Opinion ID: 1434198
Heading Depth: 1
Heading Rank: 2

Heading: disposition in the trial court

Text: Appellant originally brought suit against the Bank and Stahle. Since he and Stahle resolved their differences out of court, the trial concerned only Kost's claim against the Bank. Kost's complaint alleged that the Bank acted in a grossly negligent and willful manner in releasing the documents in the face of his letter of August 10, 1982. This standard of care corresponds with paragraph three of the escrow instructions which provides that the Bank    shall not be liable for any acts or omissions    excepting such as may arise through or be caused by its willful or gross negligence. At trial, appellant's counsel argued that the Bank construed the documents in escrow, contrary to paragraph six of the escrow instructions, when it determined that Kost was in default. Counsel argued that the Bank further violated paragraph six by releasing the documents without the joint written consent of the parties. The contention was that, pursuant to paragraph six, the Bank should have held the papers until the parties worked out their differences or until a court order directed the release. The failure of the Bank to do so constituted gross and willful negligence, according to Kost. The trial court found for the Bank and entered its findings as follows: 1. Plaintiff sought recovery of damages herein which he alleged arose out of willful and gross negligence of the Defendant Bank. 2. The parties agreed in the documents upon which the action was based to a standard which imposes liability on the Bank only for willful or gross negligence. 3. There can be no question that the Plaintiff was in fact in default under his contract with Mrs. Stahle. 4. It was not unreasonable for the Bank to conclude that Mrs. Stahle's notice of default to the Plaintiff was sufficient, and the Bank's conduct did not rise to the level of willful or gross negligence. 5. The mere failure of Mrs. Stahle to include the exact amount then due in her notice of default did not render the Bank's determination that the notice was sufficient an act of willful or gross negligence. 6. Provisions in the Bank's Escrow Agreement giving it the option to require written consent by both seller and buyer before delivering escrowed papers did not prevent the Bank from acting without such written consent. 7. The Plaintiff should be responsible for Defendant Bank's costs incurred in defense of this action.