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GELER v. NATIONAL WESTMINSTER BANK USA

May 2, 1991

IDA GELER, ISRAEL GELER, AND YACOF GELER, PLAINTIFFS,
v.
NATIONAL WESTMINSTER BANK USA, DEFENDANT AND THIRD-PARTY PLAINTIFF, V. HOWARD GLUCKMAN, AS ADMINISTRATOR OF THE LAST WILL AND TESTAMENT OF SUSANA A/K/A SHOSHANA GHITELMAN, THIRD-PARTY DEFENDANT. NATIONAL WESTMINSTER BANK USA, PLAINTIFF, V. HOWARD GLUCKMAN, AS ADMINISTRATOR OF THE LAST WILL AND TESTAMENT OF SUSANA A/K/A SHOSHANA GHITELMAN, IDA GELER, ISRAEL GELER, AND YACOF GELER, DEFENDANTS.



The opinion of the court was delivered by: Robert L. Carter, District Judge.

AMENDED OPINION

This case illustrates how ineptitude and dilatory tactics can complicate a relatively simple matter.

BACKGROUND

These consolidated actions relate to a 90-day renewable certificate of deposit, in the amount of approximately $500,000, issued by National Westminster Bank (the "Bank"). It is disputed whether the account was held solely by Benjamin Ghitelman or jointly by Benjamin Ghitelman and his wife Susana Ghitelman (a/k/a Shoshana Ghitelman). The account was a so-called Totten trust, payable on the death of the depositor or depositors to the named beneficiaries, Ida Geler, Israel Geler and Yacof Geler (the "Gelers").

Throughout the discovery period, Marilyn B. Fairberg attended conferences in the Geler action as counsel for Howard Gluckman ("Gluckman" or "Susana Ghitelman's administrator"), who was not a party to the action, and who had not yet received ancillary letters of administration C.T.A. for the Susana Ghitelman estate from the Surrogate's Court of the State of New York, County of New York. Fairberg represented to this court that her client would intervene in the action as soon as he received those letters.

Relying on these representations, Constantine A. Despotakis, then counsel to the Bank, sought to delay the resolution of the Geler action pending the intervention of Susana Ghitelman's administrator. Despite the court's repeated suggestions that the Bank should bring an interpleader claim against the Gelers and the Susana Ghitelman estate, Despotakis, without explanation or excuse, failed to pursue that remedy.*fn1 Indeed, his conduct in conferences seemed to indicate that he was more interested in protecting the interests of Susana Ghitelman's estate than those of his own client. Meanwhile, the Geler action proceeded to the point that discovery was completed and a motion for summary judgment*fn2 by the Gelers was fully submitted.

The Surrogate's Court eventually entered a decree appointing Gluckman as ancillary administrator C.T.A. of Susana Ghitelman's estate. In re Ghitelman, No. 232/1991 (N.Y.Sur.Ct., N.Y. County, Feb. 4, 1991). Despite her earlier representations, however, Fairberg did not have Gluckman intervene in the Geler action, but proceeded to file suit against the Bank in the Supreme Court of the State of New York, County of New York (the "state court action"), seeking the proceeds of the certificate of deposit, as well as damages for fraud and breach of fiduciary duty related to the transactions in issue. Gluckman v. National Westminster Bank, USA (N.Y. Sup. Ct., N.Y. County, filed Feb. 14, 1991). Fairberg's tactics waste judicial resources and threaten to expose the Bank to multiple liability on a single fund.*fn3

Despotakis, on behalf of the Bank, subsequently filed a third-party complaint in the Geler action, and an additional action in this court, No. 91 Civ. 1354 (RLC), both seeking interpleader of the competing claims of the Gelers and Susana Ghitelman's administrator. At a conference held on April 2, 1991, the court ordered the two actions consolidated.

The Bank now seeks an injunction staying litigation of the state court action.*fn4 The Gelers, however, contend that this court lacks power to enjoin proceedings in the state court action. Furthermore, they object to the Bank's stalling and ask this court to decide their motion for summary judgment in the Geler action without further delay.

DISCUSSION

Summary Judgment

The court agrees with the Gelers that it should proceed to the consideration of their summary judgment motion at this time. To be sure, in an interpleader action, a court should ordinarily wait until all claimants have been heard before deciding any individual claim. In this case, however, the Bank's irresponsible delays in bringing its interpleader claim would make it inequitable for the court to defer the resolution of the Gelers' summary judgment motion any longer. A determination of the Gelers' rights, if otherwise timely, cannot be forced to wait merely because the Bank was asleep as to its own rights.

The Gelers' motion for summary judgment must be denied, however, because there exists a triable issue of fact. Summary judgment will be granted only if there is no genuine factual dispute, such that the moving party would be entitled to a directed verdict at trial. See Anderson v. Liberty ...


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