pirilla, Jr., who owned 9.09% of the shares of stock in each corporation, offered to buy all of the outstanding shares of stock held by the remaining shareholders in both corporations for $525,000.00, plus a $15,000.00 commission to the Freeze Dorazio Agency, Inc. The minutes of the stockholders' meetings were recorded and reflect that all of the shareholders of both corporations were present in person or by proxy and that all of the shareholders voted to accept appellant's offer. The minutes of the two meetings likewise reflect that the officers of the two corporations were authorized by the shareholders to implement the sale of all of the shares of their stock in both corporations to appellant. Pursuant to the authorization given to the officers, a Letter of Intent was signed the next day by appellant and the officers of Perryopolis Land Company, Inc. and Perryopolis Auto Auction, Inc. which contained all the terms of the sale.*fn3 Subsequently, on January 20, 1977, appellant tendered a formal Stock Purchase Agreement to the other shareholders. The individual appellees, who own more than 63% of the stock of each corporation, refused to execute the Stock Purchase Agreement, and gave appellant written notice that they rejected "in total the proposed sales agreement previously delivered." At the next scheduled meetings of the two
[ 320 Pa. Super. Page 499]
corporations, the shareholders refused to ratify the minutes of the January 10, 1977 meetings and repudiated the sale.
Appellant instituted this action for specific performance, and the appellees raised the defense of the statute of frauds. The court below denied appellant's request for specific performance, finding that the statute of frauds rendered the contract unenforceable. This appeal followed.
In Sorokin v. Krasner, 289 Pa. Super. 324, 327, 433 A.2d 88, 89-90 (1981), our standard of review in equity cases was set forth as follows:
The scope of review of an appellate court in the consideration of an appeal from a final decree in an equity action is well established. A Chancellor's findings of fact, approved by the court en banc, are entitled to the weight of a jury's verdict and will not be reversed on appeal if supported by adequate evidence. See McDole v. Duquesne Brewing Co. of Pittsburgh, 281 Pa. Super. 78, 83, 421 A.2d 1155, 1158 (1980), and cases cited therein. The Chancellor's findings are afforded particular weight in cases in which the credibility of witnesses must be evaluated, as the Chancellor has had the opportunity to hear their actual testimony and to observe their demeanor on the witness stand. See Fascione v. Fascione, 272 Pa. Super. 530, 416 A.2d 1023 (1979). We should not reverse on appeal unless it is evident that the lower court abused its discretion, lacked evidentiary support for its findings, or was capricious in its disbelief of evidence submitted. See Davis v. Buckham, 280 Pa. Super. 106, 421 A.2d 427 (1980); Commonwealth ex rel. Powelson v. Powelson, 277 Pa. Super. 220, 222, 419 A.2d 741, 742 (1980). The same principles apply when a single judge, ...