Gray v. Bank of America Corp.

Filing 26

ORDER granting 19 Motion for Reconsideration or, in the Alternative, to Dismiss Defendant Grigoras as Improperly Joined and Ms. Grigoras is DISMISSED. Denying 16 Motion to Remand to State Court; granting 18 Defendants' Motion to Dismiss as to negligent misrepresentation and as to breach of contract. Signed by Judge Richard W. Story on 2/10/2017. (bdb)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
SHAERON BURNETTE GRAY,
Plaintiff,
v.
BANK OF AMERICA, N.A. and
RODICA GRIGORAS,
Defendants.

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CIVIL ACTION NO.
1:16-CV-01135-RWS

ORDER
This matter is before the Court on Plaintiff Shaeron Gray’s Motion to
Remand [16] and Defendants Bank of America, N.A. and Rodica Grigoras’s
Motion to Dismiss [18] and Motion to Reconsider or, in the Alternative, to
Dismiss Defendant Rodica Grigoras as Improperly Joined [19]. After
considering the entire record, the Court enters the following Order.
Background
This case arises out of a dispute over the ownership of a joint business
checking account between Plaintiff Shaeron Burnette Gray and Defendants
Bank of America, N.A. (“BANA”) and Rodica Grigoras. Plaintiff is the sole
surviving co-signer of that account. (First Am. Compl., Dkt. [11] ¶ 17.)

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BANA is a foreign corporation registered to do business in the State of
Georgia. (Id. ¶ 1.) Ms. Grigoras is an employee of BANA, and resides in
Georgia. (Id. ¶¶ 3, 8.)
On July 20, 1992, Bobby M. Burnette (“Decedent”), the father of
Plaintiff, opened a business account (“Account”) with Bank South, which was
later acquired by BANA. (Id. ¶¶ 5-6, 10.) Ms. Grigoras, employed with
BANA as a Senior Personal Banker, began working with Decedent on the
Account in 2008. (Id. ¶¶ 8-9.) On March 15, 2011, apparently wishing to
make Plaintiff a co-owner of the Account, Decedent added Plaintiff to his
signature card upon Ms. Grigoras’s advice. (Id. ¶¶ 10-13.) The signature card
indicated the Account was “governed by . . . the Deposit Agreement and
Disclosures,” among other documents. (2011 Signature Card, Dkt. [11-2].)
BANA and Decedent entered into one deposit agreement in 2011 when adding
Plaintiff to the signature card, (id.); Plaintiff and BANA entered into another
deposit agreement in 2013 when Plaintiff added her husband to the signature
card on October 25, 2013.1 (2013 Signature Card, Dkt. [18-4].)
1

As will become apparent, the 2010 and 2013 deposit agreements are relevant
to Plaintiff’s claims. Because the two deposit agreements are identical in the relevant
portions discussed, the Court will refer to a single “Deposit Agreement” for
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Decedent died on September 3, 2013. (First Am. Compl., ¶ 15.) Soon
after, Plaintiff notified Ms. Grigoras that her father had died. (Id. ¶ 16.) Ms.
Grigoras then informed Plaintiff that Plaintiff was the sole surviving owner of
the Account. (Id. ¶ 17.) Assuming sole ownership, Plaintiff withdrew
$163,000 from the Account with Ms. Grigoras’s help. (Id. ¶ 19.)
On April 11, 2014, individuals alleging to be heirs and beneficiaries of
Decedent sued Plaintiff in the Superior Court of Gwinnett County seeking to
recover funds withdrawn from the Account. (Id. ¶ 21.) Plaintiff then deposed
Ms. Grigoras, who gave testimony individually and on behalf of BANA. (Id.
¶¶ 23-26.) On cross motions for summary judgment, the Superior Court of
Gwinnett County found that the Account was owned by Decedent’s estate, not
Plaintiff. (Id. ¶ 28.) As a result, Plaintiff was liable to remit the $163,000 she
withdrew. (Id. ¶ 30.)
On February 8, 2016, Plaintiff filed suit in the State Court of Fulton
County against BANA2 asserting a single count of negligence and seeking

simplicity.
2

Technically, the defendant in Plaintiff’s initial Complaint was Bank of
America Corp. But on April 25, 2016, the Court granted Plaintiff’s Motion to
Substitute Party [6] and substituted BANA as the defendant.
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damages caused by Plaintiff’s reliance on Ms. Grigoras’s advice as to her
ownership of the Account. (See generally Compl., Dkt. [1-1].) BANA then
removed the case to this Court asserting diversity jurisdiction. (See Notice of
Removal, Dkt. [1].)
Shortly after removal, Plaintiff filed a Motion to Amend Complaint [8].
On April 28, 2016, the Court issued an Order noting that Plaintiff was entitled
to amend her Complaint as a matter of course and authorizing her to proceed on
the First Amended Complaint. (Apr. 28, 2016 Order, Dkt. [12].) In the First
Amended Complaint, Plaintiff asserts negligent misrepresentation and breach
of contract against BANA. (First Am. Compl., Dkt. [11] ¶¶ 31-45.) She also
adds Ms. Grigoras as a Defendant, and includes her in the negligent
misrepresentation claim. (Id. ¶¶ 31-37.)
On May 10, 2016, Plaintiff filed a Motion for Remand [16] because, with
the addition of Ms. Grigoras, complete diversity was destroyed. (Pl.’s Mot. for
Remand, Dkt. [16] at 2.) In response, Defendants filed a Motion to Reconsider
[19], asking the Court to vacate its April 28, 2016 Order allowing Plaintiff to
amend as a matter of course and denying Plaintiff’s Motion to Amend [8] as
moot. Defendants also filed a Motion to Dismiss Plaintiff’s Amended
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Complaint [18], arguing that it fails to state a claim.
Discussion
I.

Defendants’ Motion to Reconsider [19]
In their Motion to Reconsider [19], Defendants seek two separate

avenues of relief. First, they ask the Court to vacate its April 28, 2016 Order
allowing Plaintiff to add Ms. Grigoras as a Defendant through amendment as a
matter of course. Alternatively, Defendants seek the dismissal of Ms. Grigoras
under Federal Rule of Civil Procedure (“Rule”) 21 for misjoinder. Because the
Court ultimately finds that Ms. Grigoras is misjoined, it will only analyze
Defendants’ Rule 21 argument.
Rule 21 says that “[m]isjoinder of parties is not a ground for dismissing
an action. On motion or on its own, the court may at any time, on just terms,
add or drop a party. The court may also sever any claim against a party.”
District courts may use Rule 21 to preserve diversity jurisdiction by dismissing
a non-diverse party. Barnes v. Tidewater Transit Co., Inc., No. 1:13-cv-00537JEC, 2014 WL 1092288, at *3 (N.D. Ga. Mar. 18, 2014). Indeed, “it is well
settled that Rule 21 invests district courts with authority to allow a dispensable
nondiverse party to be dropped at any time, even after judgment has been
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rendered.” Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S. 567, 572-73
(2004). The essential inquiry, however, is whether the non-diverse party is
indispensable. Id. at 572. That inquiry is guided by Rule 19, which sets out
two steps for deciding whether a party must be joined as indispensable. First,
the court must decide if the party is “necessary” under Rule 19(a)(1). WinnDixie Stores, Inc. v. Dolgencorp, LLC, 746 F.3d 1008, 1039 (11th Cir. 2014).
Then, if the party is “necessary,” “but cannot be joined—i.e., because they are
non-diverse—Rule 19(b) provides a list of factors to ‘determine whether, in
equity and good conscience, the action should proceed among the existing
parties or should be dismissed.’” Molinas Valle Del Cibao, C. por A. v. Lama,
633 F.3d 1330, 1344 (11th Cir. 2011) (quoting FED. R. CIV. P. 19(b)).
Assuming that Ms. Girgoras is a “necessary” party, the Court finds that
she is not indispensable under Rule 19(b). That Rule says:
If a person who is required to be joined if feasible cannot be
joined, the court must determine whether, in equity and good
conscience, the action should proceed among the existing parties
or should be dismissed. The factors for the court to consider
include:
(1) the extent to which a judgment rendered in the person’s
absence might prejudice that person or the existing parties;

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(2) the extent to which any prejudice could be lessened or
avoided by:
(A) protective provisions in the judgment;
(B) shaping the relief; or
(C) other measures;
(3) whether a judgment rendered in the person’s absence
would be adequate; and
(4) whether the plaintiff would have an adequate remedy if
the action were dismissed for nonjoinder.
Here, none of the Rule 19(b) factors weigh in favor of dismissal in Ms.
Grigoras’s absence. Ultimately, this case is about Ms. Grigroas’s alleged
negligence within the scope of her employment with BANA. Plaintiff insists
that she is “seeking to hold [Ms.] Grigoras liable . . . to the extent [she]
exceeded her scope of authority to act for BANA or if BANA refuses to ratify
all or part of [Ms.] Grigoras’s conduct.” (Pl’s Br. in Opp’n to Defs.’ Mot. to
Reconsider, Dkt. [23] at 4.) But Plaintiff does not allege in the First Amended
Complaint that Ms. Grigoras was acting beyond the scope of her employment,
nor do Defendants ever argue as much. Thus, this case is solely a question of
respondeat superior. And in such cases, the employee is not an indispensable

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party. Hillside Orchard Farms, Inc. v. Murphy, 473 S.E.2d 181, 185 (Ga. Ct.
App. 1996).
Because Ms. Grigoras is not an indispensable party, the Court may
dismiss her because she is nondiverse using Rule 21. Thus, Defendants’
Motion to Reconsider or, in the Alternative, to Dismiss Defendant Grigoras as
Improperly Joined [19] is GRANTED and Ms. Grigoras is DISMISSED.
Without Ms. Grigoras, complete diversity is restored. As the lack of complete
diversity was the sole basis underlying Plaintiff’s Motion for Remand [16], that
motion is DENIED.
II.

Defendants’ Motion to Dismiss [18]
A.

Legal Standard

Federal Rule of Civil Procedure 8(a)(2) requires that a pleading contain a
“short and plain statement of the claim showing that the pleader is entitled to
relief.” While this pleading standard does not require “detailed factual
allegations,” mere labels and conclusions or “a formulaic recitation of the
elements of a cause of action will not do.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). In
order to withstand a motion to dismiss, “a complaint must contain sufficient
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factual matter, accepted as true, to ‘state a claim to relief that is plausible on its
face.’” Id. (quoting Twombly, 550 U.S. at 570). A complaint is plausible on
its face when the plaintiff pleads factual content necessary for the court to draw
the reasonable inference that the defendant is liable for the conduct alleged. Id.
“At the motion to dismiss stage, all well-pleaded facts are accepted as
true, and the reasonable inferences therefrom are construed in the light most
favorable to the plaintiff.” Bryant v. Avado Brands, Inc., 187 F.3d 1271, 1273
n.1 (11th Cir. 1999). However, the same does not apply to legal conclusions
set forth in the complaint. See Iqbal, 556 U.S. at 678. “Threadbare recitals of
the elements of a cause of action, supported by mere conclusory statements, do
not suffice.” Id. Furthermore, the court does not “accept as true a legal
conclusion couched as a factual allegation.” Twombly, 550 U.S. at 555.
B.

Analysis
1.

Negligent Misrepresentation

Plaintiff alleges that BANA misrepresented ownership of the Account by
“suppl[ying] false information to [Plaintiff].” (Am. Compl., Dkt. [11] ¶ 31.)
Specifically, Plaintiff alleges that she “relied reasonably on BANA[’s] . . .
repeated representations that [Plaintiff] was an owner of the Account.” (Id. ¶
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34.) She also claims that, “[o]wnership of the Account was within the
knowledge of BANA . . . not [Plaintiff].” (Id. ¶ 32.) Defendants argue that
Plaintiff’s allegations are insufficient to state a claim for negligent
misrepresentation.
“The essential elements of negligent misrepresentation are ‘(1) the
defendant’s negligent supply of false information to foreseeable persons,
known or unknown; (2) such persons’ reasonable reliance upon that false
information; and (3) economic injury proximately resulting from such
reliance.’” Brannigan v. Bank of America Corp., No. 2:13-CV-00129-RWS,
2013 WL 6510787, at *6 (N.D. Ga. Dec. 12, 2013) (quoting Marquis Towers,
Inc. v. Highland Grp., 593 S.E.2d 903, 906 (Ga. Ct. App. 2004)). Plaintiff
cannot show that BANA owed her a duty, that BANA’s representation of
Plaintiff’s ownership of the Account was false, nor that Plaintiff was
reasonable in her reliance upon that representation.
First, for a negligence claim to arise, the defendant must breach a duty.
“[T]he threshold issue in a negligence action is whether and to what extent the
defendant owes a legal duty to the plaintiff.” Ceasar v. Wells Fargo Bank,
N.A., 744 S.E.2d 369, 373 (Ga. Ct. App. 2013). To establish a duty in this
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case, Plaintiff relies on the language in the Deposit Agreement that says “[w]e
owe you only a duty of ordinary care.” (2010 Deposit Agmt., Dkt. [18-3] at 6;
2013 Deposit Agmt., Dkt. [18-5] at 4.)3 But, “[a]bsent a legal duty beyond the
contract, no action in tort may lie upon an alleged breach of [a] contractual
duty.” Brannigan, 2013 WL 6510787, at *6 (alterations in original). So
Plaintiff cannot rely on terms in the Deposit Agreement to establish a duty
relevant to the tort of negligent misrepresentation. And, in Georgia, “the law is
clear that a bank owes no legal duty to act as a customer’s legal or financial
advisor.” First Union Nat. Bank of Georgia v. Gurley, 431 S.E.2d 379, 381
(Ga. Ct. App. 1993). BANA was therefore under no duty to advise Plaintiff
whether Decedent’s estate might have a claim for funds in the Account.
Second, by the terms of the Deposit Agreement governing the Account,
Plaintiff was, in fact, an owner of the Account. This case is about conflating
ownership of the Account with ownership of the funds within the Account.

3

Plaintiff did not attach the Deposit Agreement to her Complaint or First
Amended Complaint, but following the Eleventh Circuit’s “incorporation by
reference” doctrine, the Court may consider documents attached to a motion to
dismiss without converting the motion into one for summary judgment when the
documents attached are “central to the plaintiff’s claim . . . and . . . undisputed.”
Horsley v. Feldt, 304 F.3d 1125, 1134 (11th Cir. 2002). Both Plaintiff and Defendants
rely upon the Deposit Agreements and neither challenges their authenticity.
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From the perspective of BANA, the Account “owner” is simply an individual
who is permitted by contract—the Deposit Agreement—to make decisions for
the account, such as making deposits or withdrawing any or all funds within
the account. (2010 Deposit Agmt., Dkt. [18-3] at 9; 2013 Deposit Agmt., Dkt.
[18-5] at 6.) It is clear from the Deposit Agreement that multiple individuals
may claim ownership of the funds within a joint account: “[a]ll persons whose
names appear on the account are co-owners of the account, regardless of whose
money is deposited in the account.” (2010 Deposit Agmt., Dkt. [18-3] at 9;
2013 Deposit Agmt., Dkt. [18-5] at 6) (emphasis added). Plaintiff’s name was
added to the Account by Decedent, making her a co-owner. Therefore,
BANA’s statement of ownership is true: Plaintiff is a co-owner of the Account,
regardless of whether others who are not Account owners may make claims for
the funds in the Account.
Third, Plaintiff cannot reasonably rely upon statements of ownership of
the funds within the Account for reasons closely related to those already
discussed. BANA was under no duty to advise Plaintiff whether Decedent’s
estate might have a claim for funds in the Account. The terms of the Deposit
Agreement also put Plaintiff on notice that the duty to determine rights of
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survivorship was hers alone. Those terms were clear and unambiguous:
The rights of survivorship continue between surviving co-owners
and we may pay the funds in the account to any surviving coowner. The applicable law may impose requirements that must be
met to create a joint account with right of survivorship. You are
solely responsible for meeting those requirements . . . We may
take any action authorized or permitted by this Agreement without
being liable to you, even if such action causes you to incur fees,
expenses or damages.
(2010 Deposit Agmt., Dkt. [18-3] at 10, 37; 2013 Deposit Agmt., Dkt.
[18-5] at 6, 20.)
The Georgia Court of Appeals has held that banks have no fiduciary duty
to their customers and that customers of banks have the duty of investigation
and are not entitled to rely upon the representations of bank employees. Pardue
v. Bankers First Fed. Sav. & Loan Ass’n, 334 S.E.2d 926, 927 (Ga. Ct. App.
1985) (holding that, even if a bank had intended to advise its customer on tax
liabilities and had actually misled the customer, the customer would not be
entitled to rely upon that advice but would be under a duty to conduct their own
inquiry about their tax liability). So Plaintiff was responsible for determining
whether others might have legal claims to the funds in the Account. Plaintiff
cannot therefore establish reasonable reliance.

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Because Plaintiff cannot show that BANA owed her a legal duty, that
BANA’s representation of Plaintiff’s ownership of the Account was false, nor
that Plaintiff was reasonable in her reliance upon that representation,
Defendant’s Motion to Dismiss [18] is GRANTED as to negligent
misrepresentation.
2.

Breach of Contract

Turning to Plaintiff’s final claim, Plaintiff alleges that BANA’s failure to
“properly make [Plaintiff] an owner of the Account . . . constitutes a breach of
contract.” (First Am. Compl., Dkt. [11] ¶¶ 41-42.) The elements of a breach of
contract claim are “the breach and the resultant damages to the party who has
the right to complain about the contract being broken.” Budget Rent-A-Car of
Atlanta, Inc. v. Webb, 469 S.E.2d 712, 713 (Ga. Ct. App. 1996). For the
reasons that follow, the Court finds that Plaintiff has failed to state a claim for
breach of contract.
As an initial matter, Plaintiff’s First Amended Complaint presents four
deficiencies that, taken together, merit granting a motion to dismiss for failure
to state a claim for breach of contract. First, Plaintiff does not identify a
specific contract. Plaintiff alleges that “BANA and [Plaintiff] are parties to a
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contract,” (First Am. Compl., Dkt. [11] ¶ 38), but does not specify whether that
contract is written or oral or what its terms include. Compounding that
problem, Plaintiff did not attach the contract BANA allegedly breached. The
only documents attached to the First Amended Complaint are a transcript of
Ms. Grigoras’s deposition and a copy of the 2011 signature card. The 2010 and
2013 Deposit Agreements are only in the record because Defendants attached
them to their Motion to Dismiss [18]. Third, Plaintiff does not specify what
provisions of the contract BANA allegedly breached. Plaintiff comes closest
by alleging “BANA failed to properly make [Plaintiff] an owner of the
Account. BANA’s failure to comply with a material issue to the agreed upon
contract constitutes a breach of contract.” (First Am. Compl., Dkt. [11] ¶¶ 4142.) But this allegation, without more, is insufficient to survive a motion to
dismiss.
Despite these deficiencies, Plaintiff’s briefing seems to indicate that the
Deposit Agreement is the basis of her breach of contract claim. Thus, the
Court will assume that is the case and analyze Plaintiff’s breach of contract
claim in that light. See Federal Deposit Ins. Corp. v. West, 260 S.E.2d 89, 91
(Ga. 1979) (“The deposit agreement, if any, the signature card and the checks
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drawn against the account are the contract documents between the bank and the
customer.”).
Even doing so, Plaintiff has not stated a claim for breach of contract.
Plaintiff alleges that BANA breached the contract by “fail[ing] to properly
make [Plaintiff] an owner of the Account.” (First. Am. Compl., Dkt. [11] ¶ 41.)
But, the Deposit Agreement says that “[a]ll persons whose names appear on the
account are co-owners of the account, regardless of whose money is deposited
in the account.” (2010 Deposit Agmt., [18-3] at 9; 2013 Deposit Agmt., Dkt.
[18-5] at 6.) Because Plaintiff’s name was indeed “on the account,” she was an
owner. (2011 Signature Card, Dkt. [11-2]; 2013 Signature Card, Dkt. [18-4].)
Therefore, BANA did not breach the contract by failing to make Plaintiff an
owner of the Account.
To the extent Plaintiff’s real allegation is not that BANA breached the
Deposit Agreement by failing to make Plaintiff an owner of the Account, but
instead by failing to properly determine the ownership of the funds within the
Account, that claim also fails. Plaintiff does not point to a provision within the
Deposit Agreement that would place on BANA the duty of determining
ownership of the funds within the Account. In fact, multiple provisions of the
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Deposit Agreement disclaim such a duty. For example, one provision says that
“[w]e do not have to inquire about the source or ownership of any funds we
receive for deposit or about the application of any withdrawal or payment from
an account.” (2010 Deposit Agmt., Dkt. [18-3] at 9; 2013 Deposit Agmt., Dkt.
[18-5] at 6.) Another provision says that “[w]e may act on the oral or written
instructions of any one signer on the account. Each signer may make
withdrawals, write checks, [and] transfer funds . . . .” (2010 Deposit Agmt.,
Dkt. [18-3] at 38; 2013 Deposit Agmt., Dkt. [18-5] at 21.)
As co-owner of the Account, Plaintiff authorized BANA to pay the funds
in the Account to her, all of which she was entitled to do by the express terms
of the Deposit Agreement. That does not mean, however, that BANA was
under a contractual duty to ensure that Plaintiff was the sole owner of the funds
within the Account. The Deposit Agreement expressly reserved that duty for
Plaintiff. (See 2010 Deposit Agmt., Dkt. [18-3] at 10; 2013 Deposit Agmt.,
Dkt. [18-5] at 6.) So even assuming the Deposit Agreement is the basis of
Plaintiff’s breach of contract claim, Plaintiff has failed to state a plausible
claim that BANA breached that contract. Defendants’ Motion to Dismiss [18]
is GRANTED as to breach of contract.
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Conclusion
As discussed above, Defendants’ Motion to Reconsider or, in the
Alternative, to Dismiss Defendant Grigoras as Improperly Joined [19] is
GRANTED, Plaintiff’s Motion for Remand [16] is DENIED, and Defendants’
Motion to Dismiss [18] is GRANTED.
SO ORDERED, this 10th day of February, 2017.

________________________________
RICHARD W. STORY
United States District Judge

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