Source: https://law.justia.com/cases/federal/appellate-courts/F2/999/540/309023/
Timestamp: 2019-12-07 10:06:02
Document Index: 798999024

Matched Legal Cases: ['§ 30', '§ 643', '§ 544', '§ 28', '§ 1961', '§ 1962', '§ 1962']

Quinton B. Mcnew, Plaintiff-appellant, v. People's Bank of Ewing, Defendant-appellee,jane Hayes, Defendant, 999 F.2d 540 (6th Cir. 1993) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Sixth Circuit › 1993 › Quinton B. Mcnew, Plaintiff-appellant, v. People's Bank of Ewing, Defendant-appellee,jane Hayes, Def...
Quinton B. Mcnew, Plaintiff-appellant, v. People's Bank of Ewing, Defendant-appellee,jane Hayes, Defendant, 999 F.2d 540 (6th Cir. 1993)
Plaintiff, Quinton McNew, appeals the district court's dismissal, under Fed. R. Civ. P. 12(b) (6), of his negligence and aiding and abetting fraud claims brought against defendant, People's Bank of Ewing, after one of the bank's customers defrauded him. Finding no merit in the appeal, we affirm.
This court reviews the district court's dismissal de novo, taking all factual allegations in the original complaint as true. Sinay v. Lamson & Sessions Co., 948 F.2d 1037, 1039 (6th Cir. 1991). If an allegation permits more than one inference, it must be construed in plaintiff's favor. Sinay, 948 F.2d at 1039-40. This court will affirm the dismissal "if it appears beyond doubt that the plaintiff can prove no set of facts in support of [his] claims that would entitle [him] to relief." American Eagle Credit Corp. v. Gaskins, 920 F.2d 352, 353 (6th Cir. 1990). Despite this generous standard of review, plaintiff's arguments nonetheless fail. We address the negligence and fraud claims in turn.
The complaint alleged that People's Bank was negligent in failing to withdraw plaintiff's $55,000 cashier's check from the collection system. In order to state a viable negligence claim, plaintiff must allege the breach of a legal duty owed to him by People's Bank. See, e.g., W. Page Keeton et al., Prosser and Keeton on the Law of Torts, § 30 at 164 (Lawyer's ed. 1984). Plaintiff failed to allege any specific duty owed him by People's Bank, and on appeal is unable to demonstrate that the law placed any duty upon the bank to withdraw the cashier's check from the collection process after it had been accepted for value from Hayes. Under the general rule, a cashier's check is a cash equivalent, considered "accepted in advance by the act of its issuance, [and] is not subject to countermand like an ordinary check." 10 Am.Jur.2d Banks § 643 (1963) (footnote omitted). See also id. at § 544. This court has followed that general rule. See United States v. Milton, 382 F.2d 976, 978 (6th Cir. 1967), cert. denied, 390 U.S. 952 (1968).
In January 1991, plaintiff filed suit against People's Bank in a Tennessee federal district court, asserting diversity jurisdiction. Ordinarily, a federal court sitting in diversity will apply the statute of limitations of the forum state. E.g., Hodge v. Service Mach. Co., 438 F.2d 347, 348 (6th Cir. 1971). When a cause of action accrues in another state having a shorter statute of limitations that would bar the action, Tennessee law requires its courts to borrow and apply the non-forum state's shorter statute. Tenn.Code Ann. § 28-1-112 provides:
Finally, there is no question that the cause of action accrued in Virginia, rather than in Tennessee. It is well-established under Tennessee law that in tort cases, "the cause of action accrues ... when the injury occurs or is discovered." E.g., McCroskey v. Bryant Air Conditioning Co., 524 S.W.2d 487, 491 (Tenn.1975). This court, applying Tennessee law, has held that " [w]hen a person sustains loss by fraud, the place of wrong is where the loss is sustained, not where fraudulent representations are made." Bailey v. Chattem, Inc., 684 F.2d 386, 392 (6th Cir. 1982). Together, these principles demonstrate that for purposes of Tennessee's borrowing statute, a cause of action for aiding and abetting fraud accrues where the loss from the fraud occurs. See id.; McCroskey, 524 S.W.2d at 491.
It is clear that plaintiff's loss occurred in Virginia. As soon as People's Bank accepted the $55,000 Florida cashier's check, issued $52,000 of its own cashier's checks, and deposited the remaining $3,000 into Hayes' account, Hayes had effectively converted plaintiff's check into cash, thereby consummating his loss. In addition, as the district court correctly observed in its June 6, 1991 order, " [a]ll of the actions of the People's Bank in cashing the check and refusing to retrieve it from the collection process, occurred in Virginia." Plaintiff's argument that no loss of money occurred until Hayes cashed in Tennessee the two cashier's checks issued by People's Bank is unsupported by law or logic, and ignores the $3,000 deposit and the $2,200 cash given Hayes in reliance upon that deposit. Therefore, since plaintiff's loss occurred in Virginia, his fraud claim accrued in that state, not in Tennessee.
Approximately seven months after the district court dismissed the negligence and aiding and abetting fraud claims against People's Bank, plaintiff filed a motion to reconsider the June 6, 1991 dismissal and to amend his complaint to restate his dismissed claims of negligence/gross negligence and aiding and abetting fraud against the bank, as well as state new claims of tainted title to the $55,000 check, breach of a constructive trust, conversion, and RICO violations. The district court denied the motion for the reason that " [t]he court is satisfied that the claim against the Virginia bank is time-barred."
Before reaching the merits of plaintiff's arguments, we must determine whether we have jurisdiction to entertain them. The difficulty arises from the wording of the notice of appeal. The jurisdictional issue of whether a notice of appeal perfects a valid appeal may be raised by this court, sua sponte. International Union, UAW v. United Screw & Bolt Corp., 941 F.2d 466, 469 (6th Cir. 1991). Federal Rule of Appellate Procedure 3(c) provides that the notice of appeal "shall designate the judgment, order or part thereof appealed from." Ordinarily an appeal of a final judgment preserves for review all previous non-final rulings. McLaurin v. Fischer, 768 F.2d 98, 101 (6th Cir. 1985). However, " ' [i]f an appellant ... chooses to designate specific determinations in his notice of appeal--rather than simply appealing from the entire judgment--only the specified issues may be raised on appeal.' " Wilson v. Firestone Tire & Rubber Co., 932 F.2d 510, 516 (6th Cir. 1991) (quoting McLaurin, 768 F.2d at 102). See also United Screw & Bolt Corp., 941 F.2d at 471; Drayton v. Jiffee Chem. Corp., 591 F.2d 352, 361 n. 10 (6th Cir. 1978). The notice filed in this appeal states that plaintiff
files, this, its notice of appeal from the now-final judgment resulting from the order of the district court entered June 6, 1991, granting the motion to dismiss, made pursuant to Federal Rules of Civil Procedure, Rule 12(b) (6), filed by defendant, People's Bank of Ewing, thereby, dismissing all of the claims made by plaintiff, Quinton McNew, against defendant, People's Bank of Ewing, in the instant case.
Even if this court had considered the defect in plaintiff's notice of appeal to have been a "harmless" "technical error," Taylor v. United States, 848 F.2d 715, 718 (6th Cir. 1988), a cursory examination of the claims raised in his amended complaint reveals that they are meritless.
In essence, plaintiff claims that People's Bank violated RICO by having Hayes as a customer. This is woefully inadequate to state a valid RICO claim. Plaintiff fails to make the required showing that People's Bank, as opposed to Hayes, engaged in indictable offenses under state or federal laws that constitute racketeering. See 18 U.S.C. § 1961(1); Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 481-82 & n. 3 (1985). Plaintiff's RICO claim under § 1962(c) also fails because he did not allege that People's Bank took part in the Hayes' equipment-selling scheme. This failure is deemed significant because the Supreme Court recently held in Reves v. Ernst & Young, 113 S. Ct. 1163 (1993), that a defendant must have played some part in the operation or management of the illegal enterprise itself in order to be liable under § 1962(c). Id. at 1172. These shortcomings, among others, would have been fatal to plaintiff's RICO claims.
This court may affirm on grounds other than those relied upon by the district court. AM Int'l, Inc. v. International Forging Equip. Corp., 982 F.2d 989, 993 n. 3 (6th Cir. 1993)