Court Opinion

ID: 8045237
Source: CourtListenerOpinion
Date Created: 2022-09-09 03:52:55.944487+00
Date Added: 2024-06-11T16:37:27.442867
License: Public Domain

Young, J.,
with whom Mowbray, C. J., joins,
dissenting:
Because I believe that the majority opinion does not do justice in this case, I feel that I must dissent.
Originally, Mrs. Hood approached Nevada Savings intending to buy a treasury bill. However, the new accounts representative informed Mrs. Hood that treasury bills were not available through Nevada Savings and advised her to purchase CDs through Nevada Savings instead.
Mrs. Hood expressed concern over having her mother’s name on the accounts and specifically inquired whether she should set up the accounts to require two signatures in order to withdraw the funds. Mrs. Hood informed Nevada Savings that she wanted to protect her elderly manic-depressive mother from the possibility of improvidently dissipating her funds during an emotional episode. She was assured that the certificates were required to withdraw money from the account. Mrs. Hood also expressed concern regarding the discrepancy between the terms of the signature card and her understanding that the CDs must be presented in order to withdraw the funds. Again, she was assured that the CD was required to make a withdrawal and that the signature card was simply a standard form which Nevada Savings kept on file for verification.
Relying on this information, Mrs. Hood purchased the CDs upon these express representations by Nevada Savings. This court has consistently held that where a bank customer makes a specific inquiry, she is entitled to rely on the representations made by bank personnel. Nevada Nat'l Bank v. Gold Star Meat Co., 89 Nev. 427, 431, 514 P.2d 651, 654 (1973); see also Bank of Nevada v. Butler Aviation, 96 Nev. 763, 616 P.2d 398 (1980). Mrs. Hood was continually reassured that her mother could not withdraw the funds without the certificate itself.
It is unconscionable that Nevada Savings now argues that Mrs. Hood was not justified in relying on its representations due to the *920discrepancy between its repeated assurances and the language of the signature card. In support of its argument, Nevada Savings cites to Jones v. Chiado Corp., 670 P.2d 403 (Ariz.Ct.App. 1983). This case, upon which Nevada Savings relies so heavily, has been severely limited by Lubin v. Johnson, 820 P.2d 328 (Ariz.Ct.App. 1991). There, the court stated that Chiado Corp. may no longer be the law and went on to say: “We are unwilling to endorse the idea that victimization of the ignorant has legal sanction.” Id. at 328-29.
I am unwilling to endorse the idea that victimization of the innocent and mentally afflicted has legal sanction in the State of Nevada. I believe that todays opinion will permit banks to act as they please and dispense inaccurate advice without concern for the effect it may have on an innocent customer. For that reason alone, I believe that the majority’s opinion is fatally flawed.
The standard for justifiable reliance in Nevada is whether the person had information which would serve as a danger signal. Collins v. Burns, 103 Nev. 394, 397, 741 P.2d 819, 821 (1987). Here, Mrs. Hood specifically asked about the wording of the signature card and was assured that the CDs must be presented along with a signature to withdraw funds from the accounts. Mrs. Hood acted as a reasonsably prudent person who, when she saw cause for concern, communicated her worries and was given a plausible answer. Clearly, Mrs. Hood justifiably relied on Nevada Savings’ representations.
On the Nevada Savings CDs was the bank’s logo — “Big. Safe. Friendly.” By convincing Mrs. Hood that the bank could meet her needs and by enticing her to purchase CDs from it, instead of going elsewhere to buy a treasury bill, Nevada Savings showed that is was friendly. There is no question that the bank was big. However, Mrs. Hood might be pardoned if she now questions whether the bank was “safe.” The evidence would seem to suggest that Nevada Savings was anything but safe for Mrs. Hood and her mother, Mrs. Clay comb. I am aware that a slogan of PriMerit Bank, which has taken over Nevada Savings, is “The Bank That Listens.” Hopefully, this portends a new awareness of customer needs and a more lasting concern for client protection.
On December 6, 1985, Nevada Savings allowed Mrs. Clay-comb to withdraw all the money in the CD accounts on the basis of her signature alone. Nevada Savings knew something was amiss in the series of events which took place after Mrs. Clay-comb withdrew the funds from the CD accounts. For some unexplained reason, when Mrs Clay comb changed her new account, on which she was listed as trustee for Mr. Moore, to a joint account in the names of Mr. Moore and herself, she presented their recently acquired marriage license. It was not the *921policy of the bank to ask for a marriage certificate upon adding a name to an account. Nevada Savings was apparently suspicious of the circumstances because it made a special note on the record of the transaction that the marriage license had been presented.
One can only speculate as to why Nevada Savings took such special care to note the presentation of the marriage license when the license was not required to change the names on the account. Presumably, Nevada Savings was apprehensive about the turn of events and wanted additional documentation to insulate it from any accusations of impropriety.
Nevada Savings was rightly concerned about its conduct. It had no business allowing Mrs. Clay comb to withdraw the funds because it had expressly promised Mrs. Hood, who was watching over these funds because of her mother’s manic-depressive condition, not to allow such an event to occur. At the very least, it could have communicated with Mrs. Hood to let her know what was occurring. It would have been both simple and expedient to have called Mrs. Hood on the telephone to let her know that she had been misinformed. Mrs. Hood would then have had time before funds were disbursed to take appropriate steps.
In my opinion, Nevada Savings is estopped from asserting the defense that it was bound by law to release the funds to Mrs. Clay comb. The elements of estoppel are:
(1) the party to be estopped must be apprised of the true facts; (2) he must intend that his conduct shall be acted upon, or must so act that the party asserting estoppel has the right to believe it was so intended; (3) the party asserting the estoppel must be ignorant of the true state of facts; (4) he must have relied to his detriment on the conduct of the party to be estopped.
Cheqer, Inc. v. Painters & Decorators, 98 Nev. 609, 614, 655 P.2d 996, 998-99 (1982) (citations omitted). Clearly, all the elements are met here. Nevada Savings knew the true facts regarding whether the CDs must be presented to withdraw the funds. Indeed, at trial Nevada Savings personnel repeatedly testified that the CDs were not required to withdraw funds from the accounts. Nevada Savings intended its representations to be acted upon; if Mrs. Hood did not purchase the CDs, Nevada Savings would have lost the investment. It goes without saying that Mrs. Hood was ignorant of the true facts; if she had known that Nevada Savings could not safeguard the funds as it promised her that it could, she would have taken her business elsewhere.
There is no question that Mrs. Hood relied on the representations to her detriment. Mrs. Hood was the de facto trustee for her mother. She had a fiduciary duty to safeguard and manage her *922mother’s money. When the bank, without so much as a telephone call, precipitantly released the funds to Mrs. Clay comb and Bye T. Moore, who artfully persuaded her to marry him, the result was predictable. In a few short weeks, both Moore and the money were gone. This predatory lothario drove off into the sunset, disappearing not only with the newly purchased Cadillac but the remaining monies as well. Mrs. Clay comb was apparently left nearly penniless.
Arguably, Mrs. Hood did not fulfill her duty to safeguard the funds and could be liable for that breach. Additionally, Mrs. Hood will presumably be forced to spend her own money to assist in supporting her mother. Mrs. Hood testified at trial that after the ftinds were dissipated, her mother was forced to take in a roommate at the residential hotel where she was living because there simply was not enough money to allow her mother to live alone. Mrs. Hood inferred that she assists her mother financially.
I would therefore hold that Nevada Savings is estopped from asserting its defenses in the face of its unconscionable conduct.