Gossels v Fleet National Bank

Gossels v. Fleet National Bank

Name:

Institution:

Gossels v. Fleet National Bank

parties

The plaintiff in the case was; C. Peter R. Gossels (Gossels).

The defendant in the case was; Fleet National Bank (Fleet).

Facts

The national fleet bank credited the amount of Gossels on 15th, December 1999. But, later, Gossels realized that he would have made more money if the bank had credited the check one month before. As a result, Gossels took the case against the bank for negligent misinterpretation (Gossels v. Fleet National Bank). The bank was supposed to advise its client (Gossels) that they would pay out his check at a retail exchange rate which was a percentage lower compared to the spot rate that it received for the foreign currency. But the bank chose to set a daily rate secretly since their workers were advised not to disclose to the members of the general public.

Procedure

Previously, the state intermediate appellate court had affirmed its decision for Gossels on the claim of negligent misrepresentation (Gossels v. Fleet National Bank). As a result, the defendant took the case to the appellate court with the claim that it had not committed a deceptive and unfair act in violation of the G. L. C. 93A. The withheld information from its clients purposely, by not revealing the rate differential that arose from the internal rate sheet which would be used by the bank in processing the check. The court of appeal vacated the ruling of the lower court. However, to remand for the purpose of attaining a judgment in favor of Gossel, the court ruled that the bank had breached the fiduciary duty. In the course of business, the bank failed to supply the true information which resulted in a loss.

Issues

If the bank is accepting the international check that was paid the client in currency subject to the viable exchange rate, is the bank accountable for differences in the amount paid to the client and the amount that is collected on the check?

Applicable laws

The applicable law, in this case, is the agency law. The law is based on the trusting relationship between the principal and the agent. The law requires that the agent should act on behalf of the principal openly. In this case, the agent who is subject to the control of the principal should give all the information, failure to which, the fiduciary duty is breached.

Holding

The appellate court judged the case in Gossel’s favor (Gossels v. Fleet National Bank). The judgment was made since the Fleet International Bank had breached its fiduciary duty. The principal who in this case is the client has the right to be given all the information which are known by the agent (Fleet) in reference to the bank transactions in which the bank is acting for the client. The action should be in good faith, and good faith requires total disclosure of all the material facts. Moreover, Fleet, which is the agent, in this case, had the duty to keep and render all the accounts.

Reasoning

When Fleet received and accepted the check from Gossels, they became his agent. Therefore, according to fiduciary, Fleet is required to advise Gossels about the exchange rate. According to the case, the plaintiff was not given all the information about the transaction. As a result, the bank failed to disclose, which is the reason why the plaintiff had an adequate explanation. Therefore, it is evident that the bank breached its fiduciary duty to give clients a complete accounting for the disposition of the money. As a result, the bank was liable for neglecting misrepresentation and breaching of the fiduciary contract. Moreover, the bank failed to keep and render the accounts. When it was called for an accounting by the plaintiff, Fleet failed to properly dispose of the funds which it had received from the client. In other words, the bank breached the contract that they had with Gossels.

Reference

Gossels v. Fleet National Bank. (Book Nancy k. Kubasek, Brennan, & Browne. (2015). The legal environment of business: A critical thinking approach(seventh ed.). Pearson Education, Inc.)

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