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Safe Deposit Boxes Aren't Safe

In the early 1980s, when Philip Poniz moved to New Jersey from Colorado, he needed a well-protected place to stash his collection of rare watches. He had been gathering unusual pieces since he was a teenager in 1960s Poland, fascinated by their intricate mechanics. His hobby became his profession, and by the time of his relocation, Mr. Poniz was an internationally known expert in the history and restoration of high-end timepieces.

At first, he kept his personal collection in his house, but as it grew, he wanted something more secure. The vault at his neighborhood bank seemed ideal. In 1983, he signed a one-page lease agreement with First National State Bank of Edison in Highland Park, N.J., for a safe deposit box.

Over the next few decades, the bank — a squat brick building on a low-rise suburban street — changed hands many times. First National became First Union, which was sold to Wachovia, which was then bought by Wells Fargo. But its vault remained the same. A foot-thick steel door sheltered cabinets filled with hundreds of stacked metal boxes, each protected by two keys. The bank kept one; the customer held the other. Both were required to open a box.

In 1998, Mr. Poniz rented several additional boxes, and stored in them various items related to his work. He separated a batch of personal effects — photographs, coins he had inherited from his grandfather, dozens of watches — into a box labeled 105. Every time he opened it, he saw the glinting accumulation of his life's work.

Then, on April 7, 2014, he lifted the thin metal lid. Box 105 was empty.

"I thought my heart would fail," Mr. Poniz said. He paused in his retelling of the memory. At age 67, he has a strong Polish accent and speaks English carefully. He struggled to find the right words to describe the day he discovered his watches were missing. "I was devastated," he said. "I was never like that in my life before. I had never known that one can have a feeling like that."

[...] In the days after Mr. Poniz found his box empty, he began piecing together what had happened: Wells Fargo had apparently tried to evict another customer for not keeping up with payments, and bank employees had mistakenly removed his box instead. After drilling No. 105 open, the bank shipped its contents to a storage facility in North Carolina. After Mr. Poniz discovered the loss, Wells Fargo sent back everything it had in storage, but some items had vanished.

In a six-page report filed with the Highland Park Police, Mr. Poniz described the watches, coins, documents and other items that were gone. Using auction records and sales reports, he estimated that their combined value was more than $10 million. That would make it one of the largest safe-deposit-box losses in American history.

[...] For over a decade, Mr. Poniz's Box 105 sat at the bottom of a seven-foot shelf in Wells Fargo's Highland Park vault, accessible via a metal-barred door with an old-fashioned crank. But halfway up a different wall in the vault was another Box 105 — a product of the bank's having consolidated several branches' safe deposit boxes into a single location and having kept their original numbering. Bank employees got them mixed up, and emptied the wrong one.

"There's no question that Wells Fargo drilled the box and took the contents out of it, put in storage and then returned it," John North, a lawyer representing the bank, said at a court hearing last year. "The underlying dispute is, was everything returned or not?"

That isn't really in dispute. When Wells Fargo employees opened Mr. Poniz's box, they created an inventory that included 92 watches. When workers at the bank's storage facility in North Carolina counted the items, they listed only 85. Also missing were dozens of rare coins that were listed in the first inventory, but not the second. According to Mr. Poniz, photographs and family documents also disappeared.

[...] Oddly, the bank returned to him five watches that weren't his. "They were the wrong color, the wrong size — totally different than what I had," Mr. Poniz said. "I had no idea where they came from."

[...] "Wells Fargo is reviewing the facts and circumstances of this case," said Jim Seitz, a bank spokesman. "We cannot comment further due to pending litigation."

Mr. Poniz hired lawyers. One of them, Kerry Gotlib, said he pressed the bank to find the missing items. It couldn't. He asked for a financial settlement; the bank said no. So Mr. Poniz sued in New Jersey's Superior Court.

[...] The lawsuit appears nowhere near resolution, and Mr. Poniz already has run up tens of thousands of dollars in legal fees. "The bank has spent a tremendous amount of resources and put them into defending the case, instead of stepping forward and saying, 'We made a mistake here, let's make it right,'" said Craig Borgen, another lawyer representing Mr. Poniz.

The watches that vanished were the largest and most visually striking in his collection, Mr. Poniz said. There was a Tiffany watch that tracked the moon's phases on its gold dial, and an early Breguet engraved with the coat of arms of the Duke of Orléans.

The highlight was a rare 19th-century pocket watch, whose face was dotted with pearls and rubies and concealed a pop-up bird, slightly larger than a thumbnail, that twittered and sang. Such "singing bird" watches rarely come to market. One of the last, in 1999, was sold at auction for $772,500 to the Patek Philippe Museum in Geneva.

Mr. Poniz, who spent a decade working at Sotheby's and now consults for Christie's as a horological expert, had hoped that the singing-bird watch would one day be the centerpiece of an auction of his own collection. He considered the trove to be his retirement fund.

"My impression about safe deposit boxes was that it was like you were putting things in Fort Knox," he said. "Nothing could happen to it." He doesn't think that anymore.

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