269 So. 3d 19
Miss.2018Background
- Marilyn Newsome (conservator for Victoria Newsome) opened a court-supervised conservatorship account at People’s Bank; Deposit Agreement named her sole authorized signatory.
- Attorney Keely McNulty coordinated building a house for Victoria and obtained court orders for disbursements; McNulty instructed the bank to issue cashier’s checks to herself and subcontractors.
- Bank (through employee Chris Dunn) debited the conservatorship account, placed funds in the bank’s account, and issued cashier’s checks signed by bank employees; Newsome’s signature did not appear on the checks.
- Over $400,000 was disbursed (March–October 2011); statements showed only “Miscellaneous Debit” entries, sometimes aggregating multiple checks.
- Newsome sued the Bank and Dunn for multiple common‑law claims and UCC-related claims; trial court granted summary judgment to Bank/Dunn on McNulty’s authority theory and denied summary judgment on statute‑of‑repose; both sides appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Article 4A statute‑of‑repose bars claims | Article 4A does not apply because the bank issued cashier’s checks and commingled funds; transactions are not wire/funds transfers | Transactions are governed by UCC Article 4A and barred by the one‑year repose | Court: Article 4A does not apply (cashier’s checks to beneficiaries, no bank‑to‑bank payment orders); affirm trial court denial of summary judgment on different grounds |
| Whether McNulty had actual/implied/apparent authority so Bank/Dunn get summary judgment | Newsome: McNulty had no authority from her; no express authorization | Bank/Dunn: McNulty was authorized (court role, her actions); apparent authority or estoppel binds Newsome | Court: No actual or implied authority shown; apparent authority raises factual disputes (material issue for jury) — reverse and remand on this issue |
| Whether Newsome’s duty to review statements (30‑day) bars claims | Duty clause cannot disclaim bank’s own bad faith/ordinary care; statements’ “Miscellaneous Debit” entries insufficient to foreclose claim | Bank/Dunn: statements were mailed; mailbox rule and contract notice bar claims if not timely objected | Court: Deposit Agreement’s review duty cannot absolve bank of lack of good faith/ordinary care under UCC §75‑4‑103; issue for further proceedings (no summary judgment for defendants) |
| Whether UCC displaces Newsome’s common‑law claims | Common‑law claims (fraud, conversion, negligence, etc.) survive because UCC does not expressly displace them here | Bank/Dunn: UCC covers these bank‑related disputes and displaces common law | Court: UCC (Article 4A) does not apply and defendants failed to identify other UCC provisions that displace the common‑law claims; common‑law claims survive |
Key Cases Cited
- Kinney v. S. Miss. Planning & Dev. Dist., Inc., 202 So. 3d 187 (Miss. 2016) (summary‑judgment standard; de novo review)
- McFarland v. Entergy Miss., Inc., 919 So. 2d 894 (Miss. 2005) (definition and concept of actual/express authority)
- Forest Hill Nursing Ctr., Inc. v. McFarland, 995 So. 2d 775 (Miss. Ct. App. 2008) (discussion of implied agency and apparent authority)
- Estate of Cappaert v. Barnes, 991 So. 2d 1209 (Miss. 2008) (three‑prong test for apparent authority; issue for fact‑finder)
- Andrew Jackson Life Ins. Co. v. Williams, 566 So. 2d 1172 (Miss. 1990) (apparent authority analyzed as jury question)
- Miss. Bank v. Kelly, 445 So. 2d 849 (Miss. 1984) (requirements for contempt—notice and opportunity to be heard)
- Great Atl. & Pac. Tea Co. v. Majure, 168 So. 468 (Miss. 1936) (presumption that attorney is authorized to take acts necessary in litigation when employed)