Case Title: Jakob v. First Alabama Bank of Montgomery

Citation: 361 So. 2d 1017

Docket Number: 

State: alabama

Court: Alabama Supreme Court

Date: 1978-06-30T00:00:00Z

Document:
361 So. 2d 1017 (1978)
Robert F. JAKOB
v.
FIRST ALABAMA BANK OF MONTGOMERY.
77-155.

Supreme Court of Alabama.
June 30, 1978.
Rehearing Denied August 25, 1978.
*1018 Allen W. Howell, Montgomery, for appellant.
J. E. Dillard of Steiner, Crum & Baker, Montgomery, for appellee.
BEATTY, Justice.
This is an appeal by the plaintiff, Sergeant Robert Jakob, from a summary judgment granted in favor of the defendant, First Alabama Bank of Montgomery, N.A.
Sergeant Jakob (Jakob), an active duty non-commissioned Air Force officer, applied for membership at the Maxwell Air Force Base Non-Commissioned Officers' Open Mess (NCO Club) by executing a membership application on January 23, 1973. The pertinent portions of that agreement are:
Thereafter, he and his wife received NCO Club cards. The reverse side of the cards issued to Jakob and his wife stated:
In June, 1974 the management of the NCO Club and the First National Bank of Montgomery, N.A. (now the First Alabama Bank of Montgomery, N.A.) (Bank) made an agreement which included an assignment of the NCO Club accounts and contract rights to the Bank. Jakob was later notified of this assignment at an NCO Club meeting and through the mail by a newsletter dated 4 June 1974:
Among the questions and answers referred to in the letter were these:
Thereafter, Jakob received his BankAmericard in the mail. Apparently NCO Club dues were charged automatically on the First National BankAmericard (BankAmericard).
After notice of the effective date of the assignment, Jakob attempted to pay his NCO Club dues to the cashier at the club. With the exception of that first attempt, his proffered dues were refused and he was told that they were required to be made to the bank. Jakob wrote a letter in June, 1974, apparently to the NCO Club, stating that he was forced to accept convenience credit to maintain his membership in the NCO Club and that he believed this requirement was illegal. He stated further that he would accept the BankAmericard as a membership identification but would offer his monthly dues to the NCO Club cashier. The record shows that Jakob accepted his BankAmericard for identification purposes to cash checks at the NCO Club.
Beginning in July, 1974 the bank sent Jakob monthly statements of his account. Jakob never paid these statements. In January, 1975 the NCO Club notified the bank that Jakob's club membership was revoked. In March, 1975 when Jakob's account was seven months past due, the bank determined that it was uncollectible and charged it off as a loss. When the accounts charged to the profit and loss statement for that reporting period were reported to the Credit Bureau of Montgomery in March, 1975, Jakob's account was one of those listed. The Credit Bureau then gave a report of Jakob's credit rating to Sears, Roebuck and Company. Jakob alleges, in addition, that about December 1, 1976 a bank employee made a communication to the Credit Bureau that Jakob had a BankAmericard account that was charged off as a bad debt.
In January, 1977 Jakob brought this action against the First Alabama Bank of Montgomery and the Credit Bureau of Montgomery for personal defamation of character and for defamation of his credit reputation. He alleged that the defamations occurred from a false communication and he claimed $50,000.00 in general damages and $500,000.00 punitive damages. After several motions for summary judgment the Credit Bureau was granted its motion; later the bank was granted its motion for summary judgment. Jakob appeals from the summary judgment granted to the bank.
The principal issue raised on appeal is whether or not the trial court erred in granting the bank's motion for summary *1020 judgment, i. e., was there a scintilla of evidence that there was an actionable defamatory communication, that it was not truthful, not privileged or that actual malice was present?
On appeal the plaintiff insists that there is a scintilla of evidence in the record that about December 1, 1976 an officer, agent or employee of the defendant bank made a slanderous communication to the Credit Bureau. The communication was that Jakob had a BankAmericard account which was charged to the bank's profit and loss statement due to its nonpayment. The plaintiff maintains that this statement was false because the BankAmericard was not an "accepted credit card" under law and therefore, he asserts, he incurred no bona fide debt through it because of his nonpayment of his dues.
The Consumer Credit Protection Act of 1968, 15 USCS § 1602, defined "credit cards" and "accepted credit cards:"
The Code of Federal Regulations, 12 Banks and Banking § 226.13, which supplements the statute, mandates that:
This Act was designed to put borrowers in possession of standards by which they could decide for themselves the reasonableness of credit terms so that they could shop for credit more easily. Johnson v. McCrackin-Sturman Ford, Inc., 527 F.2d 257 (C.A.Pa.1975). The credit cardholder is protected against charges for unauthorized use of his or her credit card, and liability for any unauthorized use is limited to a maximum of fifty dollars. First National City Bank v. Mullarkey, 87 Misc.2d 1, 385 N.Y.S.2d 473 (1976). Enforcement of the Act's provisions lies within the authority of both federal and state courts. Lewi's v. Delta Loans, Inc., 300 So. 2d 142 (Miss.1974).
We are convinced that Sergeant Jakob's objections to the procedures initiated by the NCO Club, which led to his being billed for dues by the defendant, were made in good faith. Nevertheless, he is mistaken in his view of the character of the BankAmericard in question. There is no question that it was a card within the meaning of § 1602(k), nor is it questionable that he was a cardholder under § 1602(m). The record justifies the conclusion, moreover, that his was an "accepted credit card" within the meaning of the statute and regulations. He applied for membership in the NCO Club shortly after arriving at Maxwell, and requested and received membership cards from the Club primarily for the convenience of check cashing, although he occasionally obtained food or refreshments there. The record discloses that he cashed forty-one checks at the NCO Club between March, 1973 and November, 1974. Thus it is clear that he requested and received a Club card which, as a cardholder, was for his purpose of obtaining admission to the Club on a deferred dues-payment basis, and for obtaining other Club services, such as check cashing. This qualified his Club card as an "accepted credit card." Following the billing agreement between the NCO Club and *1021 the defendant bank, the latter's BankAmericard, with ample notice to Sergeant Jakob, was issued in substitution for his "accepted (Club) credit card" by the bank as a successor card issuer. Thus it was true that the plaintiff had an account with the bank which, because of its nonpayment, was charged off as a bad debt. For this reason alone the trial court's order granting summary judgment was proper. Ripps v. Herrington, 241 Ala. 209, 1 So. 2d 899 (1941) (truth is a complete defense); Imperial Group, Ltd. v. Lamar Corp., Ala., 347 So. 2d 988 (1977) (summary movant must show that other party could not recover under any discernible circumstances).
Having reached the conclusion that summary judgment was proper, it is unnecessary to discuss the other issues raised on appeal. The judgment is affirmed.
AFFIRMED.
TORBERT, C. J., and MADDOX, JONES and SHORES, JJ., concur.