Opinion
14-P-1235
03-23-2016
FIA CARD SERVICES, N.A. v. VINCENT C. MUSCOLINO.
NOTICE: Summary decisions issued by the Appeals Court pursuant to its rule 1:28, as amended by 73 Mass. App. Ct. 1001 (2009), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
Plaintiff FIA Card Services, N.A. (FIA), brought this collection action against defendant Vincent C. Muscolino, one of its credit card holders. After a jury-waived trial in Superior Court, the judge found Muscolino liable to FIA for the outstanding balance on his card, and judgment entered accordingly. Muscolino, pro se on appeal as he was at trial, appeals from the judgment. We affirm.
Discussion. We understand Muscolino's challenges to the judgment against him to arise from FIA's failure to produce a credit card agreement or other documentation bearing his signature, its use at trial of documents related to a separate checking account maintained by Muscolino with an FIA affiliate, and from his contention that FIA is not the proper party in interest based on confusion about the corporate structure of FIA's parent, Bank of America Corporation.
We note at the outset that the appellate briefing in this matter was lamentably inadequate on both sides. Neither party's brief fully complied with Mass.R.A.P. 16(a)(4), 367 Mass. 921 (1975). "[Rule] 16(a)(4) . . . requires that briefs submitted to this court 'shall contain the contentions of the appellant with respect to the issues presented, and the reasons therefor, with citations to the authorities, statutes and parts of the record relied on.' . . . Briefs that limit themselves to bald assertions of error that lack[] legal argument . . . [do not] rise[] to the level of appellate argument required by rule 16. . . . Here, [Muscolino] failed to support his claims of error with sufficient legal argument or factual detail, and fails to cite to sufficient supporting authority. As both a legal and a practical matter, [Muscolino's] submissions provide an insufficient basis for this court reasonably to consider his claims." Kellogg v. Board of Registration in Med., 461 Mass. 1001, 1003 (2011) (quotations omitted). The defendant, for its part, has done little to dispel the confusion. Nonetheless, in the exercise of our discretion, we attempt to decipher the live issues despite the parties' failure to assist the court in this endeavor.
FIA called one witness to testify at trial, a FIA operations consultant who was also "an officer of the bank." The defendant called no witnesses and did not testify. He introduced some documentary evidence, largely from FIA's responses to his discovery requests.
1. Standard of review. "On review of a jury-waived proceeding, we accept the judge's findings of fact unless they are clearly erroneous." U.S. Bank Natl. Assn. v. Schumacher, 467 Mass. 421, 427 (2014). See Twin Fires Inv., LLC v. Morgan Stanley Dean Witter & Co., 445 Mass. 411, 420 (2005) ("On appeal, we are bound by a judge's findings of fact that are supported by the evidence, including all inferences that may reasonably be drawn from the evidence"). "We review the judge's rulings on questions of law de novo." Schumacher, supra.
Where, as here, a judge's findings in a bench trial "are based not on an assessment of witness credibility but solely on documentary evidence, we may draw our own conclusions from the record." Schumacher, 467 Mass. at 427 (quotations omitted). However, except for a legally inapposite and inadequately substantiated argument raised for the first time in his reply brief and discussed infra, Muscolino has not challenged the sufficiency of the documentary evidence supporting FIA's account stated theory or the judge's findings in connection therewith separately from his legal arguments concerning the absence of a written contract and FIA's consequent inability to charge interest. Any such challenge is therefore now deemed waived. See Boston Hous. Authy. v. Guirola, 410 Mass. 820, 827 n.9 (1991) (failure to raise and brief argument on appeal is deemed waiver of any objection); Abate v. Fremont Inv. & Loan, 470 Mass. 821, 833 (2015).
2. Account stated. Muscolino relies heavily on FIA's failure to produce signed copies of his credit card application, credit card agreement, or any document that contains the terms and conditions governing his account. However, Muscolino's arguments in this regard fail because the complaint in this matter alleges an "account stated," and the trial judge's findings of fact support FIA's recovery under this theory. See Charman v. Henshaw, 15 Gray 293, 294 (1860) ("[U]nder a declaration upon an account stated, the cause of action is the agreement of the parties to pay the amount due upon the accounting, and not any written instrument").
"An 'account stated' is an acknowledgment of the existing condition of liability between the parties. From it the law implies a promise to pay whatever balance is thus acknowledged to be due. It thereby becomes a new and independent cause of action, so far as that a recovery may be had upon it without setting forth or proving the separate items of liability from which the balance results." Rizkalla v. Abusamra, 284 Mass. 303, 307 (1933), quoting from Chace v. Trafford, 116 Mass. 529, 532 (1875). "An account stated 'supposes a rendering of the account by the party who is the creditor, with a balance struck, and an assent to that balance, expressed or implied; and thus the demand is essentially the same as if a promissory note had been given for the balance.'" Davis v. Arnold, 267 Mass. 103, 111 (1929), quoting from Bass v. Bass, 8 Pick. 187, 193 (1829). Under an account stated theory, a plaintiff need not "prove any items of the original indebtedness." Berwin v. Levenson, 311 Mass. 239, 247 (1942).
"The assent necessary to make out an account stated . . . may be either express or implied. . . . '[A]ssent may indeed be inferred from the reception and retaining of the account without objection.'" Milliken v. Warwick, 306 Mass. 192, 196-197 (1940), quoting from Charman v. Henshaw, 15 Gray at 294. A party's receipt of account statements and the failure to timely object to the amounts reflected can therefore establish the party's liability for the account balance. Although not often relied on in recent years in published decisions by the courts of the Commonwealth, we have not found anything to suggest that the doctrine of recovery based on an account stated is no longer viable. See, e.g., Bucklin v. National Shawmut Bank of Boston, 355 Mass. 338, 341 (1969).
Here, the trial transcript indicates that FIA introduced a collection of Muscolino's credit card statements from February, 2006, going forward. All statements were sent to Muscolino at his address. In her review of the statements, the trial judge found that Muscolino procured and repaid multiple cash advances using this account over a period of years. This evidence was more than sufficient to demonstrate the requisite "previous transactions of a monetary character creating the relation of debtor and creditor" between Muscolino and FIA on which to found recovery "upon an account stated." Rizkalla v. Abusamra, supra at 306. See Cavanaugh Bros. Horse Co. v. Gaston, 255 Mass. 587, 590 (1926) (action at law on "account stated" "lies only where there have been transactions previous to the statement of the account which create a relation of debtor and creditor").
FIA's witness testified that, consistent with FIA's business practice, Muscolino's account number was changed for accounting purposes when the account was "charged off."
The evidence further supported a finding that Muscolino impliedly assented to the "rendering of the account by [FIA,] the party who is the creditor" by failing to object to the accounting reflected in the statements and, indeed, paying against the balance stated thereon. Davis v. Arnold, 267 Mass. at 111 (an "account stated" requires "acknowledgment of an existing liability" [quotation omitted]). The judge found that as of January, 2010, Muscolino had an outstanding credit card balance of $101,898.14 and that he did not dispute any of the charges on his account or the statements showing that balance. See King v. Davis, 168 Mass. 133, 133 (1897) (in action on account stated defendant "was in arrears" but "he had made some payments on account" and plaintiff's agent "called upon him, taking with him a written statement of their mutual accounts, and showing a balance due").
Although not specifically remarked upon by the trial judge, in addition to stating some of the terms of the credit agreement and advising Muscolino that the complete terms and conditions could be found on the credit card agreement, the statements contained instructions for cardholders who wished to dispute charges. In February, 2010, Muscolino did contact FIA to request the return of the payment he had made to the account the previous October, his last payment on the account. FIA complied with his request to reverse the payment, and Muscolino did not raise any other issues or challenge his balance at that time.
Muscolino argues for the first time in his reply brief that the evidence showed a balance due different from that pleaded, citing Barker Auto Co. v. Bennett, 219 Mass. 304, 308 (1914). We need not consider this argument. See Campbell Hardware, Inc. v. R.W. Granger & Sons, Inc., 401 Mass. 278, 280-281 (1987) (court need not consider issues argued for first time in reply brief). Even if we were to address it, however, the claim is without merit. To support this claim, Muscolino notes that FIA did not introduce each and every one of his statements over the life of the card, but he does not specify which statements are missing and why their absence would be relevant. This argument falls far short of an evidentiary showing of a bona fide dispute as to the balance due. FIA brought suit for the balance as reflected on the statements at the time Muscolino stopped making payments. Muscolino has thus not shown a discrepancy between the amount pleaded, the evidence, and the findings. Barker is therefore inapposite. See Charman v. Henshaw, 15 Gray at 294 (balance rendered on written account "happens to be the precise sum for which the plaintiff sues").
To the extent Muscolino claims that FIA's failure to produce signed paperwork for the opening of the account precludes it from having charged interest on the account from its inception, his argument fails in light of the evidence supporting his assent to, and acknowledgment of, the "account stated" balance (however composed in terms of principal and interest) reflected on the statements he received, paid on, and to which he never objected prior to the charge off of the account.
3. Proper party in interest. The record supports the trial judge's findings that FIA was formerly known as MBNA America Bank, N.A. (MBNA), and that it changed its name in June, 2006, just before acquiring Bank of America, N.A. (BANA), in October, 2006. At the time of trial, both FIA and BANA were subsidiaries of Bank of America Corporation (BoA), though BANA was itself merged into and wholly owned by FIA. FIA is the BoA subsidiary responsible for unsecured lending. Although the front of Muscolino's statements directed that payments be made to "Bank of America," another section of the statement stated the following: "For the complete terms and conditions of your account, consult your credit card agreement. FIA Card Services is a trade name of FIA Card Services N.A. The account is issued and administered by FIA Card Services N.A." As found by the trial judge, the statements sent to Muscolino and admitted in evidence at trial reflect the transition of his card's issuer from MBNA to FIA and the simultaneous appearance on the statements of references to both BoA and FIA. Thus, the judge's conclusion that Muscolino's "Bank of America credit card" was issued and administered by FIA was not clearly erroneous.
Muscolino relies on information in BoA's United States Securities and Exchange Commission Form 10-Q for the quarterly period ended March 31, 2014, indicating BoA's plan to merge FIA into BANA in October, 2014, subsequent to the trial in this matter. Muscolino's confusion is understandable but ultimately irrelevant. From the record at trial, it appears that BoA owned FIA and that while FIA and BANA merged in 2006, BANA endured as a separate, if wholly owned, legal entity. The Form 10-Q appears to reflect BoA's intention to vertically restructure its holdings and place FIA under BANA. FIA's witness opined that while she was not familiar with the Form 10-Q, this could be part of a plan to streamline BoA's various entities. The corporate parent's plan to effectuate a consolidation of one of its subsidiaries into that subsidiary entity's subsidiary -- if that is in fact what the Form 10-Q announced -- does not deprive FIA of the right to prosecute this action, as the evidence sufficiently demonstrated that it remained the issuer of Muscolino's card despite the name change from MBNA.
It does not appear that the Form 10-Q was admitted in evidence. Muscolino did, however, ask FIA's witness questions about it -- and FIA's counsel conducted redirect examination on it briefly -- such that some of its content is included in the transcript. We address the Form 10-Q only to avoid any doubt as to the basis of our decision.
Muscolino's focus on FIA's statement (in response to one of his requests for admission) that FIA "is not Bank of America" is misplaced. While FIA might have elaborated on its corporate structure more fully in that admission, there is nothing about its maintenance of this action that is inconsistent with that answer. Moreover, FIA ultimately introduced sufficient evidence of its corporate structure at trial -- evidence on which the trial judge appears to have relied -- to establish its right to maintain this collection action at the time of trial. See Charman v. Henshaw, 15 Gray at 295 (plaintiff had "the right to prove that he was the real party with whom the accounting was made"). The fact that Muscolino made payments as directed to BoA is not dispositive here. "Even if it had appeared that [BoA] represented persons wholly distinct from the plaintiff, it might be proved that they were mere agents, and that [FIA] was the person to whom the right of action belonged." Ibid. See Esquire Swimming Pool Prod., Inc. v. Pittman, 114 R.I. 238, 241-242 (1975) (evidence was sufficient to show that plaintiff "was in fact the same corporate entity as [the entity that provided goods and services to the defendant] with solely a difference in name" and that plaintiff "was entitled to payment for the goods and services provided"). Cf. KOS v. Williams, 616 P.2d 868, 870 (Alaska 1980) (trial court's refusal to consider intervening partnership "the real party in interest" unjustified where record indicated that the partnership "changed its name . . . but remained the same entity").
4. Alleged privacy violations. Muscolino makes a number of conclusory assertions of alleged violations of Federal and State statutes committed by FIA and its counsel. However, at no point did he raise these allegations by way of a counterclaim or any other claim for affirmative relief against FIA or its counsel. He has also failed to show how any such violation would affect his indebtedness to FIA on the account stated theory of recovery at issue in this appeal. Thus we briefly address Muscolino's privacy concerns strictly as an evidentiary matter, that is, only to the extent that he contends certain documents from his BoA checking account that were unlawfully obtained were then improperly introduced in evidence.
Even if we assume for the sake of argument both that the material at issue was in fact unlawfully obtained and that the manner in which it was obtained precluded its admission in evidence at trial, Muscolino has nonetheless failed to show that he was prejudiced thereby. It appears from the transcript that the vast majority of Muscolino's checks that were offered in evidence by FIA were excluded by the trial judge. It further appears that the trial judge did not rely on any of the checks she did admit in finding in favor of FIA. We also see no need to consult those checks, which are in any event illegible as reproduced in the record appendix. Consequently, we fail to see how Muscolino was harmed by any failure to strike these exhibits. "[A]bsent a showing of prejudicial error resulting from an abuse of discretion, an appellate court will not disturb a judge's exercise of discretion. . . . The defendant . . . in an argument which [fails to comply] with Mass.R.A.P. 16 (a)(4), as amended, 367 Mass. 921 (1975), has not demonstrated any prejudice caused by the admission in evidence of [this] documentation." Wilson v. Honeywell, Inc., 409 Mass. 803, 809-810 (1991) (quotation omitted).
We similarly see no merit in any of Muscolino's other evidentiary challenges and no showing of prejudice.
Judgment affirmed.
By the Court (Cohen, Katzmann & Blake, JJ.),
The panelists are listed in order of seniority. --------
/s/
Clerk Entered: March 23, 2016.