Seeds v. Franklin

16 Pa. D. & C. 489, 1931 Pa. Dist. & Cnty. Dec. LEXIS 81
CourtPennsylvania Court of Common Pleas, Delaware County
DecidedFebruary 24, 1931
DocketNo. 2205
StatusPublished

This text of 16 Pa. D. & C. 489 (Seeds v. Franklin) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Delaware County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Seeds v. Franklin, 16 Pa. D. & C. 489, 1931 Pa. Dist. & Cnty. Dec. LEXIS 81 (Pa. Super. Ct. 1931).

Opinion

MacDade, J.,

— The plaintiff has filed a bill in equity against the defendants based upon fraud, setting up therein, inter alia, the following:

(a) That the defendant John M. Franklin, also known as John M. Kramer, represented to the plaintiff, Flora Kirk Seeds, that Franklin was one J. M. Kramer; that Pecano Manufacturing Company was a subsidiary of Keystone Pecan Company; that the Pecano Company was about to merge or consolidate with either Gold Dust Corporation or Postum Company, Inc., as a result of which the value of the stock of the Pecano Company would be greatly enhanced; that Franklin was authorized to represent and was representing the Pecano Company in offering for sale on its behalf a part of its original stock issue and that all of the moneys received from the sale of such stock would constitute a part of the assets of the Pecano Company; that the Keystone Company, in which company Mrs. Seeds at the time owned certain stock, had declared certain dividends and that in order to subscribe for stock of the Pecano Company it was first necessary for Mrs. Seeds to become a stockholder in the Keystone Company.

(b) That each of the representations made by Franklin constituted a material representation; that Mrs. Seeds believed the statements and representations made by him to be true, and that in reliance upon the same she was induced to purchase, and did purchase, through Franklin certain stock of the Keystone Company and also of the Pecano Company.

[490]*490(c) That Mrs. Seeds iii payment for the stock so purchased delivered to Franklin certain sums of money, stocks, bonds, securities and property at certain values mutually agreed upon between them, aggregating approximately $52,300.

(d) That in fact not one of the said statements and representations made by Franklin to Mrs. Seeds was true, but all were falsely and fraudulently made by Franklin, knowing them to be untrue, and for the purpose of deceiving Mrs. Seeds and inducing her to purchase the said stock of the Keystone Company and of the Pecano Company which she was induced to buy in reliance upon Franklin’s representations, which she believed to be true and which proved to be untrue and false, and which Franklin knew to be untrue at the time he made the statements to her, and to her detriment and prejudice.

(e) That upon learning of the falsity of the said statements and representations made by Franklin, Mrs. Seeds gave notice thereof to Franklin, rescinded the various agreements and transactions pertaining to the purchase and exchange of the said stocks, bonds and securities, etc., demanded repayment and delivery to her of all of the said moneys, stocks, bonds and property so paid and'delivered by her to Franklin, and offered to turn over to Franklin all of the stock of the Keystone Company and of the Pecano Company that she had received from Franklin in the said transactions.

(f) That Franklin has refused to turn back to Mrs. Seeds any of the moneys, stocks, bonds and other property so received by him from her.

(g)' That Franklin converted to his own use the moneys, stocks, bonds and other property so paid, transferred and delivered to him by Mrs. Seeds, and that with a part of the proceeds thereof he purchased certain property known as No. 651 Church Lane, Yeadon, for the sum of $21,000.

(h) That the said property was purchased by Franklin from one Julie E. Woods, and at Franklin’s request was conveyed by her to one Thomas H. Maney, Jr., as a strawman or trustee for Franklin; thereafter, at the direction of Franklin, it was conveyed by the strawman unto Abigail M. Mulvey, who in fact is the defendant Abigail M. Franklin, wife of the said John M. Franklin; that the full consideration for the said property and for both conveyances was furnished and paid by Franklin; that it was so paid by him out of the moneys, stocks, bonds and other property received by him as aforesaid from Mrs. Seeds, and that Franklin made settlement for the said property by paying the previous owner, Julie E. Woods, the sum of $9000 in cash and by taking the property subject to an existing mortgage of $12,000.

(i) That Mrs. Seeds has demanded of both defendants conveyance to her of the said premises, No. 651 Church Lane, Yeadon, subject to the said mortgage of $12,000, but the defendants have refused to transfer and convey the said property to Mrs. Seeds, the plaintiff.

The prayers of the bill are for discovery, an accounting, and, pending the proceedings, for an injunction restraining the defendants with respect to the real estate.

Each of the defendants has filed preliminary objections to the bill, which objections are now before us for consideration and determination.

Defendants’ preliminary objections may be grouped under two headings:

1. That plaintiff has a full, complete and adequate remedy at law.

2. That the defendants should not be required to answer the facts averred in plaintiff’s bill because defendants have a full and complete defense to plaintiff’s claim, not requiring the production of evidence to sustain it.

The first objection is based on Equity Rule 48, clause 6, and the second objection is evidently based on Equity Rule'48, clause 7.

[491]*491We shall treat the preliminary objections in the order in which they appear above.

1.

Under the facts averred, plaintiff does not have a full, complete and adequate remedy at law.

(a) Equity grants relief in cases of fraud.

In general, in cases of fraud where one party has been induced by another to act to his detriment, equity will take jurisdiction and grant relief to the injured party: Audenreid’s Appeal, 89 Pa. 114.

In that ease, a bill in equity was filed charging conspiracy to defraud plaintiff’s testator and praying that certain contracts entered into between plaintiff’s testator and defendant be declared void. Defendant through fraud and misrepresentation had induced plaintiff’s testator to transfer certain shares of stock. His false representation was that he controlled a considerable amount of the stock of a certain company and had the sole privilege of disposing of said stock. As a matter of fact, defendant had no interest in the company whatsoever. Held, judgment for plaintiff. The agreement between defendant and plaintiff’s testator was set aside as void.

See, also, Rutherford Water Co. v. Harrisburg, 297 Pa. 33, Williams v. Finlaw, Mueller & Co., 292 Pa. 244, and Bierbower’s Appeal, 107 Pa. 14, wherein a bill in equity was instituted in which it was averred that defendant through fraudulent representations had obtained absolute assignment of certain judgment notes. The bill prayed for an account and a decree that the defendants pay the complainant a certain sum with interest and further relief. The defendants demurred on the ground that the complainant had an adequate remedy at law by an action of assumpsit. The Supreme Court, in reversing the lower court, sustained the plaintiff’s bill and granted relief against the fraudulent defendant.

As to the general powers of equity in granting relief in a case of this kind, the court said: “Granted that an action of assumpsit would lie . . . it does not therefore follow that the chancery side of the court has no jurisdiction. Jurisdiction in equity depends not so much on the want of a common law remedy as upon its inadequacy, and its exercise is a matter which often rests in the discretion of the court; . . .

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Bluebook (online)
16 Pa. D. & C. 489, 1931 Pa. Dist. & Cnty. Dec. LEXIS 81, Counsel Stack Legal Research, https://law.counselstack.com/opinion/seeds-v-franklin-pactcompldelawa-1931.