He stated that appellants and their attorney represented to him, at or prior to the time he executed the notes, that the purpose of the notes was merely to insure that his obligation would be paid as described prior to Scott's receiving any distribution from either corporation. Scott testified that it was the understanding of the parties that his obligation to Somers was to become payable only when the real estate which comprised the corporate assets was sold, by deduction from his one-quarter interest in the proceeds of sale. Over Somers' objection, the chancellor permitted Scott to testify that the notes did not contain the entire agreement between the parties. If that is the case, Scott was not in default for failure to pay the notes on demand because the corporate assets had not then *307 been sold, and liquidation of the collateral was in violation of the agreement. The basic question in the hearing below was whether the promissory notes executed by Scott, which on their face are demand notes, are in reality notes callable only upon the occurrence of certain conditions and payable only from a specific fund, namely, the proceeds expected to be derived from the sale of real estate owned by the corporate appellants. Exceptions to the chancellor's findings of fact and conclusions of law were dismissed by the court en banc, which entered a final decree affirming the decree nisi. After a consolidated trial of the two cases, the chancellor, in his adjudication, found Somers' liquidation of Scott's minority stockholdings to be void and of no effect, and restored to Scott his status as a shareholder in both corporations. The liquidation followed alleged defaults in payment of the notes.īy these suits in equity, Scott sought to enjoin the corporations from transferring his stock to ascertain his rights as a minority shareholder in the two companies to order an accounting by the corporations and Somers, the majority stockholders and to appoint a receiver for each corporation. The shares of stock owned by appellee were pledged as collateral security for Scott's obligation on two promissory notes, payable to and delivered to Somers. Somers (hereinafter collectively referred to as Somers). and Bryn Mawr Arms, Inc., the two corporate appellants, by the individual appellants, Joseph V. These two actions in equity involve the liquidation of appellee Scott's minority stock interest in John Scott Development Company, Inc. ReDavid, with him ReDavid, Orlowsky & Natale, for appellee. *305 Before JONES, C.J., EAGEN, O'BRIEN, ROBERTS, POMEROY, NIX and MANDERINO, JJ.
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