No. 119 E.D. Appeal Dkt. 1983, Appeal from the order of Superior Court of Pennsylvania Nos. 2849, 2850; Philadelphia, 1982, dated May 20, 1982, Affirming and Vacating the Order of the Court of Common Pleas of Philadelphia, Civil Division, Nos. 1688 Nov. Erm, 1981, and 3394 June Term, 1980, Pa. Superior Court ,
Nix, C.j., and Flaherty, McDermott, Hutchinson and Zappala, JJ. Nix, C.j., files a concurring opinion. McDermott, J., concurs in the result. Larsen and Papadakos, JJ., did not participate in the consideration or decision of this matter.
Before us are cross appeals from an order of Superior Court. 314 Pa. Super. 347, 460 A.2d 1174. They arise out of the tangled affairs of four law firms, which quickly succeeded each other as different partners of the initial firm serially withdrew. Each firm was apparently founded on oral agreements among the changing partners.
Superior Court affirmed a Philadelphia Common Pleas order*fn1 directing the escrow agent selected by agreement,*fn2 the court appointed Conservator and the five former partners of Marvin J. Levin to certify as to the receipt of funds, fees, overhead and return of costs from these partnerships. However, Superior Court vacated that portion of the order directing the agreed to escrow agent, Howard J. Creskoff,*fn3
and former partner, Robert C. Daniels, to separately escrow for Marvin J. Levin, a percentage of the funds they receive under the Common Pleas order set forth below.
Superior Court construed that part of the order requiring the creation of these escrow accounts as analogous to an order for a mandatory injunction under Pa.R.C.P. 1531. That rule expressly requires the filing of a bond by a non-governmental plaintiff seeking a preliminary or special injunction. Pa.R.C.P. 1531(b). Superior Court thus held that the lower court had erred in directing the deposit in the "Marvin J. Levin Escrow Account" of 10% of the funds received by the escrow agent, Howard J. Creskoff,*fn4 without the posting of a bond by Levin. Superior Court applied the same reasoning to the Common Pleas order requiring former partner, Robert C. Daniels, to set aside 5% of the funds he receives on files or matters formerly handled by Adler, Barish, Daniels, Levin and Creskoff in a second "Marvin J. Levin Escrow Account". Common Pleas had directed the establishment of these escrow funds as a means of securing the status quo among Marvin Levin and all his former partners,*fn5 until the rights of the parties, inter se, had been adjudicated.*fn6
We now affirm Superior Court's judgment upholding that part of the Common Pleas order which directed certification of the accounts to Marvin Levin, but reverse that portion of its mandate vacating the order to escrow a percentage of the various successor firms' fees, funds, overhead and return of costs, pending a final settlement among all members
of the original or successor firms, including Marvin Levin.
The facts underlying these two appeals are chronologically as follows: In 1976, six lawyers formed the partnership of Barish, Adler, Daniels, Levin and Creskoff.*fn7 This firm was terminated on May 31, 1980 when Robert C. Daniels left it. Daniels filed a complaint in equity in June of 1980 asking for the appointment of a receiver, an accounting and apportionment of assets. In July, he filed a petition for the appointment of a special judge and impoundment of the record. By order of the President Judge of the Philadelphia Court of Common Pleas, Judge Edwin S. Malmed was assigned Daniels's case. He issued orders impounding the record and providing for: (a) an inventory, (b) distribution of certain assets, (c) establishment of a custodial account for all fees under the joint control of the various counsel for the parties and (d) designation of a C.P.A. to prepare and submit an account of the firm's operations from February 29, 1976 through May 31, 1980.
In March of 1981, Marvin J. Levin notified his four partners in the successor firm of Barish, Adler, Levin and Creskoff of his withdrawal, resulting in termination of the firm as then constituted. That withdrawal and termination was effective March 31, 1981. On November 12th of that year, Marvin Levin filed his complaint in equity claiming that he had been wrongfully excluded from his proportionate partnership interest in the assets of the several firms. In his prayer for relief he sought appointment of a receiver, an accounting of the assets, and other equitable relief. At this point Marvin Levin and Robert Daniels were both seeking similar equitable relief in their separate actions.
In December of 1981, Robert C. Daniels filed a petition for a Rule to Show Cause why a receiver should not be
appointed in his action against the partners initially remaining in Barish, Adler, Daniels, Levin and Creskoff, including Marvin J. Levin. The remaining partners*fn8 were then also engaged in yet a third termination dispute among themselves. After several conferences in January among the court and all parties, the three cases were consolidated and Judge Malmed issued an order on February 22, 1982 appointing Morris M. Shuster temporary receiver of the property, assets, business and affairs of all the several firms.*fn9 That order specified that "counsel for all parties have also agreed that no bond or security is required." This appointment was rescinded on May 25, 1982, after the court approved the settlement negotiated among all the parties, with the exception of Marvin Levin. In accordance with that settlement, Howard J. Creskoff, one of the ex-partners, was named escrow agent for the funds in dispute among Avram G. Adler, Marvin I. Barish, Arnold Levin and Howard J. Creskoff. The court's order of May 25, 1982 approving the settlement agreements specifically noted: "Nothing in any of the described Agreements or in this Order shall in any way affect such claims or obligations as may be held or due from Marvin J. Levin and all proceedings are without prejudice to such rights as he may have." This escrow arrangement has not been challenged by the parties to these appeals although it serves as the foundation on which the two challenged escrow accounts were subsequently created.
After a further conference among the ex-partners, the court issued another order on September 22, 1982. This is the order which precipitated the appeals now before us. It directs that all future receipts from files and matters ...