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Accadia Site Contracting, Inc. v. Northwest Savings Bank

United States District Court, W.D. New York

February 8, 2017



          HON. MICHAEL A. TELESCA, United States District Judge

         I. Introduction

         Accadia Site Contracting, Inc. (“Accadia” or “Plaintiff”), represented by counsel, instituted this action against Northwest Savings Bank (“Northwest” or “Defendant”) alleging breach of contract and negligence based on Defendant's charging of over $700, 000 in forged or fraudulently signed drafts against Plaintiff's account. This matter is before the Court upon the Report and Recommendation, dated December 5, 2016, issued by Magistrate Judge Jeremiah M. McCarthy (“the R&R”) denying Defendant's renewed motion for summary judgment.

         II. Background

         On April 30, 2010, Paul Marinaccio (“Marinaccio”) opened a commercial account (“the Account”) at Northwest on behalf of his company, Accadia. The main dispute is whether Marinaccio received and assented to the Deposit Account Agreement and Disclosure (“DAAD”), which includes a notice provision absolving Northwest of liability unless certain stringent notice periods are met. Unauthorized drafts made payable to Debra Gramza (“Gramza”), Accadia's corporate secretary, were drawn against the Account until July 2013, when the fraud was uncovered. Gramza's account privileges were rescinded at that time, and she pleaded guilty to second degree larceny and related offenses arising from her theft of about $700, 000 from Accadia from December 12, 2008, to July 29, 2013.

         Gramza accomplished the fraud by using a stamp, bearing Marinaccio's signature, that had been created for a separate restaurant business he owned. The last check drawn against Accadia's account made payable to Gramza was dated July 22, 2013. The first written notice of the alleged forgeries was made by an October 10, 2013, letter from Accadia's counsel.

         Northwest initially filed a pre-answer motion for summary judgment, and Accadia cross-moved for a stay to conduct discovery necessary to oppose the motion. Limited discovery ensued, and the parties subsequently agreed to withdraw their pending motions. Northwest then filed renewed motion for summary judgment. As noted above, Magistrate Judge McCarthy issued an R&R recommending the denial of Defendant's renewed summary judgment motion for. Defendant filed objections, and Plaintiff filed a response. For the reasons discussed below, the Court adopts in full Magistrate Judge McCarthy's R&R, and denies Northwest's renewed motion for summary judgment.

         III. Standard of Review

         To preserve a claim for review by the district court, the party must make sufficiently specific objections to the R&R. E.g., Mario v. P & C Food Mkts., Inc., 313 F.3d 758, 766 (2d Cir. 2002). “In reviewing the R&R of a dispositive matter from a magistrate judge, the district court ‘may adopt those portions of the Report to which no objections have been made and which are not facially erroneous.'” Nansaram v. City of N.Y., No. 12-CV-5038 NGG RLM, 2015 WL 5518270, at *2 (E.D.N.Y. Sept. 17, 2015) (quotation and citation omitted); see also Fed.R.Civ.P. 72(b), Advisory Comm. Notes (when a party makes no objection, or only general objections to a portion of an R&R, the district judge reviews it for clear error or manifest injustice). When a party makes specific objections, the district judge must undertake a “de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made[, ]” 28 U.S.C. § 636(b)(1)(C), and “may . . . receive further evidence[.]” Id.; see also Grassia v. Scully, 892 F.2d 16, 19 (2d Cir. 1989) (discussing § 636(b)(1)(B)).

         IV. Discussion

         A. Northwest's Objection No. 1: No Issue of Fact as to Accadia's Actual Receipt of the DAAD

         The R&R concluded that there is a triable issue of material fact as to whether Marinaccio received the DAAD at the time he opened the account at Northwest based on the following evidence in the record: Marinaccio did not recall receiving the DAAD at the time the account was opened; Marinaccio did not sign any document expressly acknowledging his receipt of the DAAD; and Northwest employee Harenda had no specific recollection of meeting Marinaccio at the time the account was opened or of providing him with the DAAD.

         Northwest objects to this conclusion on a number of grounds. First, Northwest asserts that Harenda was “absolutely positive” that she gave the DAAD to Marinaccio. At her deposition, Harenda was asked, “As you sit here today, can you be absolutely sure that you gave Mr. Marinaccio the account disclosure documents?” Harenda replied, “I give everyone their disclosures.” (Harenda: 80-81). Counsel asked if she was “absolutely positive[, ]” and Harenda replied, “Yes.” (Id.). On subsequent questioning by Accadia's counsel, Harenda admitted she had no specific recollection of meeting with Marinaccio at the time of the account opening, because she opened up “hundreds” of accounts, and in fact had no specific recollection of meeting with anybody from Accadia Site Contracting when that account was opened. (Harenda: 80-81). Harenda maintained that she did provide Marinaccio with the DAAD because “[she] opened their account. [She] hand[s] the disclosures to everyone.” (Harenda: 81).

         Northwest thus is relying on an internal policy or procedure to establish actual receipt of the DAAD. Accadia argues that the evidence does not establish the existence of a policy, reliably and consistently followed by Northwest's employees, sufficient to establish the presumption of receipt. Accadia notes that when questioned about a procedure for disseminating account documents to customers, Harenda testified that she would “print all the documents, ” “go over them with the customer, ” and give “that” to the customer. (Harenda: 33). Although, at the time of her deposition, Harenda had a “basic like outline of the documents that print[, ]” during an account opening, this outline was not in use in 2010, when Accadia opened its account. (Harenda: 40). Harenda also testified that the DAAD would be pre-filled by Northwest's computer system with the name of the Depositor (here, Accadia) and the Financial ...

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