Richard Ciccone, in his capacity as Trustee of the Trust under the Will of Alfred T. Ciccone, and Elsie M. Ciccone v. Robert A. Pitassi, Fleet National Bank, Rhode Island Hospital Trust National Bank, et al.

• Decision Date: 13 August 2004
• Docket Number: C.A. PB 97-4180
• Parties: Richard Ciccone, in his capacity as Trustee of the Trust under the Will of Alfred T. Ciccone, and Elsie M. Ciccone v. Robert A. Pitassi, Fleet National Bank, Rhode Island Hospital Trust National Bank, et al.
• Court: Rhode Island Superior Court

Richard Ciccone, in his capacity as Trustee of the Trust under the Will of Alfred T. Ciccone, and Elsie M. Ciccone v. Robert A. Pitassi, Fleet National Bank, Rhode Island Hospital Trust National Bank, et al.

C.A. No. PB 97-4180

Superior Court of Rhode Island

August 13, 2004

STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS PROVIDENCE, S.C Filed August 13, 2004 SUPERIOR COURT RICHARD CICCONE, in his capacity as: Trustee of the Trust under the Will of: Alfred T. Ciccone, and ELSIE M. CICCONE:

ROBERT A. PITASSI, : FLEET NATIONAL BANK, : RHODE ISLAND HOSPITAL TRUST: NATIONAL BANK, ET AL.:

DECISION

SILVERSTEIN J.

Before this Court is the Motion for Summary Judgment of Defendant Fleet National Bank (Fleet) as to Counts X, XI, and XII of the Amended Verified Complaint.¹

FACTS/TRAVEL

In his Last Will and Testament, Alfred T. Ciccone (A. Ciccone) created a trust (Trust) naming Elsie M. Ciccone (E. Ciccone) his wife, lifetime beneficiary and Richard Ciccone (R Ciccone), his son, an attorney, trustee and residuary beneficiary. As a lifetime beneficiary, E. Ciccone received the interest income of the Trust. (R. Ciccone Aff. ¶ 15.) Deposits of this interest, made bi-annually, were, as a matter of course, less than $10, 000 in amount. (Id.)

Shortly after A. Ciccone’s death on December 18, 1980, R. Ciccone hired Defendant Robert A. Pitassi (Pitassi), an attorney and relative, to handle the financial and

¹ In or about May of 1998, Defendant Rhode Island Hospital Trust (Hospital Trust) merged with BankBoston, N.A. BankBoston N.A. then merged with Fleet. Fleet admits that “if either plaintiff proves that any act of Hospital Trust alleged in the Amended Verified Complaint creates a legal liability on the part of Hospital Trust to that plaintiff then Fleet would be responsible for that liability.” Def.’s Mem. in Supp. of Mot. for Summ. J. at 2, n.2 legal affairs of the Trust. In his capacity as lawyer for the Trust, Pitassi helped to prepare tax returns, monitored Trust funds, and made recommendations as to the investment of Trust funds. (R. Ciccone Aff. ¶ 3.)

On March 2, 1993, R. Ciccone opened a certificate of deposit (CD) account (Account), bearing account number 8032942031, with Fleet. The “Certificate of Deposit Receipt” (CD Receipt) lists the “depositor” as “Trust Under the Will of Alfred T. Ciccone” and the depositor’s address as: c/o Robert A. Pitassi, Esq., 850 Fleet Center, Providence, RI 02903. The CD Receipt indicates that $95, 000, the sum deposited, “will be paid to the listed depositor[s]” and, that in the absence of contrary instructions, the “deposit will be automatically renewed for the same term at the rate in effect on the maturity date.” The CD Receipt further states: “[t]his is a Time Deposit Receipt which is non-negotiable and non-transferable.”

In addition, Fleet’s “Deposit Account Agreement for Personal Accounts” (Deposit Account Agreement) references CDs held by trusts. It states:

“[i]ndividuals and unincorporated non-business associations may open and maintain personal Checking and Savings Accounts, and CDs and Jumbo CDs. Personal trusts … may also maintain these Accounts. … Deposits may be made by one or two persons in trust for another (the “beneficiary”). Any action in connection with the Account, including withdrawals, may be made only by the trustee or, if there are two trustees, by both or either trustee or the survivor.” Deposit Account Agreement at 10. On January 30, 1997, Fleet addressed a “Certificate of Deposit Pre-Renewal Notice” (Pre-Renewal Notice) to Richard A. Ciccone, Trustee for “TRT U/W/O Alfred T[.] Ciccone, ” c/o Robert A. Pitassi, Esq., 850 Fleet Center, Providence, RI 02903. The Pre-Renewal Notice provides: “[y]our Fleet Certificate of Deposit will automatically renew on the maturity date indicated below. … If you wish to make changes [to the account], please complete and return this form within 10 days following your Maturity Date. Otherwise, your certificate will renew as explained above.”

Thereafter, Pitassi called Diane Becton (Becton), a “Senior Relationship Administrator” at Fleet, provided her with the CD Account number, informed her that the CD would mature in March, and said that he needed a cashier’s check made out to the Trust. (Becton Tr. at 8.) Pitassi also completed and returned to Fleet the Pre-Renewal Notice. On the Pre-Renewal Notice, Pitassi wrote, “Please make cashier’s check payable to Trustee on 3/3/97. Do not rollover. Thank you, R.A. Pitassi, Attorney for the Trustee, 2/6/97.” Furthermore, in the first signature blank below the statement “[w]e authorize Fleet Bank to carry out the options selected on this form, ” Pitassi signed “Robert A. Pitassi, Attorney for Richard A. Ciccone, Trustee.”

The CD matured on March 2, 1997. On March 3, 1997, Becton requested the cashier’s check. That same day, Fleet issued a cashier’s check (Fleet Cashier’s Check), check number 96655119, for $99, 533.69 and made payable to “Richard A. Ciccone Trustee for TRT U/W/O Alfred T. Ciccone.” Becton then called Pitassi and informed him that the Fleet Cashier’s Check was ready for pick-up at the front desk with the receptionist. (Becton Tr. at 18.)²

2 Marilyn Champ and Gloria Cassidy, relationship administrators in the private client group at Fleet during this time period (Champ Tr. at 2-3; Cassidy Tr. at 3), testified at deposition concerning Fleet’s customary banking practices. Prior to disbursing a depositor’s funds, Fleet’s employees compare the offset slip with the cashier’s check and verify that the check paying out the funds is made payable to the account holder. (Champ Tr. at 5, 7, 9; Cassidy Tr. at 15.) Fleet’s employees also ascertain that the person requesting the transaction is either a signer on the account or the person designated to act on behalf of the account. (Cassidy Tr. at 10.)

Where a trust holds an account, Fleet does not necessarily require the signature of the trustee for a requested transaction. (Id. at 14.) Fleet frequently opens accounts at the request of attorneys. (Id.) Where an attorney requests that Fleet open an account in the name of a trustee or trust, that attorney is commonly the person who signs on the account, determines that the account should be closed, or directs how to Once in possession of the Fleet Cashier’s Check, Pitassi wrote on the back of it: “for deposit only to the account of Richard A. Ciccone, Trustee for TRT U/W/O Alfred

T. Ciccone[, ] #003-396777.11.” (R. Ciccone Aff. ¶ 17.) Pitassi then deposited the Fleet Cashier’s Check at Hospital Trust in NOW account number 003-396777 (Hospital Trust Checking Account). The Hospital Trust Checking Account was in the name of Richard

A. Ciccone, Trustee under the will of Alfred T. Ciccone, and under the address 45 Enfield Avenue, Providence, RI 02904.³ Hospital Trust Statement at 1. Hospital Trust provided R. Ciccone with monthly statements concerning the Hospital Trust Checking Account. (Ferro Aff. ¶ 10.)

On or about March 4, 1997, Pitassi told E. Ciccone that he was re-investing the proceeds from the CD, Amended Verified Complaint at 4, and E. Ciccone gave Pitassi a check for $95, 000 drawn on the Hospital Trust Checking Account (Check Number 356). Elsie Ciccone made Check Number 365 payable to “Robert A. Pitassi, Attorney for Richard A. Ciccone, Trustee” and signed it “Richard A. Ciccone, Trustee [by] Elsie M. Ciccone P.O.A.” Pitassi endorsed and cashed Check Number 356 on March 4, 1997.

On or about March 10, 1997, a second check was drawn on the Hospital Trust Checking Account for $4, 533.69 (Check Number 357). Check Number 357, representing the interest income from the CD Account, was made payable and paid to E. Ciccone.⁴

Also on or about March 10, Hospital Trust provided R. Ciccone with a statement noting the $99, 533.69 deposit, Check Number 356 for $95, 000, and Check Number 357

disburse the account proceeds. (Id.) Fleet does not contact the trustee to determine whether a transaction is authorized. (Id. at 14-15.)

³ The Hospital Trust Checking Account was opened in or about 1989. On April 15, 1996, R. Ciccone signed a document granting E. Ciccone power of attorney with respect to all business with Hospital Trust concerning, inter alia, the Hospital Trust Checking Account. This power of attorney remained effective through July 30, 1997.₄ Plaintiffs claim that Pitassi filled out the two checks. See Pls.’ Mem. in Opp’n to Def.’s Summ. J. Mot. at 10 (stating that “Pitassi thereupon filled out the two checks provided to him by Elsie”). for $4, 533.69. (Ferro Aff. ¶ 14; Hospital Trust Statement at 1.) The two checks accompanied the statement. (Ferro Aff. ¶ 14.)

With Check Number 356’s proceeds, Pitassi purchased a cashier’s check from Hospital Trust, designated check number 46607139 (Hospital Trust Cashier’s Check). The Hospital Trust Cashier’s Check, dated March 4, 1997 and in the amount of $95, 000, was made payable to “Robert A. Pitassi, Attorney for Trustee Richard Ciccone.” Pitassi then deposited the Hospital Trust Cashier’s Check into his client account, account number 9392195169, at Fleet. After March 10, 1997, Hospital Trust no longer possessed any of the Fleet Cashier’s Check proceeds. (Ferro Aff. ¶ 15.)

In or about March of 1997, Pitassi gave E. Ciccone a document entitled “Table of

U.S. Treasury Bill and other investments by Richard A Ciccone, Trustee U/W Alfred T. Ciccone as of March 5, 1997.” The table states that “$95, 000 [was] used to purchase [the] face amount of $95, 000 of U.S. Treasury Bills maturing March 5, 1998.” In reality, however, Pitassi personally utilized and dissipated the $95, 000.⁵ On July 15, 1997, R. Ciccone sent Pitassi a letter authorizing Pitassi to release to R. Ciccone’s accountant “any and all information including...