Judge: Keri G. Katz, Case: 37-2021-00043098-CU-CO-CTL, Date: 2023-12-15 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - December 14, 2023

12/15/2023  08:30:00 AM  C-74 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Keri Katz

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Civil - Unlimited  Contract - Other Summary Judgment / Summary Adjudication (Civil) 37-2021-00043098-CU-CO-CTL FRANKLIN VS. BANK OF AMERICA CORPORATION [IMAGED] CAUSAL DOCUMENT/DATE FILED:

Defendant Bank of America, N.A.'s motion for summary judgment is DENIED. Bank of America's alternate motion for summary adjudication is GRANTED as to the Conversion cause of action and DENIED as to the Fraud cause of action.

Conversion Plaintiff does not oppose Bank of America's motion as to the conversion cause of action and thereby concedes Bank of America's motion as to this cause of action. Accordingly, the court summarily adjudicates the first cause of action for Conversion in favor of Defendant Bank of America, N.A. and against Plaintiff John David Franklin.

Fraud As set forth in Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, [t]he elements of fraud are: (1) a misrepresentation (false representation, concealment, or nondisclosure); (2) knowledge of falsity (or scienter); (3) intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638, 49 Cal.Rptr.2d 377, 909 P.2d 981.) Robinson Helicopter, 34 Cal.4th at 990.

In its moving papers Bank of America raises two arguments as to the fraud cause of action, the first as to the misrepresentation element and the second as to the damages element. In reply, Bank of America concedes that the case relied on for its misrepresentation/parole evidence argument [Bank of America Nat. Trust & Savings Ass'n v. Pendergrass (1935) 4 Cal.2d 258] was overruled [in Riverisland Cold Storage, Inc. v. Fresno-Madera Production Credit Assn. (2013) 55 Cal.4th 1169]. Bank of America then goes on to argue that Plaintiff cannot establish the justifiable reliance element of the fraud cause of action. However, because this argument was not raised by Bank of America in its moving papers, Plaintiff has not had an opportunity to respond. Absent the required notice, summary judgment/adjudication based on the justifiable reliance element is improper. See, San Diego Watercrafts, Inc. v. Wells Fargo Bank, N.A. (2002) 102 Cal.App.4th 308, 316 ['[w]here a remedy as drastic as summary judgment is involved, due process requires a party be fully advised of the issues to be addressed and be given adequate notice of what facts it must rebut in order to prevail'].

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2986861  11 CASE NUMBER: CASE TITLE:  FRANKLIN VS. BANK OF AMERICA CORPORATION [IMAGED]  37-2021-00043098-CU-CO-CTL As to damages Bank of America's separate statement sets forth three facts: on or about August 30, 2021, as a courtesy to Plaintiff, Bank of America caused all service fees assessed to Plaintiff's account to be reversed and allowed Plaintiff to withdraw the balance of $100.92 from his account [SSUMF 10]; Bank of America is not currently holding any fees assessed to Plaintiff relating to the checking account [SSUMF 12]; and Plaintiff does not currently have a balance with Bank of America [SSUMF 13]. Other than disputing that the reversal of service fees was done as a 'courtesy' Plaintiff does not dispute these facts.

In opposition Plaintiff argues three types of alleged damages: 1) 'loss of use' of the money in his checking account, 2) Plaintiff's expenditure of three hours of time to recover the money Bank of America removed from his checking account, and 3) the emotional distress suffered by Plaintiff as a result of Bank of America's removal of funds from his checking account. Plaintiff submits evidence that at the time Plaintiff first discovered that Bank of America was charging a service fee on his checking account he was unaware that the account agreement required a minimum balance of at least $15,000 on the line of credit or $10,000 balance in the checking account in order to avoid a monthly service charge [Plaintiff's Statement of Undisputed Material Facts 7]; Plaintiff contacted Bank of America's customer service in May, 2021 to complain about being charged a service charge on what he was led to believe was a free checking account [Plaintiff's SUMF 8]; when Plaintiff called Bank of America's customer service in May, 2021 he was advised that Bank of America would investigate his complaint and call him with the results of their investigation; Plaintiff never heard back from Bank of America after being advised that the bank would look into the matter [Plaintiff's SUMF 9]; Plaintiff was emotionally upset when Bank of America started charging a service fee on his checking account of $25.00 in March, 2021, because Plaintiff was told that the checking account was a free account with no service charges [Plaintiff's SUMF 10]; Plaintiff endured damages for approximately three hours spent trying to recover the money taken from his checking account by Bank of America [Plaintiff's SUMF 11]; and in August, 2021 Plaintiff contacted the branch manager at the La Jolla Village branch of Bank of America and advised the branch manager of how angry he was that the bank was charging him service fees on a free checking account; the branch manager then agreed to credit back to the Plaintiff's checking account all of the service fees that had been withdrawn by Bank of America from the checking account [Plaintiff's SUMF 12].

It is undisputed that, beginning in March 2021, Bank of America began charging a monthly service fee on Plaintiff's checking account because Plaintiff did not maintain the minimum balance required to avoid such fees [SSUMF 8], and that the successive monthly service fees were deducted from the balance in Plaintiff's checking account [SSUMF 9].

Although the evidence is far from overwhelming, drawing all reasonable inferences in favor of Plaintiff [Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826] the court finds the evidence sufficient to create triable issues of material fact as to whether Plaintiff sustained damage as a result of Bank of America's alleged fraud. The court is not persuaded by any of the arguments Bank of America raises. Bank of America's argument that reversal of the service fees precludes a finding that Plaintiff sustained out-of-pocket damages argument ignores Plaintiff's claims based on loss of use of these funds.

Although Bank of America argues that a fraud claim cannot rest solely on emotional distress damages, Plaintiff submits evidence of damages other than those for emotional distress. In reply Bank of America argues that since Plaintiff had not used his checking account for the past 18 years, the loss of use of funds for six months 'was no real harm.' Such issue is for the trier of fact. Bank of America's argument that Plaintiff's account did not pay interest 'so none was lost' does not consider Plaintiff's ability to remove funds from the checking account and place funds in an interest bearing account. Bank of America raises arguments as to the severity of Plaintiff's claimed emotional distress, but the analysis in the authority Bank of America relies on, Hughes v. Pair (2009) 46 Cal.4th 1035, is in the context of a cause of action for intentional infliction of emotional distress, not a general claim for emotional distress damages.

If this tentative ruling is confirmed the Minute Order will be the final order of the court and the parties Calendar No.: Event ID:  TENTATIVE RULINGS

2986861  11 CASE NUMBER: CASE TITLE:  FRANKLIN VS. BANK OF AMERICA CORPORATION [IMAGED]  37-2021-00043098-CU-CO-CTL shall not submit any further order on this motion.

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