Putnam v. Pittsburgh Railways Co.
| Decision Date | 09 May 1938 |
| Docket Number | 99,100 |
| Citation | 199 A. 211,330 Pa. 210 |
| Parties | Putnam, Appellant, v. Pittsburgh Railways Company |
| Court | Pennsylvania Supreme Court |
Argued March 25, 1938
Appeals, Nos. 99 and 100, March T., 1938, from order of C.P Allegheny Co., Oct. T., 1937, Nos. 635 and 636, in cases of Samuel H. Putnam v. Pittsburgh Railways Company and Samuel H Putnam, Jr., v. Pittsburgh Railways Company. Order reversed.
Assumpsit. Before MOORE, EGAN and SMITH, JJ.
The opinion of the Supreme Court states the facts.
Rules for judgment for want of sufficient affidavits of defense discharged, opinion by MOORE, J. Plaintiffs appealed.
Error assigned was discharge of rule.
The order discharging plaintiffs' rules for judgment for want of a sufficient affidavit of defense is reversed, and the records are remitted to the court below with directions to enter judgments against defendant for such sums as to right and justice may belong, unless other legal or equitable cause be shown to the court why such judgments should not be entered.
John M. Reed, for appellants.
Philip A. Fleger, with him T. J. Munsch, Jr., and E. P. Griffiths, for appellee.
John A. Metz and John A. Metz, Jr., filed a brief for amicus curiae.
Before KEPHART, C.J., SCHAFFER, MAXEY, LINN, STERN and BARNES, JJ.
Plaintiffs in these cases, being owners of bonds of Pittsburgh, Canonsburg and Washington Railway Company, brought the present actions to recover on an obligation by defendant company guaranteeing "the prompt payment . . . of the principal and interest of the said bonds as the same shall become or be made due and payable, according to the terms of said bonds and of the foregoing mortgage." The mortgage thus referred to was from Pittsburgh, Canonsburg and Washington Railway Company to The Safe Deposit and Trust Company of Pittsburgh as trustee for the bondholders. Defendant filed affidavits of defense which the court held sufficient to prevent summary judgments.
It is not disputed by defendant that its obligation notwithstanding the use of the word "guarantee," is one of suretyship: Roberts v. Riddle, 79 Pa. 468; Iron City National Bank v. Rafferty, 207 Pa. 238; Lincoln Bank of Erie v. Gem City Wholesale Grocery Co., 286 Pa. 421. It sets up the defense that the bonds, by their terms, are subject to the provisions of the mortgage securing them, and the mortgage in turn provides that "No owner of any bond or interest coupon hereby secured shall have any right to institute any writ, action or proceeding in equity or at law for the foreclosure of this indenture, or for the execution of any trust thereof, or for the appointment of a receiver, or for any other remedy hereunder," unless such holder shall have previously given to the trustee notice of the default, and the owners of the majority in amount of the bonds shall have made written request upon the trustee to institute such proceeding, and they shall have offered to the trustee indemnity against costs and liabilities, and "such notification, request and offer of indemnity are hereby declared in every such case, at the option of the trustee, to be conditions precedent to the execution of the powers and trusts of this indenture, and to any action or cause of action for foreclosure, or for the appointment of a receiver, or for any remedy hereunder; it being understood and intended that no one or more owners of bonds or interest coupons shall have any right, in any manner whatever, by his or their...
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