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Shelbyville attorney Mark Dean will have his day today in the Kentucky Supreme Court.
Attorneys for Dean, who sued Commonwealth Bank & Trust for not noticing that his secretary was embezzling millions of dollars from him, and the bank will present oral arguments at 10 a.m. before all seven state supreme court justices at the Kentucky Supreme Court in Frankfort in the case of Mark Dean vs. Commonwealth Bank & Trust Co.
Dean filed suit in January 2009, accusing the bank of a violation of a Kentucky Uniform Commercial Code, as well as aiding and abetting fraud and illegal activity and breach of duty of ordinary care.
In 2008, Dean learned that his secretary, Jody Wills, who had been with him since he opened his office in 1998, had diverted more than $800,000 from his clients’ escrow accounts, thefts that had been occurring from 2003 to 2005.
Wills wrote herself duplicate payroll checks and paid her credit card bills and mortgage payments on her home with funds stolen from the accounts. To cover up those thefts afterwards, she floated checks among numerous banks that involved more than $2.6 million.
The lawsuit was dismissed in 2010 by Shelby Circuit Judge Charles Hickman in a summary judgment, a decision upheld in 2011 by the Kentucky Court of Appeals in 2011, with the court writing that Dean should have been aware of Wills’ check-kiting scheme.
Dean then petitioned the Supreme Court and last year was granted a discretionary review, which is the authority of the court to decide if a case merits being heard.
Dean’s team of attorneys, Laurence J. Zielke, Nancy J. Schook and Karen D. Campion of Louisville, will argue that Dean had no way of knowing that Wills was stealing money from him because her embezzlement scheme was so elaborate.
Wills had pleaded guilty and had received probation for the theft of $720,000 from Dean’s escrow account. She was jailed at the beginning at 2012 for falling behind on her restitution schedule of $600 per week to Dean, but was paroled in March.
The suit says the bank knew or should have known that Wills was engaged in suspicious activity, was negligent in not advising him of the check-cashing scheme and failed to contact Dean about very large amounts of money and the repeated use of counter checks.
John T. McGarvey of Louisville, attorney for Commonwealth Bank, said that in his oral argument this morning, he intends to point out that the bank was not negligent in its duty toward Dean.
“The bank’s claim, that has been sustained thus far by the Shelby Circuit Court and by the Kentucky Court of Appeals, is that the person who signed the checks was an authorized signer on the account, that when the bank paid the checks, it returned every one of the checks…and the bank was never notified that the checks had been improperly paid,” he said.
McGarvey said he does not know how long it will take the court to come back with a ruling, but it could be several weeks, or even months.