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August 28, 1986

MELLON BANK, N.A., Defendant

The opinion of the court was delivered by: DIAMOND


 Plaintiff brought this action to recover damages for the alleged breach by the defendant of a Wholesale Financing Commitment (hereafter sometimes, "WFC"). The WFC was a contract, more specifically, a letter of credit, under which the defendant agreed to pay the plaintiff for invoices and drafts issued in connection with the delivery by plaintiff of Fiat motor vehicles to one of its dealers, Bob Raymond Imports, Inc. (hereafter sometimes, "BRI"). Following a bench trial, the court makes the following findings of fact and conclusions of law.

 Findings of Fact

 1. Plaintiff, Fiat Motors of North America (hereafter sometimes, "Fiat" or "Fiat Motors") is a business corporation, which at the time the complaint was filed was incorporated under the laws of the state of New York. At all times material herein, plaintiff's principal place of business was located in Hasbrouck Heights, New Jersey (Plaintiff's proposed findings of fact ("PPFF") No. 1). *fn1"

 2. Defendant, Mellon Bank, N.A. (hereafter sometimes, "Mellon" or "Mellon Bank"), is a national banking association not having its registered office or a principal place of business within the State of New York or the State of New Jersey. (PPFF No. 2).

 3. Mellon Bank has its principal office and place of business within the district of the United States District Court for the Western District of Pennsylvania. (PPFF No. 3).

 4. The amount in controversy in this action exceeds the sum or value of Ten Thousand Dollars ($10,000.00), exclusive of interest and costs. (PPFF No. 4)

 5. Fiat Motors previously was known as Fiat-Roosevelt Motors, Inc. and Fiat Distributors, Inc. (PPFF No. 5).

 6. At all times material hereto, Fiat Motors was an importer into and distributor of Fiat motor vehicles within the United States of America. (PPFF No. 6).

 7. At all times material hereto, BRI was a car dealer engaged in the sale and servicing of Fiat motor vehicles. (PPFF No. 7).

 8. By agreement dated November 19, 1975, Fiat Distributors, Inc. and BRI entered into a written Dealer Sales and Service Agreement (the "Dealer Agreement"). *fn2" (Plaintiff's Exhibit No. 5). *fn3"

 9. At the time Fiat Motors entered into the Dealer Agreement, Fiat Motors relied on, inter alia, a Wholesale Financing Commitment previously issued by Defendant, Mellon Bank (Exhibit No. 1).

 10. Mellon Bank had security agreements with Bob Raymond Imports and filed financing statements reflecting its security interest (Exhibits No. 25 and 25A).

 11. On October 2, 1978, Mellon Bank executed another Wholesale Financing Commitment (Exhibit No. 2) for the benefit of plaintiff, Fiat Motors. This WFC provided in part that:


In consideration of shipments or deliveries of Fiat motor vehicles which may hereafter be made by you pursuant to written orders of the dealer designated above, [BRI] we hereby agree (a) to pay you the total amounts shown on invoices covering such shipments and deliveries . . . upon presentation by you to us of such invoices, or (b) to pay promptly at par, drafts drawn on us for the total amount of such invoices, provided, however, (i) that our obligation hereunder shall not exceed $50,000.00 aggregate amount of invoices or drafts presented in any one day . . . .

 12. Mellon's line of credit to Bob Raymond Imports under the WFC was Two Hundred Fifty Thousand Dollars ($250,000.) (Exhibit No. 3).

 13. On or about January 18, 1977, Mellon Bank executed a "Waiver of Certificate of Origin" which it presented to Fiat Motors wherein Mellon requested that Fiat "send directly to subject dealer [BRI] the Certificate of Origin for the Fiat automobiles that are purchased from you until otherwise notified in writing by us." (Exhibit No. 4).

 13-A. This waiver remained in effect during all times material in this case, and never was withdrawn or rescinded by Mellon Bank.

 14. From October of 1978 through 1981, plaintiff shipped over a hundred cars to BRI in reliance, at least in part, on the 1978 WFC.

 15. In April 1981, BRI agreed to participate in Fiat's so-called "1981 Spring Incentive Program" (hereafter sometimes, the "Program" or the "1981 Program") and agreed to purchase fifty of plaintiff's cars between April and July 1981. (Exhibit Nos. 8 and 8A).

 16. Mellon was not advised of Fiat's 1981 Spring Incentive Program or of its terms and conditions until on or about April 30, 1981, when Mellon received the first group of invoices for Fiat vehicles ordered by BRI under the Program.

 17. Among those vehicles delivered to Bob Raymond Imports pursuant to the 1981 Program were twelve Fiat automobiles identified by serial number, all of which were shipped in 1981.

 18. On or about the date of shipment of these motor vehicles, Fiat Motors issued invoices and sight drafts pertaining to the respective vehicles, and those sight drafts and invoices were mailed to and received by defendant, Mellon Bank, (Exhibit Nos. 11A-L). 19. Those invoices are as follows: Model/Serial Invoice Invoice Invoice Number Amount Date Exhibit No. 1981-X19-00137416 $ 8,374.00 4/30/81 11-A 1981-124-00175539 $ 8,687.00 4/30/81 11-B 1981-138-02524948 $ 5,695.00 5/07/81 11-C 1981-138-02537465 $ 5,695.00 5/07/81 11-C 1981-X19-08138748 $ 8,524.00 4/30/81 11-E 1981-X19-08141830 $ 8,524.00 4/30/81 11-F 1981-124-08180679 $ 9,230.00 4/30/81 11-G 1981-124-08182669 $ 9,230.00 7/29/81 11-H 1981-124-08183551 $ 9,230.00 7/29/81 11-I 1981-124-08183608 $ 9,466.00 7/29/81 11-J 1981-124-08184021 $ 9,037.00 4/30/81 11-K 1981-124-08184627 $ 9,466.00 4/30/81 11-L


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