Patrick v. Union State Bank

• Decision Date: 12 July 1996
• Citation: 681 So.2d 1364
• Parties: Bridgette L. PATRICK v. UNION STATE BANK. 1931430.
• Court: Alabama Supreme Court

Page 1364

681 So.2d 1364

Bridgette L. PATRICK v. UNION STATE BANK.

1931430.

Supreme Court of Alabama.

July 12, 1996.

Mark B. Polson and Emily J. Hurst of Polson & Robbins, P.C., Birmingham, for Appellant.

Michael C. Quillen and Emily Sides Bonds of Walston, Stabler, Wells, Anderson & Bains, Birmingham, for Appellee.

H. Hampton Boles and Teresa G. Minor of Balch & Bingham, Birmingham, for Amicus Curiae Alabama Bankers Association in support of appellee.

ON APPLICATION FOR REHEARING

ALMON, Justice.

The opinion of August 4, 1995, is withdrawn and the following is substituted therefor.

Bridgette L. Patrick appeals from a summary judgment for Union State Bank in her action alleging that the bank negligently allowed an imposter to open a checking account in Ms. Patrick's name. The imposter wrote several worthless checks on the account, and as a result Ms. Patrick was subsequently arrested and incarcerated. The issues are whether the bank owed a duty to Ms. Patrick and whether Ms. Patrick met her evidentiary burden on the question of proximate cause.

I.

In April 1990, Ms. Patrick applied for renewal of her Alabama driver's license and was issued a temporary license pending the issuance of a new permanent license. An Alabama temporary driver's license does not contain a picture of the licensee. Several weeks later, Ms. Patrick discovered that the temporary license and her Rich's department store credit card were missing from her wallet. Ms. Patrick reported to Rich's that the credit card was missing, and she subsequently received her permanent driver's license in the mail.

On May 10, 1990, a person calling herself "Bridgette Patrick," and using Ms. Patrick's temporary driver's license as identification, opened a checking account with a deposit of $100 at the Pell City branch of Union State Bank. Kim Abbott, the bank employee who opened the account, testified that the imposter stated that she had only one form of identification, that she had no permanent address because, she said, she was currently living at a shelter for abused women, and that she was trying to find a job and a place to live. Ms. Abbott also testified that she noticed that the imposter did not completely sign her last name on the account signature card; that she noticed that the signature on the card was different from the signature on Ms. Patrick's temporary driver's license; that she did not ask the imposter to verify the Social Security number by presenting a Social Security card; and that she did not attempt to verify either of the telephone numbers given to her by the imposter. Ms. Abbott did use a computerized banking information system called the "CHEX System" to determine whether "Bridgette Patrick" had any negative banking history; however, the system revealed no banking history at all on Bridgette Patrick.

With the checks given to her upon opening the account, the imposter proceeded to write checks totalling approximately $1,500 to merchants over a wide area of Jefferson and Shelby Counties. The first three checks exhausted the $100 deposit, and numerous "not sufficient funds" notices were then sent to the post office box address given by the imposter upon opening the account. The notices were returned to the bank marked "Attempted, Not Known." No notices were mailed to the address on Ms. Patrick's temporary driver's license. On May 31, 1990, the bank closed the account. The checks were returned as "not sufficient funds" items to the merchants, who had accepted the checks as payment for merchandise. The merchants then initiated proceedings that resulted in warrants being issued in 11 jurisdictions ¹ for the arrest of Bridgette Patrick for issuing worthless checks.

Some months after Ms. Patrick discovered that her temporary license and Rich's card were missing, she received a notice from the City of Adamsville informing her that it had an outstanding warrant for her arrest. Ms. Patrick's father inquired as to the source of the warrant and was informed that Ms. Patrick had been charged with issuing worthless checks. Ms. Patrick then reported to the police in Adamsville, and her handwriting was compared to that found on the checks. The handwriting did not match, and the charges were dismissed. Subsequently, Ms. Patrick received a notice from the City of Birmingham informing her that it had issued a warrant for her arrest for issuing a worthless check. Ms. Patrick then reported to the police in Birmingham, and the charge was dismissed after her handwriting was compared to that found on the check. Ms. Patrick testified that she asked one of the Birmingham officials whether she needed a lawyer and was told no, because there did not appear to be any more checks. Ms. Patrick also testified that, at the time, she assumed that there must be another person by the name of "Bridgette Patrick."

In the summer of 1992, while Ms. Patrick was traveling through Montevallo with her mother and her six-month old baby, she was stopped by the Montevallo police for allegedly running a red light. After Ms. Patrick's driver's license was checked, she was arrested at the scene on the basis of outstanding warrants in Shelby County for issuing worthless checks. Although the officials in Shelby County concluded that Ms. Patrick's handwriting did not match the handwriting on the checks, she was held overnight because of outstanding warrants in other jurisdictions.

The following morning, Ms. Patrick was picked up at the Shelby County Jail by the City of Hoover on a warrant for issuing worthless checks. Ms. Patrick was arrested, photographed, fingerprinted, required to change into jail clothes, and held for 72 hours. Upon release by the City of Hoover, Ms. Patrick was taken into custody by the City of Fairfield on a charge of issuing worthless checks; she was incarcerated there for approximately two days and then released into the custody of the City of Midfield. Ms. Patrick was held by the City of Midfield for 24 hours on a warrant for issuing worthless checks; she was then released into the custody of the City of Homewood. Ms. Patrick was held overnight in Homewood and then released into the custody of her mother. Ms. Patrick's mother then had to take her immediately to the City of Leeds to sign a signature bond.

The total time of Ms. Patrick's incarceration came to approximately 10 consecutive days, and it was followed by numerous court appearances in the various jurisdictions. All of the charges against Ms. Patrick were eventually dismissed. The imposter has not been found.

Ms. Patrick brought an action against Union State Bank, alleging that the bank "negligently allowed a[n] unknown female, fraudulently posing as Plaintiff, to open a checking account ... [by] fail[ing] to demand proper identification from said person seeking to open the account and ... fail[ing] to verify information which had been obtained at the time the account was opened." The bank moved for a summary judgment, averring that there was no genuine issue of material fact and that it was entitled to a judgment as a matter of law. The circuit court granted the motion, holding that there were no material facts in dispute and that Ms. Patrick had not presented substantial evidence that would support a finding of the essential elements of duty and proximate cause.

II.

"The existence of a duty to the plaintiff is fundamental to a negligence claim." Graveman v. Wind Drift Owners' Ass'n, Inc., 607 So.2d 199, 203 (Ala.1992) (citing City of Bessemer v. Brantley, 258 Ala. 675, 65 So.2d 160 (1953)). The bank's position is that in opening new accounts it has no legal duty to use due care to protect members of the general public from fraud perpetrated by a third party who might open a checking account as an imposter. In response to this argument, Ms. Patrick presented the affidavit of Timothy Gruber, who identified himself as a bank security expert. Based on his security background and five years' experience as the director of corporate security for First Alabama Bank in Birmingham, Mr. Gruber expressed the opinion that almost all banks require photographic identification and that banks do this not only for their own protection, but for the protection of others as well. Moreover, Mr. Gruber stated that banks should compare the signature on the potential customer's identification with the signature on the bank's signature card. According to Mr. Gruber, it follows that several factors should have alerted the bank teller that the person opening the account in Bridgette Patrick's name was, in fact, an imposter. This included the lack of photographic identification, the different signatures on the stolen driver's license and the signature card, the incomplete signature on the signature card, and the different addresses presented by the imposter.

The bank notes that it is a rule in Alabama that, absent a special relationship or special circumstances, a person has no duty to protect another from criminal acts of a third person.

This rule is most commonly applied in cases in which a business invitee or employee seeks to impose liability on a premises owner or employer for injuries or damage resulting from the criminal acts of a third party committed on the owner's or employer's premises. See Habich v. Crown Central Petroleum Corp., 642 So.2d 699 (Ala.1994); Dailey v. Housing Authority for Birmingham Dist., 639 So.2d 1343 (Ala.1994); Bailey v. Bruno's, Inc., 561 So.2d 509 (Ala.1990); Moye v. A.G. Gaston Motels, Inc., 499 So.2d 1368 (Ala.1986); Ortell v. Spencer Cos., 477 So.2d 299 (Ala.1985); Henley v. Pizitz Realty Co., 456 So.2d 272 (Ala.1984); Latham v. Aronov Realty Co., 435 So.2d 209 (Ala.1983); Berdeaux v. City National Bank, 424 So.2d 594 (Ala.1982); Parham v. Taylor, 402 So.2d 884 (Ala.1981) (citing 10 A.L.R.3d 619). ² The rule has also been applied in cases in which a plaintiff sought to impose liability upon a psychiatrist for injuries resulting from criminal assault by the psychiatrist's...