Commonwealth v. Philadelphia Co.

145 Pa. 142 | Pennsylvania Court of Common Pleas, Dauphin County | 1891

Opinion,

Mr. Justice Williams :

The business of the appellant is the production, transportation, and. sale to customers of natural gas in Allegheny county, with its office in the city of Pittsburgh. George Westinghouse, Jr., was the inventor of certain appliances to regulate and facilitate the transportation, supply, and combustion of gas, which the appellee desired to make use of in its business. It accordingly entered into an agreement with Mr. Westinghouse for what is described in the agreement as a “ grant of license ” for the exclusive use of his patents in the county of Allegheny, in consideration for which it agreed to give him shares of its capital stock amounting, at the face value, to one million dollars. This exclusive “ grant of license ” was upon certain conditions that limited the operation of the grant. Among these faas one prohibiting the grant under it of any right outside of Allegheny county. Another reserved to Mr. Westinghouse, his representatives and assigns, the right to “ make, or procure the making, of any or all the patented apparatus ” to be used under the grant. Stripped of its verbiage, the agreement required Mr. Westinghouse to furnish the Philadelphia Co. his inventions, enumerated therein, for use in their business to whatsoever extent the company might require them. It required him to refuse them to all other persons or companies doing business in Allegheny county. The company thus secured the exclusive use of the manufactured apparatus or machines in that county. Mr. Westinghouse retained his patents, the right to manufacture or control the manufacture of the machines used by the Philadelphia Co., and his original exclusive right to make, sell, or use outside of Allegheny county.

The question raised on these facts is whether the stock used, instead of money, to pay for the right to use, by themselves, their lessees or vendees, the manufactured apparatus made under protection of the enumerated patents, in the county of Allegheny, was invested in patent rights, and therefore exempt from the capital-stock tax imposed by the commonwealth. It will be seen, by reference to the contract and the findings of the court below, that the subject-matter of the sale or license by Westinghouse was not his patents, but his machines or apparatus, manufactured and ready for the trade. He did not sell his right as an inventor, but his goods as a manufacturer and owner, finished and ready for use. True, he agreed to sell to no one else in the county, and to allow the company to control the sale within the county lines, just as a manufacturer of a particular brand of cloth or leather might agree to do with a customer in the same county, who wished to control the trade therein; but this was an agreemónt about goods, and nothing more. This case is ruled by Commonwealth v. D. & P. Teleg. Co., ante, 121, in which an opinion is this day filed. It is unnecessary to repeat what was then said upon the questions involved. We adopt the reasons given for the decision in that case as part of this opinion.

The judgment is reversed, and judgment is now entered in favor of the commonwealth against the Philadelphia Company for the sum of $5,000, with interest.