
 
 










MEMORANDUM OPINION

No. 04-07-00828-CV

Christa C. LENK, Administratrix of the Estate of Mickey Carl Marcus,
Appellant

v.

JEFFERSON STATE BANK,
Appellee

From the Probate Court No. 1, Bexar County, Texas
Trial Court No. 2003-PC-2655
Honorable Polly Jackson Spencer, Judge Presiding

Opinion by: 	Karen Angelini, Justice

Sitting: 	Karen Angelini, Justice
		Rebecca Simmons, Justice
		Steven C. Hilbig, Justice

Delivered and Filed: March 11, 2009

REVERSED AND REMANDED
	This is an appeal from an order granting Jefferson State Bank's motion for summary
judgment and denying the motion for summary judgment filed by the administratrix of the Estate of
Mickey Carl Marcus, Christa C. Lenk ("Lenk"). We reverse the trial court's order and remand for
further proceedings consistent with this opinion.
Background
	On March 7, 2000, Mickey Carl Marcus died leaving $22,863.68 in an account at Jefferson
State Bank. In April 2000, Melvyn Morris Spillman, a former Bexar County clerk, presented false
Letters of Administration on the Estate of Mickey Carl Marcus to Jefferson State Bank. He was then
given complete control and signatory authority over the bank account. Spillman directed Jefferson
State Bank to send all future bank statements to his address, rather than to the deceased's address. 	In May 2000, Spillman deposited a number of checks totaling $164,444.29 into the bank
account. By January 31, 2001, Spillman had withdrawn all but $903.96 from the account. 
	In September 2003, after the fraudulent schemes of Spillman came to light, Lenk was
appointed to serve as the administratrix of Mickey Carl Marcus's estate. On June 3, 2005, Lenk
made written demand upon Jefferson State Bank for the sums that had been deposited into Marcus's
account and that had been withdrawn or paid therefrom based on the fraudulent actions of Spillman,
which Lenk claimed totaled $185,785.55. Jefferson State Bank refused to pay the amount requested.
Lenk then sued Jefferson State Bank for breach of its deposit contract. Both Lenk and Jefferson State
Bank filed motions for summary judgment; the trial court denied Lenk's motion and granted
Jefferson State Bank's motion. In two issues on appeal, Lenk argues that the trial court erred in
granting Jefferson State Bank's motion for summary judgment and in denying her motion for
summary judgment.  
Standard of Review
	To obtain a traditional summary judgment, a party moving for summary judgment must show
that no genuine issue of material fact exists and that the party is entitled to judgment as a matter of
law. Tex. R. Civ. P. 166a(c); see Randall's Fook Mkts., Inc. v. Johnson, 891 S.W.2d 640, 644 (Tex.
1995). When both sides move for summary judgment on the same issue and the trial court grants one
but denies the other, the denial is reviewable as a part of the appeal from the granted motion. See
Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Basse Truck Line, Inc. v. First
State Bank, 949 S.W.2d 17, 22 (Tex. App.--San Antonio 1997, writ denied). Further, when the order
granting summary judgment does not specify the grounds upon which the trial court relied, we must
affirm the judgment if any of the theories raised in the motion for summary judgment are
meritorious. See State Farm Fire & Cas. Co. v. S.S., 858 S.W.2d 374, 380 (Tex. 1993). And, we
review the trial court's ruling on a motion for summary judgment under the usual standard of review.
See Randall's Food Mkts., 891 S.W.2d at 644.
Discussion
	A deposit contract between a bank and an account holder is considered a contract in writing
for all purposes. Tex. Fin. Code Ann. § 34.301(a) (Vernon Supp. 2008). The elements of a breach
of contract claim are (1) a valid contract, (2) performance or tendered performance by the plaintiff,
(3) breach by the defendant, and (4) damages sustained by the plaintiff as a result of the breach. MG
Bldg. Materials, Ltd. v. Moses Lopez Custom Homes, Inc., 179 S.W.3d 51, 61 (Tex. App.--San
Antonio 2005, pet. denied). In suits to recover deposits, the bank has the burden of proving payment
under authority from the depositor and is obligated to pay out funds on deposit according to the
directions of the depositor. See Mesquite State Bank v. Prof'l Inv. Corp., 488 S.W.2d 73, 75 (Tex.
1972). 
	Bank deposits are typically classified as either "general deposits" or "special deposits." See
Hodge v. N. Trust Bank of Tex., N.A., 54 S.W.3d 518, 522 (Tex. App.--Eastland 2001, pet. denied).
A general deposit of money with a bank typically creates a creditor-debtor relationship between the
depositor and the bank with title to the money passing to the bank, subject to the depositor's demand
for payment. See id. A special deposit, on the other hand, creates a bailor-bailee relationship, and the
bank keeps or coveys identical property or funds entrusted to it. See id. "[W]hen a bank makes a
'wrongful payment' from a general deposit, there is no violation of the deposit agreement because
the bank has title to the funds." Id. at 525-26. This is because the general depositor is a creditor of
the bank, and it is only upon the bank refusing a demand for payment of the general deposit that the
bank breaches its relationship with the depositor. See id. at 526. Thus, an action for breach of a
depository agreement does not begin to run against the depositor until demand is made and refused
or an adverse claim is asserted. See id. at 524.
	In her brief, Lenk argues that the trial court should have granted her motion for summary
judgment because she proved that Jefferson Bank breached the depository agreement as a matter of
law. Thus, Lenk argues that when she, the duly appointed administrator for the estate, made a
demand for payment, Jefferson Bank was required to tender the amount of the deposit to Lenk. See
Lenk v. Guaranty Bank, No. 04-07-00503-CV, 2008 WL 2602121, at *4 (Tex. App.--San Antonio
2008, pet. filed). Jefferson Bank refused to tender the amount to Lenk, but argues that no breach
occurred because it tendered the amount to Spillman in reliance on Section 186 of the Texas Probate
Code. Further, Jefferson Bank argues that Lenk's action is barred by Section 4.406 of the Texas
Business and Commerce Code.
A.	Section 186 of the Texas Probate Code
	In its motion for summary judgment and on appeal, Jefferson State Bank asserts that Section
186 of the Texas Probate Code provides it with a defense to Lenk's claim for breach of depository
agreement. Section 186 provides that letters of administration "shall be sufficient evidence of the
appointment and qualification of the personal representative of an estate and of the date of
qualification." Tex. Prob. Code Ann. § 186 (Vernon 2003). Thus, Jefferson State Bank argues that
it could properly rely on Spillman's false letters of administration pursuant to Section 186. 
	In Lenk v. Guaranty Bank, No. 04-07-00503-CV, 2008 WL 2602121 (Tex. App.--San
Antonio 2008, pet. filed), a similar case involving Spillman's fraudulent actions, we fully considered
this issue of whether Section 186 of the Probate Code allows a bank to rely on fraudulent letters of
administration. We concluded it did not. See id. at *4. We explained that although the bank
attempted to meet its burden of proving that it had not breached the depository agreement by relying
upon the forged letters of administration, because Spillman was not a duly appointed legal
representative, the bank's payment to Spillman did not relieve the bank of its indebtedness to the
estate in the full amount of the deposit. (1) Id. Following Lenk v. Guaranty Bank, we hold that Jefferson
Bank cannot rely on Spillman's fraudulent letters of administration to relieve it of its indebtedness
to the Estate of Mickey Carl Marcus in the full amount of the deposit. See id. 
  B.	Section 4.406 of the Texas Business and Commerce Code
	Jefferson State Bank also argues that Lenk is barred from recovering by Subsection 4.406(f)
of the Texas Business and Commerce Code. Subsection 4.406(f) provides the following:
	Without regard to care or lack of care of either the customer or the bank, a customer
who does not within one year after the statement or items are made available to the
customer (Subsection(a)) discover and report the customer's unauthorized signature
on or any alteration on the item is precluded from asserting against the bank the
unauthorized signature or alteration. . . .


Tex. Bus. & Com. Code Ann. § 4.406(f) (Vernon 2002) (emphasis added). Thus, a customer has
a duty to report any unauthorized signatures within one year of the bank sending the customer
statements or making the items available to the customer pursuant to Subsection 4.406(a).
Subsection 4.406(a) provides,
	A bank that sends or makes available to a customer a statement of account showing
payment of items for the account shall either return or make available to the customer
the items paid or provide information in the statement of account sufficient to allow
the customer reasonably to identify the items paid. . . .

Id. § 4.406(a) (emphasis added).
	Here, Jefferson Bank argues that it complied with Subsection 4.406(a) when it mailed
statements to Spillman. (2) However, because Spillman was not the duly appointed legal representative,
see Lenk, 2008 WL 2602121, at *4, he was not the "customer." Thus, Jefferson Bank's act of
sending statements to Spillman's address did not trigger the customer's duty to report unauthorized
signatures pursuant to Subsection 4.406(f). And, there is no evidence in the record that Jefferson
Bank ever sent the statements to Lenk. Nevertheless, Jefferson Bank argues that it made the
statements available to Lenk because a person presenting appropriate credentials could either obtain
account statements at its branch office or access those statements online. Thus, Jefferson Bank
argues that when Lenk was appointed administratrix, she should have come to the bank and
demanded the statements or asked to see them online. We decline to read into Section 4.406 that the
appointment of an administrator fulfills the bank's duties to send or make available statements under
Subsection 4.406(a). See First Citizens Bank v. All-Lift of Ga., Inc., 555 S.E.2d 1, 3 (Ga. Ct. App.
2001) (holding that under UCC 4.406, "a bank does not make statements available within the
meaning of this Code section by merely holding statements and doing nothing more" and explaining
that "[a]dopting the bank's position would make the timing provisions of this Code section
exceedingly difficult to apply and enforce."). Here, the only evidence presented was that Jefferson
Bank mailed the statements at issue to Spillman at his address. There is no evidence that Jefferson
Bank ever complied with its duties under Subsection 4.406(a). Thus, Subsection(f) does not apply. (3)
	Jefferson Bank also argues that Lenk's claim is barred because Marcus and Jefferson Bank
contractually agreed to modify Subsection 4.406(f)'s one-year notice period to sixty days. However,
because Subsection 4.406(f) does not apply, any contractual modification of the notice period would
also not apply.
Conclusion
	The trial court erred in granting summary judgment in favor of Jefferson Bank and should
have granted summary judgment in favor of Lenk. Therefore, we reverse the judgment of the trial
court and remand the cause to the trial court for entry of judgment consistent with this opinion. 
 
							Karen Angelini, Justice
1.  We recognize that although fully briefed and considered by the court, in our opinion in Lenk v. Guaranty
Bank, when we stated that Guaranty Bank "attempted to meet this burden by presenting evidence that it relied upon
forged documents presented by Spillman in paying Spillman the funds in Thompson's account," we did not expressly
state that Guaranty Bank was relying on Section 186.
2.  The account statements at issue are those for the months of April, May, June, July, and August 2000.
Marcus died in March 2000, and the statement for that date contains the notation "Mickey Carl Marcus, Do Not Mail
- Deceased, Deliver to Customer Ser." On April 18, 2000, Spillman presented the fraudulent letters of administration,
and was able to change the name and address on the account.
3.  Because Subsection 4.406(f) was never triggered, we need not reach the issue of Lenk's actual knowledge.

