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December 21, 1972

Louis Beltran Sanchez BELLORIN

Newcomer, District Judge.

The opinion of the court was delivered by: NEWCOMER

NEWCOMER, District Judge.

 On September 28, 1970, Plaintiff, Louis Beltran Sanchez Bellorin, filed a complaint against The Fidelity Bank ("Fidelity"), Lemoyne Trust Company, ("Lemoyne"), Fulghum Contracting Corporation, and Constructora de Tuberia, C.A. ("Contuca"), asserting a claim in the amount of $212,144.00 as a commission for personal services purportedly rendered in connection with the collection of a debt owed by the Venezuelan Government to Contuca, a subsidiary of the Fulghum Contracting Corporation.

 Plaintiff's claim is based on a letter of authority dated May 29, 1962 to Howard Rife from Fidelity and Lemoyne, authorizing Rife to collect the debt owed by Venezuela to Fulghum Contracting Corporation; on the purported assignment by Rife to Plaintiff of that letter of authority; and on certain letters to Plaintiff from James T. Fulghum in his own behalf, on behalf of Fulghum Contracting Corporation and purportedly on behalf of the defendant banks.

 Each of the defendant banks was served with the Complaint and has answered denying any liability to Plaintiff. More specifically, Fidelity and Lemoyne deny that they knew of, authorized or ratified any assignment of the May 29, 1962 letter. Fidelity and Lemoyne also denied that they ever authorized James T. Fulghum, Fulghum Contracting Corporation, or Constructora de Tuberia, C.A. (Contuca) to act as their agent; and deny that they ratified or affirmed the actions of James T. Fulghum in seeking help from Bellorin to collect the debt from Venezuela.

 Service on Defendant, Fulghum Contracting Corporation, was attempted in 1970. On motion of the Defendant, an order was entered on June 28, 1971 quashing service on Fulghum Contracting Corporation. A second summons was returned "Not Served" as to Fulghum Contracting Corporation on April 5, 1972, and effective service on Fulghum Contracting Corporation has not been made as of the date of the filing of this memorandum.

 On July 1, 1970, an Order to Dismiss without Prejudice was entered as to Constructora de Tuberia, C.A. (Contuca), which, so far as the record discloses, was never served.

 Discovery has been conducted by Plaintiff and the defendant banks, including depositions of Plaintiff, several officers of Fidelity, and James T. Fulghum.

 Fidelity and Lemoyne have now moved for summary judgment.


 Beginning in 1955, Lemoyne began extending loans to Fulghum Contracting Corporation. These loans were secured by receivables and equipment of Fulghum Contracting, and securities and real estate owned by James Fulghum. Because of the size of the loans, Lemoyne brought in Fidelity as a participant. In 1958, Contuca, a wholly owned subsidiary of Fulghum Contracting Corporation, in a joint venture with a Venezuelan company named Petrogas, completed construction of a pipeline in Venezuela. Because of a change in the Venezuelan Government in 1958, payment of nearly $1,000,000.00 due Fulghum Contracting Corporation under the construction contract, was withheld. On June 10, 1959, Fulghum Contracting Corporation assigned this receivable as collateral, to further secure the loans of Fidelity and Lemoyne. The Venezuelan Government was duly notified of this assignment.

 In approximately 1960, Fulghum Contracting Corporation began experiencing difficulty in making payments on its loans from Lemoyne, and liquidation of the collateral commenced. On May 29, 1962, Fidelity and Lemoyne authorized one Howard Rife to act as their agent in the collection of the Venezuelan claim. This letter of authority read as follows:

"This letter will authorize you on behalf of Fidelity-Philadelphia Trust Company and Lemoyne Trust Company to accept payment of their claim as assignee of Fulghum Contracting Corporation against the Venezuelan Government for the unpaid balance due on the contract between Fulghum Contracting Corporation, through its wholly-owned subsidiary, Constructora de Tuberia, C.A. (Contuca) in a joint venture with Petrogas, C.A. and the Venezuelan Government, acting by and through the Venezuela Petrochemical Institute, dated September 25, 1956, for the construction of a pipeline between Anaco and La Mariposa. The claim is outlined in a letter to the Minister of Hacienda, Republic of Venezuela, dated March 23, 1961, a copy of which is attached hereto.
This will supersede any previous instructions or powers of attorney by the undersigned banks to any other persons and you may inform the Venezuelan Government or its representatives that you have the sole ...

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