The plaintiff's suit against her agent for allegedly misleading her regarding certain investment strategies for proceeds of a life insurance policy and fees survived the agent's motion to dismiss. Waldemar v. Golden, 2018 U.S. Dist. LEXIS 204801 (M.D. Fla. Dec. 4, 2018).
The facts were based upon the allegations in the complaint. Golden, the agent, sold a life insurance policy to plaintiff's husband. After her husband's death, Golden contacted plaintiff and offer his services to handle the investment of the $426,000 life insurance proceeds. Golden gained control of the life insurance proceeds and the money in plaintiff's IRA account. Golden had plaintiff sign an agreement without explaining his $395 per hour fee plus disbursements for any time spent on the matter.
When Golden took control of the accounts, the contained $426,319, plus interest from the insurance proceeds and $79,266.34 from the IRA. Plaintiff instructed that the funds were not to be traded until further notice. Nevertheless, Golden started trading the funds and reduced the account by almost $200,000. Golden had charged here $50,000 in fees up to that point.
Plaintiff sued and Golden moved to dismiss. Golden argued, among other things, that plaintiff's allegations that she gave oral instructions while the agreement required written instructions.
Plaintiff's claims for fraudulent inducement and common law fraud was sufficient. The agreement said Golden would act according to plaintiff's instructions and investment objections which was false in light of what transactions followed. Plaintiff sufficiently stated a claim for breach of fiduciary duty and for negligence.
The breach of contract claim was also adequately pled. While Golden was correct in noting that generally oral modifications to written agreements were unenforceable if proscribed by the written agreement, there were exceptions to the rule where, for example, there was detrimental reliance. The agreement obligated Golden to act in plaintiff's best interests, in a matter consistent with her investment objectives and instructions, in good faith, and compliance with applicable laws and regulations. Golden breached these obligations and plaintiff suffered damages as a result.
