Wellington Energy v. Citizens v. Ostrowski, R. ( 2020 )

J-A26038-19
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
WELLINGTON ENERGY, INC. : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
:
v. :
:
:
CITIZENS BANK OF PENNSYLVANIA : No. 499 WDA 2019
v. :
:
:
RAELISE OSTROWSKI :
Appeal from the Judgment Entered April 5, 2019
In the Court of Common Pleas of Allegheny County Civil Division at
No(s): GD 13-017836
BEFORE: SHOGAN, J., LAZARUS, J., and OLSON, J.
MEMORANDUM BY OLSON, J.: FILED MARCH 10, 2020
Appellant, Wellington Energy, Inc., appeals from the judgment entered
on April 5, 2019. We affirm.
The trial court ably summarized the underlying facts and procedural
posture of this case:
Raelise Ostrowski, an employee of Wellington Power
Corporation,[1] forged indorsements on [264 of Appellant’s]
checks, enabling her to steal $[375,628.62]. Ms. Ostrowski
forged the indorsements from 2008 until she was caught in
2013. Ms. Ostrowski was Wellington Power’s payroll
administrator, which made her responsible for the payroll and
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1 Wellington Power Corporation is Appellant’s parent corporation and it
“oversees the administration, including the accounting and payroll functions,
of” Appellant. Appellant’s Complaint, 12/11/13, at ¶¶ 8-9.
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“per diem” reimbursements as [Appellant’s] employees
replaced between eight and ten million electrical meters in
the State of California. Per diem checks, typically in the
amount of $1,385 or $1,551.66, reimbursed approximately
[15 or 20] employees monthly for their travel related
expenses, such as mileage and housing. When Ms. Ostrowski
found that an employee receiving per diem reimbursements
separated from [Appellant] by way of resignation,
retirement[,] or termination, she would continue to have per
diem reimbursement checks issued to them.
Ms. Ostrowski then forged the indorsement signatures of the
former employees on the backs of the checks and deposited
them via automated teller machines into her own checking
accounts with Citizens Bank and PNC Bank. For example,
Zack Smith ended his employment with [Appellant] in
September [] 2009, but Ms. Ostrowski continued to have
monthly per diem reimbursement checks issued to Zack
Smith until July [] 2013, when Citizens Bank discovered that
checks she was depositing had forged signature
indorsements. Ms. Ostrowski was then charged with the
crime of mail fraud (18 U.S.C. § 1341), [pleaded] guilty[,]
and served [24] out of a [27] month prison sentence.
In September [] 2013, [Appellant] began this civil lawsuit
against Citizens Bank of Pennsylvania by writ of summons,
which was followed in December by a complaint. Among
other things, the complaint alleged that Citizens Bank owed
[Appellant] $366,485.32 for failing to exercise ordinary care
by accepting deposits into Ms. Ostrowski’s account of checks
made payable to other individuals that contained forged
indorsements. Citizens Bank joined Ms. Ostrowski as an
additional defendant, alleging she should indemnify or
contribute towards any liability of Citizens Bank to
[Appellant]. . . .
In December [] 2017, the Honorable [Paul F. Lutty, Jr.]
granted Citizens Bank’s motion for partial summary judgment
by prohibiting [Appellant’s] claims arising from all checks in
bank statements made available to [Appellant] in July [] 2012
or earlier. Judge Lutty’s ruling left intact [Appellant’s] claims
[related to the] forged checks deposited between August []
2012 and July [] 2013.
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The dispute over the reduced amount of $109,581.66 was
assigned to [the trial court judge, the Honorable Alan
Hertzberg,] for resolution by way of a jury trial. After a trial
of approximately three days, Citizens Bank withdrew its claim
against Ms. Ostrowski. On [Appellant’s] claims against
Citizens Bank, the jury returned a verdict in favor of Citizens
Bank. [Specifically, the jury found that Citizens Bank did not
fail to exercise ordinary care in this case. See Jury Verdict,
11/30/18, at 1.]
Trial Court Opinion, 6/4/19, at 1-3 (footnotes and some capitalization
omitted).
Following the denial of Appellant’s post-trial motion, Appellant filed a
notice of appeal. Appellant raises three claims on appeal:
1) Did the [trial] court err when it applied the facially
inapplicable provisions of 13 Pa.C.S.A. § 4406(f) to grant
partial summary judgment and, thereby, to limit the scope of
[Appellant’s] claims to a one-year lookback period?
2) Did the [trial] court err in permitting [Citizens Bank] to
introduce as evidence customer agreements between other
banks and their customers which were irrelevant, hearsay,
unauthenticated, misleading and highly prejudicial?
3) Did the [trial] court err in not granting a mistrial or
providing a limiting instruction when [Citizens Bank] made
references to [Appellant’s] claims against [PNC Bank] in
closing arguments in violation of [the trial court’s] order on
[Appellant’s] pretrial motion in limine?
Appellant’s Brief at 4 (some capitalization omitted).
We have reviewed the briefs of the parties, the relevant law, the certified
record, the notes of testimony, and the opinions of the able trial court judges,
the Honorable Paul F. Lutty, Jr. and the Honorable Alan Hertzberg. We
conclude that Appellant is not entitled to relief in this case, for reasons partially
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expressed in Judge Lutty’s June 6, 2019 opinion2 and fully expressed in Judge
Hertzberg’s June 4, 2019 opinion. Therefore, we affirm on the basis of Judge
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2 Appellant claims that, in granting Citizens Bank’s motion for partial summary
judgment, Judge Lutty erred by “limit[ing] the scope of [its] claims to a
one-year lookback period.” Appellant claims that this error caused it prejudice
because, during trial, Citizens Bank defended the action by pointing out “the
long duration of the fraud” and by faulting Appellant for failing to catch the
fraud earlier. Appellant’s Brief at 34-36. According to Appellant:
the wrongly-limited look-back period permitted the jury to
consider [Citizens Bank’s] liability only for the final year –
after Ms. Ostrowski’s conduct had been continuing for years.
In a trial without the prejudice of the one-year look-back
period, the jury would consider [Citizens Bank’s] conduct
looking back to 2008, which would have considerably altered
the jury’s weighing of the claims and evidence.
Id. at 35-36.
If Appellant is claiming that it suffered prejudice because the summary
judgment ruling limited its ability to present evidence related to events that
occurred before the one-year look-back, this claim fails. To be sure, Judge
Lutty’s summary judgment ruling only limited Appellant’s potential damages
in this case – it did not limit the evidence that the parties were permitted to
introduce. Indeed, at the beginning of the trial, Appellant’s attorney informed
the trial court:
Yes[, Your Honor]. As [Citizens Bank’s attorney] said to Your
Honor, while we are going to tell the facts going back
to the beginning of the fraud, we’re only seeking damages
and only mentioning specific damages for the 79 checks in
the one-year look-back period consistent with Judge Lutty’s
order.
...
We’re not going to make an argument that, gee, we’re
entitled to [$]400,000, but we can only get [$109,000]. We
understand it’s [$109,000] per Judge Lutty’s Order.
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Lutty’s and Judge Hertzberg’s thorough opinions and adopt them as our own.
In any future filing with this or any other court addressing this ruling, the filing
party shall attach a copy of Judge Lutty’s June 6, 2019 opinion and Judge
Hertzberg’s June 4, 2019 opinion.
Judgment affirmed.
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I think both parties will be talking about the conduct over four
or five years, but we will not ask for damages more than
[$109,000], whatever the stipulated amount is.
N.T. Trial, 11/27/18, at 22 (emphasis added).
Further, in this case, the jury specifically found that Citizens Bank did not fail
to exercise ordinary care. See Jury Verdict, 11/30/18, at 1. Therefore, since
the summary judgment order only limited the potential damages that
Appellant could receive and since the jury found that Appellant was not
entitled to damages in this case, even if the summary judgment order were
erroneous, Appellant did not suffer any prejudice as a result of the error and
it is not entitled to relief on appeal.
If, on the other hand, Appellant claims that the summary judgment ruling
caused it to suffer prejudice because the ruling caused the jury to not “weigh[]
Citizens [Bank’s] conduct of allowing these fraudulent ATM deposits for years
against [Appellant’s] conduct,” this claim also fails. See Appellant’s Reply
Brief at 9-10. This claim of prejudice would only be relevant as to the amount
to which Appellant’s failure to exercise ordinary care contributed to its loss.
Here, however, the jury simply found that Citizens Bank did not fail to exercise
ordinary care. Therefore, and again, the summary judgment ruling did not
prejudice Appellant.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 3/10/2020
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