Absolute Drug Detection Services, Inc., and Chauncey Thuss, Jr. v. Regions Bank and Nisa Jordan

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REL: 12/21/2012 Notice: T h i s o p i n i o n i s s u b j e c t t o formal r e v i s i o n b e f o r e p u b l i c a t i o n i n t h e advance s h e e t s o f Southern R e p o r t e r . R e a d e r s a r e r e q u e s t e d t o n o t i f y t h e R e p o r t e r o f D e c i s i o n s , Alabama A p p e l l a t e C o u r t s , 300 D e x t e r A v e n u e , M o n t g o m e r y , A l a b a m a 3 6 1 0 4 - 3 7 4 1 ((334) 2 2 9 - 0 6 4 9 ) , o f a n y t y p o g r a p h i c a l o r o t h e r e r r o r s , i n o r d e r t h a t c o r r e c t i o n s may b e made b e f o r e t h e o p i n i o n i s p r i n t e d i n Southern R e p o r t e r . ALABAMA COURT OF CIVIL APPEALS OCTOBER TERM, 2012-2013 2110494 Absolute Drug D e t e c t i o n S e r v i c e s , I n c . , and Chauncey Thuss, J r . v. Regions Bank and N i s a Jordan Appeal from J e f f e r s o n C i r c u i t (CV-09-901750) Court PITTMAN, J u d g e . Absolute Drug Detection Services, I n c . ("ADDS"), a n d C h a u n c e y T h u s s , J r . ( " T h u s s " ) , t h e owner o f ADDS, a p p e a l a summary j u d g m e n t i n f a v o r Nisa Jordan This ("Jordan"), action transactions o f R e g i o n s Bank from ("Regions") a n d an e m p l o y e e o f R e g i o n s . arises that occurred out of allegedly unauthorized i n v o l v i n g b a n k a c c o u n t s ADDS h a d 2110494 with Regions. naming ADDS a n d Thuss as d e f e n d a n t s filed Regions, A d r i e n n e R e e d d/b/a J e f f c o Jordan, ADDS a n d Thuss "willfulness," Jordan, Eric Chem-Dry, S p r i n t and E r i c R e e d d/b/a A n a l y t i c a l and the action i n May 2 0 0 9 , Reed ("Reed"), Communications, T e s t i n g Group. A g a i n s t Regions asserted and wantonness; claims of negligence, additionally, they stated a b r e a c h - o f - c o n t r a c t c l a i m a g a i n s t R e g i o n s o n l y . ADDS a n d Thuss a l l e g e d t h a t R e g i o n s and J o r d a n had i m p r o p e r l y p e r m i t t e d Reed t o e x e c u t e t r a n s a c t i o n s t h a t h a d n o t b e e n a u t h o r i z e d b y Thuss and t o become a s i g n a t o r y on ADDS's b a n k a c c o u n t s . In August motions. ADDS 2011, a l l d e f e n d a n t s and Thuss responded filed summary-judgment i n opposition t o those m o t i o n s , a n d a h e a r i n g on t h e m o t i o n s was h e l d on O c t o b e r 4, 2011. On O c t o b e r 12, 2 0 1 1 , t h e t r i a l court entered a p a r t i a l summary j u d g m e n t i n f a v o r o f R e g i o n s a n d J o r d a n , b u t i t d e n i e d the motions of the other t h e r e a f t e r f i l e d motions R. C i v . P., c e r t i f i c a t i o n defendants. Regions and Jordan f o r the entry o f a Rule 54(b), A l a . of the p a r t i a l summary j u d g m e n t as a f i n a l j u d g m e n t as t o t h e c l a i m s a s s e r t e d a g a i n s t them, w h i c h the trial timely c o u r t g r a n t e d on November 14, 2011. ADDS a n d Thuss a p p e a l e d ; t h e a p p e a l was t r a n s f e r r e d court to this b y t h e supreme c o u r t p u r s u a n t t o A l a . Code 1975, 2 § 12-2-7(6). 2110494 The is record reveals the following undisputed a c o r p o r a t i o n l o c a t e d i n Birmingham testing and r e l a t e d services f o r i t s clients. owner o f ADDS; a t a l l r e l e v a n t t i m e s , branch account operations a t the Regions l o c a t i o n , where ADDS c o n d u c t e d Thuss i s the with Regions: a a n d a money-market a c c o u n t . manager drug Reed was t h e b u s i n e s s manager f o r ADDS. ADDS h a d two b a n k a c c o u n t s checking ADDS provides that facts. Jordan Southside was t h e branch most o f i t s t r a n s a c t i o n s . The d e p o s i t a g r e e m e n t e n t e r e d i n t o b y T h u s s , on b e h a l f o f ADDS, a n d R e g i o n s provided: " I f y o u d i s c o v e r an u n a u t h o r i z e d payment o r o t h e r d i s c r e p a n c y , you must p r o m p t l y n o t i f y us i n w r i t i n g o f t h e r e l e v a n t f a c t s . Y o u r r e p o r t must i d e n t i f y t h e s p e c i f i c time o r d e b i t s t h a t you a r e c h a l l e n g i n g . " I f you f a i l t o comply w i t h your d u t y t o examine your statements and account a c t i v i t y and r e p o r t e r r o r s , d i s c r e p a n c i e s and u n a u t h o r i z e d t r a n s a c t i o n s , i n a d d i t i o n t o any a n d a l l o t h e r r i g h t s a n d r e m e d i e s available t o u s , we shall have the defenses c o n t a i n e d i n § 4-406(d) o f t h e U n i f o r m C o m m e r c i a l Code (UCC) ... I n a d d i t i o n , i f y o u r c l a i m i n v o l v e s a s e r i e s of items c o n t a i n i n g unauthorized s i g n a t u r e s o r a l t e r a t i o n s b y t h e same w r o n g d o e r , y o u s h a l l be p r e c l u d e d f r o m a s s e r t i n g a g a i n s t us a n y u n a u t h o r i z e d s i g n a t u r e o r a l t e r a t i o n b y t h e same w r o n g d o e r on a n y i t e m p a i d i n good f a i t h on o r a f t e r 10 c a l e n d a r d a y s after the f i r s t statement describing the f i r s t altered or unauthorized i t e m was s e n t o r made a v a i l a b l e t o you "Without regard t o the care or l a c k of care o f e i t h e r you o r u s , i f you f a i l w i t h i n 30 c a l e n d a r d a y s a f t e r t h e s t a t e m e n t o r i t e m i s s e n t o r made a v a i l a b l e t o d i s c o v e r a n d r e p o r t w i t h r e s p e c t t o an 3 2110494 i t e m ( i ) your u n a u t h o r i z e d s i g n a t u r e , o r ( i i ) any u n a u t h o r i z e d o r m i s s i n g endorsement, o r ( i i i ) any a l t e r a t i o n on an i t e m , y o u s h a l l be p r e c l u d e d f r o m a s s e r t i n g a g a i n s t us t h e u n a u t h o r i z e d s i g n a t u r e , t h e u n a u t h o r i z e d o r m i s s i n g e n d o r s e m e n t o r a l t e r a t i o n on that item. This absolute p r e c l u s i o n a p p l i e s (i) t o e a c h i t e m t h a t y o u f a i l t o r e p o r t w i t h i n 30 c a l e n d a r days and ( i i ) r e g a r d l e s s o f t h e l e g a l t h e o r y you a s s e r t . By t h i s p r o v i s i o n , y o u a n d we i n t e n d t o shorten the absolute s t a t u t o r y p r e c l u s i o n period f o r u n a u t h o r i z e d s i g n a t u r e s and a l t e r a t i o n s s p e c i f i e d i n § 4 - 4 0 6 ( f ) o f t h e UCC a n d t o e s t a b l i s h a c o n t r a c t u a l condition precedent f o rr e p o r t i n g claims i n v o l v i n g u n a u t h o r i z e d o r m i s s i n g endorsements. "Except f o r t r a n s a c t i o n s c o v e r e d by t h e E l e c t r o n i c Funds T r a n s f e r A c t o r u n a u t h o r i z e d d e b i t s i n v o l v i n g Substitute Checks, y o u must report any o t h e r p r o b l e m s w i t h y o u r a c c o u n t w i t h i n 30 c a l e n d a r d a y s o f t h e d a t e we s e n d o r make a v a i l a b l e t h e s t a t e m e n t o r i t e m s , f a i l i n g w h i c h y o u w i l l be p r e c l u d e d f r o m a s s e r t i n g t h e p r o b l e m s a g a i n s t u s , even i f we f a i l to e x e r c i s e o r d i n a r y c a r e . " (Emphasis The reporting calendar added.) deposit agreement unauthorized days also fund-transfer of the mailing stated unauthorized transfers that were deemed within statements, of 30 which including wire t r a n s f e r s ; the i f ADDS transactions t h e burden payments of monthly l i s t e d t h e t r a n s f e r s o f funds, agreement imposed or failed other authorized after to report any discrepancies, the t h e 30 days had elapsed. Reed h e l d a l l b o o k k e e p i n g did responsibilities a t ADDS a n d n o t answer o r r e p o r t t o a s u p e r i o r ; t h u s , no one c h e c k e d 4 2110494 Reed's work. One of those responsibilities was to review ADDS's m o n t h l y bank s t a t e m e n t s and t o c h e c k , and t h e n r e p o r t , unauthorized transactions and discrepancies. Additionally, Thuss h a d e n t r u s t e d Reed w i t h h i s s i g n a t u r e stamp f o r Reed t o use when n e c e s s a r y . use The d e p o s i t of a signature agreement a l s o a d d r e s s e d t h e stamp: "Since we h a v e no way of determining the v a l i d i t y of checks or other w r i t t e n orders b e a r i n g f a c s i m i l e s i g n a t u r e s , which i n c l u d e s t h e use of a s i g n a t u r e stamp, [ A D D S ] h e r e b y r e l e a s e [ s ] t h e Bank f r o m any l i a b i l i t y f o r unauthorized u s e o f any facsimile signature device." Thuss was the only authorized person whose name was l i s t e d as a s i g n a t o r y f o r ADDS's b a n k a c c o u n t s . Reed was n e v e r authorized Thuss as a s i g n a t o r y on t h e a c c o u n t s , n e v e r d i r e c t e d by t o be specific so listed, occasions, either o f ADDS's person must be permitted to and, with never a u t h o r i z e d accounts. listed withdraw The as a the exception t o withdraw record signatory money from Regions r e q u i r e d t h a t , i n order of a funds establishes on that an from that account account. few a t o be Further, t o add a new s i g n a t o r y on an a c c o u n t , t h e e x i s t i n g s i g n a t o r y must a u t h o r i z e t h e a d d i t i o n o f t h e new s i g n a t o r y e i t h e r by c o m i n g t o t h e bank i n p e r s o n o r by having t h e new s i g n a t o r y s i g n a s i g n a t o r y c a r d i n t h e p r e s e n c e of a n o t a r y . The r e c o r d r e v e a l s t h a t R e e d was a d d e d as a new 5 2110494 s i g n a t o r y on t h e ADDS a c c o u n t s on September 12, 2008, b u t t h a t t h e a d d i t i o n o f Reed's name a s a s i g n a t o r y on t h e a c c o u n t s was n o t a u t h o r i z e d b y T h u s s ; Thuss d i d n o t go t o t h e bank on t h a t date and d i d n o t p r o v i d e a notarized signature to authorize Reed's a d d i t i o n ; t h o u g h t h e stamp o f T h u s s ' s s i g n a t u r e appear from t h e record t o have been p e r t i n e n t documents, t h e s i g n a t u r e In September 2008, on one o f t h e was n o t n o t a r i z e d . the record concerned about t h e f i n a n c i a l affixed does reveals, Thuss became s i t u a t i o n o f ADDS when some o f t h e l a b o r a t o r i e s u s e d b y ADDS r e f u s e d t o r e l e a s e t e s t r e s u l t s because those laboratories previous work p e r f o r m e d . t o R e g i o n s , Thuss h a d n o t been paid b y ADDS f o r I n a l e t t e r d a t e d December 22, 2008, stated: "Looking a t t h e September [ 2 0 0 8 ] s t a t e m e n t i t appears t o t a l d e p o s i t s o f $20,369.00 were made. T h e r e were two w i r e t r a n s f e r s t o t a l $3,050.00 w h i c h a p p e a r s t o go t o two l a b s . T h e r e was a l s o a bank d e b i t f o r $2,000.00 b u t I c a n n o t t e l l where i t went o r what i t was f o r . I n t e r e s t i n g l y enough, i t o c c u r r e d on S e p t e m b e r 12, 2008, t h e same d a y t h e s i g n a t u r e c a r d was c h a n g e d b y E r i c [ R e e d ] a n d N i s a Jordan." The second time Thuss i n f o r m e d R e g i o n s o f unauthorized a c t i v i t y on t h e ADDS a c c o u n t s t a t e m e n t s was i n May 2010 i n a l i s t of a l l e g e d l y unauthorized checking account. t r a n s a c t i o n s i n v o l v i n g t h e ADDS T h a t was t h e f i r s t r a i s e d any c o n c e r n r e g a r d i n g time transactions 6 ADDS a n d Thuss i n v o l v i n g t h e ADDS 2110494 checking ADDS account. L i s t s and Thuss unauthorized t h a t were c o m p i l e d a n d d i s c l o s e d b y during transactions discovery reflected purported f r o m May 2007 t o December 2007 a n d f r o m J a n u a r y 2008 t h r o u g h S e p t e m b e r 2 0 0 8 ; a p p r o x i m a t e l y 176 o f t h e 239 t r a n s a c t i o n s l i s t e d as u n a u t h o r i z e d were transactions e x e c u t e d b y Reed's u s e o f T h u s s ' s s i g n a t o r y stamp, w h i l e t h e remainder ADDS's were transactions drawn from checking account. The trial asserted court, i n i t s judgment, s t a t e d t h a t t h e claims b y ADDS a n d T h u s s a g a i n s t b a r r e d b y A l a . Code 1975, as w e l l as b y t h e d e p o s i t and ADDS. 1 On a p p e a l , Regions and J o r d a n were § 7-4-406(d) a n d (f) a n d § 7-4A-505, agreement e n t e r e d ADDS a n d Thuss i n t o by Regions assert that the t r i a l c o u r t e r r e d i n e n t e r i n g a summary j u d g m e n t i n f a v o r o f R e g i o n s and Jordan evidence because, sufficient ADDS a n d Thuss to present assert, a general f a c t as t o whether R e g i o n s and J o r d a n a c t e d e x e r c i s e d o r d i n a r y care i n p r o c e s s i n g issue presented of material i n good f a i t h and the t r a n s a c t i o n s t o be i m p r o p e r ; t h e y a s s e r t t h a t t h e t r i a l Code 1975, they claimed court ignored Ala. § 7 - 4 - 4 0 6 ( e ) , w h i c h , t h e y c o n t e n d , s t a t e s t h a t §_ The r e c o r d , p u r s u a n t t o R u l e 1 0 ( f ) , A l a . R. App. P., h a s been supplemented w i t h a copy o f t h e t r i a l c o u r t ' s p a r t i a l summary-judgment o r d e r e n t e r e d i n f a v o r o f R e g i o n s a n d J o r d a n . 1 7 2110494 7-4-406(d) and (f) do b a n k d i d n o t pay set apply i n s i t u a t i o n s i n which the a d d i t i o n a l l y , t h a t the bar i n good f a i t h and, forth in § there not 7-4-406(d) does n o t automatically apply i s e v i d e n c e i n d i c a t i n g t h a t the bank f a i l e d t o ordinary care i n p a y i n g an item and such f a i l u r e when exercise contributed to a l o s s . It i s well s e t t l e d that summary j u d g m e n t de the trial court. ( A l a . C i v . App. must review novo, u s i n g N e a l v. 2011). the established that Sem appellate the court same s t a n d a r d Ray, Inc., 68 So. Under R u l e 5 6 ( c ) , A l a . R. evidence no an to determine genuine i s s u e whether of m a t e r i a l reviews applied 3d 194, the movant makes t h a t showing, the fact existed, nonmovant law. thereafter b e a r s t h e b u r d e n t o adduce " s u b s t a n t i a l e v i d e n c e " t o r e b u t movant's s h o w i n g t h a t fact. 794, of B a s s v. 797-98 i s no genuine i s s u e S o u t h T r u s t Bank o f B a l d w i n C n t y . , of the material 538 So. 2d ( A l a . 1989). " [ S ] u b s t a n t i a l evidence i s evidence such weight exercise of existence of the Life there we movant t h e r e b y e n t i t l i n g t h e movant t o a j u d g m e n t as a m a t t e r o f If by 196 C i v . P., the a and q u a l i t y that impartial Assurance judgment fair-minded can reasonably f a c t s o u g h t t o be p r o v e d . " Co. of F l o r i d a , 547 8 persons So. 2d infer West v. 870, in the the Founders 871 (Ala. 2110494 1 9 8 9 ) . We a p p l y t h e de novo s t a n d a r d o f r e v i e w t o e a c h i s s u e raised i n the present This bars case appeal. turns on t h e a p p l i c a b i l i t y of the statutory a s s e r t e d b y R e g i o n s a n d J o r d a n , w h i c h i n t u r n d e p e n d on t h e t i m i n g o f t h e r e p o r t s made b y ADDS a n d Thuss t o R e g i o n s o f unauthorized 1975, activity § 7-4-406(f), within on ADDS's accounts. Under a customer has a s t r i c t which t o r e p o r t suspected Ala. Code 180-day p e r i o d unauthorized transactions; the d e p o s i t agreement, however, e x p r e s s l y s h o r t e n s t h e p e r i o d to 30 calendar days. expressly without Therefore, 2 Critically, regard t o the care according § 7-4-406(f) applies e x e r c i s e d b y t h e bank. to the deposit agreement a n d § 7-4- 4 0 6 ( f ) , when r e a d t o g e t h e r , t h e f a i l u r e o f ADDS t o r e p o r t a n y u n a u t h o r i z e d t r a n s a c t i o n a f t e r t h e l a p s e o f 30 d a y s o f h a v i n g received the monthly account statement reflecting those t r a n s a c t i o n s a b s o l u t e l y b a r s a n y c l a i m s ADDS m i g h t otherwise have allegedly asserted unauthorized against Regions based on transactions. Additionally, those unauthorized wire The trial court's judgment was based on i t s i n t e r p r e t a t i o n o f t h e d e p o s i t agreement and t h e s t a t u t o r y p r o v i s i o n s t o g e t h e r . Though ADDS a n d Thuss d i d n o t c h a l l e n g e the terms o f t h e d e p o s i t agreement o r whether t h e time l i m i t s s e t f o r t h i n t h e s t a t u t e s may be m o d i f i e d b y t h e d e p o s i t a g r e e m e n t , we n o n e t h e l e s s a c k n o w l e d g e t h a t t h e p a r t i e s were free t o c o n t r a c t u a l l y modify t h e s t a t u t o r y time limits p u r s u a n t t o A l a . Code 1975, §§ 7-1-302 a n d 7-4A-501. 2 9 2110494 transfers must be r e p o r t e d w i t h i n one y e a r of a customer's r e c e i v i n g n o t i c e s u f f i c i e n t t o have c o m p e l l e d t h e c u s t o m e r t o r e p o r t t h e u n a u t h o r i z e d t r a n s a c t i o n u n d e r A l a . Code 1975, § 74A-505. T h a t s t a t u t e a p p l i e s t o t r a n s f e r s o f f u n d s , wire transfers, favor of and o p e r a t e s as a complete t h e bank customer's having after one been year r u l e of repose i n has p a s s e d notified including of a from the questionable transaction. ADDS a n d T h u s s , i n their brief to this court, argue i n d e t a i l t h a t t h e s t a t u t o r y b a r s o f §§ 7-4-406(d) a n d 7-4A-505 are inapplicable, citing evidence that Jordan acted i n bad f a i t h because she p r o c e s s e d t h e t r a n s a c t i o n s d e s p i t e knowing t h a t o n l y Thuss was an a u t h o r i z e d s i g n a t o r y on t h e a c c o u n t s . Jordan's 3 f a i l u r e t o make s u r e t h a t Reed was a u t h o r i z e d as a s i g n a t o r y on t h e a c c o u n t s i s t h e o n l y e v i d e n c e t o w h i c h ADDS and Thuss point f a i t h . Jordan's Thuss's was as d e m o n s t r a t i v e of Jordan's ( a l l e g e d ) c u l p a b i l i t y , however, i s negated by a c t i o n s ; b e c a u s e Reed h a d T h u s s ' s reasonable a l l e g e d bad f o r Jordan t o permit s i g n a t u r e stamp, i t him t o conduct the I n t h e i r b r i e f , ADDS a n d Thuss a l s o a s s e r t t h a t R e g i o n s and J o r d a n p e r m i t t e d Reed t o d e p o s i t p a y m e n t s a d d r e s s e d t o ADDS a n d Thuss i n o t h e r , p e r s o n a l a c c o u n t s b e l o n g i n g t o Reed. However, c l a i m s g r o u n d e d upon s u c h u n a u t h o r i z e d a c t i v i t y were n o t a s s e r t e d i n t h e c o m p l a i n t , a n d , t h u s , a r g u m e n t s as t o s u c h c l a i m s a r e n o t p r o p e r l y b e f o r e us i n t h i s a p p e a l . 3 10 2110494 transactions. Jordan's part In other w o r d s , any a d d i t i o n a l c u l p a b i l i t y f o r having allowed Reed to conduct on the t r a n s a c t i o n s i s n e g a t e d b y t h e u n d i s p u t e d f a c t t h a t Thuss h a d entrusted, ostensibly with no a c c o u n t a b i l i t y , h i s s i g n a t u r e stamp t o Reed f o r Reed t o u s e a t h i s d i s c r e t i o n . M o r e o v e r , i t is undisputed that Thuss d i d not review s t a t e m e n t s a n d t h a t he d e l e g a t e d the monthly bank t o Reed t h e r e s p o n s i b i l i t y o f i d e n t i f y i n g and r e p o r t i n g u n a u t h o r i z e d t r a n s a c t i o n s and o t h e r discrepancies. The terms o f t h e d e p o s i t presumes Regions agreement c l e a r l y another that when person reflect that possesses the s i g n a t u r e stamp o f a c u s t o m e r , t h a t p e r s o n p o s s e s s e s t h e stamp as an agent of the customer. I t follows language of the p r o v i s i o n i n the d e p o s i t Regions' liability signature stamp i s i n t e n d e d in a person diligence who based on the that the agreement unauthorized limiting use t o emphasize t h e a u t h o r i t y possesses t h e stamp and, strict of vested i n turn, expected o f a customer t o guard a g a i n s t a the misuse of t h e stamp. The t e r m s i m p l i c i t l y b u t u n q u e s t i o n a b l y i t e r a t e t h e need t o m o n i t o r t h e use o f a s i g n a t u r e has entrusted the customer. stamp when a c u s t o m e r i t t o be u s e d a t t h e d i s c r e t i o n o f an a g e n t o f The d e p o s i t agreement requires p r e c i s e l y the l e v e l o f d i l i g e n c e t h a t w o u l d have p r o t e c t e d ADDS a n d R e g i o n s 11 2110494 a g a i n s t t h e scheme a l l e g e d l y i m p l e m e n t e d b y Reed i n t h i s The r e q u i r e m e n t t h a t u n a u t h o r i z e d case. t r a n s a c t i o n s be r e p o r t e d a t t h e f i r s t o p p o r t u n i t y a n d t h e p r e s u m p t i o n p l a c e d upon t h e u s e o f a s i g n a t u r e stamp were i n c l u d e d i n t h e d e p o s i t a g r e e m e n t as safeguards t o p r o t e c t R e g i o n s a n d ADDS a g a i n s t loss. ADDS a n d Thuss a r g u e t h a t § 7-4-406(d) i s t h e s t a t u t o r y bar t h a t , under d i f f e r e n t circumstances, here, w o u l d be a p p l i c a b l e but, they a s s e r t , Jordan acted i n bad f a i t h by a l l o w i n g Reed t o c o n d u c t t r a n s a c t i o n s and, t h e r e f o r e , t h a t t h e y a r e n o t be b a r r e d Aside from a s s e r t i n g c l a i m s from t h e g e n e r a l against Regions and Jordan. a u t h o r i t y o f § 7-4-406(d), which bars c l a i m s a g a i n s t a b a n k o n l y s o l o n g as t h e b a n k h a s n o t a c t e d in bad f a i t h , caselaw ADDS t o support a n d Thuss the notion do n o t c i t e that any s t a t u t e o r Jordan's conduct was s u f f i c i e n t s o as t o f o r e c l o s e a p p l i c a t i o n o f § 7 - 4 - 4 0 6 ( d ) . I f we c o n s i d e r , i n isolation and i n a l i g h t most f a v o r a b l e t o them, ADDS a n d T h u s s ' s a r g u m e n t t h a t J o r d a n e r r e d b y a l l o w i n g Reed t o e x e c u t e t r a n s a c t i o n s w h i l e Reed was n o t a u t h o r i z e d as a signatory demonstrated care on t h e a c c o u n t s , Jordan's that failed i n conducting s h e may have everyday business; conduct, to exercise her actions a t most, ordinary certainly d i d not r i s e t o the l e v e l of bad f a i t h , e s p e c i a l l y i n l i g h t of 12 2110494 Thuss's shortfalls and the s h o r t f a l l s h a d on n e g a t i n g This aforementioned Jordan's effect his culpability. c a s e comes down t o a q u e s t i o n of deadlines. After r e c e i v i n g the monthly account statement f o r each account, was ADDS r e q u i r e d t o r e p o r t any u n a u t h o r i z e d t r a n s a c t i o n s l i s t e d i n t h a t a c c o u n t s t a t e m e n t w i t h i n 30 c a l e n d a r d a y s p u r s u a n t to the t e r m s a g r e e d upon i n t h e d e p o s i t a g r e e m e n t a n d w i t h o u t regard to Regions' exercise exercise reasonable of reasonable care, c a r e , as e x p r e s s e d or failure i n § 7-4-406(f). to ADDS and Thuss r e p o r t e d u n a u t h o r i z e d a c t i v i t y on two o c c a s i o n s : i n December 2008 a n d i n May 2010. As t o t h e c l a i m s b a s e d on t h e activity r e p o r t e d i n May 2010, u n d e r A l a . Code 1 9 7 5 , § 7-4- 4 0 6 ( f ) , t h o s e c l a i m s were b a r r e d b e c a u s e t h e a c t i v i t y was made known t o ADDS a n d Thuss 2008. To t h e e x t e n t Next, statements that the a c t i v i t y included wire transfers, Code 1975, i n account those reported at that time c l a i m s were b a r r e d u n d e r A l a . § 7-4A-505. we address the v a l i d i t y of claims u n a u t h o r i z e d - a c t i v i t y r e p o r t i n Thuss's l e t t e r December i n 2007 a n d 2008. transactions transactions: In that but only letter, Thuss r a i s e d concerns based on t h e t o Regions i n mentioned a s t o one o f three those a bank d e b i t t h a t h a d t a k e n p l a c e i n S e p t e m b e r 2008. However, t h o s e t r a n s a c t i o n s were n o t r e p o r t e d w i t h i n t h e 13 2110494 30-day r e p o r t i n g p e r i o d and, Thuss fell the the safeguards a g r e e m e n t and, w r o n g d o i n g ; had a g r e e m e n t , any by the his asserted. s i g n a t o r y on ADDS's a c c o u n t s , and h i s f a i l u r e t o e x e r c i s e required fulfilling timely the disabled of were n o t as diligence short thus, responsibilities deposit agreement contemplated by the effectively terms of the i n s t e a d , o n l y h e l p e d p e r p e t u a t e Reed's a l l e g e d Thuss c o m p l i e d w i t h t h e loss resulting terms of the deposit f r o m Reed's a l l e g e d w r o n g d o i n g w o u l d have b e e n m i t i g a t e d . AFFIRMED. Thompson, P . J . , and B r y a n and Moore, J . , c o n c u r s i n t h e 14 Thomas, J J . , c o n c u r . result, without writing.

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