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F~.\FR.ES\Clienta\5844 Mumma Enate\5844.19 Accounts and Dia[tibution Truna\5644.19 DLn5844.19.Responae to Petition to Compel Compliance dated 1.28.13.Final.2.wpd
No V. Otto III, Esquire c~ ~ ~
I.D. No. 27763 ~ o ``' m ~
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George B. Faller, Jr., Esquire m ~ ~ ~-
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I.D. No. 49813 ~ n ~ p.-a ~ ~
Jennifer L. Speazs, Esquire n' can ~ `J' ~ ~
I.D. No.87445 0 ~
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MARTSON LAW OFFICES
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10 East High Street ~ ~
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Cazlisle, PA 17013 a ~> ~
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(717) 243-3341 c~ _
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Attorneys for Lisa M. Morgan
IN THE COURT OF COMMON PLEAS OF
IN RE: :CUMBERLAND COUNTY, PENNSYLVANIA
Estate of Robert M. Mumma,
N0.21-86-398
Deceased.
ORPHANS' COURT DIVISION
RESPONSE OF LISA M. MORGAN AS EXECUTRIX AND TRUSTEE OF THE
ESTATE OF ROBERT M. MUMMA TO PETITION TO COMPEL COMPLIANCE
WITH COURT'S ORDER DATED JULY 30 2012 AND FOR SANCTIONS AND
ALTERNATIVELY. TO VACATE SAID ORDER
AND NOW, comes Lisa M. Morgan, Executrix of the Estate of Robert M. Mumma and
Trustee of the Marital and Residuary Trusts under such Will, who responds to Robert M.
Mumma, II's Petition to Compel Compliance with Court's Order Dated July 30, 2012, and for
Sanctions and Alternatively, to Vacate Said Order, as follows:
1-4 Admitted. Further, in respect of pazagraph 2 a., as set forth in the Order of the
Court dated July 30, 2012, Mrs. Morgan was ordered to cause both D-E and the Residuary Trust
to provide certain information and, in the absence of certain objections, proceed with liquidation
and distribution. No such objections were made and Mrs. Morgan complied with such Order.
5-6 After reasonable investigation, Mrs. Morgan is without knowledge or information
sufficient to form a belief as to the truth or falsity of this averment.
7. Mrs. Morgan is without knowledge or information sufficient to form a belief as to
the truth or falsity of this pazagraph, and its subparts, with regazding to what, if any,
"investigation" Petitioner has undertaken or what the results of such effort have been. By way of
further response, Mrs. Morgan responds as follows to the vazious subpazagraphs:
~^'3
7. a. Mrs. Morgan is without knowledge or information sufficient to form a belief as to
the truth or falsity of this paragraph as it relates to the original issuance of the insurance policies
in question. By way of further response, the insurance policies in question became owned by DE
Distribution Corp. by virtue of the corporate division of Nine Ninety-Nine, Inc. in July 1993.
Mrs. Morgan denies that Petitioner is a shareholder of "Pennsy Supply Inc." Indeed, that
allegation is inconsistent with the conclusion in prior litigation involving Petitioner, as Petitioner
executed a written, irrevocable consent and joinder in the corporate division of Nine
Ninety-Nine, Inc. The allegations of this paragraph are flatly inconsistent with multiple prior
rulings of the Court in various litigations. See Exhibit "A" hereto attached.
7. b. Mrs. Morgan is without knowledge or information sufficient to form a belief as to
the truth or falsity of this paragraph as it relates to the original issuance of the insurance policies
in question. In any event, such allegations aze irrelevant.
7. c. Mrs. Morgan is without knowledge or information sufficient to form a belief as to
the truth or falsity of this pazagraph as it relates to the original issuance of the insurance policies
in question. Moreover, Mrs. Morgan denies that there currently exist any binding or effective
"agreements with Pennsy Supply" regazding the policies. In any event, such allegations aze
irrelevant. Mrs. Morgan further denies any chazacterizations of the terms or provisions of the
insurance policies, which are in writing and speak for themselves. In addition, as set forth in the
Order of the Court dated July 30, 2012, Mrs. Morgan was ordered to cause both D-E and the
Residuary Trust to provide certain information and, in the absence of certain objections, proceed
with liquidation and distribution, with which Order Mrs. Morgan complied.
7. d. The insurance policies and ancillary documents are writings and speak for
themselves.
7. e. Denied. On the contrary, Petitioner executed a written, irrevocable consent and
joinder in the corporate division of Nine Ninety-Nine, Inc. The allegations of this paragraph are
flatly inconsistent with multiple prior rulings of the Court in various litigations. See Exhibit "A"
hereto attached. See also Mrs. Morgan's answer to subpazagraph a.
7. f. After reasonable investigation, Mrs. Morgan is without knowledge or information
sufficient to form a belief as to the truth or falsity of this averment. However, the record reflects
that the Report and Recommendation of the Auditor and the Order of the Court were mailed to
Petitioner's counsel, Jeffrey G. Brooks, Esquire.
7. g. After reasonable investigation, Mrs. Morgan is without knowledge or information
sufficient to form a belief as to the truth or falsity of this averment insofar as it relates to
Petitioner's knowledge. However, Petitioner's counsel, Jeffrey G. Brooks, Esquire, participated
in the proceedings before the Auditor and the agreement therein reached.
7. h. Denied that Attorney Brooks so advised. Admitted as to the request for additional
information. Such information was provided to Attorney Brooks on August 2, 2012.
7. i. The Auditor's Report and Recommendation and the transcript of the
July 26, 2012, proceedings are in writing and speak for themselves, and all characterizations of
them are denied. Mrs. Morgan admits that requests were made for information, and that her
counsel understood that such a request had been made. To the extent this paragraph alleges
something more, those allegations are denied. In particular, Mrs. Morgan denies any allegation
that Petitioner was unfamiliar with the existence of the insurance policies in question.
7. j. The Auditor's Report and Recommendation and the transcript of the
July 26, 2012, proceedings are in writing and speak for themselves, and all characterizations of
them are denied. Moreover, Mrs. Morgan is without knowledge or information sufficient to
form a belief as to the truth or falsity of this paragraph as it relates to any purported "need" for
information.
7. k. The averments of this paragraph are a legal conclusion to which no response is
required.
8. Denied.
9. Admitted.
10. Denied.
11. Denied that Mrs. Morgan failed to provide such information. To the contrary,
such information was provided to counsel for Petitioner and counsel for Barbara Mumma.
12. Denied. To the contrary, Mrs. Morgan provided such information, and despite
repeated requests for a response made to Petitioner's counsel, no such response was
forthcoming.
13. No response required.
14. No response required.
15. The averments of this paragraph are a legal conclusion to which no response is
required.
WHEREFORE, Lisa M. Morgan, Executrix of the Estate of Robert M. Mumma and
Trustee of the Marital and Residuary Trusts under such Will, respectfully requests Your
Honorable Court to dismiss Robert M. Mumma, II's Petition to Compel Compliance with
Court's Order Dated July 30, 2012 and for Sanctions and Alternatively, to Vacate Said Order.
Respectfully submitted,
MA TSON LA OFFICES
By:
No V. Otto III, Esquire
George B. Faller, Jr., Esquire
Jennifer L. Spears, Esquire
10 East High Street
Carlisle, PA 17013
(717)243-3341
Brady L. Green, Esquire
WILBRAHAM LAWLER & BUBA
1818 Market Street, 31st Floor
Philadelphia, PA 19103
(215) 972-2860
Attorneys for Lisa M. Morgan
Date: March 15, 2013
ROBERT M. MUMMA, II, AV THE COURT OF COMMON PLEAS OF
Plaintiff' CUMBERLAND COUNTY, PENNSYLVANIA
v. CIViL ACTION -EQUI'T'Y
PENNSY SUPPLY, iNG.,
Defendant N0.99-2765 EQUITY TERM
IN RE: ADJUIIICATION
BEFORE OLER. J.
D>G~CREE NISI
AND NOW, this 17`'' dad' of May, 2002, upon consideration of .Plaintiffs
complaint for declaratory judgment in the abavc-captioned case, and following a nonjury
trial, it is ordered, adjudged, decreed and declared that Plaintiff does not retain an
ownership interest in a corporation Mown as Pennsy Supply Inc., or any derivation
thereof, and that the transfers of shares in Pennsy Supply Inc.., or any derivation thereof,
at issue in this action were not soided by operation of the shareholders' agreement
executed in I96I.
THIS DECREE NISI shall automatically become a final decree, without further
order of court, if no party in interest files a timely motion for post-trial relief in
accordance with Pennsylvania Rulc of Civil Procedure 227.1.
BY THE COURT,
~r
. 'Jcsley Olcr, .,
Rabat M. Mumma, Ti
Box E .
Bo~vmansdale,l'A 17008
Plaintiff, Pro Sc •
EXHIBIT
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li%HIBIT "A°
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ROBERT M. MUMMA, II, IN THE COURT OF COMMON PLEAS OF
Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA
v. CIVIL ACTION - EQUi'I`Y
PENNSY SUPPLY, INC.,
Defendant N0.99-2765 EQUITY TERM
IN RE: ADJUDICATION
BEFORE OLER. J.
OPINION and DECREE NISI
OLER, J., May 17, 2002.
In this equity action, Plaintiff Robert M. Mumma, II, claims an ownership interest
in a corporation known as Pennsy Supply Inc. (with no comma), which, according to
Plaintiff, has survived for over fifty years as an entity separate and distinct from Pennsy
Supply, Inc. (with a comma). Plaintiff argues that, although he sold his interests in the
latter, he retained an ownership interest in the former, as evidenced by a share certificate,
dating to 1963, which facially represented 314 shares of stock in "Pennsy Supply Inc."
(with no comma). Thus, essentially, Plaintiffs claims are predicated on the legal
significance of a comma or lack thereof.
The ownership interest claimed byPlaintiff represents shares in a corporation that
was built up by Plaintiffs father, Robert M. Mumma, whose death in 198G initiated a
"long line" of seemingly "unending litigation"'' involving Plaintiff, other members of the
Mumma family, and various corporations involved in subsequent transactions involving
the "Pennsy Supply Businesses."~ The latest in this series of cases involve the sate of the
~ Hereinafter, all references to "Penrssy Supply, Inc:'should be construed as references to
Pennsy Supply, Inc. (-vith a comma), and all references to "Pennsy Supply Inc." should
be construed as references to Pennsy Supply Inc, (with no comma).
a In re Estatr of Mumma, Orphans' Ct. No. 21-86-398, slip op. at 1 {Ct. Com. Pl.
Cumberland Nov. 5, 1992).
~ Sec, e.g., Mumma v. CRN, Lrc., 99.154G Civil Term (Ct. Com. Pl. Cumberland 1999);
Mumma v. G-~-T Disfrrbution Corp., 94-0423 Civil Term (Ct. Com. Pl. Cumberland
1994); Mumma a A'ine Ninety-Nine, Inc., 14 Equity 1990 {Ct. Com. Pl. Cumberland
r
l;
"Pennsy Supply Businesses" to another ciltporation, CIt!-I plc. Plaintiff consented to this
sale and released Itis o~~•nership interest in the "Pennsy Supply Businesses" for
consideration of approximately S3 million:' Soon after executing this release, PlainlifF
initiated lawsuits against various corporations involved in the transaction, including G-A-
TDistribution Corporations and CIZH p!c e
On May 7, 1999, Plaintiff filed this declaratory judgment action against another
such corporation, Defendant Pennsy Supply, Inc. 1n this action, Plaintiff regt:ested that
the court declare that he "is a lawful on•ncr of 314 shares of stock in Pennsy Supply
Inc."' Plaintiff also rerluested a declaration that previous transfers of shares in Pennsy
Supply Inc., including Plaintiffs shares, were void under the terms of an agreement
executed by the shareholders of Pennsy Supply Inc. in .1961 and that, pursuant to that
agreement, Plaintiff has the option to purchase a significant ownership interest in that
corporation at book value.$ As with Plaintiffs prior claims in other cases, resolution of
the prescitt claims in Plaintiff's fa~•or trould effectively require the unraveling of the sale
of the "Pennsy Supply Business" and «•ould allow Plaintiff to reacquire control of assets i
that were transferred to CRH plc by Flaintiff for consideration of $3 million.
A nonjury trial was held aver the course of five days. Based upan the evidence in
the record, and for the reasons stated in this opinion, the court will find for Defendant.
1990); Mumnra v. Nine Ninety-Nine, hrc., 15 Equity 1990 (Ct. Com. PJ. Cumberland
1990); Monona v. Mrrnvrro, 84 Equity 1990 (Ct. Com. Pl. Cumberland 1990); Mumma v.
Mumma, 66 Equity 1988 (Ct. Com. PI. Cumberland 1988); Irr rP Esla~e of Mumnra,
Orphans' Ct. No. 21-Sd-398 (Ct. Com. Pl. Cumberland 1986).
See infra notes 18-34 and accompanying text.
s See Mumnra v. G-A-T Distri6:rlion Corp., 94-0423 Civil Term (Ct. Com. PI.
Cumberland 199q).
6 Sec h1umnra v. CRN, Inc., 99-1546 Civil Term {Ct. Com. PI. Cumberland 1999).
Pl.'s Action for a Declaratory J., filed May 7, 1999, at 5.
See id.
2
i ~~ F'11'I.~NST$ r• rncr '•
1. According to the records of the Conunomvealth .for Nine Ninety-Nine,
Ine.,9 on May 3, 1961, a corporation 1:nown as Pennsy Supply, Inc., which had been
incorporated on Mnrch 20, 1958, merged .into a corporation Mown as Fiala Cn~shed
Stone Corporation, which had been incorporated on November 5, 1958.10
i
2. As a result of the merger, on May 3, 1961, Pennsy Supply, Inc., ceased to
exist as the name of a corporation recognized in the records of the Commonwealth.~~ •
3. According to the records of the Cornmomveatth for Nine Ninety-Nine, Inc,,
i immediately after the merger, on A•fay 3, 1961, Fiala Crushed Stone Corporation changed
its name to Pennsy Supply Inca-
' 4. On December 29, 1961, the two shareholders of Pennsy Supply Inc., Kim
Company and Jerry T. Simpson, entered into a shareholders' agreement, which limited
the ability of current shareholders to transfer shares without first offering the shares for
sale to the eorporation.13
5. Share certificates issued after this agreement bear a restrictive legend,
which identified the applicabilit}• of the restrictions imposed by the shareholders'
agreement of December 29, 1961.."
6. On August 1, 1963, the two shareholders, Kim Company and Jerry T.
Simpson, entered into a termination agreement, which provided, in pertinent part: "(S)aid
s Specifically, these records are the articles of incorporation and amendments for Nine
Ninety-Nine, Inc, filed with the Commomvealth of Pennsylvania Department of State.
' See Def,'s Ex. 48, Trial, Dte. '13-IS, 2000, May 30-31, 2001 {hereinafter Pl.'s / I)cf.'s
Ex. ___).
to Def.'s Ex. 48, 49.
~ ~ Id
~ r Id.
's P}.'s Ex. S.
"E.g., Pl.'s E~:. 3.
3
parties hereto agree that said shareholder's Agreement of December 29, 1961 behveen
Kim [Company] and [.Icrry T.] Simpson is hereby cancelled, annulled and terminated."is ~
7. 'fhc termination agreement Curtner provided that "upon transfer of all of the
shares of stock of [Deny T.J Simpson to [Robert M.J Mumma, [Plaintiff's father,] all
rights, obligations and conditions of said Agreement shall cease"16
8. On August 1, 1963, Terry T. Simpson transferred a total of 1,250 shares in
Pennsy Supply Inc. to Robert M. Mumma."
9. On August 5, 1963, Robert M. Mumma transferred 3l4 shares in Pennsy
Supply Inc. to Plaintiff and Plaintiff was issued a share certificate representing those ~
I
shares.'s ~
10. Plaintiff's share certificate does not bear the restrictive legend that appeared ~
on share certificates issued prior to August 1, 1963, and after the execution of the
shareholders' agreement.19 I
11. According to the records of the Commomveatth for Nine Ninety-Nine, Inc.,
on May 31, 1979, a corporation Mown as Tri-Ms. Inc. merged into Pennsy Supply Inc 20
12. According to the records of the Commonwealth for Nine Ninety-Nine, Inc.,
on August 3!, 1981, a corporation knotivn as Four Farty One Corporation merged into
Pennsy Supply, Inc?' } i
13. Although the merger of May 3I, 1979, refers to Pennsy Supply Inc., and
the merger of August 31, 1981, refers o Pennsy Supply, inc., both mergers involved the
Is Def.'s lrx. 8.
.6 fa.
t~ Pl.'s Ex. 5.
is pl.'s Ex. I. The shares were actually iransfened to Robert M. Mumma as custodian for
Plaintiff, who was a minor at the time of the initial transfer. Plaintiff came into
possession ofthe shares in 1971. N.T. 34-38, 114, 150, Trial, Dcc. 13-15, 2000, May 30-
31, 2001 (hereinafter N.T. ,~; sec also Pl.'s I/x. 1.
1 ° See Pl.'s Ex. 1.
zo Def.'s £x. 4 $.
21 IG.
a
same corporation, the corporation which had been originally known as Fiala Crushed
Stone Corporation and which had been incorporated an November 5, 1958.
14. Thereafter, although the records of the Commontveihh for Ninc Ninety-
Nine, Inc., refer solely to Pennsy Supply, htc., those references are to the same
corporation previously identified as Pennsy Supply Inc., the corporation which had been
originally known as Fiala Crushed Stone Corporation and which had been incorporated
on November 5, 1958.x''
S. On October 9, 1981, Ten-O-One, Inc., was incorporated as a wholly-owned
subsidiary of Pennsy Supply, Inc z3
I G. According to the records of the Gomntomvealth for Ninc Ninety-Ninc, Inc.,
on January 4, 1982, Pennsy Supply, Inc., changed its name to Nine Ninety-Nine, Inez{
17. On January 4, 1982, alt outstanding share certificates bearing the Warne
Pennsy Supply, Inc., or any derivation thereof, were replaced with new share certificates
bearing the name Nine Ninety-Nine, lnc?s
18. Plaintiff was issued a now share certificate bearing the name Nine Ninety-
Nine, Inc., to replace his share certificate bearing the name Pennsy Supply, lne,26
19. Plaintiff retained possession of the share certificate,. which bore the Warne
Pennsy Supply Inc. and which had represented 31.4 shares in Pennsy Supply, Inc?'
20. On January 4, 1982, Ten-O-One, Inc., awholly-otivned subsidiary ofNine-
Ninety-Nine, Inc., changed its name to Pennsy Supply, Inc.zB
21. Pennsy Supply, Inc., formerly known as Ten-0-One, lnc., continued to
operate as awholly-owned subsidiary corporation of Nine Ninety-Nine, Inc.29
n See Def.'s Ex. 48; N.T. 17I-75.
23 Def.'s Ex. 50; see also, e.g., N.T. S I b.
z' Def.'s Ex. 48.
zs Sec N.T. 476-?8; see also Dcf's Ex. 15-C.
zs Def.'s Ex. I S-C, 1 ~, 26; see also N.T. I60, 31 b-1?.
z' Sec Pl.'s Ex. 1.
zs Def.'s Ex. 50.
_ ~. ,
22. In July 1993, pursuant to a majority vote of shareholders, all shares of Nine i
Ninety-Nine, Inc., along with other corporate assets denominated collectively as the
"Pennsy Supply Businesses," ware sold to another corporation, CRH p1c.30 j
i.
23. On March 17, 1995, Plaintiff. joined the sale of the "Pennsy Supply
Businesses" through the execution of an "irrevocable" consent and joinder.31
24. On March 17, 1995, Plaintiff sold his outstanding sltares in Nine Ninety- I
Nine, Tnc., to CRH plc and received approximately $3 million in proceeds from the sale.3` I
i
25. On March 17, 1995, Plaintiff transferred the shares and surrendered the ~
share certificate representing his shares in Nine Ninety-Nine, ]nc is
26. As of March t7, 1995, Plaintiff retained na ownership interest in Nine
Ninety-Nine, Inc 3a
DiSCUSSiON
Declaratory Jadgnrents. Declaratory judgments are available for parties "to obtain
a declaration of the existing legal rights, duties, or status of the parties tivhere the
declaration will aid in the determination of a genuine, justiciable controversy:'
Redevelopment .4utlr. a Int'! Lrs. Co., 454 Pa. Super. 374, 383, 685 A.2d 581, 585
(1996). Generally, the party asserting ownership of property currently possessed and
operated by another bears the burden of establishing his or her Icgal right to that property,
particularly when documentary evidence exists to support the possessor's right to
ownership. See In re Estate of f~?einer, 405 Pa. 540, 543, 176 A.2d 4I0, 412 (1962); see
also Montgo»rery v. Keystone Sav. d Loan Assn, 150 Pa. Super. 577, 581, 29 A.2d 203,
205 (1942). .
zv Def.'s Ex. 50; see also, e.g., N.T. 516.
;° See Def.'s Ex. 17, 18, 47.
~t Def.'s Ex. 7; see also N.T. 161, 171-75, 254, 26i; Def.'s Ex. 47.
12 Sec N.T. 159.1? 1-"15; see also Dcf.'s Ex. 47.
31 See N.T. ] 59, 171-75; Def.'s Ex. 26.
3a Def.'s Ex. 7; see also N.T. 161, 171-75, 254, 261; Def.'s Ex. 47.
6
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Ownership Interest itr PetrrrsySrrpply Lrc. The court is of the opinion that Plaintiff
has failed to offer persuasive evidence to support his claim of an ownership interest,
represented by the share certificate bearing the name Pennsy Supply Inc. Instead, the
evidence presented in this case established that Plaintiff, through the execution of the
consent and joinder agreement in 1995, sold the ownership interest that had been
represented by the share certificate.
Possession of a share certificate is not dispositive evidence of an ownership t
interest in the corporation named on the certificate, but functions only as supporting
evidence that the possessor. has a valid ownership claim. See Act of Dec. 21, 198$, P.L.
1444, Na. 177, § 103, as arrrettded, 15 Pa. C.S.A. ~ 1103 (Nest 1998 & Supp. 2001) ~
(defining a "share certificate" as "[a~ written instrument signed on behalf of the
corporation evidencing the Fact that the person therein named is the record owner of the
shares therein described"); see also IS Pa. C.S.A. § f52$(a} (stating that shares of a ~
business arc `'represented" by share certificates). In other words, a distinction is made
1
behveen the share certificate and the underlying ownership interest, the shares,
represented b}• the certificate. When an issuing corporation,35 because of a change in
name or similar event, cartcels outstanding share certificates and issues new certificates {
under the rew corporate name, the underlying ownership interests represented by al! ~
certificates -- both the cancelled and the new -- do not change and remain in the issuing i.
corporation. See I~r re Estate of Rimer, 71 I A.2d 1018, 1023 (Pa. Super. Ct. 1998} I
(finding that cancellation of an old certificate and issuance of a new certificate has "no ~
legal effect" on the individuaI's "entitlement to the underlying asset"). The possession of
share certificates, or tack thereof, does not affect whether the shareholders retain an ~
i
ownership interest in the issuing corporation, even though it now operates under a '
different name 3e
~s The issuing corporation may be defined as the corporation that originally issued the
shares and share certificates.
3a It seems an odd cute of law that would allow the possessor of cancelled certificates in a
non.-defunct corporation to reap a n•indfall and acquire an ownership interest in a newly-
7 '
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Conclusive evidence of an ownership interest can be found only by examining the
records pertaining to the structure and development ofthe issuing corporation. Sea 15 Pa.
C.S.A. § 1916 (stating that amendments to the articles of incorporation become effective
only upon filing with the Commonwealth); see also 1 S Pa. C.S.A. § 1309 (stating the
corporate records kept by the Commomvealth serve as "conclusive evidence" 'of the
status of that corporation) s7 A corparaGon is required to file with the Commonwealth all
information pertaining to corporate charter amendments, mergers and name changes. 15
Pa. C.S.A. § 1911. Because the existence of the corporation is dependent on state
recognition, these records sense as `'conclusive proof ` of alterations in corporate structure
and identity. 15 Pa. C.S.A. § 1309. Thus, by tracking the changes in the structure of the
issuing corporation, as evidenced by the records of the Commonwealth, the current
identity of the issuing corporation, in which the ownership interest remains, can be
determined.
In filing both articles of incorporation and amendments thereto, entities must abide
by several statutory filing requirements in order to secure official recognition of the
proposed incorporation or amendment. one such requirement limits the ability pf an
entity to incorporate under a name that is not "distinguishable" from the name of another
corporation already recognized in the records of the Commomvealth. 15 Pa. C.S.A.
formed corporation merely because, by happenstance, the new corporation chose to use
the same name as the old corporation..
37 Even if the court may in same circumstances infer the existence of a de facto
corporation from testimonial evidence of the assumption of corporate identity, but see
Act of Dcc. 21, 1988, P.L. 1414, No. 177, § 103, 15 Pa, C.S.A. § 1904 (Vilest 1998 &
Supp: 2001) ("The doctrine of de facto mergers, consolidations, and other fundamental
transactions is abolished ...."), Plaintiff has not presented facts to support such a claim.
Here, Plaintiff presented, as alleged corporate officers of a second "Pennsy Supply"
corporation, two individuals, who were both aver eighty years of age. These individuals
could not testify clearly to the existence of two "Pennsy Supply" corporations but could
only, in response to Plaintiff's leading questions, agree that twa such corporations may
have existed at some time. As such, in the court's vices, no credible evidence tvas
presented of any "2ttempt to organize'" or an "assumption and exercise of rorporate
power," to support Plaintiff's claim of a de facto corporation. Sec hr re Riviera Country
Ciuh, 1961'a..Supcr. 636, G40-41, 17G A.2d 704, 707 (1961).
0
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§ 1303(b). Section 135 of Title 15 establishes the requirements far a "distinguishable"
name and provides, in pertinent part, as follows:
(e) Distinguishable names: -A name shall not be considered
distinguishable ... from another name for purposes of this title ... salety
because the names differ from each other in any or ail of the following
respects:
(1) Use ofpunctuation marks.
15 Pa. C.S.A. § 135(e). Thus, it is the policy of the Commonweallh not to recognize
proposed articles of incorporation or amendments that would result in two corporations
with duplicate names.3S
Based on the records of the Commomvealth presented in this case, as of 1982, the
identity of the issuing corporation, in which Plaintiff held an ownership interest, was
Nine Ninety-Nine, Inc. According to these records, Nine Ninety-Nine, Inc., had been
incorporated in 1.958 under the name Fiala Crushed Stone Corporation. Soon thereafter, it
changed its name to Pennsy Supply Inc., the name under which it issued PIaintiff s share
certificate and shares. In L9$2, this corporation (i.e., the issuing corporation) changed its
name to Nine Ninety-Nine, Inc. Although the name of the corporation changed, its basic
structure and identity did not, and Plaintiff's ownership interest remained in that
corporation, now knatvn as Nine Ninety-Nine, Inc s9
3a Although the current version of the statutory restriction on duplicate names was passed
in 1958, similar statutes in effect during ail periods in question also limited the ability of
corporations to use a name that was not "distinguishable" from corporate names in the
records of the Commomvealth. See 15 Pa. C.S.A. § 1303 notes.
39 This conclusion is supported by the fact that, at the time of the name change, Plaintiff
received a new share certificate representing new shares in Nine Ninety-Nine, Inc. It
seems incredible to posit that Nitre Ninety-Nine, Inc., ticould simply issue shares of
corporate stork to Plaintiff ~~•ithout a demand for compensation. Raiher, it seems more
likely that the new share certificate was a replacement for PlaintilTs now-cancelled
certificate, which bore the name Pennsy Supply Inc., a name no longer used by the
issuing corporation. Cf. Rider, 7L! A.2d at 1023 (finding that cancellation of an old
certificate and issuance of a new certificate has "no Iegat effect" on the individual's
"entitlement to the underlying asset").
9
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With respect to the identity of the issuing corporation, the fact that the records of
ttte Commonwealth inrxplieably insert a comma into the name Pcnnsy Supply Inc, !
between 1979 and i 98l is immaterial to the analysis for ttvo reasons. First, the insertion
occurred wholty within the corporate records for Nine Ninety-Nine, inc., a single
corporation, and the records contain no suggestion to rebut the inference that these two ~'
names refer to the same corporation, the ono that later changed its name to Nine Ninety- f
i
Nine, Inc. Second, under statutory filing restrictions, corporate names that differ only in
terms of punctuation are not "distinguishahte" far purposes of determining corporate j
identity. Thus, the insertion or deletion of a comma would not effect au officially
recagni2ed change in either the corporate name or identity. The basic premise of
Plaintiffs argument, that two "Pcnnsy Supply" corporations, differing only by a comma,
existed at tltc same time, is untenable in tight of this statute.
According to the records of the Commomvcatth, which serve as "conclusive
evidence" of incorporation and corporate identity, as of 1995, the identity of the issuing
corporalian of Plaintiffs shares was Nine Ninety Nine, Inc. Although Plaintiff retained
his share certificate boating the name Pcnnsy Supply Inc., his o~vnershig interest
remained in the issuing corporation, Nine Ninety-Nine, inc. When Plaintiff sold his
shares in that corporation to CRH plc in 1995, he sold the ownership interest that had
been represented by the share certiftcate bearing the name Pcnnsy Supply Inc. Thus,
Plaintiffs contention that his share certificate represents an existing and valid. ownership
interest in a corporation knotivnas Pcnnsy Supply Inc. must fail.
Ejfect of'rhe 1961 Slrare/TOlders' Agreement. With respect to Plaintiffs claims
that the shareholders' agreement of 1961 voided atl transfers of his 314 shares of stock,
the court is of the opinion that the termination agreement of 1963 negated any such
potential effect on subsequent transfers. Cf. iS Pa. C.S.A. § 1529 (stating that
shareholders may alter transfer restactions by agreement). Because Plaintiffs shares
were issued after the execution of the termination agreement, and because the share
certificate itself does not indicate that the limitations imposed by the shareholders'
10
,,
agreement apply, that agreement had no cfTect on subsequent transfers of PIaintilis
shares.
CONCLUSInNS OF LAW
1) The court has jurisdiction over the parties and of the subject matter
involved in this litigation.
2) Plaintiffs share certificate, bearing the name Pennsy Supply Inc., does not '
represent an ownership interest in any corporation in the Commonwealth.
•
3) Plaintiff s share certificate, bearing the name of Pennsy Supply Inc., does
not entitle Plaintiff to exercise any shareholders' rights with respect to any corparatian in i
the Commomvealth.
4) The shareholders' agreement, executed b}• shareholders in Pennsy Supply
Inc, in 1961 and terminated by the same shareholders in 19G3, did not operate to void the
August I, 1963, transfer of shares in .Pennsy Supply Inc, by Jerry T. Simpson to Robert f
1.
M. Mumma; the August 5, 1963, transfer of shares in Pennsy Supply Inc. by Robert M. '
Mumma to Plaintiff; or the March 17, 1995, sale of those shaves by Piainti ff to CRH plc,
S) Plaintiff is nat entitled to the exercise of any shareholders' rights with ~
respect to the option to purchase shares in a corporation krtoivn as Pennsy Supply 1nc., or
any derivation thereof.
For the foregoing reasons, the following decree nisi will be entered.40
17EC- R, E~St
AND NOW, this I7a' day of May, ?Op2, upon consideration of Plaintiff's :1.
complaint for declaratory judgment in the above-captioned case, and fotlowmg a nonjury ,
trial, it fs ordered, adjudged, decreed and declared that Plaintiff does not retain aft
ownership interest in a corporation l:notivn as Pennsy Supply Inc,, or any derivation ~`;
thereof, and that the transfers of shares in Pennsy Supply Inc., or any derivation thereof, i ~
40 "The practice and procedure [inactions for declaratory relief] shall follorv, as nearly as ~
may be, the rules governing the Action in Equity." Pa. R.C.P. lGO1(a); see Pa. R.C.P.
15f 7(a) (describing the contents ofadjudication in equit}•). j
~~
,,
.. • .
,.
at issue in this action were not voided by operation of the shareholders' agreement
executed in 1961.
THIS DECREE NISI shall automat'tca[ly become a final decree, without further j
order of court, if no party in interest files a timely motion for post-trial relief in
accordance with Pennsylvania Rule of Civil Procedure 227.3.
BY THE CQURT,
/s/ J. Weslev Uler. r.
J. Wesley Qler, Jr., J.
Robert M. Mumma, T[
Box E
Bowmansdalc, PA 17008
Plaintiff, Pro Se
Robert M. Mumma,lI
68$0 S.E. Harbor Circle
~3tuart, Fiorida 34996
Plaintiff, Pro Se
Michael A. Finio, Esq.
Stephan M. Donweber, Esq.
Centre Square West
1500 Market Street, 28th Floor
Philadelphia, PA 19102
Attorneys for Defendant Pennsy Supply, Inc.
In T
and
12
°" 'Rla
TIDE}~ C:.,; e 3 4-.., s::t ~;:
VERIFICATION
No V. Otto III, Esquire, of the firm of MARTSON DEARDORFF WILLIAMS OTTO
GILROY & FALLER, attorneys for Lisa M. Morgan in the within action, certifies that the
statements made in the foregoing Response are true and correct to the best of his knowledge,
information and belief, based upon information provided by Lisa M. Morgan. He understands
that false statements herein are made subject to the penalties of 18 Pa. C.S. Section 4904 relating
to unsworn falsification to authorities.
No V. Otto III, Esquire
CERTIFICATE OF SERVICE
I, Ami J. Thumma, an authorized agent for Martson Deazdorff Williams Otto Gilroy &
Faller, hereby certify that a copy of the foregoing Response was served this date by depositing
same in the Post Office at Carlisle, PA, first class mail, postage prepaid, addressed as follows:
Jeffrey G. Brooks, Esquire
Minto Law Group, LLC
Two Gateway Center
603 Stanwix Street, Suite 2025
Pittsburgh, PA 15222
Richard F. Rinaldo, Esquire
Williams Coulson Johnson Lloyd Parker & Tedesco, LLC
One Gateway Center, 16~' Floor
Pittsburgh, PA 15222
Ms. Linda M. Mumma
P.O. Box 30436
Bethesda, MD 20824
Joseph D. Buckley, Esquire
1237 Holly Pike
Carlisle, PA 17013
Mr. Robert M. Mumma, II
Box F
Grantham, PA 17027
MARTSf~NI LAW
By
~fii J. ~/ '
Ten East igh Street
Carlisle, PA 17013
(717)243-3341
Date: March 15, 2013