No. 1487 Philadelphia, 1981, Appeal from Order of the Court of Common Pleas, Civil Action, Law of Pike County at No. 36 November Term, 1979.
Thomas J. Newell, Hawley, for appellants.
Patrick M. Connolly, Scranton, for appellees.
Spaeth, Cavanaugh and Montemuro, JJ.
[ 305 Pa. Super. Page 149]
Lawrence Goodman and Rosalyn Goodman, the appellants herein, entered into a construction agreement with Pate Construction, Inc. dated November 28, 1977, for the construction of a new home. The cost of the house was to be $43,404.00. The agreement stated in Paragraph Second: "The owner does hereby promise and agree to and with the said contractor that owner shall and will, in consideration of the covenants and agreements being performed and kept by the contractor, as specified, well and truly pay, or cause to be paid unto the contractor . . ." the sum of $43,404.00 in accordance with a pay-out schedule. This paragraph further provided that "Owner and Contractor agree to modify this pay-out schedule if required by any lending institution to conform with that institution's pay-out schedule."*fn1 In February, 1978, the Northeastern Bank of Pennsylvania, the appellee herein, loaned the appellants $49,000.00 for the purpose of financing the construction of their home.
[ 305 Pa. Super. Page 150]
Construction of the home commenced in February, 1978. The Northeastern Bank made payments to Pate Construction, Inc. in March, 1978, July, 1978, and two payments in August, 1978, totaling approximately $33,921.00. This amount represented about eighty per cent payable by the appellants to Pate Construction, Inc. under their contract. At the end of August, 1978, Pate Construction, Inc. abandoned the construction of the appellant's home and allegedly some of the work that it performed prior to leaving the job was not done in a workmanlike manner. In December, 1979, the appellants commenced an action in assumpsit against Pate Construction, Inc., Clarence W. Pate, Sigrid V. Pate and Northeastern Bank of Pennsylvania. The bank filed a motion for summary judgment which was granted by the court below and forms the basis of this appeal. Based on a stipulation of counsel the court below entered judgment in favor of the appellants and against Pate Construction, Inc. in the amount of $42,851.28, the principal amount appellants sought against Pate Construction, Inc. in their complaint in assumpsit. Also, based on counsel's stipulation, judgment was entered in favor of the individual defendants, Clarence W. Pate and Sigrid V. Pate and against the appellants.
The sole issue on appeal is whether summary judgment was properly entered in favor of Northeastern Bank of Pennsylvania and against the appellants. It is axiomatic that summary judgment will be entered only in a clear case. Hankin v. Mintz, 276 Pa. Super. 538, 419 A.2d 588 (1980). A summary judgment may be granted where the pleadings, depositions, interrogatories and admissions on file show that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. Bollinger v. Palmerton Area Communities Endeavor, Inc., 241 Pa. Super. 341, 361 A.2d 676 (1976); Community Services of Clearfield, Inc. v. Local 2665, American Federation of State, County and Municipal Employees, AFL-CIO, 292 Pa. Super. 238, 437 A.2d 23 (1981). Applying these rules, and interpreting the facts most favorably to the appellants there is nothing in the record that establishes a promise by the
[ 305 Pa. Super. Page 151]
bank that it would not release funds to Pate Construction, Inc. unless the work had been performed in a workmanlike manner.*fn2 The bank was not a party to the contract between the appellants and Pate Construction, Inc. Further, the pay-out schedule entered into between the appellants and Pate Construction, Inc. provided that the appellants and the contractor would modify the pay-out schedule if required by any lending institution to conform with the institution's pay-out schedule. While it might be argued that the appellants had the right to rely on the bank's undertaking to engage in some kind of pay-out plan, there is nothing in the evidence to suggest that the bank undertook an obligation to appellant to pay out sums only on a pro tanto basis in strict accordance with the exact progress of the construction and precise conformity to the requirements of the building contract to which it was not a party.
The depositions reveal that there were no genuine issues as to any material fact. Lawrence Goodman, one of the appellants, testified as follows with reference to the bank's obligations:
Q. When you closed your mortgage at the bank, who represented you?
A. I believe it was a title company.
Q. Did you have any attorney present?
Q. Was there an attorney from the bank present?
[ 305 Pa. Super. Page 152]
Q. Did anybody at the closing advise you as to the procedures the bank uses with respect to disbursement of the monies that they are holding in escrow for the construction of the house?
A. They advised me that I had paid $125 inspection fee, and I assumed the bank was going to ...