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COKER v. BANK OF AMERICA

August 18, 1997

EZEKIEL O. COKER, Plaintiff,
v.
BANK OF AMERICA, Defendant.



The opinion of the court was delivered by: PECK

 ANDREW J. PECK, United States Magistrate Judge:

 To the Honorable John F. Keenan, United States District Judge:

 Plaintiff Ezekiel O. Coker alleges that the New Mexico branch of defendant Bank of America National Trust & Savings Association ["BANTSA" or the "Bank"] wrongfully paid a stolen and forged $ 17,500 check drawn on his account over his "post no debit" instruction, and also wrongfully closed his account with the Bank. Coker has turned what appears to be a $ 17,500 claim that should be heard in state court in New Mexico into a federal complaint, filed in the Southern District of New York on the basis of diversity jurisdiction, seeking over $ 100,000 in damages.

 BANTSA has moved for partial summary judgment and to dismiss or transfer. For the reasons set forth below, the Court recommends that BANTSA's (1) motion for partial summary judgment with respect to the account closing claim (the third cause of action) be granted, (2) motion to dismiss the remainder of the complaint for failure to satisfy the amount in controversy requirement be denied, and (3) motion to transfer the case to the District of New Mexico be granted.

 FACTS

 Coker's Bank Account

 In May 1982, while Coker was a student in the United States, he opened an account with Albuquerque Federal Savings and Loan in Las Cruces, New Mexico. (Amended Verified Complaint ["Cplt."], First Count, P VI.) Thereafter, BANTSA took over that bank's assets and liabilities, informed Coker of the takeover, and assigned Coker account number 20291-02475. (Id. P VII; Answer P 6.) Coker left the account in "good standing" when he returned to Nigeria in 1986. (Cplt., First Count, PP I, VI.)

 Coker's Check

 It is undisputed that on July 28, 1994, BANTSA paid a $ 17,500 check dated July 4, 1994 from Coker's account. (Cplt., First Count, P XII; Answer P 7; Coker Aff. P 4.) The parties dispute the propriety of BANTSA's action.

 Coker alleges that on January 11, 1994, his residence in Nigeria was burgled and his checkbook was stolen. (Cplt., First Count, P IX.) Coker alleges that he called BANTSA two days later to place a "'stop payment order'" on the account. (Id. P X; Coker Aff. P 5.) Coker also alleges that he faxed and mailed a letter confirming the "'post no debits'" instruction. (Cplt., First Count, PP X, XI.) Coker further maintains that on June 16, 1994, he telephoned a BANTSA representative and re-confirmed the hold on the account. (Id. P XI; Coker Aff. P 5.)

 BANTSA claims to have no record of any such fax, letter, or telephone conversation. (Famuyide Aff. Ex. C.) BANTSA claims that "since no stop payment order was received prior to July 28, 1994, the date [Coker's] check was processed, there was no reason to stop the payment of that check." (Id.)

 BANTSA Closes Coker's Account

 BANTSA notified Coker by letter dated September 22, 1995 that it was closing his account. (Affidavit of Lawanda Strong, BANTSA Customer Assistance Officer, P 6 & Ex. C.) BANTSA closed the account on October 10, 1995. (See BANTSA 3(g) Statement, P 4; Strong Aff. P 4; Cplt., Third Count, P II.) These facts are undisputed; the propriety of the account closing is disputed.

 BANTSA points to its "Disclosure and Account Agreement" booklet, "effective June 21, 1993," which states:

 
Welcome to Bank of America, and thank you for opening an account with us.
 
When you open a personal deposit account with us, you agree to the terms and conditions described in this publication. The agreement you make with us, and the rights and obligations we both have, are governed by and interpreted according to New Mexico and federal law.
 
* * *
 
CHANGE IN TERMS We may change the terms and conditions discussed in this publication at any time. If you maintain your checking or savings account or renew your time deposit after the effective date of the change, you indicate your agreement to the change.
 
* * *
 
CLOSING AN ACCOUNT You or we may generally close your checking, money market, or savings account any time without advance notice.

 (Strong Aff. Ex. B at pp. 1, 3.) Coker, however, maintains that he never received a copy of that agreement. (Coker Aff. P 11.)

 Coker's Damage Claims

 In the "First Count" of his complaint, Coker requests $ 100,000 in "damages [] and punitive damages" to compensate him for "financial loss, loss of use of his money, loss of profit, hardship and inconvenience" from BANTSA's failure to stop payment on the stolen $ 17,500 check. (Cplt., First Count, PP IX, XII, XIII, XVIII.) Coker maintains that BANTSA was negligent and reckless in failing to honor Coker's post no debit order, and that BANTSA also acted "fraudulently, deceitfully, oppressively, maliciously and outrageously towards" Coker, thus "intentionally causing or recklessly disregarding the probability of causing emotional distress to [Coker]." (Id. PP XIV-XVII.)

 Coker's "Second Count" requests $ 20,000 to compensate him for the "attorney's fees, traveling expenses, huge telephone expenses, mailing expenses, court fees" and "untold hardship and inconvenience" resulting from BANTSA's alleged negligence and fraudulent conduct. (Cplt., Second Count, PP II, III.)

 Coker's "Third Count" alleges that BANTSA "for no just cause unilaterally closed" his account, causing him damages of $ 50,000 from the lost "future opportunity to finance his children [sic] education in the United States through the subject account," and from the lost "opportunity to earn interest on the subject account." (Cplt., Third Count, PP II, III, IV, VI.) Coker further contends that this damage is irreparable because ...


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