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HILLBROOK APARTMENTS v. NYCE CRETE COMPANY (12/01/75)

decided: December 1, 1975.

HILLBROOK APARTMENTS, INC., APPELLANT,
v.
NYCE CRETE COMPANY



Appeal from judgment of Court of Common Pleas of Montgomery County, No. 69-15524, in case of Hillbrook Apartments, Inc. v. Nyce Crete Company.

COUNSEL

Clarke F. Hess, with him Butera and Detwiler, for appellant.

Robert G. Rosen and D. Murtaugh, with them Edward J. Hardiman, Walter J. Timby, Jr., and Pearlstine, Salkin, Hardiman and Robinson, and LaBrum & Doak, for appellee.

Watkins, P. J., Jacobs, Hoffman, Cercone, Price, and Spaeth, JJ. (Van der Voort, J., absent.) Opinion by Spaeth, J. Van der Voort, J., did not participate in the consideration or decision of this case. Dissenting Opinion by Cercone, J. Jacobs, J., joins in this dissenting opinion.

Author: Spaeth

[ 237 Pa. Super. Page 568]

Appellant, Hillbrook Apartments, Inc.,*fn1 instituted suit

[ 237 Pa. Super. Page 569]

    in assumpsit as assignee of a contract for the installation of concrete floor systems in six apartment buildings belonging to plaintiff. The complaint alleged that the floors were improperly and poorly installed by appellee, Nyce Crete Company. Appellee moved for judgment on the pleadings on the ground that appellant did not have standing to enforce the underlying contract. After argument before a court en banc, the motion was granted. This appeal followed.

The underlying contract was executed on October 23, 1962, and was between appellee and Paul S. Vollrath. The contract, written on appellee's stationery, was captioned "Re: Hillbrook Inc." and was addressed to Mr. Paul S. Vollrath. It was signed "Nyce Crete Company." Beneath this were the signatures of "Joseph C. Nyce, Engineer" and "J. David Nyce, Pres." In the lower left hand corner, under the statement, "Agreeed [ sic ] as contract", was Vollrath's signature; it was not accompanied by any indication of representative capacity.*fn2

The construction called for by the contract was completed in October, 1964. On November 5, 1969, Paul S. Vollrath Associates, Inc., assigned all rights in the contract to appellant. Vollrath signed this statement twice, once as President of Vollrath Associates, (this signature was followed by the Secretary-Treasurer's), and again, in the lower left hand corner, under the word "Approved", as President of appellant (this signature was followed by the Assistant Secretary's). On November 10, 1969, appellant brought this action now before this court.

The difficulty, it will be observed, is that there is nothing to show that Vollrath Associates had any interest in the contract to assign to appellant; Vollrath Associates is not mentioned in the contract. It is true that the

[ 237 Pa. Super. Page 570]

    contract is signed by Vollrath. However, there is no statement of corporate identity accompanying his signature, nor is a corporate seal affixed. See generally, Smiler v. Toll, 373 Pa. 127, 94 A.2d 764 (1953). The manner in which Vollrath signed the contract indicated nothing more than an intention to be bound as an individual. Strauss and Co. v. Berman, 297 Pa. 432, 147 A. 85 (1929). Therefore, on the face of the contract Vollrath Associates did not have any interest in it to assign to appellant. Nevertheless, appellant contends that it can maintain this action as a real party in interest.

"To be the real party in interest one must not merely have an interest in the result of the action but must be in such command of the action as to be legally entitled to give complete acquittance or discharge to the other party, upon performance." Spires v. Hanover Fire Ins. Co., 364 Pa. 52, 58, 70 A.2d 828, 831 (1950) (emphasis in original); Pa. R. C. P. 2002; Goodrich-Amram § 2002 (a)-3.

Appellant first contends that it is a real party in interest because it is a third party beneficiary to the contract.

There are three types of third party beneficiaries: donee beneficiary, creditor beneficiary, and incidental beneficiary. They are defined in the Restatement of Contracts, § 133 (1932):*fn3

"§ 133. Definition of Donee Beneficiary, Creditor Beneficiary, Incidental Beneficiary.

(1) Where performance of a promise in a contract will benefit a person other than the promisee, that person is . . . .:

(a) a donee beneficiary if it appears from the terms of the promise in view of the

[ 237 Pa. Super. Page 571]

    accompanying circumstances that the purpose of the promisee in obtaining the promise of all or part of the performance is to make a gift to the beneficiary or to confer upon him a right against the promisor to some performance neither due nor supposed or asserted to be due from the promisee to the beneficiary;

(b) a creditor beneficiary if no purpose to make a gift appears from the terms of the promise in view of the accompanying circumstances and performance of the promise will satisfy an actual or supposed or asserted duty of the promisee to the beneficiary, or a right of the beneficiary against the promisee which has been barred by the Statute of Limitations or by a discharge in bankruptcy, or which is unenforceable because of the Statute of Frauds;

(c) an incidental beneficiary if neither the facts stated in Clause (a) nor those stated in Clause (b) exist."

In Spires v. Hanover Fire Ins. Co., supra at 56-57, 70 A.2d at 830 (1950), (emphasis in original) the court said: "To be a third party beneficiary entitled to recover on a contract it is not enough that it be intended by one of the parties to the contract and the third person that the latter should be a beneficiary, but both parties to the contract must so intend and must indicate that intention in the contract; in other words, a promisor cannot be held liable to an alleged beneficiary of a contract unless the latter was within his contemplation at the time the contract was entered into and such liability was intentionally assumed by him in his undertaking; the ...


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