That’s right. Mary beat the bank. Again.
In an appeal, U.S. Bank tried to get out of paying Mary McCulley the $6 million a Montana jury awarded her back in 2014. Yesterday, the Supreme Court of Montana decided against U.S. Bank—they’re going to owe McCulley the $6 million, plus interest from the earliest possible date they could owe it, not the later one that had been bandied about.
Here is the Court’s own synopsis:
Mary McCulley bought a condominium in Bozeman and sought a 30-year, residential loan for $300,000 from Heritage Bank, which later merged with U.S. Bank. She later sued the Bank, alleging the Bank defrauded her by instead issuing an 18-month, $300,000 commercial loan, and failing to notify her of the change. When McCulley could not obtain refinancing and the condominium went into foreclosure, she attempted suicide. The jury found that the Bank defrauded McCulley and awarded her $1,000,000 in compensatory damages and $5,000,000 in punitive damages, which the District Court approved.
On appeal, U.S. Bank argued that testimony it had offered from a former bank officer and McCulley’s medical records were improperly excluded from evidence; challenged the sufficiency of the evidence to support the jury’s finding of fraud; argued that U.S. Bank could not be held liable for punitive damages arising out of Heritage Bank’s conduct that preceded the merger of the banks; and challenged the propriety of the punitive damages award. McCulley cross-appealed the date set by the District Court for interest to begin accruing on the judgment.
The Montana Supreme Court concluded that, because U.S. Bank had failed to provide the bank officer’s journals to McCulley during the discovery process, the officer was prohibited from testifying with respect to the journals. The Court further concluded that because U.S. Bank failed to lay a proper evidentiary foundation for McCulley’s medical records, they were properly excluded. The Court held that fraud was demonstrated because evidence at trial established that the Bank falsely represented it would provide a 30-year, residential loan to McCulley, the Bank knew the representation was false, and the Bank intended McCulley to rely on the false representation, which she did to her detriment. The Court also held that, because the federal Bank Merger Act required U.S. Bank to assume “all liabilities” of Heritage Bank, U.S. Bank was properly held liable for all damages, including punitive damages, arising out of Heritage Bank’s conduct, and that circumstances proven during the trial supported the punitive damages award because the Bank’s conduct was reprehensible, the ratio between compensatory damages and punitive damages fell within the guidelines provided by the United States Supreme Court, and the statutory cap on punitive damages provided by the Montana Legislature was not exceeded. Lastly, the Court concluded that interest on the judgment must accrue from the date of the jury’s verdict, not the date of District Court’s post-trial decision approving the award. Thus, the Court affirmed the damages judgment, and reversed the calculation of interest on the judgment.
That friends, is a sweet, sweet victory, for Mary and for bank fighters everywhere. It gives all of us at least a modicum of hope that the banks will be held accountable for their misdeeds. At the very least, it is an acknowledgment that, as Mary herself said:
Hey wake up! The banks do lie, cheat, and steal.