Opinion
2004-1271.
Decided October 24, 2006.
Counsel for Plaintiff: Craig R. Fritzsch, Esq., Office Post Office Address, Binghamton, NY.
Counsel for Defendant: Scolaro, Shulman, Cohen, Fetter Burstein, P.C., By: Andrew M. Knoll, Esq., of Counsel Office Post Office Address, Syracuse, NY.
Defendant, J.P. Morgan Chase Co., moves for summary judgment dismissing this complaint which seeks payment of two certificates of deposit (CPLR § 3212). Plaintiff, J. Clifford Signor, Jr., opposes the motion.
BACKGROUND
On December 5, 1989, Chase Lincoln First Bank, N.A., issued two certificates of deposits that are the focus of this litigation. The first certificate of deposit was issued in the name of "Pauline R. Evans" in the amount of $20,000 (hereinafter "CDNo.1"). The second certificate of deposit was issued to "Pauline R. Evans or J. Clifford Signor" in the amount of $5,269.69 (hereinafter "CD# 2"). Both certificates of deposit had a term of seven days and were automatically renewable every week at a new interest rate.
Plaintiff, age 83, was the nephew of Pauline R. Evans. It appears undisputed that in 1989 Ms. Evans' moved in with plaintiff. Plaintiff alleges he had discussions with his aunt regarding his inheritance, as well as payment of her funeral expenses. Plaintiff further alleges that pursuant to these discussions he accompanied his Aunt to a Chase Lincoln First Bank, N.A. branch in Binghamton, New York on December 5, 1989 to purchase two certificates of deposit. According to plaintiff, the $20,000 in CD# 1 "[w]as going to be like a trust fund that if something happened to her, it would become mine at her death" (Defendant's Exhibit D, p. 11). Plaintiff alleges that CD# 2 was to cover Ms. Evans' funeral expenses which is why his name was added in the alternative. Ms. Evans resided with plaintiff until her death, at the age of 94, on December 24, 1997.
On September 24, 1999, all of Chase's deposit liabilities for its Binghamton, NY branches were sold to MT Bank.
On August 22, 2003, six years after Ms. Evans' death, plaintiff demanded payment of both certificates of deposit from defendant. Defendant performed a record search in 2003, but did not locate any records involving either certificate of deposit (Lewis Affidavit, ¶ 4).
Plaintiff commenced this action to compel payment to him of both certificates of deposit. The Summons and Complaint were filed in the Broome County Clerk's Office on June 17, 2004. Defendant served a Verified Answer with affirmative defenses on August 20, 2004. Defendant deposed the plaintiff on November 22, 2005. Plaintiff decided not to conduct any depositions of defendant and indicated he had no intention of calling any expert witness at trial.
A non-jury trial was scheduled for September 6, 2006, but adjourned without date at the request of the parties upon the submission of defendant's pending motion for summary judgment. Both parties agree that this case should be resolved by way of summary judgment given the plaintiff's decision to elect a non-jury trial, lack of any witness with first-hand knowledge, and plaintiff's decision not to call an expert witness. DISCUSSION
Plaintiff previously moved for summary judgment which was denied by this court by way of an Order dated September 19, 2005.
Defendant's motion for summary judgment will be granted on several grounds.
1. Summary Judgment
Defendant argues that on this record as a matter of law that plaintiff cannot meet his burden of proof at trial that the defendant is indebted to him under either CD# 1 and/or CD# 2.
Defendant's proof establishes that a search of its own records in 2003 uncovered no records regarding either CD# 1 and CD# 2. Further, defendant submitted proof in affidavit form from bank personnel that its business practice is to destroy records seven years after an account is closed. Thus, defendant contends the fact that the 2003 search of records revealed no documentation, means that "Chase must have paid the certificates of deposit more than seven years prior to making the search" (Lewis Affidavit, ¶ 5). Moreover, defendant also argues that plaintiff has failed to produce any evidence which would show said certificates of deposit were still active such as current bank statements or 1099s showing interest payments.
In opposition, plaintiff's position is quite simple. Plaintiff's proof is limited to his possession of the original first page from each certificate of deposit and his opinion that as Ms. Evans' primary caregiver he would have known if she had cashed in either certificate of deposit during her lifetime (Defendant's Exhibit D, p. 25). Plaintiff did not offer any expert testimony in opposition to this motion.
Plaintiff's position is based on his belief that his possession of the original face page from each of the certificates of deposit demonstrates the existence of a question of fact as to whether Ms. Evans' cashed them during her lifetime. The court disagrees. Defendant has submitted uncontradicted affidavits from bank personnel stating that these certificates of deposits would have contained another page — the original signature page. Plaintiff offers nothing to explain the missing signature pages for CD# 1 and CD# 2 (UCC § 3-804). Moreover, according to bank personnel, even if plaintiff were in possession of the original signature pages, the physical surrender of the certificates of deposit was not necessary in order to cash out and close either account (Barry Affidavit, ¶ 4). Plaintiff offers nothing in opposition to these arguments and elected not to depose any of defendant's employees on these issues. Consequently, in view of the foregoing, the court finds that defendant's motion for summary judgment should be granted.
The court also agrees with defendant that this proof warrants a conclusion of either a legal presumption of payment or, at a minimum, an inference of payment under the circumstances. A legal presumption of payment is generally accepted after twenty years as long as the statute of limitations has run, but has also been found in cases ranging from 14-19 years (NY Jur 2d, Payment § 180; Morse v. Miller, 39 NYS2d 815, 816 [1943], affd 267 AD 801 [1943], lv denied 267 AD 1034 [1944]; In re Rutherfurd's Estate, 182 Misc 1019, 1022-1023 [1944]). An inference of payment is proper before the limitations period has run but when a lapse of time, coupled with certain acts and/or omissions warrants such an inference ( Oneida Nat. Bank Trust Co. of Central New York v. Kranz, 70 Misc 2d 595, 598 [1972]).
II. Laches
Defendant's alternative arguments for summary judgment warrant discussion as well. Defendant also asserts that this action should be barred by the equitable doctrine of laches. Laches is an equitable bar, based on a lengthy neglect or omission to assert a right and the resulting prejudice to an adverse party ( In re of Barabash's Estate, 31 NY2d 76, 81). The mere lapse of time, without a showing of prejudice, will not sustain a defense of laches ( Galyn v. Schwartz, 56 NY2d 969, 972).
Defendant argues that plaintiff's six year delay (from Ms. Evan's death in December 1997 to the demand for payment of these certificates of deposit in August 2003) resulted in substantial prejudice due to destruction of records in accordance with its record retention policy. As noted by defendant, if a demand for payment had been made promptly after Ms. Evans' death in 1997, defendant's records regarding these certificates of deposit would have still been in existence. Plaintiff offers no argument disputing the resulting prejudice to defendant due to said delay ( In re Linker, 23 AD3d 186 [co-trustee's petition for accounting was barred by laches; co-trustee did not sue until 12 years after learning trust had been repudiated, critical records were no longer available and settlor was dead]).
As noted above, defendant also argues that plaintiff has failed to produce any 1099 forms in this case. It is undisputed that the Internal Revenue Service would have issued 1099s for any interest paid on these certificates of deposits and would still be issuing said forms if they remained in existence. Plaintiff has not produced any current 1099s and further conceded in his deposition that he destroyed all of Ms. Evans' financial documents after her death and is unable to produce copies of any 1099s (Defendant's Exhibit D, pp 24-25). Moreover, defendant also argues that plaintiff could have subpoenaed the 1099s from the IRS, but has failed to do so. Based on the foregoing, the court finds that based upon plaintiff's delay causing defendant substantial prejudice due to the unavailability of critical records, as well as plaintiff's failure to obtain available documentation (1099s) that the doctrine of laches is applicable.
Defendant argues that it lacked standing to make said request to the IRS.
III. Standing
Finally, defendant argues that plaintiff lacks standing with respect to CD# 2 to bring a lawsuit that is properly brought by Ms. Evans' estate. "Standing to sue is critical to the proper functioning of the judicial system. It is a threshold issue. If standing is denied, the pathway to the courthouse is blocked" ( Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 NY2d 801, 812, cert denied 540 US 1017). Here, it is undisputed that CD# 2 was issued in Ms. Evans' name alone. As such, CD# 2, if uncashed, vested in Ms. Evans' personal representative upon her death as personal property and did not pass automatically to plaintiff. Thus, the court finds that plaintiff lacks standing to commence this action with respect to CD# 2.
CONCLUSION
For the reasons stated, defendant J.P. Morgan Chase Co.'s motion for summary judgment dismissing the complaint is GRANTED and the complaint is DISMISSED.
This decision constitutes an order of the court. The mailing of a copy of this Decision and Order by this court shall not constitute notice of entry.
It is so ordered.