Kennedy v. Fagan

92 So.3d 528

Richard KENNEDY, Individually and as the Dative Testamentary Executor of and the Succession of Sylvia Antonia Acosta Kennedy Graves

v.Julie Kennedy FAGAN, Thomas Schafer III, ABC Insurance Company, T. Lynn Witt–Stamps, J. Jackson Stamps, Def Insurance Company, Bank of Louisiana and Shirley Henderson.

No. 2011 CA 0482.

Court of Appeal of Louisiana, First Circuit.

May 1, 2012.

Rehearing Denied July 31, 2012.

Maurice J. LeGardeur Jr., Covington, LA, Adam S. Lambert, New Orleans, LA, for Plaintiff–Appellant Richard Kennedy.

Michael S. Fawer, Covington LA, for Defendant–Appellee, Julie Kennedy–Fagan.

Henry L. Klein, New Orleans, LA, for Defendants–Appellees Bank of Louisiana and Shirley Henderson.

Before CARTER, C.J., KUHN, PETTIGREW, McCLENDON, and WELCH, JJ.

PETTIGREW, J.

[1 Cir. 2]In this action for damages, plaintiff-appellant, individually, and in his capacity as the dative testamentary executor of the estate of his late mother, filed suit naming numerous defendants, including his sister, who was the former testamentary executrix, the former attorneys for the estate, their respective malpractice insurers, a bank holding assets belonging to the estate, and an employee of said bank. Cross motions for summary judgment were later filed, on behalf of plaintiff-appellant, as well as on behalf of the bank and its employee. From a denial of his motion for summary judgment and a grant of summary judgment in favor of the bank and its employee, which dismissed his claims against said defendants, plaintiff-appellant has appealed to this court.

FACTS

The present litigation is yet another lawsuit arising out of the 2001 murder-suicide of Emory Lea Graves, Sr. and his wife, Sylvia Antonia Acosta Kennedy Graves. See In re Succession of Graves, 2007–2180 (La.App. 1 Cir. 3/12/08), 985 So.2d 140,writ denied,2008–0799 (La.6/6/08), 983 So.2d 919;Kennedy–Fagan v. Estate of Graves, 2007–1062 (La.App. 1 Cir. 7/21/08), 993 So.2d 255,writ denied,2008–2079 (La.11/10/08), 996 So.2d 1073.

Sylvia Antonia Acosta Kennedy Graves, decedent herein (“decedent”), died testate as a result of a murder-suicide on or about July 21, 2001. The decedent left two legatees, who were children from her first marriage—a daughter, defendant Julie Esther Kennedy–Fagan (“Julie”), and a son, plaintiff-appellant, Richard Vincent Kennedy (“Richard”). According to the terms of the decedent's will, Julie was named as executrix of the estate. Due to her apparent failure to properly administer and liquidate decedent's estate, Julie was removed from her duties as testamentary executrix by order of the trial court. In Julie's stead, her brother and co-heir, Richard, was appointed by the trial court to serve as the dative testamentary executor.

On January 3, 2006, Richard instituted the present tort suit, appearing individually, and in his capacity as executor of the estate. Based upon the allegations of his petition, Richard seeks to recover estate assets, monies, and damages resulting from the actions [1 Cir. 3]and/or inactions of the defendants named herein. Following a denial of his motion for a partial summary judgment and a grant of summary judgment in favor of the bank and its employee dismissing his claims against said defendants, Richard now appeals. We affirm in part, reverse in part, and remand.

Richard alleged in the instant petition that his sister Julie retained attorneys T. Lynn Witt–Stamps and her husband, attorney J. Jackson Stamps, ¹ to represent decedent's estate, and began administration of the estate on or about August 8, 2001. It was also alleged that “[t]he estate consisted of several valuable properties, including immovable rental properties in Louisiana and other states, three automobiles, and valuable estate jewelry, which was [sic] owned by decedent at the time of her death.” Richard further alleged that Julie and her attorneys opened succession bank accounts at the Bank of Louisiana (“Bank”), 636 Gause Boulevard, Slidell, Louisiana, with the assistance of their friend and/or associate, defendant Shirley Henderson, the assistant vice president and manager of the Gause Boulevard Branch of the Bank. It was alleged that Ms. Henderson “routinely breached her duties to the bank and its clients in order to assist [Julie], and her attorneys.” Richard claimed that Julie together with “defendantsT. Lynn Witt–Stamps and J. Jackson Stamps, took physical possession of the estate jewelry, which [Julie] herself valued at over $100,000.00, and placed [said] jewelry into a [safety deposit] box located at the [Bank].”

Richard alleged in the instant action for damages that during Julie's administration of the estate, and while attorneys T. Lynn Witt–Stamps, J. Jackson Stamps (collectively, “Witt and Stamps”), and later, Thomas Schafer, III, provided legal representation to the estate, said defendants were allowed to enter the safety deposit box at the Bank without obtaining court approval and without even signing signature cards for the said safety deposit box. It was also alleged that during one of these unrecorded entries into the [1 Cir. 4]estate's safety deposit box, the valuable pieces of estate jewelry were removed leaving only “worthless costume jewelry and paste.”

Additionally, Richard alleged that Julie authorized Mrs. Witt–Stamps to sign checks on the decedent's bank accounts and withdraw over $30,000.00 in attorney fees from said accounts without court approval or notice and without the court's knowledge.

Richard also alleged that the Bank knew or should have known of the actions of Julie's attorney, Mrs. Witt–Stamps, as the Bank kept banking records in the normal course of its business. Additionally, it was alleged that the Bank knew or should have known of the close relationship between its employee, Ms. Henderson, Julie, and Mrs. Witt–Stamps, and should have closely monitored the decedent's bank accounts.

Richard further alleged that Julie's subsequent attorney, Mr. Schafer, knew or should have known that prior counsel, Witt and Stamps, had removed funds from the decedent's accounts without court approval, as records of said transactions and letters from Julie “authorizing” withdrawals by Mrs. Witt–Stamps were later discovered among Mr. Schafer's files.

It was alleged that the aforementioned unauthorized acts were effectuated during Julie's administration of decedent's estate with the apparent assistance of Ms. Henderson, in her official capacity as a bank officer with the Bank, thereby rendering the Bank vicariously liable.

ACTION OF THE TRIAL COURT

On April 8, 2010, Richard filed a motion for partial summary judgment against the Bank and Ms. Henderson for estate funds that were illegally dispersed to Witt and Stamps by the Bank and Ms. Henderson. Richard also sought a partial summary judgment on the issue of liability against these same defendants for the jewelry that was allegedly stolen from the safety deposit box at the Bank.

In response, the Bank and Ms. Henderson filed a cross-motion for summary judgment and claimed that the Bank was not liable because it was allegedly authorized by Julie, its “customer” and executrix of the estate, to issue 11 cashier's checks signed by Ms. Henderson for funeral expenses, legal fees, and taxes. The Bank argued that since [1 Cir. 5]Julie had consented to its drafting of the cashier's checks and given authorization for the estate's attorneys to enter the safety deposit box, the Bank was only honoring the wishes of its customer and could not be held liable.

Following a hearing on June 29, 2010, the trial court, for reasons orally assigned, denied Richard's partial motion for summary judgment against the Bank and Ms. Henderson, and dismissed Richard's claims against these defendants. Although the trial court specifically rejected the arguments put forth by the Bank regarding prescription and abandonment,² the trial court found that Julie, in her capacity as executrix, had the authority to write checks and authorize withdrawals from the decedent's Bank accounts. It was on this ground that the trial court granted the cross-motion for summary judgment filed by the Bank and Ms. Henderson. From this judgment, Richard, both individually, and in his capacity as executor of the estate of decedent, has appealed.

ISSUES PRESENTED ON APPEAL

In connection with his appeal in this matter, Richard presents the following issues for review and disposition by this court:

1. Did the trial court commit an error of law by failing to apply the legal presumption of liability for a bank that loses deposits which it was paid to keep safe?

2. Did the trial court commit an error of law by failing to apply the legal presumption of liability under the theory of Res Ipsa Loquitur?

3. When a bank's customer and account holder dies, can the bank simply release funds from the decedent's account on orders of the decedent's daughter without prior orders of a court, or must that bank require a court order to release funds from the bank accounts of a deceased person?

4. May a bank be held liable for property lost or stolen from one of its safety deposit boxes when the bank admittedly failed to follow proper banking procedures and protocols by allowing unauthorized persons to enter the box without even signing the signature card or recording their entry into the box?

[1 Cir. 6]STANDARD OF REVIEW

A motion for summary judgment is a procedural device used to avoid a full scale trial when there is no genuine issue of material fact. Gonzales v. Kissner, 2008–2154, p. 4 (La.App. 1 Cir. 9/11/09), 24 So.3d 214, 217. Summary judgment is properly granted if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue of material fact, and that mover is entitled to judgment as a matter of law. La.Code Civ. P. art. 966(B). Summary judgment is favored and is designed to secure the just, speedy, and inexpensive determination of every action....