Thomson's Estate

Citations

• 153 Pa. 332
• 26 A. 652
• 1893 Pa. LEXIS 1104

Syllabus

<p>[Marked to be reported.]</p> <p>Partnership — Unincorporated joint stock company dealing in lands— Principal and income — Life tenant and remainder-men.</p> <p>An unincorporated joint stock company organized to trade in land is essentially a partnership, in which the shares of the members do not represent land as such but an interest in the venture; and dividends declared out of the proceeds of sales made by the association, are-to be regarded as profit made in the business, so long as the capital stock remains unimpaired.</p> <p>An unincorporated association was organized to buy land in large tracts, lay out streets and lots upon it, and sell the lots at such prices as to yield profits on the venture. The titles were not made to the, members of the association as tenants in common, but to trustees who conducted the business of making sales, executing and delivering deeds to purchasers, collecting the purchase money, and doing such other acts on behalf of the company as the nature of tho business required. The trustees rendered accounts at stated intervals, and dividends were from time to time declared and paid. The capital stock as originally invested remained unimpaired. Held, that as between the life tenant and remainder-man of the stock, the dividends were income and not principal.</p> <p>Oliver’s list., 136 Pa. 43, followed; Vinton’s Ap., 99 Pa. 434, and Hubley’s Est., 41 Leg. Int. 66; 16 Phila. 327, distinguished.</p> <p>Principal and income — Stock bonus — Life tenant and remainder-man.</p> <p>The price realized by the sale of a privilege incident to the ownership of stock of a corporation, to subscribe to the bonds of another corporation whose stock is to be given as a bonus to the subscriber, is not income from the stock to which the privilege is incident.</p> <p>The above stock bonus arrangement characterized as a gross violation of law.</p>