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filed: October 20, 1986.


Appeal from the Order entered August 20, 1985 in the Washington County Court of Common Pleas, No. 7366, Equity Book 43, Page 247.


J. Shane Creamer, Philadelphia, for appellant.

Ira S. Lefton, Pittsburgh, for appellees.

Brosky, Kelly and Roberts, JJ.

Author: Kelly

[ 358 Pa. Super. Page 54]

This appeal arises from a dispute between the appellant, Century Inn, Inc. ("Century Inn"), and appellees, Century Inn Realty, Inc., Joan Bigelow, Nancy Scheirer, and Robert Scheirer ("Century Realty"). On February 7, 1978, Century Inn brought an action in equity seeking, inter alia, to enjoin Century Realty from interfering with the operation of the restaurant known as Century Inn. The case was called for trial on July 10, 1979.*fn1 On that date, the parties were able to negotiate a settlement agreement. The terms of the somewhat complex agreement, which involved the conveyance of property interests and the issuance of a mortgage, were placed upon the record in open court. In the months and years that followed, the parties attempted unsuccessfully, with the assistance of the court, to draft the terms of the documents necessary for carrying out the agreement which had been reached. Finally, when almost seven years had elapsed from the date of the stipulation,

[ 358 Pa. Super. Page 55]

    the court directed the parties to prepare a set of documents which would be acceptable to each of them. This was done, and after reviewing the documents, the court below prepared its own documents, "attempting to retain as much as possible the language of the respective parties . . . ." The court then made two sets of changes to the documents, based upon the comments and exceptions of the parties, and prepared a final draft of the documents. On August 20, 1985, the court ordered the parties to appear on September 27, 1985 for the purpose of executing the documents. Century Inn appealed this order.*fn2 Because we conclude that the court below erred in ordering Century Inn to execute documents which varied from the terms of the earlier settlement agreement, we vacate the order of the court below and remand for further proceedings.

In order to fully understand the issue which is raised in this appeal, it is necessary to review the tangled facts underlying the parties' dispute. As determined by the court below, the three real parties in interest in this sordid family disagreement are Gordon Harrington, Joan Bigelow and Nancy Scheirer. Gordon, Bigelow and Scheirer are the three children of Mary Harrington. Century Inn was incorporated by Mary Harrington*fn3 in 1970. Mary Harrington owned certain real property, which she began leasing to Century Inn in April, 1970. Century Inn operated a restaurant on the premises. In 1976, Mary Harrington formed a second corporation, Century Realty. Mary Harrington was the sole shareholder, sole director, and secretary-treasurer of Realty; she elected her son, Gordon Harrington, as president.

Mrs. Harrington transferred the real estate which she owned and which had been leased to Century Inn to Realty. Realty ratified the lease, so that the property continued to

[ 358 Pa. Super. Page 56]

    be leased to Century Inn for its restaurant business. In December 1976, Mrs. Harrington transferred 39,000 shares of the 100,000 shares of Realty to her children in equal parts of 13,000 each; she retained 61,000 shares.

Mrs. Harrington died in June, 1977. At the time of her death, she also held the majority of the shares of Century Inn stock; each of the three children held 2,000 of the shares, with Mary Harrington holding 9,000 shares. The situation which arose with the death of Mrs. Harrington ultimately led to the litigation now before us. The three children, Gordon Harrington, Bigelow, and Scheirer, were the co-executors of Mrs. Harrington's estate. According to the terms of Mrs. Harrington's will, Gordon Harrington received a life estate in Mrs. Harrington's 9,000 shares of Century Inn stock. A dispute arose as to whether Scheirer and Bigelow, as majority trustees, or Gordon Harrington as tenant of the life estate, could vote the shares of Century Inn stock which were formerly held by Mrs. Harrington.

In December, 1977, the orphan's court division of the Washington County Court of Common Pleas awarded Gordon Harrington an advance distribution of the 9,000 shares. This effectively resulted in a redistribution of the previously equally distributed voting powers within Century Inn. Gordon Harrington now could vote a total of ...

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