## Facts

- A nine-bank international consortium entered a written deposit/loan agreement with a Venezuelan financial institution for $25 million; one bank participated for $3 million.
- The agreement required repayment of principal and interest in six semiannual installments and designated a New York bank (Marine Midland) as agent to receive payments in New York and distribute them pro rata to the lenders.
- The borrower made scheduled payments in 1982, reducing the participating bank’s share of outstanding principal to $2 million.
- In 1983, Venezuelan currency-control decrees restricted dollar use and directed Venezuelan financial institutions to restructure debt and suspend principal payments until 1986; the borrower continued paying interest but stopped paying principal.
- The agreement contained New York choice-of-law and forum provisions and included express waivers of objections to New York venue, a waiver of any right to insist on litigation in Venezuela, appointment of a New York agent for service, and consent to New York personal jurisdiction.
- The participating bank sued in New York for its unpaid principal balance, moved for partial summary judgment, and had obtained an attachment of funds allegedly owed to the borrower.
- The borrower cross-moved to dismiss on forum non conveniens and, alternatively, sought summary judgment based on international comity (Venezuelan decrees) and lack of the plaintiff bank’s standing to sue alone.

## Issues

1. Whether New York was an appropriate forum, despite the parties’ foreign status and Venezuelan regulatory context, given the agreement’s New York forum-selection and choice-of-law provisions and New York contacts.
2. Whether a single participating bank in a consortium loan had contractual authority (standing) to sue the borrower in its own name, or whether enforcement was reserved to the agent bank and/or collective lender action.
3. Whether Venezuelan decrees suspending principal payments should be recognized as a defense under international comity (given the court’s resolution of standing).

## Decision

- The court denied dismissal on forum non conveniens, holding New York was an appropriate forum in light of the parties’ contractual forum provisions and New York’s substantial transactional connections.
- The court held the plaintiff lacked standing to sue individually because the agreement, read as a whole, structured the creditor relationship and enforcement mechanism as a consortium arrangement administered through the agent and collective lender decision-making.
- The action was dismissed for lack of standing; the plaintiff’s motion for partial summary judgment was denied.
- The court did not reach a merits determination on the international comity defense because the standing defect was dispositive.

## Legal Principles

- New York courts generally enforce forum-selection and choice-of-law clauses in international commercial financing, and foreign parties and foreign regulatory issues do not alone make New York an inconvenient forum where New York has meaningful contractual and performance contacts.
- In a consortium/syndicated loan structure with an agent bank and collective decision provisions, an individual participant may lack standing to sue the borrower if the contract vests enforcement authority in the agent and/or requires majority (or other collective) lender authorization.
- Contract interpretation for standing focuses on the agreement as a whole, including the allocation of payment administration, amendment/enforcement procedures, and the avoidance of fragmented lender litigation.

## Conclusion

The court retained the case in New York under the forum-selection framework and strong New York transaction ties, but dismissed because the deposit agreement’s consortium-and-agent enforcement structure did not authorize a single participating bank to sue the borrower independently.


Credit Francais Int'l, S.A. v. Sociedad Financiera de Comercio, C.A., 128 Misc. 2d 564, 490 N.Y.S.2d 670 (Sup. Ct. N.Y. Cnty. 1985)