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TOM MORELLO CONSTRUCTION COMPANY v. BRIDGEPORT FEDERAL SAVINGS & LOAN ASSOCIATION AND DAVID W. FOULKE (09/26/80)

filed: September 26, 1980.

TOM MORELLO CONSTRUCTION COMPANY, INC., APPELLANT,
v.
BRIDGEPORT FEDERAL SAVINGS & LOAN ASSOCIATION AND DAVID W. FOULKE



No. 1655 October Term 1979, Appeal from the Order of the Court of Common Pleas of Montgomery County, Civil Division at No. 77 - 13568.

COUNSEL

John D. Maida, Norristown, for appellant.

Desmond J. McTighe, Norristown, for Bridgeport Federal, appellee.

William H. Bradbury, III, Norristown, for Foulke, appellee.

Spaeth, Brosky and Van der Voort, JJ.

Author: Spaeth

[ 280 Pa. Super. Page 332]

This is an appeal from an order granting motions for summary judgment on all three counts of appellant's complaint.

The allegations of the complaint may be summarized as follows. Appellant is a construction company specializing in excavation and in the installation of water and sewer lines. In January 1976 it entered into various contracts with the Charles Differ Land Development Corporation in connection with a development known as the Russell Tract, in Collegeville. Differ assured appellant that sufficient funds to pay appellant for its work at the Russell Tract would be placed in escrow with Bridgeport Federal Savings and Loan Association, which is one of the two appellees in this appeal. In April 1976, before beginning the work, appellant conferred with David W. Foulke, president of Bridgeport Federal, who is the other appellee, and Foulke orally confirmed that sufficient funds were being held in escrow for appellant's benefit, and said that Differ was a reliable contractor with

[ 280 Pa. Super. Page 333]

    the ability to complete the development profitably, and that appellant need not worry about being paid. In reliance on Foulke's representations concerning the escrow fund and Differ's ability, appellant performed his contracts with Differ. However, appellant received only small progress payments from Differ while work at the Russell Tract was underway. In September 1976, after work had been substantially completed, appellant tried to collect the money due it by asking Bridgeport Federal to pay it from the escrow fund. Payment was refused and appellant was told that it would have to look to Differ for payment, which it did unsuccessfully.

The complaint is against Bridgeport Federal, and is in assumpsit and trespass. The assumpsit count claims payment under the escrow agreement. There are two trespass counts. The first trespass count alleges that Bridgeport Federal made payments from the escrow account direct to Differ and that this was a violation of its duty of care to see that the escrow account protected appellant. The second trespass count alleges that Bridgeport Federal, through Foulke, misrepresented the protection to be afforded appellant by the escrow arrangement and Differ's reliability. Bridgeport Federal responded by joining Foulke as an additional defendant and by filing a preliminary objection pleading the Statute of Frauds*fn1 as a defense to any oral promise that might have been made to pay appellant from the escrow account what Differ owed appellant.

The lower court overruled the preliminary objection. In considering the objection, the court properly looked only to the allegations of the complaint and deemed them admitted. Gekas v. Shapp, 469 Pa. 1, 364 A.2d 691 (1976). As just noted, the complaint alleges that the escrow fund was held by Bridgeport Federal to assure that appellant would be paid for the work it did under its contract with Differ. It followed that the allegation that Bridgeport ...


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