Appeal, No. 142 | Pa. | Apr 30, 1923
Opinion by
Plaintiff was indebted to the Bangor Trust Company on a note and certain trade acceptances aggregating $67,-852, to secure which there was deposited with the trust company $50,000 of plaintiff’s first mortgage bonds. Payment of the note being demanded, Frank Wise, a defendant, took over the indebtedness. Thereupon the trust company endorsed without recourse the notes in its possession and delivered at the same time the $50,000 collateral. Wise, however, insisted on additional security, and $50,000 more, of the total issue of $100,000 of the same bonds, with 900 shares of stock of the Philadelphia Hosiery Company, and bonds of the par value of $3,000 of the Bangor Silk Knitting Company, with some raw silk, were accepted by Wise as sufficient. When the notes became due, payment was demanded; it was tendered, with a demand for the return of all collateral. The latter being refused, this bill was filed to restrain other disposition of the collateral and for a mandatory order to redeliver it to plaintiff.
There is really but one question involved in this appeal, and that of fact, — though there are 131 assignments
At the trial it was contended the bonds were owned in equal shares by George Wise, son of Frank Wise, and Henry A. Berendsen, through the Berendsen Silk Company. The court refused to sustain this contention, and there was sufficient evidence to support this finding. In view of the rule of law just announced, no good can come from reviewing the testimony, which is of interest to the litigants only. In the 31st finding, it is stated the Berendsen Silk Company, otherwise George Wise and Henry Berendsen, did not at any time pay money or other valuable consideration for the bonds. George Wise, on cross-examination, stated he did not claim the bonds as his personal property, but in right of the Berendsen Silk Company, of which he was an officer. All the property here in question, the court below finds, was delivered by plaintiff to Frank Wise as collateral. Frank Wise, the creditor and pledgee, cannot contest the title of his pledgor. A pledgee is estopped from denying the title of his pledge either by claiming title in himself or by setting up title in a third person. The pledgee’s duty is to return to the pledgor the property so pledged when
Wise’s claim to the bonds through part ownership of the Berendsen Silk Company depended on a receipt, and plaintiff’s minutes; but the court below found these minutes and the receipt were fraudulently obtained, and no such meetings were held. It is stated the “entire matter was a juggling with the affairs of this corporation, which was contrary to law and to good morals,” and the “Berendsen Silk Company was a sham and a fraud, formed to divert $50,000 from plaintiff.” That was an absolute nullity in law. Of course Wise could not hold the bonds on account of services as a director or officer (Grafner v. Pittsburg, Neville Island and Coraopolis St. Ry. Co., 207 Pa. 217" court="Pa." date_filed="1903-11-09" href="https://app.midpage.ai/document/grafner-v-pittsburg-neville-island--coraopolis-street-railway-co-6247369?utm_source=webapp" opinion_id="6247369">207 Pa. 217; Hechelman v. Geyer, 248 Pa. 430" court="Pa." date_filed="1915-03-08" href="https://app.midpage.ai/document/hechelman-v-geyer-6252599?utm_source=webapp" opinion_id="6252599">248 Pa. 430; Wilson v. Brown, 269 Pa. 225" court="Pa." date_filed="1920-12-31" href="https://app.midpage.ai/document/wilson-v-brown-6255038?utm_source=webapp" opinion_id="6255038">269 Pa. 225), and the burden was on him, as an officer of plaintiff corporation, to show he had legal title to the bonds. His co-owner denied his right, and the court below believed the latter.
We cannot, on the evidence submitted, say the court erred in holding the silk was deposited for the use and benefit of Frank Wise and not George Wise, and the former must account for its value.
Plaintiff had such qualified property in three certificates of stock of the Philadelphia Hosiery Company as
The court found the payment of $5,000 to defendant came from an advancement to plaintiff from the individuals named. But it was none the less a payment of interest, accepted by defendant.
Collateral security, when demanded, must either be produced or a satisfactory account given for its non-production: Stuart v. Bigler’s Assignees, 98 Pa. 80" court="Pa." date_filed="1881-10-03" href="https://app.midpage.ai/document/stuart-v-biglers-assignees-6236890?utm_source=webapp" opinion_id="6236890">98 Pa. 80. Where the debt has been discharged and the collateral is not returned, the measure of damages is the value of the article at the time of the conversion (Taylor v. Morgan, 3 Watts 333" court="Pa." date_filed="1834-09-15" href="https://app.midpage.ai/document/taylor-v-morgan-6311370?utm_source=webapp" opinion_id="6311370">3 Watts 333), to which interest may be added. The rule is different with regard to stocks: Sproul v. Sloan, 241 Pa. 284" court="Pa." date_filed="1913-05-28" href="https://app.midpage.ai/document/sproul-v-sloan-6251771?utm_source=webapp" opinion_id="6251771">241 Pa. 284.
A careful review of the evidence convinces us the court committed no reversible error; all the assignments are dismissed.
The decree of the court below is affirmed, at the cost of appellants.