Ameritrade, Inc. v. First Interstate Bank of Nevada
| Citation | 105 Nev. 696,782 P.2d 1318 |
| Decision Date | 27 November 1989 |
| Docket Number | No. 19775,19775 |
| Parties | AMERITRADE, INC., Appellant, v. FIRST INTERSTATE BANK OF NEVADA, Respondent. |
| Court | Supreme Court of Nevada |
This is an appeal from an order granting respondent's motion for partial summary judgment. For the reasons set forth below, we reverse.
Taken in the light most favorable to appellant, the record indicates the following facts: In February 1985, appellant Ameritrade, Inc. contracted with Stoneridge Securities, Inc. to handle all cashiering functions related to securities transactions for Stoneridge's customer accounts. To perform these services, Ameritrade opened an account with respondent First Interstate Bank of Nevada. Stoneridge would deposit monies into this account and then direct Ameritrade, through the use of trade orders, to purchase various securities for its customers.
On November 27, 1987, a check payable to Ishwar Patel, Hansa Patel, and Kangi Patel (Patel check) was drawn on an account at a Massachusetts bank in the amount of $236,465.41. Ameritrade alleges that the Patel check was endorsed and deposited into Ameritrade's account at First Interstate by a Stoneridge employee, Randy Gleich. Ameritrade then purchased various securities for the Patels pursuant to Stoneridge's directions.
On or about December 21, 1987, First Interstate advised Ameritrade that a hold was being placed on its account because the Patels had claimed their endorsements were forged and unauthorized. On January 6, 1988, the Patels assigned all their rights to First Interstate in the securities purchased by Ameritrade on their behalf. First Interstate subsequently paid the Patels $230,445.41 and received a release of all claims the Patels might have against First Interstate.
Also on January 6, 1988, First Interstate Vice President James Howard advised Ameritrade that the hold on its account had been released. Ameritrade subsequently transferred the contents of the Patels' account to an account in the name of First Interstate. Ameritrade then liquidated some of the securities in this account and by January 26, 1988, had reimbursed First Interstate a total of $75,000.00.
On April 1, 1988, First Interstate filed suit against Stoneridge, Stoneridge President Ronald Wheeler, Sr., and Ameritrade to recover the losses sustained due to negotiation of the Patel check. By way of an affirmative defense, Ameritrade asserted that Randy Gleich was authorized to endorse the Patel check.
A joint case conference report was filed August 24, 1988, by the attorneys for First Interstate, the Patels, and Ameritrade. At this time both Stoneridge and Wheeler were in bankruptcy. In the August 24 report, Ameritrade again asserted that Gleich was authorized to endorse the Patel check. The report also contains a discovery plan and witness list, which includes Gleich's name and the notation: "Gleich will testify as to agreements and transactions with the Patels, including endorsement of the check in question."
First Interstate filed a motion for partial summary judgment against Ameritrade on October 3, 1988, asserting Ameritrade's liability based on breach of the presentment and transfer warranties contained in NRS 104.4207(1) and (2). 1 An affidavit of forgery and non-authorization, signed by each of the Patels, accompanied First Interstate's motion. In its opposition, Ameritrade requested additional discovery time pursuant to NRCP 56(f) in order to depose the witnesses listed in the joint case conference report. Despite this request, the district court granted First Interstate's motion by order dated November 15, 1988.
Ameritrade contends that the district court erred by granting First Interstate partial summary judgment. Specifically, Ameritrade contends that a continuance should have been granted which would have enabled Ameritrade to depose the witnesses listed in the joint case conference report. Ameritrade argues that without such testimony, the district court could not fairly evaluate the factual issues raised by Ameritrade's various defenses. This contention has merit.
Preliminarily, we note that less than eight months had passed since the filing of First Interstate's complaint until the time summary judgment was granted. We also note that Ameritrade was unable to commence taking depositions until after the joint case conference report was filed. See NRCP 26...
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