CHARLES C. PATSOS vs. FIRST ALBANY CORPORATION & another [Note 1]

MARSHALL, C.J. We consider in this case whether claims by a customer against his broker-dealer in the securities business are barred by the applicable statutes of limitations. A judge in the

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Superior Court concluded that they were, and entered summary judgment for the defendant on all counts. The plaintiff appealed, and the Appeals Court vacated the judgment. Patsos v. First Albany Corp., 48 Mass. App. Ct. 266 (1999). We granted the defendant's application for further appellate review. We agree with the well-reasoned decision of the Appeals Court, but take this opportunity to clarify relevant points of law. We vacate the judgment and remand the case to the Superior Court for further proceedings consistent with this opinion.

We view the facts in the light most favorable to the plaintiff, Charles Patsos, the party opposing summary judgment. We assume that all of the facts in his detailed affidavit are true, Graham v. Quincy Food Serv. Employees Ass'n & Hosp., Library & Pub. Employees Union, 407 Mass. 601, 603 (1990), drawing from them all inferences favorable to him. O'Gorman v. Rubinaccio & Sons, 408 Mass. 758, 759 (1990) [Note 2].

First Albany Corporation (First Albany) is a broker-dealer in the securities business. With headquarters in Albany, New York, it has a branch office in Boston. From April, 1988, through August, 1989, Edward Accomando was employed by First Albany as its registered representative authorized to effect securities transactions for its customers. Patsos alleged that from June, 1988, through approximately August, 1989, Accomando improperly withdrew more than $1.6 million from Patsos's First Albany accounts, without his knowledge or approval.

The circumstances of Patsos's dealings with Accomando are these. In 1987, Patsos, who previously had not invested in the

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securities market, was introduced to Accomando. Accomando represented to him that, if followed, his investment advice could make Patsos "a great deal of money." While it is not clear when Accomando first began advising Patsos, at some point Patsos bought approximately $8 million of Central Cooperative Bank stock on Accomando's advice, approximately one-half of which was purchased on a margin account.

Sometime between the purchase of the Central Cooperative Bank stock and early January, 1988, Accomando twice advised Patsos that he was at risk of losing his entire investment if he did not pay down his margin account. Accomando also told Patsos that he could arrange a "private" or "negotiated" sale of the stock that would permit Patsos to pay down the account without affecting the market price of the stock. In late December, 1987, or early January, 1988, Accomando executed a $1 million transaction to that effect on behalf of Patsos.

Around that time Accomando informed Patsos that he intended to switch brokerage firms and become an employee of First Albany. His new affiliation, he told Patsos, would allow Patsos to invest a larger percentage of his account on margin, thereby providing greater protection for his investments and relieving Patsos of periodic margin calls when the market value of the Central Cooperative Bank stock dropped below a certain price [Note 3]. Patsos established five brokerage accounts with First Albany after it employed Accomando [Note 4]. During 1988 and 1989, while employed by First Albany, Accomando continued to advise Patsos concerning which stocks to purchase, how many shares to buy, and when to make the purchases. Patsos trusted Accomando completely, and First Albany has not challenged Patsos's statement that Accomando exerted "complete control" over his accounts.

Patsos states, and we must accept as true, that he lacked the,

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experience and expertise needed to buy and sell stocks and that he relied entirely on Accomando's advice, knowledge, and experience. First Albany has also not challenged that Patsos informed Accomando that he was an unsophisticated investor, and that Accomando encouraged Patsos to trust him. While they spoke frequently regarding the accounts, Accomando often did not tell Patsos about executed transactions until after they had been completed, if at all. Patsos authorized a second private sale of his Central Cooperative Bank stock worth $1.75 [m]illion in March or April, 1989, after Accomando again persuaded him that he was at risk of losing his investment if he did not pay down his margin account. Although Accomando was by then employed by First Albany, Patsos received no documentation that the sale had taken place; he relied on Accomando's assurance that it had been completed.

After Patsos became a customer, First Albany sent him monthly statements advising him of the status of each of his accounts. The content of those statements inform First Albany's defense. Each First Albany statement covered a particular period and referenced the account number and the name of the "investment executive," Edward Accomando. Of relevance to this case is account activity described in some of the monthly statements as "issued by Boston": thirty-one transactions executed between June 14, 1988, and July 31, 1989, are described this way. For each such entry, the word "check" or "CKS" appears in a column headed "price or entry," with a dollar amount entered in the corresponding "debit" column. The dollar amount of each "check" varied, ranging from $1,000 to $1.06 million. Patsos states that he did not understand the meaning of the term "issued by Boston," and never received copies of the checks to which the statements apparently referred. When he told Accomando that he did not know how to decipher the statements, Accomando responded by telling him "not to worry."

In late December, 1994, or early January, 1995, agents of the Federal Bureau of Investigation (FBI) and attorneys from the United States Department of Justice New England bank fraud task force, investigating Accomando's business dealings, interviewed Patsos about checks drawn on his First Albany accounts payable to a gambling casino, a professional sports team, and others. It was then that Patsos learned for the first time that Accomando had converted significant funds for his own personal use. Patsos was also told that, as a result of the investigation,

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Accomando's broker's license had been revoked. Patsos was shown documents authorizing the transfer of the funds from his accounts, but according to Patsos the signatures on the documents were forged.

On January 24, 1995, counsel for Patsos wrote to First Albany, asserting that funds belonging to Patsos and his nominees had been wrongfully withdrawn from accounts handled by Accomando and converted to the personal use of First Albany's employees. The letter identified and challenged thirty-three checks, totaling $1,672,230.70, charged to the five accounts. Counsel made demand for copies of all of Patsos's records, including copies of all checks drawn against his accounts. By letter dated February 6, 1995, First Albany rejected all of the claims, informing Patsos that it would vigorously defend any action against it. First Albany also refused to deliver the account records and copies of the disputed checks [Note 5].

According to Patsos, his FBI interview took place in either late December, 1994, or early January, 1995. We agree with the Appeals Court that the inferences favorable to Patsos, which we also draw, are that it was highly likely that First Albany was aware of the alleged embezzlement by February 6, 1995, and, if so, the defendant's February 6 letter could be viewed by a jury as an act of concealment. Patsos v. First Albany Corp., supra at 269. As the Appeals Court also noted, Patsos filed his complaint on November 28, 1995, approximately ten or eleven months after the FBI interviewed him. Id. Nevertheless on December 18, 1995, First Albany filed an answer denying outright "that there was a conversion of [Patsos's] funds by Accomando."

In short, the pleadings and affidavits present material questions of fact concerning the allegations of wrongdoing by First Albany or Accomando that would preclude entry of summary judgment. But the challenged checks were drawn from June, 1988, through August, 1989, more than six years prior to the commencement of this action on November 28, 1995. First Albany asserts that all of Patsos's claims - for conversion, breach of fiduciary duty, breach of contract, lack of good faith, negligent supervision, and violation of G. L. c. 93A - are therefore barred by the applicable statutes of limitations [Note 6].

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To defeat First Albany's motion for summary judgment, Patsos seeks to avail himself of the discovery rule. The rule, which operates to toll a limitations period until a prospective plaintiff learns or should have learned that he has been injured, may arise in three circumstances: where a misrepresentation concerns a fact that was "inherently unknowable" to the injured party, where a wrongdoer breached some duty of disclosure, or where a wrongdoer concealed the existence of a cause of action through some affirmative act done with the intent to deceive. Protective Life Ins. Co. v. Sullivan, 425 Mass. 615, 631-632 (1997). On appeal, Patsos relies on the first two theories [Note 7]. First, Patsos contends that he could not have discovered Accomando's conversion of his funds before his FBI encounter because the transactions were "inherently unknowable [Note 8]." Second, he argues that a jury reasonably could conclude that First Albany breached its fiduciary duty to reveal to him facts that, if disclosed, would have made him aware of the alleged embezzlement. This failure, he claims, constituted fraudulent concealment and thereby triggered the tolling protection of G. L. c. 260, s. 12 [Note 9], until he was informed by the FBI in late 1994 or early 1995 that his funds had been misappropriated.

We may summarily dispose of his first argument. We agree

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with the motion judge [Note 10] that there was nothing "inherently unknowable" about the information supplied by First Albany in its monthly statements. The discovery rule provides that a cause of action for the redress of an "inherently unknowable" wrong does not accrue until the plaintiff knew, or in the exercise of reasonable diligence should have known, of the factual basis for a cause of action. See Williams v. Ely, 423 Mass. 467, 473 n.7 (1996); Olsen v. Bell Tel. Labs., Inc., 388 Mass. 171, 175 (1983); Maggio v. Gerard Freezer & Ice Co., 824 F.2d 123, 130 (1st Cir. 1987). The First Albany statements that Patsos received in 1988 and 1989 indicated that a number of checks "issued by Boston" were categorized as "debits" from his accounts. If Patsos did not understand the statements, as he claims, in the exercise of reasonable diligence he could have demanded an explanation from Accomando and sought further explanations from First Albany if Accomando's dismissals were not satisfactory to him. Cf. Olsen v. Bell Tel. Labs., Inc., supra at 175, and cases cited.

The Appeals Court correctly recognized, however, that his second claim has merit. Where compliance with a statute of limitations is at issue, "factual disputes concerning when a plaintiff knew or should have known of his cause(s) of action are to be resolved by the jury." Riley v. Presnell, 409 Mass. 239, 247 (1991). To avail himself of the protection of G. L. c. 260, s. 12, therefore Patsos must set forth facts from which a jury reasonably could find that a fiduciary relationship existed between himself and First Albany, and that First Albany breached its fiduciary duty to disclose to him adequate information that would have apprised him that his funds had been converted. Demoulas v. Demoulas Super Mkts., Inc., 424 Mass. 501, 519 (1997) ("[w]here a fiduciary relationship exists, the failure adequately to disclose the facts that would give rise to knowledge of a cause of action constitutes fraudulent conduct and is equivalent to fraudulent concealment for purposes of applying [G. L. c. 260J s. 12") [Note 11]. First Albany asserts that as a matter of law there was no fiduciary relationship between the

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parties, and that even if there were, First Albany met its fiduciary duty to Patsos by sending him monthly account statements that disclosed all material information [Note 12].

We consider first whether a jury reasonably could find that the relationship between First Albany and Patsos was fiduciary in nature. Relying on Vogelaar v. H.L. Robbins & Co., 348 Mass. 787 (1965), the motion judge concluded that under Massachusetts law there was no fiduciary relationship between Accomando or First Albany and Patsos [Note 13]. Her ruling is consistent with the decisions of several Federal courts that interpreted Vogelaar to hold that, under Massachusetts law, a "simple" broker-customer relationship is not fiduciary in nature, even if a broker has encouraged the trust of an unsophisticated customer. See, e.g., Lefkowitz v. Smith Barney, Harris Upham & Co., 804 F.2d 154, 155 (1st Cir. 1986) (allegations of customer's minimal knowledge of investments and reliance on account executive who also was close personal friend insufficient to warrant finding of fiduciary relationship because "a simple stockbroker customer relationship does not constitute a fiduciary relationship in Massachusetts");

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Cannistracci v. Dean Witter Reynolds, Inc., 796 F. Supp. 619, 622 (D. Mass. 1992) (same); McIntyre v. Okurowski, 717 F. Supp. 10, 11 (D. Mass. 1989) (same). For reasons we shall describe, however, we agree with the Appeals Court that, based on Patsos's affidavit and all favorable inferences drawn from it, a jury would be justified in finding that a "full relation of principal and broker" between Accomando and Patsos came into existence, and with it a general fiduciary relationship between First Albany and Patsos. Patsos v. First Albany Corp., supra at 271, quoting Berenson v. Nirenstein, 326 Mass. 285, 289 (1950).

As the Appeals Court noted, prior to the Berenson decision, whether a broker-customer relationship was a fiduciary relationship or a business relationship "had a varied history in Massachusetts [Note 14]." Patsos v. First Albany Corp., supra at 270-271. There, we recognized a distinction between a "mere engagement to buy in behalf of another without more," and an arrangement where the conduct of the parties established "the full relation of principal and broker," thus giving rise to fiduciary obligations. Berenson v. Nirenstein, supra at 289. We held that a fiduciary relationship came into existence where a stockbroker had approached an investor, offered to serve as his agent in a purchase of shares in a company, and represented that he was in a unique position to negotiate the purchase. Id. This was in accord with our earlier decision in Birch v. Arnold & Sears, Inc., 288 Mass. 125, 129, 136 (1934), in which we held that, where a customer was "densely ignorant of matters relating to the making of investments" and entrusted her life savings to a broker who knew she was an inexperienced investor and induced her reliance, a broker-customer relationship was "one of trust and confidence" as opposed to one "which ordinarily exist[s] between a broker and his customer."

Read together, Vogelaar, Berenson, and Birch recognize that in Massachusetts a relationship between a stockbroker and a customer may be either a fiduciary or an ordinary business relationship, depending on whether the customer provides sufficient evidence to prove "a full relation of principal and

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broker." Because there remain ambiguities as to circumstances that may give rise to a "full relation of principal and broker" and its concomitant fiduciary obligations, we suggest considerations relevant to that determination.

Courts in other States have not been of single mind whether fiduciary duties inhere in every relationship between a stockbroker and his customer. Some have suggested that the resolution of that question turns on whether the broker and customer deal at arm's length. See, e.g., Banca Cremi, S.A. v. Alex Brown & Sons, 132 F.3d 1017, 1038 (4th Cir. 1997) (under Texas law, a stockbroker can be a fiduciary to a customer where "the relationship between [the] broker and its customer is that of principal and agent," but not where the parties "conducted their business at arm's length in a principal-to-principal relationship"); Dinsmore v. Piper Jaffray, Inc., 593 N.W.2d 46-47 (S.D. 1999) ("While a fiduciary relationship does exist between [stock]brokers and their [customers], fiduciary duties are not owed when the parties are dealing at arm's length . . . [and] . . . arise only when one undertakes to act primarily for another's benefit"). Other courts have suggested that a broker always owes his customer some fiduciary obligations. See, e.g., Romano v. Merrill Lynch, Pierce, Fenner & Smith, 834 F.2d 523, 530 (5th Cir. 1987), cert. denied, 487 U.S. 1205 (1988) (under Federal securities law, "a broker does owe his client a fiduciary duty"); O'Malley v. Boris, 742 A.2d 845, 849 (Del. 1999) (because the relationship between a customer and stockbroker is that of principal and agent, the broker, as agent, has a fiduciary duty to carry out the customer's instructions promptly and accurately).

There is general agreement, however, that the scope of a stockbroker's fiduciary duties in a particular case is a factual issue that turns on the manner in which investment decisions have been reached and transactions executed for the account. See, e.g., Romano v. Merrill Lynch, Pierce, Fenner & Smith, supra at 530 ("the nature of the fiduciary duty owed will vary, depending on the relationship between the broker and the investor"); Hill v. Bache Halsey Stuart Shields, Inc., 790 F.2d 817, 824 (10th Cir. 1986) (broker generally owes fiduciary duties to customer because broker is customer's agent, but scope of duties turns on nature of broker's responsibilities because agent is only fiduciary within scope of agency); Paine, Webber, Jackson & Curtis, Inc. v. Adams, 718 P.2d 508, 516-517 (Colo. 1986)

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(fiduciary nature of a stockbroker-customer relationship is a factual issue that turns on a number of factors).

In determining the scope of the broker's fiduciary obligations, courts typically look to the degree of discretion a customer entrusts to his broker. Where the account is "non-discretionary," meaning that the customer makes the investment decisions and the stockbroker merely receives and executes a customer's orders, the relationship generally does not give rise to general fiduciary duties. See, e.g., Independent Order o Foresters v. Donaldson, Lujkin & Jenrette, Inc., 157 F.3d 933, 940- 941 (2d Cir. 1998) ("Under New York law, as generally, there is no general fiduciary duty inherent in an ordinary broker-customer relationship. . . . [A general fiduciary] duty can arise only where the customer has delegated discretionary trading authority to the broker"). See also Carr v. CIGNA Secs., Inc., 95 F.3d 544, 547 (7th Cir. 1996); Greenwood v. Dittmer, 776 F.2d 785, 788 (8th Cir. 1985). For nondiscretionary accounts, each transaction is viewed singly, the broker is bound to act in the customer's interest when transacting business for the account, but all duties to the customer cease "when the transaction is closed." Leib v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 461 R Supp. 951, 952-953 (E.D. Mich. 1978), aff'd, 647 F.2d 165 (6th Cir. 1981) [Note 15]. See Hill v. Bache Halsey Stuart Shields, Inc., supra at 824 (in nondiscretionary accounts broker owes only a narrow duty not to make unauthorized trades).

Conversely, where the account is "discretionary," meaning that the customer entrusts the broker to select and execute most if not all of the transactions without necessarily obtaining prior approval for each transaction, the broker assumes broad fiduciary obligations that extend beyond individual transactions. See, e.g., Carr v. CIGNA Secs., Inc., supra at 547 ("The general

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rule . . . is that a broker is not the fiduciary of his customer unless the customer entrusts him with discretion to select the customer's investments"); Leib v. Merrill Lynch, Pierce, Fenner & Smith, Inc., supra at 953[ [Note 16]. But see Romano v. Merrill Lynch, Pierce, Fenner & Smith, supra at 530 (there is no "bright-line" distinction between the fiduciary duty owed customers in discretionary as opposed to nondiscretionary accounts). Trading by the broker without the customer's prior approval suggests that an account is discretionary [Note 17], while frequent communications between the parties about the prudence of various transactions may support a finding that a customer has retained control of his account. Leib v. Merrill Lynch, Pierce, Fenner & Smith, Inc., supra at 954. If a broker has acted as an investment advisor, and particularly if the customer has almost invariably followed the broker's advice, the fact finder may consider this as evidence that the relationship is discretionary. Leboce, S.A. v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 709 F.2d 605, 607-608 (9th Cir. 1983). Courts have looked to both the documentation of the customer's account, as well as to the execution of particular account transactions, to determine whether the customer has entrusted a broker to manage his investments for his benefit. Paine, Webber, Jackson & Curtis, Inc. v. Adams, supra at 516.

Other factors may also support a finding that a stockbroker has assumed general fiduciary obligations to a customer. A customer's lack of investment acumen may be an important consideration, where other factors are present. See, e.g., Broomfield v. Kosow, 349 Mass. 749, 755 (1965); Birch v. Arnold & Sears, Inc., 288 Mass. 125, 129, 136 (1934); Romano v. Merrill

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Lynch, Pierce, Fenner & Smith, supra at 530, citing Clayton Brokerage Co. v. Commodity Futures Trading Comm'n, 794 F.2d 573, 582 (11th Cir. 1986) (trier of fact must consider "the degree of trust placed in the broker and the intelligence and personality of the customer"); Leib v. Merrill Lynch, Pierce, Fenner & Smith, Inc., supra at 953, 954 (where customer is particularly young, old, or naive with regard to financial matters, courts are "likely" to find that broker assumed control over account). An inexperienced or naive investor is likely to repose special trust in his stockbroker because he lacks the sophistication to question or criticize the broker's advice or judgment. Paine, Webber, Jackson & Curtis, Inc. v. Adams, supra at 517. This may be particularly true where the broker holds himself out as an expert in a field in which the customer is unsophisticated. See, e.g., Burdett v. Miller, 957 F.2d 1375 (7th Cir. 1992); Paine, Webber, Jackson & Curtis, Inc. v. Adams, supra at 517, citing Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Boeck, 127 Wis. 2d 127, 145-146 (1985) (Abrahamson, J., concurring) ("[B]y gaining the trust of a relatively uninformed customer and purporting to advise that person and to act on that person's behalf, a broker accepts greater responsibility to that customer"). Social or personal ties between a stockbroker and customer may also be a consideration because the relationship may be based on a special level of trust and confidence. Leib v. Merrill Lynch, Pierce, Fenner & Smith, Inc., supra at 954.

We have considered these and similar facts relevant to determining the scope of duty that extends to a customer. Broomfield v. Kosow, supra at 755 ("review such factors as the relation of the parties prior to the incidents complained of," as well as "the readiness of the plaintiff to follow the defendant's guidance in complicated transactions wherein the defendant has specialized knowledge"). But we have also held that a business relationship between a broker and customer does not become a general fiduciary relationship merely because an uninformed customer reposes trust in a broker who is aware of the customer's lack of sophistication. See Snow v. Merchants Nat'l Bank, 309 Mass. 354, 360-361 (1941) (bank that conducted hundreds of securities transactions for elderly widow uninformed in financial matters could not reasonably have been considered to have acted as fiduciary because customer's mere trust or reliance not enough to establish a fiduciary relationship). Cf.

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Broomifield v. Kosow, supra at 755 (catalyst in transformation of business relationship into fiduciary relationship is defendant's knowledge of plaintiffs reliance upon him). In this respect, as others, our law is consistent with other States. See, e.g., Hill v. Bache Halsey Stuart Shields, Inc., supra at 824 ("A fiduciary duty . . . cannot be defined by asking the jury to determine simply whether the principal reposed 'trust and confidence' in the agent").

In setting out these factors, we recognize that the factual inquiry in each case must be guided by two potentially competing considerations: the need to protect customers who relinquish control of their brokerage accounts, and the need to ensure that securities brokers - particularly those who merely execute purchase and sell orders for customers - not become insurers of their customers' investments. Assigning general fiduciary duties only to those stockbrokers who have the ability to, and in fact do, make most if not all of the investment decisions for their customers properly provides appropriate protection only for those customers who are particularly vulnerable to a broker's wrongful activities.

If Patsos had merely alleged "in very general terms" that he trusted Accomando, that Accomando was aware of his inexperience, and that he had transferred funds for Accomando to invest on his behalf, that would be insufficient to establish that Patsos and Accomando had entered into a general fiduciary relationship. See Vogelaar v. H.L Robbins & Co., 348 Mass. 787, 787-788 (1965). But here, as the Appeals Court correctly noted, Patsos "set out with precision" in his affidavit uncontested statements that, if true, would permit a jury reasonably to find that Accomando's relationship with Patsos was not a business relationship but a "full relation of principal and broker" giving rise to general fiduciary obligations. Patsos v. First Albany Corp., 48 Mass. App. Ct. 266, 273 (1999). Those include that (1) Patsos lacked sophistication and experience as a securities investor; (2) a reasonable inference can be drawn that Accomando had significant investment experience and specialized knowledge about private securities transactions; (3) Accomando was aware of Patsos's inexperience as an investor, and encouraged Patsos to rely on his investment expertise by promising financial benefits, favorable margin treatment, and private stock sales; (4) Accomando was in "complete control" of the Patsos accounts; (5) Accomando told Patsos that he was conducting transactions

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solely for his benefit; (6) Accomando selected and executed transactions in the accounts without the prior knowledge of or authorization from Patsos; (7) Accomando and First Albany did not provide Patsos written confirmation of stock transactions worth $1.75 million in March or April, 1989; and (8) when questioned, Accomando assured Patsos that he need not worry about his inability to understand the monthly statements or the terms of the customer agreement.

We also agree with the Appeals Court that, if a jury find that Accomando assumed broad fiduciary obligations to Patsos, as they may, First Albany may be held liable for Accomando's wrongful conversion of Patsos's funds under established principles of agency law. See Patsos v. First Albany Corp., supra at 272, citing Restatement (Second) of Agency s. 261 comment a (1958) (liability of principal results if "the agent's position facilitates . . . the fraud, in that from the point of view of the third person the transaction seems regular on its face and the agent appears to be acting in the ordinary course of the business confided to him"). See also Restatement (Second) of Agency s. 261 (1958) ("A principal who puts a servant or other agent in a position which enables the agent, while apparently acting within his authority, to commit a fraud upon third persons is subject to liability to such third persons for the fraud"); id. at comment a (liability of principal results even where the principal is entirely innocent, has received no benefit from the transaction, and where the agent has acted solely for his own purposes).

We next consider First Albany's contention that, even if it owed a general fiduciary duty to Patsos, it met any duty of disclosure because its monthly statements correctly informed Patsos that checks for specified amounts were issued on specified dates, and debited to his accounts. We agree with the Appeals Court that a jury justifiably may find that the monthly statements bearing the description "issued by Boston" constituted a failure to disclose adequately facts that would give rise to Patsos's knowledge of Accomando's embezzlement. Patsos v. First Albany Corp., supra at 272. While First Albany insists that the monthly statements are sufficiently clear on their face to disclose all necessary facts to its customer, where (i) First Albany's headquarters are in Albany, New York, (ii) stock purchases would in the ordinary course of business be paid from the customer's account, and (iii) Accomando told Patsos "not to worry" when he said that he did not understand the

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monthly statements, it is impossible to reach that conclusion as a matter of law [Note 18]. The tolling provisions of G. L. c. 260, s. 12, would be available to Patsos were a jury to conclude that the monthly statements did not satisfy First Albany's duty of disclosure. Demoulas v. Demoulas Super Mkts., Inc., 424 Mass. 501, 519 (1997).

We turn finally to First Albany's argument that summary judgment is proper because Patsos did not raise timely objections to the monthly statements as required by the terms of its "customer's agreement" with him [Note 19], thereby waiving his right to object to them years later. We subscribe to the conclusion of the Appeals Court that, "[I]f we assume, as we must, that the plaintiff's funds on deposit with the defendant were secretly converted to the personal use of Accomando and that the plaintiff had no knowledge of the embezzlement until the FBI interview early in 1995, then the plaintiff's failure to object within ten days of each of the defendant's statements in 1988 and 1989 was the direct result of the defendant's alleged fraudulent concealment of the embezzlement, and the ten-day notice provision would not bar the plaintiffs action." Patsos v. First Albany, Inc., supra at 273 [Note 20] We add to this two further observations. First, when he signed First Albany's customer's agreement in April, 1988, Patsos was told by Accomando that he need not read or understand it, and that the document contained "mere formalities." Second, at an unspecified later date, Patsos did what the customer agreement required - he questioned Accomando, about the transactions and the terms of the monthly statements - and he was told "not to worry."

Because of our conclusions, we need not reach the merits of

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Patsos's argument that the customer agreement was an unenforceable contract of adhesion. The judgment for First Albany is vacated. The case is remanded to the Superior Court for further proceedings consistent with this opinion.

So ordered.