Glassman v Wachovia Bank, N.A.

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[*1] Glassman v Wachovia Bank, N.A. 2007 NY Slip Op 51699(U) [16 Misc 3d 1135(A)] Decided on September 7, 2007 Supreme Court, New York County Stallman, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on September 7, 2007
Supreme Court, New York County

Roberta Glassman, Plaintiff,


Wachovia Bank, N.A., Defendant.



For Plaintiff:

Daniel R. Solin, Esq.

401 Broadway, Suite 306

New York, New York 10013

(239) 949-1606

For Defendant:

Stevens & Lee, P.C.

By: Jocelyn Keynes, Esq.

485 Madison Avenue

New York, New York 10022

(212) 319-8500

Michael D. Stallman, J.

Plaintiff Roberta Glassman sues defendant Wachovia Bank, N.A. for negligence and breach of contract, alleging that the Bank wrongfully drilled open her locked safe deposit box, causing the loss of $75,000 in cash that was allegedly stored in the locked box.


Plaintiff, a 74 year old woman, maintains residences in both New York and Florida. In approximately January 2005, plaintiff opened a "self-service" safe deposit box bearing box number 298 (the Box) at a branch of the Bank located in the Baywinds Financial Center of West Palm Beach, Florida. Under the lease agreement for the Box (the Agreement), the term "self service" means "there is no dual lock control and no attendant present" and that plaintiff has "the only keys to access the Box." See Affidavit of Daniel Solin, Exhibit E (Agreement ¶ 2). The Agreement also provides, among other things, that any contents missing from the Box are plaintiff's responsibility and that "the Bank has no liability whatsoever unless the loss is caused by the Bank's gross negligence, fraud or bad faith." Id. When plaintiff signed the Agreement, she requested and received two keys to the Box. [*2]

Plaintiff alleges that, shortly before leaving for a trip to Europe in May 2005, she removed $3,000 cash from the Box, leaving $87,000 cash (in $100 bills) in the Box, along with a $100,000 Suffolk County bond. On May 27, 2005, because of the Bank's mistaken belief that the Box was new and unrented, the Bank retained and authorized technicians of Diebold Incorporated to drill open the Box. According to the Call Report of the Diebold technicians, the purpose of the May 27th service call was to drill locks of allegedly unrented deposit boxes, for which the Bank had told Diebold the keys for such boxes did not work.[FN1] An envelope bearing the Box number, containing keys, was mistakenly included in the Bank's inventory of unrented boxes.[FN2] As of May 2005, it appears that the subject Bank branch had been open for only five months; had new safe deposit boxes in its inventory, some rented and some unrented; and, at the time when the Bank authorized Diebold technicians to drill the deposit boxes, it maintained in its computer database a list of rented boxes, and the list included the subject Box.

Although acknowledging that it has maintained a computer list of rented boxes, defendant asserts that its policies do not require Bank employees to supervise locksmiths, such as Diebold, when they service new or unrented boxes. Because the employees believed that the Box and box 455 were unrented, they instructed Diebold technicians to drill the locks of these boxes and to re-key them without supervision.

Based on the affidavits of the two Diebold technicians, David Kajfasz and Craig Weaber, defendant also asserts that upon drilling the lock of the Box, the technicians realized that the Box was not new or unrented (because it did not have the white styrofoam plug around the Box that would have been present in a new, never-before used box), so they immediately stopped what they were doing and notified the Bank's branch manager Tonica Chappell, who was seated outside the vault.

Defendant further asserts that Chappell and another Bank employee, Shirley Marrero, then phoned the Bank's operations consultant, Erin Britt, to learn the appropriate procedures for the situation. Thereafter, Bank employees accompanied the technicians back into the vault, whereupon the Box was allegedly pulled out of the vault's wall, opened, inventoried, and its contents secured in a tamper-proof bag, which was then placed in the Box and returned into the vault's wall. Defendant also asserts that Chappell and Marrero, in the presence of the technicians, each counted the cash in the Box (which totaled $12,000) and signed an inventory form attesting to the contents of the Box, as containing only $12,000 cash (all $100 bills) and the $100,000 bond. The technicians purportedly re-keyed and replaced the lock to the Box, and the new keys for the replaced lock were placed in another tamper-proof bag, which, in turn, were locked in the Bank's vault under a dual-control lock. See affidavits of Chappell, Marrero, Kajfasz and Weaber. [*3]

Later, on the same day, certain of the Bank's department heads and management (including Janet Grubbs, a service leader) held a conference call to discuss the incident; Grubbs was designated to call plaintiff to inform her of the incident. Grubbs left plaintiff a voice message on May 27, 2005 and requested her to return the call. Grubbs left similar messages for plaintiff from May 31, 2005 to June 13, 2005. On June 16, 2005, Grubbs reached plaintiff in New York and told her that the Box had been drilled open under the mistaken belief that it was unrented, but its contents were secured in a tamper-proof bag and placed back in the Box. That same day, Grubbs sent a letter to plaintiff, which included an inventory list of the contents of her Box.

Plaintiff did not return to the Bank until October 17, 2005, when she took possession of the contents of the Box, and received keys to the new lock that had been installed on the Box. Plaintiff refused to sign a Box Replacement Key Acknowledgment Form which, if signed, would have required her to return her two keys to the Box previously given to her, as well as to acknowledge that (1) she was present when the Bank's locksmith (Diebold) drilled open her Box, and (2) she had inspected the contents of her Box and that they were intact. Affidavit of Jocelyn Keynes, Exhibit 22 (the Re-Key Form) & Exhibit 23. Thereafter, on November 18, 2005, plaintiff returned to the Bank to close out her Box, but refused to sign a lease termination form which, if signed, would have required her to surrender her two new keys to the Box (she apparently returned one key), and to release the Bank from all liabilities relating to the Box. Affidavit of Jocelyn Keynes, Exhibits 24-25.

Plaintiff commenced this action on October 12, 2006. The complaint alleges two causes of action, negligence and breach of contract, and seeks damages in the amount of $75,000. After the parties concluded discovery, they moved for summary judgment.


In setting forth the standards for granting or denying a motion for summary judgment, pursuant to CPLR 3212, the Court of Appeals noted, in Alvarez v Prospect Hospital (68 NY2d 320, 324 [1986]):

As we have stated frequently, the proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact. Failure to make such prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers. Once this showing has been made, however, the burden shifts to the party opposing the motion for summary judgment to produce evidentiary support in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action [internal citations omitted].


Choice of Law

In this case, both parties apply and argue New York law. However, because the alleged loss took place in Florida and the Agreement was executed by the parties in Florida, an issue may be raised as to whether Florida law should govern, especially in view of the legal principle in New York that the law of the state having the most significant contacts or relationships with the matter in dispute should be applied. Miller v Miller, 22 NY2d 12 (1968); Tuthill Finance v Cartaya, 133 AD2d 343, 344 (2d Dept 1987). [*4]

"The first step in choice of law analysis is determining whether an actual conflict exists between the jurisdictions involved." K.T. v Dash, 37 AD3d 107, 111 (1st Dept 2006), citing Matter of Allstate Ins. Co., 81 NY2d 219, 223 (1993). However, "[w]here no conflict exists between the laws of the jurisdictions involved, there is no reason to engage in a choice of law analysis." Elson v Defren, 283 AD2d 109, 114 (1st Dept 2001).

In this case, as explained below, New York and Florida law are substantially similar with respect to the enforceability of exculpatory clauses and as to the meaning of gross negligence. Because no conflict of laws exists between these jurisdictions, the conclusion reached by the Court in this case is the same, irrespective of whether Florida or New York law is applied.


Enforceability of Exculpatory Clauses

In New York, while the law generally enforces contract provisions exculpating a party from its own ordinary negligence, public policy prevents a party from exculpating itself for its own grossly negligent conduct. Colnaghi, U.S.A., Ltd. v Jewelers Protection Servs., Ltd., 81 NY2d 821, 823 (1993). The law is similar in Florida, where an appellate court has held that the limitation of liability provided in a safe deposit box agreement which limited the bank's obligations for loss to instances of gross negligence, fraud or bad faith was not unenforceable. F.D.I.C. v Carre, 436 So. 2d 227, 229-230 (Fla App 2d Dist 1993)(court noted that whether or not "a customer is wise to enter into an agreement such as the one in this case, we cannot find that the agreement was against public policy."). Thus, under the laws of New York and Florida, an exculpatory clause, such as the provision contained in the subject Agreement that limits a party's liability to grossly negligent conduct, is enforceable.


Gross NegligenceIn New York, to establish a prima facie case of negligence, a plaintiff must allege that (1) the defendant owed a duty to the plaintiff; (2) the defendant breached that duty; and (3) the breach was the proximate cause of plaintiff's injury. Friedman v Anderson, 23 AD3d 163, 164 (1st Dept 2005)(citations omitted). However, grossly negligent conduct "differs in kind, not only degree, from claims of ordinary negligence. It is conduct that evinces a reckless disregard for the rights of others or smacks' of intentional wrongdoing." Colnaghi, supra, 81 NY2d at 823-824 (citation omitted); accord Obremski v The Image Bank, 30 AD3d 1141, 1142 (1st Dept 2006).

The Florida courts have acknowledged that their jurisprudence "reflects a history of difficulty in dividing negligence into degrees" and that "it is doubtful that gross negligence has precisely the same meaning in each context." See Fleetwood Homes of Florida, Inc. v Reeves, 833 So. 2d 857, 865-66 (Fla App 2d Dist 2002); see also LeMay v Kondrk, 860 So. 2d 1022, 1025 (Fla App 5th Dist 2003) ("Courts have encountered great difficulty in attempting to draw clear and distinct lines between the various grades of negligence). In Fleetwood Homes, the court observed that, in the context of addressing workers' compensation and in awarding punitive damages based on gross negligence, the relevant statute defines gross negligence to include "conduct [that] was so reckless or wanting in care that it constituted a conscious disregard or indifference to the life, safety, or rights [*5]of person exposed to such conduct." Id. at 867.[FN3]

Based on the foregoing, both New York and Florida courts appear to use substantially similar criteria in defining grossly negligent conduct.

In the instant case, it is undisputed that the Bank's employees were under the mistaken belief that plaintiff's Box was unrented, and authorized the Diebold technicians to drill the Box unsupervised, which allegedly caused plaintiff to incur monetary loss. In their affidavits, the Bank's employees state that they were following the Bank's policy of not supervising or accompanying Diebold technicians when they performed maintenance services on new or unrented deposit boxes. The Bank employees further state that as soon as they were informed by the technicians that plaintiff's Box was not new or unrented (after the Box's lock was drilled), they followed all of the Bank's procedures in safeguarding the contents of the Box and notifying plaintiff of the incident. Based on the employees' statements that they were following Bank policies and procedures, defendant argues that "Plaintiff has failed to show even ordinary negligence, let alone meet the burden of proof for a finding of gross negligence." Defendant's Reply Mem., at p. 13.

Assuming for the purposes of argument that it is the Bank's policy to not require its employees to supervise locksmiths when servicing new or unrented boxes,[FN4] it is undisputed that the Bank maintains a computerized list of rented boxes, such that the Bank's employees can readily determine whether a particular box is rented by simply checking such list, before allowing locksmiths to drill unsupervised. Furthermore, based on the Re-Key Form which plaintiff had refused to sign, it appears that before the Bank authorizes a locksmith to drill and re-key a customer's safe deposit box, the customer would be given an opportunity to be present when the box is drilled and re-keyed. This provides protection to customers (in recognition of their rights, as lessees, to their rented boxes), as they have the "only keys" to access their own self-service box. Any forcible entry into a box without the box holder's permission may constitute a violation of the holder's contract and property rights, unless such entry is required by law, such as in compliance with a search warrant or other court order.

The Call Report filled out by the Diebold technicians indicates that "forcible entry" of plaintiff's Box was authorized by the Bank's employees.See Affidavit of Daniel Solin, Exhibit F. However, the Bank employees did not check the computer list before authorizing the technicians to drill unsupervised what they erroneously believed to be unrented boxes, despite defendant's assertion that its policy does not require the employees to do so. Moreover, the Bank has not explained how a set of keys ended up in the key envelope bearing plaintiff's Box number (when, under the Agreement, plaintiff was supposed to have the only set of keys). Under the unusual circumstances of this case, a triable issue of fact is presented as to whether the Bank's acts and [*6]omissions "[evince] a reckless indifference to the rights of others." See Adler v Columbia Sav.& Loan Assn., 26 AD3d 349, 350 (2nd Dept 2006) (affirming trial court's denial of defendant's motion for summary judgment because "triable issues of fact exist as to whether the appellants were grossly negligent," even though the contract has an exculpatory clause shielding the defendant from liability for ordinary negligence, but not for gross negligence); Lubell v Samson Moving & Storage, 307 AD2d 215, 216 (1st Dept 2003) ("Ordinarily the question of gross negligence is a matter to be determined by a trier of fact"). See also New York Pattern Jury Instruction 2:10A (gross negligence "means a failure to use even slight care, or conduct that is so careless as to show complete disregard for the rights and safety of others"); Florida Standard Jury Instructions - Civil Cases (gross negligence means conduct that was "so reckless or wanting in care that it constituted a conscious disregard or indifference to the life, safety and rights of persons exposed to such conduct").

Even assuming, for purposes of argument, that the Bank's employees followed the Bank's procedures, that does not itself state a valid defense or mean that the Bank acted with reasonable care. Rather, whether the Bank's acts or omissions, including and notwithstanding its policies and practices, were grossly negligent under the circumstances, is a triable issue.

In light of the definition of gross negligence, the Bank's admitted failure to check the computer list before permitting locksmiths to act unsupervised, and the Bank's failure to explain the presence of a set of keys in a key envelope bearing plaintiff's Box number, it cannot be said that the allegation that defendant was grossly negligent is legally insufficient as a matter of law.[FN5] Inasmuch as there is a triable issue of fact as to whether defendant's acts or omissions constitute grossly negligent conduct, the motion and cross motion for summary judgment are both denied.


Proximate Cause

Defendant indicates that plaintiff returned only one of the original keys to the Box, and refused to sign the Re-Key Form, which required her to surrender both keys to the Bank. Consequently, defendant contends that the other key is missing, and surmises that someone other than plaintiff (such as her daughter or live-in companion) could have used the other key to remove cash from the Box without her knowledge or authorization. In this scenario, the defendant argues that plaintiff should not be granted summary judgment in her favor, because defendant's actions would not have been the proximate cause of plaintiff's alleged loss or the basis of plaintiff's claim. Defendant's Mem. of Law, at 14-16; Defendant's Reply Mem., at 7. Defendant also indicates that it would have no liability pursuant to paragraph 4 of the Agreement, which provides, that "unless you notify the Bank that a key is missing and the Bank has a reasonable opportunity to prevent access to the Box, the Bank will have no liability if the Box is entered by a third party. The Bank has no duty to question the authority of any person to open or remove property from the Box if that person is in possession of a key to the Box."

Plaintiff counters that the other key has been (and still is) in the possession of her counsel, [*7]Daniel Solin, Esq. who has offered to let defendant's attorney physically inspect it. Plaintiff's Reply Mem. of Law, at 9. Defendant counters that, "even if it is true that Plaintiff found the second key to the Original Lock, and the key in her counsel's possession is that key, that alone does not disprove the fact that someone other than Plaintiff could have used her keys to access Box Number 298." Defendant's Reply Mem., at 7.

The parties' dispute as to whether the other key was ever "missing" and used to access the Box raises another issue of fact that further warrants denial of plaintiff's motion for summary judgment. To the extent that defendant seeks summary judgment based on paragraph 4 of the Agreement, defendant has not met its burden to show that paragraph 4 applies, because defendant clearly speculates that someone other than plaintiff opened the Box without plaintiff's consent with the other key before Diebold drilled the Box.

Defendant also contends that plaintiff's loss, if any, is attributable to plaintiff's failure to keep an accounting, inventory, or record of the contents of the Box. Logically, the absence of evidence is not the cause of any loss that plaintiff may have incurred. Of course, it is plaintiff who has the burden of proving that the allegedly missing $75,000 was in the Box at the time it was drilled and that the Bank is legally responsible for the loss. Although defendant maintains that plaintiff's explanation of the amount that she kept in the Box is uncorroborated, inconsistent and not credible, credibility questions, including those surrounding the alleged storage of $90,000 in cash in a safe deposit box, cannot be resolved on a motion for summary judgment.


Accordingly, it is

ORDERED that plaintiff's motion for summary judgment in her favor, and defendant's cross

motion for summary judgment dismissing the complaint, are hereby denied.

Dated: September 7 , 2007ENTER:

New York, New York





Footnote 1: The Call Report, a copy of which is annexed as Exhibit F to the affidavit of Daniel Solin, Esq. (plaintiff's counsel), indicated that apart from the Box, only one other box (box number 455), an unrented box, was drilled by Diebold on May 27, 2005.

Footnote 2: It is unclear how a set of keys came to be in the key envelope bearing the number of the Box, given that, according to the Agreement and the Bank's procedures, plaintiff should have been given the only set of keys to the Box.

Footnote 3: The same definition for gross negligence was noted in In re Standard Jury Instructions-Civil Cases, (797 So. 2d 1199 [2001]), where the Florida Supreme Court authorized the publication of guidelines for jury instructions and model verdict forms with respect to the award of punitive damages in instances that involve intentional misconduct or grossly negligent conduct.

Footnote 4: Defendant has not furnished to the Court copies of any Bank policies and procedures concerning safe deposit box access, repair or servicing, whether by Bank personnel or contractors.

Footnote 5: Given the foregoing analysis, it is unnecessary for the Court here to address plaintiff's assertion that the Bank should have asked the technicians whether they had removed anything from the Box, and that they should have been searched before allowed to leave the Bank's premises. It is also unnecessary to address defendant's assertion that the Bank's employees followed the proper procedures in securing the contents of the Box, after it was drilled by the technicians.

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