1

 Northwest's complaint alleges that the checks were presented

for payment in late October 2004. See Compl. at 2; see also Pl.'s

(continued...)

 IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

NORTHWEST BANK, §

§

Plaintiff, §

§

VS. § NO. 4:04-CV-948-A

§

WORTH NATIONAL BANK, §

§

Defendant. §

MEMORANDUM OPINION

and

ORDER

Came on for consideration the motion of defendant, Worth

National Bank, ("Worth") for summary judgment and for an award of

its attorney's fees. Based on the motion, the response of

plaintiff, Northwest Bank, ("Northwest") Worth's reply brief, the

summary judgment record, and the applicable authorities, the

court concludes that the motion for summary judgment should be

granted and the motion for award of attorney's fees should be

denied. 

I. 

Northwest's Complaint

This action is brought pursuant to 12 C.F.R. § 229.38, and

"arises out of a claim of late return made by [Worth] in

connection with Northwest's return of several checks which were

presented on accounts with insufficient funds." Compl. at 2 ¶ V. 

In the complaint filed August 2, 2004,1 Northwest asserts claims

 

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1(...continued)

Resp. at 7-8. Based on the entire record, the court is convinced

that the events relevant to this motion occurred in October 2003 and

that the references in the complaint, as well as Northwest's response

to this motion, to events in October 2004 are typographical errors.

2

against Worth for (1) wrongful claim of late return, (2)

conversion, and (3) unjust enrichment.

II.

Grounds for the Motion

Worth urges in its motion for summary judgment that all of

plaintiff's claims must fail because the summary judgment

evidence establishes that Northwest failed to provide Worth with

timely notice of nonpayment on the checks at issue in compliance

with 12 C.F.R. § 229.33. Worth has also moved the court for a

judgment awarding it attorney's fees against Northwest.

III.

Summary Judgment Principles

A party is entitled to summary judgment on all or any part

of a claim as to which there is no genuine issue of material fact

and as to which the moving party is entitled to judgment as a

matter of law. Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 247 (1986). The moving party has the initial

burden of showing that there is no genuine issue of material

fact. Anderson, 477 U.S. at 256. The movant may discharge this

burden by pointing out the absence of evidence to support one or

more essential elements of the non-moving party's claim "since a

complete failure of proof concerning an essential element of the

nonmoving party's case necessarily renders all other facts

 

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3

immaterial." Celotex Corp. v. Catrett, 477 U.S. 317, 323-25

(1986). Once the moving party has carried its burden under Rule

56(c), the non-moving party must do more than merely show that

there is some metaphysical doubt as to the material facts. 

Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S.

574, 586 (1986). The party opposing the motion may not rest on

mere allegations or denials of pleading, but must set forth

specific facts showing a genuine issue for trial. Anderson, 477

U.S. at 248, 256. To meet this burden, the nonmovant must

"identify specific evidence in the record and articulate the

'precise manner' in which that evidence support[s] [its]

claim[s]." Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994). 

An issue is material only if its resolution could affect the

outcome of the action. Anderson, 477 U.S. at 248. Unsupported

allegations, conclusory in nature, are insufficient to defeat a

proper motion for summary judgment. Simmons v. Lyons, 746 F.2d

265, 269 (5th Cir. 1984).

IV.

Undisputed Facts

The following is an overview of the evidence in the summary

judgment record pertinent to the motion for summary judgment:

On October 27, 2003, Worth presented seven checks to

Northwest for payment. The total value of those checks was in

excess of $2,500. Because the accounts at Northwest on which the

checks were drafted did not have sufficient funds to cover their

amounts in full, Northwest determined that it would not remit

 

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4

payment on those checks. Because of federal banking regulations,

Northwest had to provide Worth notice of nonpayment no later than

4:00 p.m. on Tuesday, October 29, 2005. 

At that time, Northwest outsourced its check processing to a

company called Intercept Group ("Intercept"). During the

afternoon of October 29, Intercept employee Debra Moore ("Moore")

attempted several times to provide Worth with the notice of

nonpayment. On each attempt, Moore dialed the same number, (817)

237-8800. Moore's calls were never answered by a live person at

Worth; instead, each call to (817) 237-8800 was answered by voice

mail. After several attempts at reaching a live person, Moore

finally left a message on that number's voice mail informing

Worth of the nonpayment. Those were the only attempts made by or

for Northwest to give the required notice to Worth.

The main telephone number of Worth's Lake Worth branch is

(817) 237-8800. On October 29, 2003, Worth operated a

switchboard for (817) 237-8800 during its business hours, from

8:30 a.m. to 5:00 p.m., and all calls placed to that number

during those hours were answered by a Worth receptionist. Only

after the switchboard closed at 5:00 p.m. would a call to the

main number go to voice mail. 

Upon receiving the returned checks from Northwest, Worth

submitted a late return claim to the Federal Reserve, and the

items were subsequently charged to Northwest.

V.

Analysis

 

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2 The pertinent ground of Worth's motion for summary

judgment is a contention that the summary judgment evidence will

establish that timely notice of return was not given. This

memorandum opinion is written consistent with that ground of the

motion. In the summary judgment papers, Worth argues that

summary judgment should be granted because Northwest failed to

carry its burden of proving that it gave timely notice. Even if

the court could not conclude that Worth established as a matter

of law that timely notice was not given, the court would conclude

that summary judgment would be appropriate because Northwest

failed to offer any summary judgment evidence that would support

a finding that timely notice was given.

5

A. Northwest's Notice of Nonpayment was Untimely

1. Applicable Law

None of Northwest's claims has merit if Northwest failed to

give proper notice of nonpayment to Worth. See Farm Credit

Servs. of Am. v. Am. State Bank, 339 F.3d 764, 772 (8th Cir.

2003). The controlling regulation, 12 C.F.R. § 229.33, states in

relevant part that:

If a paying bank determines not to pay a check in the

amount of $ 2,500 or more, it shall provide notice of

nonpayment such that the notice is received by the

depositary bank by 4:00 p.m. (local time) on the second

business day following the banking day on which the

check was presented to the paying bank.

Id. at (a). Applying that regulation to this record, if the

summary judgment evidence shows without dispute that the call

from Intercept was made after 4:00 p.m. on October 29, 2003, then

Worth is entitled to summary judgment.2

2. Timely Notice Was Not Given

The court concludes that the undisputed summary judgment

evidence is that Northwest did not provide timely notice pursuant

to 12 C.F.R. § 229.33. There is no evidence in the summary

judgment record that Worth was notified of the nonpayment prior

 

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6

to 4:00 p.m. on October 29, 2003. And the evidence in the record

supports the inference that notice was first attempted to be

given after 5:00 p.m. on that date. Therefore, Northwest's

claims fail. 

B. Worth's Motion for Attorney's Fees

Worth seeks an award of attorneys' fees. Even if Worth had

legal entitlement to the recovery of attorney's fees, the summary

judgment record obviously would not provide the court sufficient

basis for making such an award. The court is interpreting

Worth's request for recovery of attorney's fees as a submission

by Worth to the court of the issue of attorney's fees to be

resolved on the basis of the record now existing. The court

concludes that Worth has not shown entitlement to recovery of

attorney's fees.

Ordinarily, a prevailing party is not entitled to collect

its attorney's fees absent explicit statutory authority. See Key

Tonic Corp. v. United States, 511 U.S. 809, 819 (1994). The

statute cited to by Worth, 12 C.F.R. § 229.38, makes no specific

reference to awarding of attorneys fees in cases of this type. 

VI.

Worth's Third-Party Claims

The court notes that Worth has filed a third-party complaint

against third-party defendants, Longhorn Bevco & Supply, L.L.C.,

Danny Terrell, Eric Scott Laske, West Texas Grub and Firewater,

Inc., and R. Harvey Neuman. Each one of Worth's claims against

third-party defendants was predicated on a finding that Northwest

 

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7

had provided timely notice of nonpayment. Given the court's

ruling on that issue, the court concludes that Worth's thirdparty complaint is now moot. 

VII.

O R D E R

For the reasons stated herein,

The court ORDERS that Worth's motion for summary judgment

be, and is hereby, granted and that all claims asserted by

Northwest against Worth in the captioned action be, and are

hereby, dismissed.

The court further ORDERS that Worth be, and is hereby,

denied any recovery of attorneys' fees from Northwest. 

The court further ORDERS that all claims asserted by Worth

against third-party defendants be, and are hereby, dismissed

without prejudice.

SIGNED February 1, 2006.

 /s/ John McBryde 

JOHN McBRYDE

United States District Judge

 

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