Appeal of the Fidelity Insurance Trust & Safe Deposit Co.

Mr. Justice Paxson

delivered the opinion of the Court

The learned court below dismissed the exceptions and confirmed the Master’s report without filing an opinion. "We are left, therefore without the aid which the discussion of the case by that court would have given us.

We find no fault with the Master’s findings of fact, nor up to a certain point, with his conclusions. Assuming that the agreement embodied in “Exhibit A” was participated in by the defendants below, and was binding upon them as found by the Master, we are of opinion that he was clearly right in holding that the plaintiffs below were bound to contribute their pro rata share of the purchase money and the expenses. The most that can be claimed for “ Exhibit A ” is that it was a contract that in case the defendants should purchase the road, it should be for the joint benefit of the parties to the agreement. This implied necessarily that the purchase was to be at their joint expense; that is, that the purchase money and expenses should be contributed by all the parties in proportion to their respective interests. The present contention that the defendants were bound to advance the plaintiffs’ share of purchase money and expenses is without merit. There is nothing in “ Exhibit A ” from which such an agreement can be reasonably inferred. The property was sold to Ogden for $85,000. The defendants paid the purchase money, of which the sum of $10,001.40 was applicable to the expenses of the foreclosure proceedings, and the payment of prior liens, and the sum of $10,958.60 was applicable to the payment of the dividends of bondholders other than the plaintiffs and the defendant corporation. Uo portion of this purchase money was contributed by the plaintiffs, or by. either of them. On the contrary, when applied to shortly after the sale to contribute their, respective shares, they flatly refused. As one of the witnesses remarked: “ They hooted the idea of the thing, and would not have entertained it for a moment.”

Up to this point we agree with the Master’. But in discussing the liability of the plaintiffs to contribute, he says: “ If the case turned upon this simple question, it would doubtless be necessary to dismiss the bill. There were, however, other circumstances to complicate the matter. After the purchase by the defendants, they dealt with the property as their own, without the leave, assistance, or advice of the plaintiffs, or any of them. They did more. They gave away, as a gratuity to Ogden, an integral part of the property purchased for the joint benefit of the plaintiffs and defendants, to wit: That part of the value of the road represented by the shares of stock issued by the re-organized railroad company, being all over $65,000, the amount of the mortgage bonds issued by the company.”

Just here we think the Master fell into error. It was contended by the defendants that they did not purchase the property under “ Exhibit A; ” that they fixed $30,000 as the limit which they authorized their agent to bid; that he refused to exceed his limit although urged by others to do so; that the property was finally knocked down to Mr. Ogden for $35,000; that they subsequently advanced him the money to pay for the property and merely took the title as collateral to secure their advances. AVe need not discuss this view of the case, for conceding the purchase to enure to the benefit of the plaintiffs, all the defendants could be called upon to do was to permit the plaintiffs to como in under the new arrangement. The defendants were not required by “ Exhibit A ” to purchase the property in any event and without any regard to price. If they gave the plaintiffs an opportunity of coining in and sharing the benefits of the purchase they did all that in equity they could be called upon to do. That they did this appears, clearly in the case. The plaintiffs refused to contribute a dol-i lar of the purchase money. With such refusal thoir right to ■' participate in the direction of the affair, or in the proceeds of the re-sale ceased, and the defendants had the right to deal with, the property as their own. The claim of the plaintiffs to share the benefits of the transaction, and yet leave the burden and risk to the defendants, cannot be sustained. Such mode of dealing was pointedly condemned in Yeager and Grim’s Appeal, 4 Outerbridge, 88. The appellees contend, however, that Yeager and Grim’s Appeal differs from the present case for the reason that in that case it was agreed that the purchase money should be paid by the three parties who had agreed to buy at the assignee’s sale, and the appellee refused to pay his proportion; whereas in the case in hand, the plaintiffs agreed to accept new bonds for those which they then held, in the re-organization. We are unable to perceive this distinction. AVe regard “Exhibit A” as an agreement between certain of the bondholders of the Delaware Shore Railroad Company, that one of their number, to wit, the defendant company, should buy in the said railroad for their joint account and benefit, and that in the proposed plan of re-organization the parties thereto would accept new bonds in lieu of the old bonds held by them. This is a very common proceeding in such cases, and necessarily involved an outlay of money. The sum of $10,001.40 was required to pay the costs of foreclosure, ¡expenses and prior liens; and the further sum of $10,958.60 jjpo pay other bondholders not parties to the agreement. By whom was this money to be paid ? Manifestly by the parties interested, unless it was expressly agreed to the contrary. The plaintiffs contend that they were not to pay anything; they sajr such was their understanding. Their understanding, however, is a matter of no consequence unless' it amounted to an agreement with the defendant company, and of this there is no evidence. On the contrary, “ Exhibit A,” which we must accept as the final understanding of the parties contains nothing from which we can reasonably infer that the defendants were to advance the plaintiffs’ share of the purchase money.

Under the view we take of the case the plaintiffs stand in , the same position as the other bondholders not parties to Exhibit A.” This entitles them to a dividend out of the I [¡purchase money paid by the defendants, but not to participate yin the proceeds of the sale made by them. The plaintiff, George W. Hall, appears to have received his share. This is a matter, however, with which we have no concern in this proceeding.

We need not discuss the matter of the $10,000 claimed by the defendants for moneys expended by them in the improvement of the road. Had the plaintiffs contributed their quota of the purchase money they would have been in a position to question such outlay. But until such payment they had no interest in the purchase. They declined to pay any part of the assessment upon the ground that they were not obliged to contribute anything, either as purchase mone3r or otherwise.

The plaintiffs also appealed from this decree, and have filed numerous assignments of error. What has been said renders a discussion of them unnecessary. The plaintiffs’ appeal is dismissed at their respective costs.-

The appeal of the defendant company is sustained; and as to them the decree is reyersed, and the bill dismissed at the costs of the appellees.