JOSEPH J. BLASKOVITZ, JR., by and through his attomey-in-fact, DACE BLASKOVITZ and the Estate of DOTTIE C. BLASKOVITZ, by andthrough its executor, DACE BLASKOVITZ Plaintiffs,
DOVER FEDERAL CREDIT UNION, Defendants.
Submitted: May 25, 2017
Defendant's Motion to Dismiss. Granted in Part; Denied in
C. Powell, Esquire of The Powell Firm, LLC, Wilmington,
Delaware; attorney for the Plaintiffs.
Michael C. Heyden, Esquire of The Law Offices of Michael C.
Heyden, Wilmington, Delaware; attorney for the Defendant.
WILLIAM L. WITHAM. JR., Resident Judge
the Court are a Motion to Dismiss filed by Defendant Dover
Federal Credit Union (the "Credit Union") and the
Plaintiffs' response in opposition. The parties presented
oral argument on May 25, 2017. The motion raises two issues
for the Court's decision: (1) whether the Complaint's
allegations of common-law negligence and breach of contract
are displaced by Delaware's enactment of the Uniform
Commercial Code (UCC) and, if not, (2) whether the
Complaint's allegations are so vague as to warrant
dismissal. Because the Court holds that the negligence claim
is displaced but the breach of contract claim is not, the
Motion to Dismiss will be GRANTED IN PART and DENIED IN PART.
BACKGROUND AND PROCEDURAL HISTORY
case centers around three members of the Blaskovitz family:
Joseph and the late Dottie Blaskovitz, husband and wife, and
their only son, Dace (collectively, the
"Plaintiffs"). The Complaint alleges as follows:
and Dottie were lifelong Delawareans who retired to Florida.
Their assets consisted principally of accounts at the Credit
Union and a mobile home park. While in Florida, Joseph and
Dottie's health began to decline. Both would eventually
develop dementia and, as a result of their declining health,
the two moved back to Delaware in the fall of 2014.
is a longtime customer of the Credit Union. In 1963, he
became customer number "007."
Joseph and Dottie moved back to Delaware, their son Dace (who
was and is their power of attorney) began making arrangements
to protect the couple's assets. Among those arrangements
was a June 2015 meeting with representatives of the Credit
Union, including President and Chief Executive Officer Glen
Daniels, to notify the Credit Union of the pair's
declining health and potential susceptibility to fraud. In
response, the Credit Union declined to list Dace as one of
the owners on the account. But the Credit Union, at
Dace's urging, promised to provide "additional
protection and oversight" of his parents' accounts.
Based on those promises, Dace began to focus on other matters
on his parents' behalf. But the Credit Union did nothing
to investigate or alert the Blaskovitzes when third parties
(apparently residents of the Blaskovitzes' mobile home
park) "were absconding with thousands of dollars"
from the parents' accounts.
not until over a year later, in February 2016, that Dace got
access to account information for his parents' accounts
at the Credit Union. What he found dismayed him: the account
balances were significantly lower than he expected and
included a "wrongful decrease" of at least $334,
445.00. As power of attorney for his parents, Dace notified
the Credit Union, filed a claim, and provided an Affidavit of
Forgery for the sixty days before February 18, 2016. The
Credit Union told him that he could only recover losses going
back sixty days, and in the end only returned $18, 100 to
Joseph and Dottie's accounts.
behalf of his father and his mother's estate,
Dace sued the Credit Union for negligence and breach of
negligence claim was based on a few separate alleged duties.
The first was the Credit Union's duty to safeguard its
customers' funds, which the Plaintiffs say was breached
when the Credit Union "wrongfully honor[ed]" forged
checks and failed to put a policy or process in place to
review the authenticity of signatures on checks. The second
and third duties arose under Delaware's enactment of the
Uniform Commercial Code and the Credit Union's promise to
the Plaintiffs after learning of the parents' incapacity.
The Credit Union breached these duties, the Plaintiffs say,
when they continued to pay forged checks. The final source of
duties is unclear. The Plaintiffs allege that there were a
number of procedures and protocols that are "customary
or should be implemented... to combat... financial
exploitation of the elderly."
breach of contract claim was based on "a Joint Share
Account Agreement, among others" into which the parties
entered. The agreements, the Plaintiffs allege, required
sight review of checks, which the Credit Union failed to
perform. The Plaintiffs also appear to allege that the
agreements required full reimbursement of the forged payments
under the circumstances described in the Complaint. Finally,
the Plaintiffs allege that their damages are a result of the
Credit Union's failure to follow through on its promises
Credit Union filed a Motion to Dismiss, which the Plaintiffs
oppose. This is the Court's ruling on the Credit
Union's Motion to Dismiss.
Credit Union argues that bank customers may not assert
common-law negligence and breach-of-contract claims against
their bank when the bank pays on forged checks. The Credit
Union contends that such claims are displaced by the Uniform
Commercial Code. To the extent that there are any legally
viable claims, the Credit Union argues, they are not alleged
with sufficient specificity to survive a motion to dismiss.
Plaintiffs argue that both negligence and breach-of-contract
claims are viable when a bank pays on forged checks, and are
only displaced when the circumstances and duties fall within
the scope of the UCC. The representations made by the Credit
Union, the Plaintiffs contend, bring the claims outside the
scope of the UCC. The Plaintiffs also argue that to the
extent that the Complaint could be made more specific, a
motion to dismiss is not the appropriate remedy.
is a notice pleading jurisdiction. Thus, for a complaint to
survive a motion to dismiss, it need only give general notice
of the claim asserted." When deciding a motion to dismiss
under Superior Court Rule of Civil Procedure 12(b)(6),
(hereafter "Rule 12(b)(6)") all well-pleaded
allegations in the complaint must be accepted as
true. The test for sufficiency is a broad one:
the complaint will survive the motion to dismiss so long as
"a plaintiff may recover under any reasonably
conceivable set of circumstances susceptible of proof under
the complaint."However, the Court "will not accept
conclusory allegations unsupported by specific facts or 
draw unreasonable ...