Opinion ID: 2605270
Heading Depth: 1
Heading Rank: 1

Heading: Dr Angelos' Claims

Text: On appeal, Dr. Angelos' first claim is that the trial court erred in applying the four-year statute of limitations contained in U.C.A., 1953, §§ 78-12-1 & -25, rather than the unlimited statute of limitations contained in U.C.A., 1953, § 78-12-34 (1977) (repealed July 1, 1981, 1981 Utah Laws ch. 16, § 1). Section 78-12-34 provided that there was no statute of limitations barring recovery by one who has deposited money with a financial institution: To actions brought to recover money or other property deposited with any bank, trust company or savings or loan corporation, association or society there is no limitation. Id. (emphasis added). By the express terms of the statute and the decisions of this Court, § 78-12-34 has been held to apply only where the cause of action arises out of a plaintiff's relation as a depositor with the bank. See, e.g., Esponda v. Ogden State Bank, 75 Utah 117, 283 P. 729 (1929); Verdi v. Helper State Bank, 57 Utah 502, 196 P. 225 (1921); Larsen v. Utah Loan & Trust Co., 23 Utah 449, 65 P. 208 (1901). But see Strong v. Missouri-Lincoln Trust Co. of St. Louis, Mo. App., 263 S.W. 1038 (1924). To hold that Dr. Angelos is a depositor by reason of McCormick's forging of his endorsement and depositing of the checks into her own personal account would be to contort the plain meaning of the term deposited as it is used in § 78-12-34. There are no Utah cases which support such an anomalous application. Moreover, the policy behind § 78-12-34 is to protect persons who have deposited money in a bank account from being barred from claiming that money years later. We find no policy consideration that would justify bringing the present case within the purview of that statute. We therefore hold that Dr. Angelos is not a depositor within the meaning of § 78-12-34, and thus, the trial court was correct in applying the four-year statute of limitations contained in U.C.A., 1953, §§ 78-12-1 & -25. [2] In Dr. Angelos' second point on appeal, he claims that the trial court erred in its award of damages because it did not consider all of the available evidence. Because of the numerous documents and the absence of all of the Bank's records of McCormick's account, the parties agreed, pursuant to a motion made in chambers and during trial, that the extent of Dr. Angelos' loss would be decided by a master if liability were found to exist. Now that liability has been found to exist, if Dr. Angelos can provide additional evidence that has not been previously considered by the trial court, he is entitled to a determination of the amount of his losses in light of that additional evidence. We therefore remand this cause of action to the trial court to determine whether Dr. Angelos can produce additional evidence and, if so, to determine the extent of Dr. Angelos' damages in light of the new evidence. On appeal, the Bank also claims that the trial court erred in its award of damages because its determination included some ... checks [which] were endorsed in blank by the proper payee [ i.e., Dr. Angelos]. When Dr. Angelos endorsed some of his patients' checks in blank, they became payable to bearer and could be negotiated by delivery alone until specially endorsed. See U.C.A., 1953, § 70A-3-204(2). Because those checks were bearer instruments, the Bank is not liable to Dr. Angelos for McCormick's theft and subsequent cashing of them unless the instruments bore a restrictive endorsement at the time of their theft. See J. White & R. Summers, Handbook of the Law under the Uniform Commercial Code § 15-4, at 594-97 (2d ed. 1980). Thus, on remand, the trial court's award of damages in favor of Dr. Angelos and against the Bank should exclude the amounts of those checks which were properly endorsed in blank by Dr. Angelos. The Bank also argues that the trial court erred in its ruling that the doctrines of waiver, estoppel, laches, and avoidable consequences are not a bar to Dr. Angelos' right of recovery. The applicable standard of review is as follows: While it is true in equity cases this Court may review questions of both law and fact we are not bound to substitute our judgment for that of the trial court, and because of its advantaged position we give considerable deference to its findings and judgment. Nupetco Associates v. Jenkins, Utah, 669 P.2d 877, 883 (1983) (quoting Ream v. Fitzen, Utah, 581 P.2d 145, 147 (1978)). See also, e.g., Dang v. Cox Corp., Utah, 655 P.2d 658 (1982); Parks Enterprises, Inc. v. New Century Realty, Inc., Utah, 652 P.2d 918 (1982). With respect to the doctrine of waiver, this Court has stated: To constitute waiver, one's actions or conduct must be distinctly made, must evince in some unequivocal manner an intent to waive, and must be inconsistent with any other intent. Hunter v. Hunter, Utah, 669 P.2d 430, 432 (1983) (citations omitted). Such action or conduct is missing in the present case. Thus, the trial court's finding that Dr. Angelos did not waive his rights against the Bank was proper. With respect to the doctrine of estoppel, this Court has stated: The doctrine of estoppel has application when one, by his acts, representations, or conduct, or by his silence when he ought to speak, induces another to believe certain facts exist and such other relies thereon to his detriment. Leaver v. Grose, Utah, 610 P.2d 1262, 1264 (1980) (citations omitted). See also, e.g., Celebrity Club, Inc. v. Utah Liquor Control Commission, Utah, 602 P.2d 689, 694 (1979) (setting forth a breakdown of the essential elements of estoppel). Again, there is no action or conduct by Dr. Angelos that would support a finding of estoppel. Furthermore, the trial court found that Dr. Angelos did not induce the Bank to act to its detriment. Moreover, the purpose of the doctrine of estoppel is to rescue from loss a party who has, without fault, been deluded into a course of action by the wrong or neglect of another. Rowley v. Marrcrest Homeowners' Association, Utah, 656 P.2d 414, 418 (1982) (quoting Morgan v. Board of State Lands, Utah, 549 P.2d 695, 697 (1976)) (emphasis added). In the present case, the Bank is not without fault. Thus, the trial court's finding that Dr. Angelos was not estopped to assert his rights against the Bank was also proper. This Court has previously set forth the doctrine of laches as follows: Laches is not mere delay, but delay that works a disadvantage to another. To constitute laches, two elements must be established: (1) The lack of diligence on the part of plaintiff; [and] (2) An injury to defendant owing to such lack of diligence. Papanikolas Brothers Enterprises v. Sugarhouse Shopping Center Associates, Utah, 535 P.2d 1256, 1260 (1975) (footnotes omitted). In finding that the Bank was not prejudiced by the passage of time, the trial court implicitly found that the second element of the doctrine of laches was not satisfied. On the facts of the present case, where the Bank's injury is attributable to its own actions and conduct, or lack thereof, we affirm the trial court's ruling that Dr. Angelos' cause of action against the Bank is not barred by the doctrine of laches. The doctrine of avoidable consequences, also referred to as mitigation of damages, generally operates to prevent one against whom a wrong has been committed from recovering any item of damage arising from the wrongful conduct which could have been avoided or minimized by reasonable means. See, e.g., Jankele v. Texas Co., 88 Utah 325, 332-34, 54 P.2d 425, 428-29 (1936); C. McCormick, Handbook on the Law of Damages § 33, at 127-30 (1935). The Bank contends that because Dr. Angelos was negligent in failing to discover McCormick's embezzlement, he is precluded by the doctrine of avoidable consequences from recovering any damages that he has suffered. The Bank's argument fails for two reasons. First, McCormick's embezzlement consisted of a series of wrongful acts rather than one continuous act as the Bank contends. Under the doctrine of avoidable consequences, [o]ne need never take steps in advance to avoid the consequences of a future threatened wrong ..., but rather, need only avoid or minimize damages that arise out of a wrong that has already been committed. C. McCormick, supra, § 37, at 137. Accord Restatement (Second) of Torts § 918(1) (1979) (barring recovery of damages that one could have avoided by reasonable efforts after the commission of the tort). Thus, Dr. Angelos' negligence in failing to discover McCormick's past embezzlement of funds does not, under the doctrine of avoidable consequences, preclude him from recovering for damages sustained by McCormick's subsequent and future embezzlement of funds. Second, the doctrine of avoidable consequences does not prevent Dr. Angelos from recovering where the Bank was itself in as good, if not a better, position to avoid the consequences or mitigate the damages caused by McCormick's embezzlement. See, e.g., Alexander v. Brown, Utah, 646 P.2d 692, 695 (1982). Thus, we affirm the trial court's ruling that Dr. Angelos is not precluded by the doctrine of avoidable consequences from recovering the damages he sustained. Russell also appeals, claiming error by the trial court in ruling that Dr. Angelos' claims are not barred by the doctrines of avoidable consequences and election of remedies. Our previous discussion regarding the doctrine of avoidable consequences is also applicable to, and dispositive of, Russell's contention. Thus, we need only address his contention regarding the doctrine of election of remedies. Russell contends that Dr. Angelos' pursuit of a judgment against the Bank necessarily constitutes an election of remedies and therefore bars a cause of action against Russell. This contention is unfounded. This Court has previously stated that: The doctrine of election of remedies is a technical rule of procedure and its purpose is not to prevent recourse to any remedy, but to prevent double redress for a single wrong. Said doctrine presupposes a choice between inconsistent remedies, a knowledgeable selection of one thereof, free of fraud or imposition, and a resort to the chosen remedy evincing a purpose to forego all others. Royal Resources, Inc. v. Gibralter Financial Corp., Utah, 603 P.2d 793, 796 (1979) (emphasis in original) (footnotes omitted). The doctrine of election of remedies does not preclude Dr. Angelos from receiving a judgment against both the Bank and Russell. By his own pleading, Dr. Angelos sought (1) a judgment against the Bank for the amount of checks that it cashed with Dr. Angelos' forged endorsement and (2) a judgment against either or both McCormick and Russell for the damages caused to Dr. Angelos by McCormick's embezzlement which exceeds the amount of any judgment rendered against the Bank. The doctrine of election of remedies is inapplicable to the present case because Dr. Angelos is not seeking or obtaining double redress for a single wrong. Id. However, the trial court entered judgment for Dr. Angelos and against the Bank, Russell and McCormick, jointly and severally. This judgment is inconsistent with Dr. Angelos' prayer for relief for a judgment against Russell only for those damages suffered by Dr. Angelos in excess of the amount of the judgment against the Bank. We therefore reverse the trial court's ruling of joint and several liability and remand this case for entry of a judgment consistent with the relief requested.