Bertolet v. Lanard. Lieberman

• Court: Superior Court of Pennsylvania
• Writing for the Court: STADTFELD, Judge.
• Citation: 152 Pa.Super. 37,30 A.2d 630
• Parties: BERTOLET v. LANARD. LIEBERMAN, TO USE OF BERTOLET, v. SAME.
• Decision Date: 01 March 1943

152 Pa.Super. 37
30 A.2d 630

BERTOLET
v.
LANARD.
LIEBERMAN, TO USE OF BERTOLET,
v.
SAME.

Superior Court of Pennsylvania.

March 1, 1943.

Appeals Nos. 112, 113, October term, 1942, from order of Municipal Court, Philadelphia County, November term, 1935, Nos. 504, 505; John Robert Jones, Adrian Bonelly, and Leopold C. Glass, Judges. Leopold C. Glass, Judges.

Two actions in assumpsit, one by William H. Bertolet, Jr., and the other by George B. Lieberman, to the use of William H. Bertolet, assignee, both against Thomas S. Lanard. The cases were tried together and verdict was for the defendant. From an order granting new trial, defendant appeals.

Affirmed.

30 A.2d 631

George H. Detweiler, of Philadelphia, for appellant.

Peter P. Zion, of Philadelphia, for appellees.

Before KELLER, P. J., and CUNNINGHAM, BALDRIGE, STADTFELD, RHODES, HIRT, and KENWORTHEY, JJ.

STADTFELD, Judge.

The plaintiff, William H. Bertolet, Jr. (in his own right and as assignee of George B. Lieberman), brought actions in assumpsit against the defendant that were identical in all details except the amount of moneys which each had contributed to a certain pool of $33,405.40 and their proportionate right or share in the recovery. The two cases were tried together before Judge Glass and a jury. The jury found for the defendant. Motions for a new trial and judgment n.o.v. were filed. The motion for a new trial was granted by a divided court. Judge Glass, trial judge, dissenting. It is from the granting of this motion for a new trial that the defendant appellant has filed his appeal.

The plaintiffs' pleadings and evidence set forth that they were formerly directors and stockholders of Pilgrim Title and Trust Company; that defendant, a member of the Philadelphia Bar, was likewise a director and stockholder of that bank, and also counsel for the bank; that they, together with other contributors, employed Lanard as counsel to protect and recover upon their interests in certain certificates of deposit which formed part of the collateral securing a loan made by the Pilgrim Bank

30 A.2d 632

to one Brown and Stevens; that each of the plaintiffs, by his contribution, was the equitable owner of part of said certificates, and as such, entitled to receive his proportionate part of the moneys recovered thereon; that the defendant had received from the Secretary of Banking, in possession of the Cosmopolitan State Bank of Philadelphia, dividends upon the certificates of deposit; that in July of 1932, plaintiffs learned that the defendant had received a dividend of $4,950. on or about March 7, 1930; in September of 1932, they demanded of the defendant their proportionate share of such dividend, but defendant refused to pay. On or about December of 1934, plaintiffs learned that defendant had received an earlier dividend of $5,400 on or about March 2, 1927. They thereupon made demand upon the defendant for payment of their proportionate share of the total dividends paid, which was in an amount of $11,025, which defendant refused to pay.

On December 17, 1924, a loan was granted by Pilgrim to one Brown and Stevens, private bankers, in the amount of approximately $33,000. This was made up of several smaller loans. One of the loans was in the amount of $15,000. This was evidenced by a note in that amount, for which the bank held as collateral security two certificates of deposit with the Cosmopolitan State Bank in the sum of $10,000 and $5,000 respectively. In addition to this loan there were certain overdrafts charged to Brown and Stevens.

Plaintiffs aver a report of the Banking Department, as a result of an examination of the affairs of Pilgrim as of February 11, 1925, showed an impairment of capital of that bank in the amount of $33,405.40 because of the loan to the aforesaid Brown and Stevens.

The Banking Department refused to grant any value to the principal obligation of Brown and Stevens or to the certificates of deposit in question. It requested that the threatened impairment of $33,405.40 of the capital stock of Pilgrim be protected by a contribution of a like amount.

Lanard's advice was sought by the directors, including these plaintiffs. Plaintiffs alleged that the defendant advised that those directors who contributed to this fund would receive whatever was obtained from the Brown and Stevens loan or from the collateral, and at the most the directors would lose but half of their contribution. Plaintiffs relied upon the statement and representation of the defendant as counsel and made their contributions to the fund; that equitable title to their proportionate share of the certificates of deposit thereupon passed to them because of their contributions; that defendant acted as counsel for the plaintiffs and other contributors to the said fund and undertook to collect any moneys that might be payable because of the certificates of deposit.

Thereafter, in October of 1926, Pilgrim sold most of its assets to the William Penn Title and Trust Company; the certificates of deposit were not part of the assets of Pilgrim and were not sold to William Penn Title and Trust Company. The purchaser (William Penn) rejected the Brown and Stevens loan. (This loan, at that time, was carried on the books of Pilgrim in the amount of $8,422.70, being the balance of the Brown and Stevens loans and other drafts after setting off a $33,000 certificate of deposit issued to Brown and Stevens by Pilgrim.) This set-off was on the advice of the defendant.

Trustees for stockholders were appointed to liquidate those assets which were retained by Pilgrim. The trustees were plaintiffs Lieberman and Bertolet, the witness Levene and one Branagan. Defendant was retained as counsel for the trustees at an annual retainer of $2,000. All the contributors to the pool in question were also stockholders. On December 3, 1928, the defendant made a report concerning various items which had not been purchased by William Penn, including the Brown and Stevens account, addressed to the trustees for stockholders, in which he stated that that item could be marked off as a total loss. (On March 2, 1927, he had received the first dividend of $5,400 because of the certificates of deposit in question.) Defendant did not report the collection of this dividend to the contributors or to anyone else. In March of 1930,...