FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

KRISTEN SCHERTZER;

BRITTANY COVELL, individually 

and on behalf of all others similarly 

situated, 

Plaintiffs-Appellants, 

 v. 

BANK OF AMERICA, NA, 

Defendant-Appellee.

No. 23-55104 

D.C. No. 

3:19-cv-00264-

JM-MSB 

OPINION

Appeal from the United States District Court

for the Southern District of California

Jeffrey T. Miller, District Judge, Presiding

Argued and Submitted May 13, 2024

Pasadena, California

Filed July 29, 2024

Before: Ronald Lee Gilman,* Ronald M. Gould, and 

Salvador Mendoza, Jr., Circuit Judges.

Opinion by Judge Gould

* The Honorable Ronald Lee Gilman, United States Circuit Judge for the 

U.S. Court of Appeals for the Sixth Circuit, sitting by designation.
2 SCHERTZER V. BANK OF AMERICA, NA

SUMMARY**

Breach of Contract / California Law

The panel affirmed in part and reversed in part the 

district court’s summary judgment in favor of Bank of 

America (“BOA”), and vacated the district court’s denial of 

class certification, in plaintiff’s putative class action alleging 

claims for breach of contract and breach of the implied 

covenant of good faith and fair dealing, based on fees BOA 

charged when plaintiff used a non-BOA ATM. 

BOA charged plaintiff, a BOA accountholder, two 

separate out-of-network balance inquiry fees when she used 

her BOA debit card at a non-BOA ATM. Plaintiff claimed 

that only the first of two fees was permissible under the 

parties’ contract. 

The panel reversed the district court’s summary 

judgment in favor of BOA on plaintiff’s claim for breach of 

contract. The panel agreed with plaintiff that the term 

“balance inquiry,” as used in the contractual documents, 

means a customer-initiated transaction like a withdrawal, 

where BOA can charge customers only when the customer 

explicitly requests balance information. The panel rejected 

BOA’s argument—that it lacked control over third-party 

ATM operators or the fashioning of their screen prompts and 

therefore cannot be held responsible for customer responses 

to the screen prompts—because BOA’s level of control over 

** This summary constitutes no part of the opinion of the court. It has 

been prepared by court staff for the convenience of the reader.
SCHERTZER V. BANK OF AMERICA, NA 3 

the ATM operators has no effect on the question of contract 

interpretation raised in this case. 

The panel affirmed the district court’s summary 

judgment in favor of BOA on plaintiff’s claim for breach of 

the implied covenant of good faith and fair dealing because 

the claim is indistinguishable from plaintiff’s breach of 

contract claim and therefore superfluous. 

The panel rejected BOA’s argument that plaintiff’s 

failure to follow the contract’s pre-dispute procedures 

presented an independent ground for summary judgment 

because there was no indication that these procedures 

covered situations in which customers believe that BOA has 

overcharged them in violation of the contract. 

Finally, the panel vacated the district court’s denial of 

class certification and remanded for the district court to 

reconsider class certification.

COUNSEL

Jae K. Kim (argued), Lynch Carpenter LLP, Pasadena, 

California; Todd D. Carpenter and Tiffine E. Malamphy, 

Lynch Carpenter LLP, Del Mar, California; Sophia G. Gold 

and Jeffrey D. Kaliel, KalielGold PLLC, Washington, D.C.; 

for Plaintiffs-Appellants. 

Shawn R. Obi (argued) and Amanda L. Groves, Winston & 

Strawn LLP, Los Angeles, California, for DefendantAppellee.
4 SCHERTZER V. BANK OF AMERICA, NA

OPINION

GOULD, Circuit Judge:

Plaintiff Brittany Covell,

1 a Bank of America (“BOA”) 

accountholder, brought this putative class action against 

BOA, asserting claims for breach of contract and breach of 

the implied covenant of good faith and fair dealing, based on 

fees BOA charged when Plaintiff used a non-BOA ATM. 

The district court granted summary judgment in favor of 

BOA and denied class certification. We have jurisdiction 

pursuant to 28 U.S.C. § 1291. We affirm in part, reverse in 

part, and remand for further proceedings.

BACKGROUND

BOA charged Plaintiff two separate $2.50 out-ofnetwork (“OON”) balance inquiry fees when she used her 

BOA debit card at a non-BOA ATM. Plaintiff claims that 

only the first of the two fees was permissible under the 

parties’ contract. The contract allows BOA to charge OON 

balance inquiry fees, but whether the fee at issue was 

permissible depends on how “balance inquiry” is defined. 

Under Plaintiff’s definition, she did not make a second

“balance inquiry” within the meaning of the contract; under 

BOA’s definition, she did. The factual circumstances 

surrounding Plaintiff’s transaction are undisputed.

1 At the time of the district court’s final order, Kristin Schertzer was also 

a named plaintiff in the action, but this appeal is maintained solely by 

Covell.
SCHERTZER V. BANK OF AMERICA, NA 5 

I. The ATM Transaction 

A. First Balance Inquiry Charge

A customer initiates a transaction at a non-BOA ATM 

by inserting her debit card. The ATM then prompts the 

customer: “Would you like to view your Account Balance?”, 

with buttons for “Yes” or “No.” If the customer selects 

“Yes,” the next screen prompts the customer to “Select 

inquiry account,” with buttons for “Checking,” “Savings,” 

and “Credit Card.” Once the customer selects an account, 

the ATM transmits an electronic “balance inquiry request” 

to BOA, and BOA charges the customer a $2.50 OON 

balance inquiry fee. The ATM then displays the customer’s 

balance information for the account selected.

B. Second Balance Inquiry Charge

On the screen displaying the customer’s balance, the 

ATM next prompts the customer: “Would you like to print 

your Balance and continue the Transaction?”, with buttons 

for “Continue” and “Cancel.” If the customer selects 

“Continue,” the ATM transmits a second electronic balance 

inquiry request to BOA, and BOA charges the customer 

another $2.50 OON balance inquiry fee. The ATM then 

displays a menu of transactions with which the customer can 

proceed, including “Withdrawal,” “Transfer,” and 

“Inquiry.” Once the customer completes one of these 

transactions, the ATM prints a receipt displaying the 

customer’s balance information.

Plaintiff does not dispute that the first OON fee—

incurred when she selected “Yes” to the prompt asking her 

if she wanted “to view your Account Balance”—was 

permissible under the parties’ contract as a balance inquiry 

fee. But Plaintiff contends that the second OON fee was not 
6 SCHERTZER V. BANK OF AMERICA, NA

permissible under the contract, because she did not initiate a 

“balance inquiry” when she elected to “print [her] Balance 

and continue the Transaction.” 

II. Governing Agreements

The parties agree that this case is governed by three 

contractual documents (collectively, the “Account 

Documents”): (1) the “Deposit Agreement and Disclosures” 

(the “Deposit Agreement”); (2) the “Important Information 

Brochure: Card Agreement and Disclosure” (the 

“Brochure”); and the “Personal Schedule of Fees” (the “Fee 

Schedule”).2 The relevant provisions in each document are 

as follows. 

Deposit Agreement

ATM Fees. When you use an ATM that is not 

prominently branded with the Bank of 

America name and logo, you may be charged 

a fee by the ATM operator or any network 

used and you may be charged a fee for a 

balance inquiry even if you do not complete 

a fund transfer. We may also charge you fees.

Other Fees. For other fees that apply to 

electronic banking services, please review 

the Schedule of Fees for your account and 

each agreement or disclosure that we provide 

to you for the specific electronic banking 

service, including the separate agreement for 

2 The district court also referred to the “Schedule of Electronic Fees and 

Dollar Limits on Transactions Supplement to Your Card Agreement,” 

but this document is duplicative of the Fee Schedule. 
SCHERTZER V. BANK OF AMERICA, NA 7 

Online and Mobile Banking services and the 

separate agreement for ATM and debit cards. 

Brochure 

“You authorize us to act on the instructions 

you give us through ATMs.” 

Fee Schedule

Fee 

Name/Description

Fee 

Amount

Other Important 

Information About 

This Fee

Non-Bank of 

America ATM Fee 

for:

Withdrawals, 

transfers and balance 

inquiries at a nonBank of America 

ATM in the U.S. 

$2.50 each When you use a 

non-Bank of 

America ATM, you 

may also be charged 

a fee by the ATM 

operator or any 

network used and 

you may be charged 

a fee for a balance 

inquiry even if you 

do not complete a 

funds transfer.

III. Procedural History

Plaintiff originally brought this action against not only 

BOA, but also the operators of the non-BOA ATMs, 

Cardtronics, FCTI, and Cash Depot (the “ATM Operators”). 

The ATM Operators filed motions to dismiss under Rule 

12(b)(6) arguing, inter alia, that Plaintiff had not alleged 

damages because the OON fee at issue was charged by BOA 

and not by the ATM Operators. Plaintiff settled with the 
8 SCHERTZER V. BANK OF AMERICA, NA

ATM Operators before their motions were decided. The 

case now consists solely of claims against BOA for breach 

of contract and breach of the implied covenant of good faith 

and fair dealing. 

Plaintiff contends that she was charged two OON fees by 

BOA when she conducted a transaction at an ATM operated 

by FCTI. She seeks to bring this action on behalf of all 

similarly situated BOA customers. Plaintiff moved to certify 

a class of:

All Bank of America, N.A., checking account 

holders in the United States who since May 

1, 2018 were assessed two (2) out-of-network 

fees for a single balance inquiry undertaken 

at FCTI, Inc.’s ATM machines located in 7-

Eleven stores.[3]

BOA opposed class certification and moved for summary 

judgment on Plaintiff’s breach of contract and implied 

covenant claims. The district court granted summary 

judgment on both claims and denied class certification. 

Schertzer v. Bank of America, Case No. 19-cv-264, 2022 WL 

1004559 (S.D. Cal. Apr. 4, 2022). Shortly thereafter, the 

district court denied Plaintiff’s motion for reconsideration. 

Plaintiff timely appealed the district court’s summary 

judgment, class certification, and reconsideration orders.

3 Then-plaintiff Schertzer also sought to certify a class of Cardtronics 

ATM users, but Covell does not appeal the district court’s denial of 

certification as to that class.
SCHERTZER V. BANK OF AMERICA, NA 9 

DISCUSSION

I. Breach of Contract

A. Parties’ Interpretations of “Balance 

Inquiry”

The Account Documents do not define “balance 

inquiry.” Schertzer, 2022 WL 1004559, at *8. As an initial 

matter, we must clarify the parties’ competing definitions of 

the term. The district court adopted BOA’s interpretation. 

However, we conclude that the district court misunderstood

Plaintiff’s proposed interpretation. 

Plaintiff had argued to the district court that to make a 

“balance inquiry” under the contract “reasonably means that 

customers must have affirmatively requested . . . their 

account balance information” and that “the party that is 

relevant in determining whether balance information has 

been requested is the customer, not the ATM machine or 

network.” 

In rejecting this interpretation and adopting BOA’s 

alternative, the district court relied on a provision in the 

Deposit Agreement and Brochure that reads: 

ATM Fees. When you use an ATM that is not 

prominently branded with the Bank of 

America name and logo, you may be charged 

a fee by the ATM operator or any network 

used and you may be charged a fee for a 

balance inquiry even if you do not complete 
10 SCHERTZER V. BANK OF AMERICA, NA

a fund transfer. We may also charge you 

fees.[4]

Referring to the first sentence of this paragraph, the 

district court mistakenly characterized Plaintiff’s 

interpretation of “balance inquiry” as “suggesting a 

subjective consent/intent requirement into the ‘when you use 

a non-Bank of America ATM’ clause for a ‘balance 

inquiry.’” Schertzer, 2022 WL 1004559, at *9. The district 

court rejected what it understood to be Plaintiff’s 

interpretation, stating: 

Reading the contract as a whole, and in a 

commonsense manner, the phrase appears to 

refer to a customer’s general use of the ATM. 

That is when a customer places their 

debit/credit card in an ATM machine and

enters their PIN and selects options on the 

screen to access their bank account/s, they are 

“using” a non-Bank of America ATM 

machine. The fact that the actions are being 

performed by the customer implicitly 

signifies consent in the circumstances. In 

other words, the “instruction”[5] is carried out 

by the customer hitting buttons or prompts on 

the ATM screen over which [BOA] has no 

control. To require [BOA] to glean the 

subjective intent of OON ATM users defies 

4 The last sentence of the provision appears only in the Deposit 

Agreement.

5 This is a reference to the Brochure, which states: “You authorize us to 

act on the instructions you give us through ATMs.”
SCHERTZER V. BANK OF AMERICA, NA 11

logic and common sense given the protocols 

and mechanics of OON ATMs.

Id. 

The district court concluded that the Account Documents 

unambiguously allow BOA to charge an OON fee for each 

electronic balance inquiry request transmitted by the ATM 

in response to customer selections on the ATM screen, 

regardless of whether those selections explicitly referred to 

balance information. The district court reasoned that even if 

the term were ambiguous and extrinsic evidence were 

considered, the result would be the same. Id. at *9-12.

BOA and the district court misconstrue Plaintiff’s 

interpretation as requiring BOA to divine a customer’s 

subjective intent each time the customer presses a button on 

an ATM. The district court misunderstood Plaintiff’s 

interpretation to include a requirement that balance inquiries 

be performed “knowingly” or “intentionally”—terms BOA

repeats on appeal to undermine Plaintiff’s arguments. But 

these terms do not appear anywhere in Plaintiff’s briefs.

Plaintiff’s interpretation of “balance inquiry,” as

“reasonably mean[ing] that customers must have 

affirmatively requested . . . their account balance 

information,” does not in fact imply a subjective intent 

requirement. Plaintiff simply argues that the customer must 

make the balance inquiry, as opposed to the ATM 

transmitting an inquiry to BOA with or without the customer 

requesting one. Determining whether a customer has 

initiated a balance inquiry does not require probing her

subjective intent; it merely requires that the consumer has 

made the balance inquiry. Plaintiff concedes that when a 

customer presses a button on an ATM that says “balance 
12 SCHERTZER V. BANK OF AMERICA, NA

information” (or something similarly explicit) it is 

objectively clear that the customer has requested a balance 

inquiry.

Plaintiff’s interpretation is based on objective 

manifestations of consent commonly required in electronic 

transactions. In cases where consumers interact with 

websites, for example, this court and others have required 

that the customer “take an[] affirmative action to 

demonstrate assent” to terms of service. Nguyen v. Barnes 

& Noble, Inc., 763 F.3d 1171, 1178-79 (9th Cir. 2014); see 

also Reichert v. Rapid Investments, Inc., 56 F.4th 1220, 

1230-31 (9th Cir. 2022); Knutson v. Sirius XM Radio Inc., 

771 F.3d 559, 565 (9th Cir. 2014) (“Courts must determine 

whether the outward manifestations of consent would lead a 

reasonable person to believe the offeree has assented to the 

agreement.”); Specht v. Netscape Comms. Corp., 306 F.3d 

17, 29, 31, 33-34 (2d Cir. 2002) (requiring “that a user’s act

. . . manifest assent to contract terms”). Although these 

cases involve contract formation rather than performance,

they illustrate that there is nothing novel or unusually 

burdensome about requiring a merchant to determine 

whether a customer has objectively manifested consent to a 

transaction.6 These cases serve as a guide in assessing 

consent to electronic transactions. 

In summary, we are presented with two interpretations 

of the term “balance inquiry.” Plaintiff’s interpretation 

6 Indeed, a recent district court decision that considered a challenge to a 

similar balance-inquiry fee rejected defendant FTCI’s contention that the 

plaintiffs’ claims required “the Court [to] probe whether each individual 

customer relied on the allegedly deceptive [ATM screen prompt].” 

Polvay v. FTCI, Inc., 2024 WL 322050, at *2-3, 5 (S.D.N.Y. Jan. 29, 

2024).
SCHERTZER V. BANK OF AMERICA, NA 13

allows a customer to be charged for a “balance inquiry” 

under the contract only if it is objectively clear that the 

customer requested balance information from the ATM—for 

example, by selecting “Yes” in response to a prompt reading 

“Would you like to view your Account Balance?” Plaintiff 

thus characterizes a “balance inquiry” as a customerinitiated transaction in which the customer inquires about 

her balance.

In sharp contrast, BOA’s interpretation, adopted by the

district court, allows BOA to charge a customer for a 

“balance inquiry” anytime that an ATM sends an electronic 

message to BOA requesting balance information, regardless 

of what the customer pressed on the ATM screen. BOA and 

the district court thus conceive of a “balance inquiry” as an 

ATM-initiated transaction that occurs whether or not a 

customer makes any inquiry at all.

We adopt Plaintiff’s interpretation and reverse the 

district court’s grant of summary judgment for BOA.

B. Contract Interpretation

The parties agree that California law governs their 

contract. Contract interpretation is a question of law, which 

we review de novo. Atel Fin. Corp. v. Quaker Coal Co., 321 

F.3d 924, 925-26 (9th Cir. 2003) (per curiam); Trustees of 

S. Cal. IBEW-NECA Pension Trust Fund v. Flores, 519 F.3d 

1045, 1047 (9th Cir. 2008). 

“The fundamental goal of contract interpretation is to 

give effect to the mutual intent of the parties as it existed at 

the time of contracting.” U.S. Cellular Inv. Co. v. GTE 

Mobilnet, Inc., 281 F.3d 929, 934 (9th Cir. 2002). “Such 

intent is to be inferred, if possible, solely from the written 

provisions of the contract, County of Fresno v. Frensno 
14 SCHERTZER V. BANK OF AMERICA, NA

Deputy Sheriff’s Ass’n, 51 Cal. App. 5th 282, 292 (2020), “if 

the language is clear and explicit, and does not involve an 

absurdity,” Cal. Civ. Code § 1638. 

California law provides several principles that guide our 

inquiry into what the parties mutually intended a contract 

term to mean. Synthesizing these principles, we consider 

whether a proffered interpretation: (1) aligns with the

ordinary and popular meaning of the term; (2) gives effect to 

all of a contract’s provisions or renders some superfluous; 

(3) is supported by reading the contract as a whole; 

(4) would produce an absurd or inequitable result. We have 

applied each of these principles to interpretation of the term

“balance inquiry” and conclude that these contract 

interpretation principles all support Plaintiff’s interpretation 

of the term. 

i. The “Ordinary and Popular” Meaning of 

“Balance Inquiry”

Under California contract law, applicable here, terms 

must be “understood in their ordinary and popular sense 

rather than according to their strict legal meaning; unless 

used by the parties in a technical sense, or unless a special 

meaning is given to them by usage.” Cal. Civ. Code § 1644. 

The “ordinary and popular” meaning of a term is “the 

meaning a layperson would ascribe to [it].” Sup. Ct. of 

Alameda Cnty. v. County of Alameda, 65 Cal. App. 5th 838, 

850 (2021) (quoting AIU Ins. Co. v. Sup. Ct., 51 Cal. 3d 807, 

821-22 (1990)); see also Ray v. Farmers Ins. Exch., 200 Cal. 

App. 3d 1411 (1988). 

The district court’s interpretation of “balance inquiry,” 

characterized to include an inquiry made by the ATM 

computer, does not represent the “ordinary and popular” 

meaning of the term. The district court defined “balance 
SCHERTZER V. BANK OF AMERICA, NA 15

inquiry” as an electronic transmittal between an ATM and 

BOA that can occur even when a customer has not requested 

balance information. See Schertzer, Case No. 19cv264, Dkt. 

271 at 15-16. In adopting this interpretation, the district 

court assumed that a layperson would be well-versed in the 

electronic transmittals that occur between the ATM and 

BOA. In the district court’s view, a layperson reading 

BOA’s contract would understand that “balance inquiry”

could not refer to anything other than these electronic 

transmittals. We conclude that these assumptions are

unreasonable and do not plausibly represent a layperson’s 

understanding of “balance inquiry.”

BOA’s and the district court’s interpretation of “balance 

inquiry” is more akin to a technical definition understood by 

those in the industry familiar with how ATMs work. Indeed, 

BOA submitted a lengthy expert report to the district court 

describing the process that occurs when an ATM transmits a 

balance inquiry request to a bank. The process was broken 

down into no fewer than nine steps, complete with a 

diagram. But nothing in the Account Documents tells a 

consumer that the contract term “balance inquiry” refers to 

such a complicated automated process. See Cal. Civ. Code

§ 1644 (technical meanings of terms do not apply “unless 

used by the parties in a technical sense, or unless a special 

meaning is given to them by usage”). BOA accountholders 

are generally not sophisticated parties likely to be familiar 

with the mechanics of ATM transmittals or the technical 

meaning of the term “balance inquiry” proffered by BOA. 

See Universal Cable Productions, LLC v. Atlantic Specialty 

Ins. Co., 929 F.3d 1143, 1153–54 (9th Cir. 2019) (industry 

usage of insurance term applied where insured was a 

sophisticated party who conducted frequent business related 

to the insurance trade); see also Cal. Civ. Code § 1645 
16 SCHERTZER V. BANK OF AMERICA, NA

(technical terms are “interpreted as usually understood by 

persons in the profession or business to which they relate”).

In contrast, Plaintiff’s interpretation—that a “balance 

inquiry” occurs when a customer objectively makes a 

request for balance information—aligns with the ordinary 

and popular meaning of the term. Consumers who use 

ATMs and sign up for a debit card would be familiar with 

the term “balance inquiry,” because it often appears as an 

option on ATM screens alongside “withdrawal” and 

“transfer,” and as a prompt that explicitly refers to “balance 

information.” The “Network Rules” binding all of the 

ATMs at issue require that ATMs offer a balance inquiry 

option. A reasonable consumer would understand—without 

need for an expert report—that by responding “Yes” to the

prompt “Would you like to view your Account Balance?”, 

she is inquiring about her balance information.7 A customer 

reading the Account Documents would naturally associate 

the term “balance inquiry” with this familiar ATM 

transaction.8 

We conclude that the ordinary and popular meaning of 

“balance inquiry” requires an objectively clear customer

request for balance information from the ATM. Only then 

would it be reasonable for a bank to charge its customers a 

balance inquiry fee.

7 Different ATM screens present the balance inquiry option in different 

ways. Sometimes the screen will display an option labeled “inquiry,” 

but at other times the ATM will prompt the customer “Would you like 

to view your balance?”.

8 Consistent with the popular meaning of the term, Plaintiff does not 

challenge the validity of the first OON charge, incurred when Plaintiff 

selected “Yes” in response to the prompt: “Would you like to view your 

Account Balance?”.
SCHERTZER V. BANK OF AMERICA, NA 17

ii. Interpretation Should Not Render Part of 

the Contract “Superfluous, Useless, or 

Inexplicable” 

“An interpretation which gives effect to all provisions of 

the contract is preferred to one which renders part of the 

writing superfluous, useless or inexplicable.” Carson v. 

Mercury Ins. Co., 210 Cal. App. 4th 409, 420 (2012) 

(citation omitted). 

BOA’s and the district court’s interpretation of “balance 

inquiry” violates this principle. The district court relied on 

the “ATM Fees” provision in the Deposit Agreement and in 

the Brochure, which reads: 

ATM Fees. When you use an ATM that is not 

prominently branded with the Bank of 

America name and logo, you may be charged 

a fee by the ATM operator or any network 

used and you may be charged a fee for a 

balance inquiry even if you do not complete 

a fund transfer. We may also charge you fees.

Other Fees. For other fees that apply to 

electronic banking services, please review 

the Schedule of Fees for your account and 

each agreement or disclosure that we provide 

to you for the specific electronic banking 

service, including the separate agreement for 

Online and Mobile Banking services and the 

separate agreement for ATM and debit cards. 

The district court extrapolated from the “When you use” 

language in the first sentence of the “ATM Fees” provision

to conclude that, “when a customer places their debit/credit 
18 SCHERTZER V. BANK OF AMERICA, NA

card in [a non-BOA] ATM machine . . . [,] they are ‘using’ 

a non-Bank of America ATM machine. . . . [and that] fact . . . 

implicitly signifies consent.” Schertzer, 2022 WL 1004559, 

at *9.

However, the district court ignored the phrase “We [(i.e., 

BOA)] may also charge you fees” at the end of the Deposit 

Agreement provision. This phrase is critical. A statement 

that “[BOA] may also charge you fees” indicates that the 

preceding “When you use” language does not refer to BOA 

fees. If the “When you use” language referred to fees that

BOA may charge, then the words “[BOA] may also charge 

you fees” would be superfluous or inexplicable. 

The district court also ignored that the clause it relied 

upon explicitly states that, “[w]hen you use an ATM . . . ,

you may be charged a fee by the ATM operator.” The district 

court nevertheless interpreted this clause as referring to 

BOA-charged fees. This interpretation renders the “by the 

ATM operator” language inexplicable.

A more natural reading of the provision giving effect to 

all its parts is that the first (“When you use”) sentence refers 

to fees charged by ATM operators, and the second sentence 

refers to BOA fees that are detailed in a separate provision. 

The provision that states “We may also charge you fees” is 

immediately followed by the “Other Fees” provision that

refers to the Fee Schedule where BOA’s fees (including the 

balance inquiry fee) are listed.

We conclude that the “When you use” provision cannot 

be read to support BOA’s interpretation of the term “balance 

inquiry” without rendering other provisions superfluous or 

inexplicable.
SCHERTZER V. BANK OF AMERICA, NA 19

iii. Reading the Contract as a Whole 

Contracts are interpreted as a whole “so as to give effect 

to every part, if reasonably practicable, each clause helping 

to interpret the other.” Cal. Civ. Code § 1641. “The 

meaning of the words contained in a contract is to be 

determined not from a consideration of the words alone but 

from a reading of the entire contract.” Brobeck, Phleger & 

Harrison v. Telex Corp., 602 F.2d 866, 872 (9th Cir. 1976) 

(quoting Sunset Sec. Co. v. Coward McCann, Inc., 47 Cal. 

2d 907, 911 (1957)). 

Reading the Account Documents as a whole supports 

that “balance inquiry” refers to a customer-initiated request 

for balance information. The Fee Schedule states that a 

$2.50 OON fee may be charged for “Withdrawals, transfers 

and balance inquiries.” Withdrawals and transfers are 

unquestionably customer-initiated transactions. The 

Account Documents make clear that an ATM cannot initiate

a withdrawal or transfer without a customer’s permission. 

“Balance inquiry” is listed alongside these terms, which 

reasonably suggests that it too is a customer-initiated 

transaction. The customer would naturally assume that she 

initiates a balance inquiry in the same way that she initiates 

a withdrawal: by selecting an option that explicitly refers to 

the desired transaction. Thus, in the normal case, a balance 

inquiry is made by the customer, not by the bank. The 

Account Documents do not mention ATMs’ electronic

transmittals to BOA or otherwise suggest that the balance 

inquiry fee might be connected to them. 

Plaintiff’s contention that “balance inquiry” refers to a 

customer-initiated transaction is reinforced by language in 

the Brochure that states: “You authorize us to act on the 

instructions you give us through ATMs.” BOA’s 
20 SCHERTZER V. BANK OF AMERICA, NA

interpretation of “balance inquiry” explicitly maintains that 

it acts on instructions it receives from the ATM. BOA states 

that it does not know what customers are selecting on the 

ATM screen; it knows only what messages the ATM is 

sending to BOA. BOA’s interpretation of “balance inquiry” 

contradicts the contractual provision that provides BOA will 

act on the customer’s instructions. 

iv. Interpretation Should Not Produce an 

“Absurdity” or an “Inequitable” Agreement

Our interpretation of terms in a contract “must be fair and 

reasonable, not leading to absurd conclusions.” State 

Compensation Ins. Fund v. Dep’t of Ins., 96 Cal. App. 5th 

227, 236 (2023) (citation omitted). We “avoid an 

interpretation which will make a contract extraordinary, 

harsh, unjust, or inequitable.” Barroso v. Ocwen Loan 

Servicing, LLC, 208 Cal. App. 4th 1001, 1013 (2012) 

(citation omitted).

BOA’s and the district court’s interpretation of the 

contract produces an absurd and inequitable result. The 

district court’s reasoning suggests that a customer 

“implicitly . . . consent[s]” to fees associated with an ATM 

transaction by “using” the ATM, even if the customer cannot 

reasonably know that his actions are generating fees. See 

Schertzer, 2022 WL 1004559, at *9. Under this 

interpretation, a customer’s use of an ATM gives a blank 

check to BOA for any fees BOA decides to charge. As 

Plaintiff hypothesized before the district court, “[BOA] 

could charge consumers for a balance inquiry if the Bank 

receives notice from an ATM operator, even if a consumer 

clicks ‘no’ and declines to perform a balance inquiry, or even 

if the customer was prompted a different transaction than a 

balance inquiry.” Id. (citation omitted). 
SCHERTZER V. BANK OF AMERICA, NA 21

The Account Documents do not indicate that customers 

intended that their insertion of a debit card into an ATM 

would give BOA such vast discretion. Plaintiff’s 

interpretation avoids this inequitable result because it 

understands a “balance inquiry” to be a customer-initiated 

transaction like a withdrawal, where BOA can charge 

customers only when the customer explicitly requests

balance information. 

C. BOA’s Lack of Control over Third-Party 

ATM Operators

BOA persuaded the district court that, because BOA 

allegedly has no control over the ATM Operators or the 

fashioning of their screen prompts, the court could not hold 

BOA responsible for fees generated by customer responses 

to the screen prompts. We reject this line of reasoning

because BOA’s level of control over the ATM Operators has 

no effect on the question of contract interpretation before us.

BOA’s control over the ATM Operators does not speak 

to what BOA and Plaintiff mutually intended when they 

agreed to the Account Documents. BOA’s relationship with 

the ATM Operators is not described in the Account 

Documents. An ordinary consumer would not know of this 

relationship when reviewing the Account Documents. There 

is no reason to believe that BOA’s control over the ATM 

Operators—totally unknown to ordinary consumers—bears

on a customer’s interpretation of the term “balance inquiry.” 

This makes it irrelevant to the contract interpretation inquiry. 

The district court framed BOA’s control over the ATM 

Operators in terms reminiscent of the duty of care that arises 

in tort cases. The district court reasoned that, “[w]hile the 

practices of the ATM Operators may indeed be 

questionable,” BOA has no control over the “buttons or 
22 SCHERTZER V. BANK OF AMERICA, NA

prompts on the ATM screen,” and “[a]bsent any agency 

relationship, the court is loath to hold [BOA] responsible for 

the actions of a third party.” Id. at 16, 20.

Yet there are no tort claims in this action. Plaintiff’s 

claims arise from a contract dispute between Plaintiff and 

BOA. The “practices of the ATM Operators” are not at 

issue. Plaintiff does not allege that she was harmed by the 

ATM Operators. Plaintiff alleges that she was harmed by 

BOA. BOA—not the ATM Operators—charged the second 

OON fee at issue. BOA’s control or lack of control over the 

ATM Operators does not relieve BOA of its contractual duty 

to charge only those fees permitted by the Account 

Documents. 

The district court’s passing reference to an “agency 

relationship” is another inapposite allusion to tort law. An 

agency relationship is relevant in cases where “[a] principal 

who conducts an activity through an agent is subject to 

liability for harm to a third party caused by the agent’s 

conduct.” Restatement (Third) of Agency § 7.05 (2006) 

(emphasis added); see also Jones v. Royal Admin. Servs., 

Inc., 887 F.3d 443, 448-49 (9th Cir. 2018). Here, Plaintiff 

does not allege any harm caused by the ATM Operators, 

whether they are BOA’s agents or not. Plaintiff’s suit seeks 

to hold BOA responsible for BOA’s own alleged breach of 

the parties’ contract. 

D. Extrinsic Evidence

Under California law, we consider extrinsic evidence if 

it supports a proffered interpretation of a disputed term. 

Dore v. Arnold Worldwide, Inc., 39 Cal. 4th 384, 391 (2006). 

“The test of admissibility of extrinsic evidence to explain the 

meaning of a written instrument is not whether it appears to 

the court to be plain and unambiguous on its face, but 
SCHERTZER V. BANK OF AMERICA, NA 23

whether the offered evidence is relevant to prove a meaning 

to which the language of the instrument is reasonably 

susceptible.” Id. (internal quotation marks and citation 

omitted). If admitted, extrinsic evidence is used to ascertain 

the “objectively reasonable expectation of the promisee.” 

Buckley v. Terhune, 441 F.3d 688, 695 (9th Cir. 2006) 

(internal quotation marks and citations omitted). If extrinsic 

evidence does not help make sense of an ambiguous term, 

then “the language of a contract should be interpreted most 

strongly against the party who caused the uncertainty to 

exist.” Id. at 695-66 (quoting Cal. Civ. Code § 1654).

To the extent that the parties proffered extrinsic evidence 

before the district court, it took the form of (1) screenshots 

of the ATM screen prompts; (2) testimony from BOA 

employees; and (3) expert testimony on industry standards 

for ATMs. See Schertzer, 2022 WL 1004559, at *9-12.

The district court evaluated the extrinsic evidence in 

terms of whether it showed that BOA had control or 

oversight over the ATMs. See id. Among other things, the 

district court concluded that the evidence showed that 

“[BOA] has no relationship with Cardtronics or FTCI that 

would allow it to assert any control over the screens at 

issue”; “[BOA] . . . must respond to OON requests for 

balance information and cannot selectively respond based on 

customer ‘intent’”; and, “[BOA] cannot distinguish whether 

a customer using an OON ATM pressed a button asking to 

have the balance printed on the screen or on a receipt.” Id.

at 11.

BOA’s control over the ATM Operators is not relevant 

to the parties’ contract dispute. This case does not concern 

the actions of a third party—it concerns BOA’s actions, 

because it was BOA that charged Plaintiff the challenged 
24 SCHERTZER V. BANK OF AMERICA, NA

second OON fee. Extrinsic evidence of BOA’s control over 

the ATM Operators is irrelevant.

There is also some extrinsic evidence that undermines 

BOA’s interpretation of “balance inquiry.” For example, the 

Network Rules allow BOA to decline ATM balance inquiry 

requests under certain circumstances, such as when there is 

“fraud or credit risk presented by individual cardholder 

usage patterns.” None of these circumstances apply here, 

but the provision demonstrates that BOA can and does 

evaluate objective circumstances to determine whether a 

customer actually made a particular transaction. This 

undermines the credibility of BOA’s argument that it cannot 

determine if a customer is making a balance inquiry without 

probing their subjective intent. It also contradicts the district 

court’s finding that BOA “must respond to OON requests for 

balance information” without exception.

Because we conclude that extrinsic evidence does not 

support a proffered interpretation of the contract, we must 

construe any “ambiguous language against the interest of the 

party that drafted it.” Juarez v. Wash Depot Holdings, Inc., 

24 Cal. App. 5th 1197, 1203 (2018) (citing Cal. Civ. Code 

§ 1654). Further, “[t]his rule applies with particular force in 

the case of a contract of adhesion.” Id. BOA does not 

dispute that the Account Documents are a contract of 

adhesion. None of its terms were negotiated, and Plaintiff

could only accept or reject it. See Badie v. Bank of America, 

67 Cal. App. 4th 779, 785-86 (1998) (noting that contracts

between BOA and credit card holders were “undisputed[ly] 

. . . contracts of adhesion”).

We do not see the term “balance inquiry” as an

ambiguous term. As discussed above, Plaintiff’s 

interpretation of “balance inquiry” reflects its ordinary and 
SCHERTZER V. BANK OF AMERICA, NA 25

popular meaning. Even if the term “balance inquiry” were 

to be considered ambiguous, it would then be construed 

against its drafter, BOA, leading to the same conclusion we 

reach on grounds of the language’s plain meaning. 

II. Implied Duty of Good Faith and Fair Dealing 

In addition to breach of contract, Plaintiff contends that 

BOA breached the covenant of good faith and fair dealing, 

which is implied in every contract in California. Foley v. 

Interactive Data Corp., 47 Cal. 3d 654, 684 (1988). A 

breach of the implied duty of good faith and fair dealing goes 

beyond a breach of contract and involves “a failure or refusal 

to discharge contractual responsibilities, prompted not by an 

honest mistake, bad judgment or negligence but rather by a 

conscious and deliberate act, which unfairly frustrates the 

agreed common purposes and disappoints the reasonable 

expectations of the other party thereby depriving that party 

of the benefits of the agreement.” Careau & Co. v. Sec. Pac. 

Bus. Credit, Inc., 222 Cal. App. 3d 1371, 1394 (1990). 

A breach of this covenant is common in cases where one 

party has discretionary power in the performance or 

enforcement of the contract but abuses that discretion to 

deprive the other party of a contractual benefit the other 

reasonably expected. Acree v. Gen. Motors Acceptance 

Corp., 92 Cal. App. 4th 385 (2001). However, “no 

obligation can be implied that would result in the obliteration 

of a right expressly given under a written contract.” New 

Hampshire Ins. Co. v. Ridout Roofing Co., 68 Cal. App. 4th 

495, 505 (1998) (internal quotation marks and citation 

omitted). Also, “if the plaintiff’s allegations of breach of the 

covenant of good faith ‘do not go beyond the statement of a 

mere contract breach and, relying on the same alleged acts, 

simply seek the same damages or other relief already 
26 SCHERTZER V. BANK OF AMERICA, NA

claimed in a companion contract cause of action, they may 

be disregarded as superfluous as no additional claim is 

actually stated.’” Bionghi v. Met. Water Dist. of S. Cal., 70 

Cal. App. 4th 1358, 1370 (1999) (quoting Careau, 222 Cal. 

App. 3d at 1395).

Plaintiff claims that BOA breached the covenant of good 

faith and fair dealing by abusing the discretion purportedly

provided to BOA by the phrase “We may also charge you 

fees.” Plaintiff further contends that BOA “interpret[ed] . . . 

the undefined term ‘balance inquiry’ unreasonably” in a 

manner that gave the bank “carte blanche discretion to assess 

OON Fees anytime an ATM machine or network requested 

a balance inquiry.”

This claim is indistinguishable from Plaintiff’s breach of 

contract claim. It hinges on contract interpretation, and not 

on any alleged attempt by BOA to frustrate “the agreed 

common purposes” of the contract. Careau, 222 Cal. App. 

3d at 1394. Plaintiff’s implied covenant claim is rendered 

duplicative and unnecessary by our interpretation of 

“balance inquiry” and our conclusion that Plaintiff had 

properly alleged a claim of contract breach based on BOA’s 

charging a second OON fee without authorization. By 

concluding that BOA was permitted to charge OON fees 

only for customer-initiated balance inquiries, we necessarily 

conclude that BOA had an express duty to limit its fees to 

such inquiries. This express duty renders the implied duty 

of good faith and fair dealing superfluous. See New 

Hampshire Ins. Co., 68 Cal. App. 4th at 505 (express rights 

override implied rights); Bionghi, 70 Cal. App. 4th at 1370 

(implied covenant claims that mirror breach claims are 

superfluous). 
SCHERTZER V. BANK OF AMERICA, NA 27

We affirm the district court’s grant of summary 

judgment for BOA on Plaintiff’s good faith and fair dealing 

claim.

III. Pre-Dispute Procedures

BOA contends that Plaintiff’s failure to follow the 

contract’s pre-dispute procedures presents an independent 

ground for summary judgment. The district court rejected 

this assertion, and we agree. 

In a section titled “Reporting Problems,” the Deposit 

Agreement states:

If you find that your records and ours 

disagree, if you suspect any problem or

unauthorized transaction on your account or 

you do not receive a statement when 

expected, call us immediately at the number 

for customer service on your statement. 

* * * 

Problems or unauthorized transactions 

include: suspected fraud; missing deposits; 

unauthorized electronic transfers; missing,

stolen, or unauthorized checks or other 

withdrawal orders; checks or other 

withdrawal orders bearing an unauthorized

signature, endorsement or alteration; illegible 

images; encoding errors made by you to us; 

and counterfeit checks. This is not a complete 

list.

The Deposit Agreement gives customers 60 days to 

notify BOA of such problems, after which point they “may 

not bring any legal proceeding or action against us to recover 
28 SCHERTZER V. BANK OF AMERICA, NA

any amount alleged to have been improperly paid out of your 

account.” 

It is undisputed that Plaintiff here did not use these 

procedures to report the second OON charge that she 

incurred at a non-BOA ATM. Schertzer, 2022 WL 1004559, 

at *14-15. The district court nonetheless correctly held that 

the procedures do not apply to this case because, inter alia, 

“the issues listed as ‘problems’ in the notice provisions seem 

to relate to major issues such as fraud and unauthorized or 

stolen checks.” Id. at *16. As the district court noted, every 

example of “[p]roblems or unauthorized transactions” refers 

to fraudulent activity in which another person gains 

unauthorized access to the customer’s funds. There is no 

indication that the reporting procedure covers situations in 

which a customer believes that BOA has overcharged them 

in violation of the contract. We affirm the district court’s 

denial of summary judgment for BOA based on Plaintiff’s

not following these pre-dispute procedures. 

IV. Class Certification

“Rule 23(b)(3) permits a party to maintain a class action 

if . . . the court finds that the questions of law or fact common 

to class members predominate over any questions affecting 

only individual members, and that a class action is superior 

to other available methods for fairly and efficiently 

adjudicating the controversy.” Conn. Ret. Plans & Trust 

Funds v. Amgen Inc., 660 F.3d 1170, 1173 (9th Cir. 2011)

(citing Fed. R. Civ. P. 23(b)(3)), aff'd, 133 S. Ct. 1184 

(2013). The district court denied Plaintiff’s motion for class 

certification because common questions of fact or law did 

not predominate over individual ones. See Schertzer, 2022 

WL 1004559, at *17-20. The district court broadly cited 

three areas in which it had concluded that individual 
SCHERTZER V. BANK OF AMERICA, NA 29

considerations predominated over common ones: (1) the 

subjective intent of each class plaintiff; (2) variations in the 

ATM prompts that different class plaintiffs saw; (3) different 

states’ laws that applied to different plaintiffs. See id. 

Our interpretation of “balance inquiry” ameliorates the 

“subjective intent” concern. Our interpretation of the term 

does not require probing the subjective intent of individual 

ATM customers. For this reason, we vacate the district 

court’s denial of class certification. It is unclear how our 

holding might affect the other two concerns identified by the 

district court. We remand for the district court to reconsider 

class certification.

CONCLUSION

For the foregoing reasons, we: (1) REVERSE the district 

court’s grant of summary judgment for BOA on Plaintiff’s 

breach of contract claim; (2) REVERSE the district court’s

denial of Plaintiff’s motion for reconsideration; (3) AFFIRM 

the district court’s grant of summary judgment for BOA on 

Plaintiff’s claim for breach of the implied covenant of good 

faith and fair dealing; (4) AFFIRM the district court’s denial 

of summary judgment for BOA on the grounds that Plaintiff 

did not follow pre-dispute procedures; (5) VACATE the 

district court’s denial of class certification; and, 

(6) REMAND with instructions for the district court to 

reconsider class certification and for further proceedings 

consistent with this disposition.