Henderson v. Metropolitan Bank & Trust Co.

• Decision Date: 08 August 2007
• Docket Number: No. 06 Civ. 1039(SAS).,06 Civ. 1039(SAS).
• Citation: 502 F.Supp.2d 372
• Parties: Carl W. HENDERSON, Jr., Administrator of the Estate of David M. Henderson, Francisco Solis, Trustee of Messenger Trust One, and Michael S. Henderson, Successor Trustee of Messenger Trust One, Plaintiffs, v. METROPOLITAN BANK & TRUST COMPANY, Defendant.
• Court: U.S. District Court — Southern District of New York

502 F.Supp.2d 372

Carl W. HENDERSON, Jr., Administrator of the Estate of David M. Henderson, Francisco Solis, Trustee of Messenger Trust One, and Michael S. Henderson, Successor Trustee of Messenger Trust One, Plaintiffs, v. METROPOLITAN BANK & TRUST COMPANY, Defendant.

No. 06 Civ. 1039(SAS).

United States District Court, S.D. New York.

August 8, 2007.

COPYRIGHT MATERIAL OMITTED

Joseph J. D'Erasmo, Esq., Joseph J. D'Erasmo & Associates, Rockville, MD, Nizar A. DeWood, Esq., Laurel, MD, for Plaintiffs.

Benjamin Zelermyer, Esq., Law Offices of Wesley Chen, New York, NY, for Defendant.

OPINION AND ORDER

SHIRA A. SCHEINDLIN, District Judge.

I. INTRODUCTION

Carl W. Henderson, Jr. of Tennessee, Administrator of the Estate of David M. Henderson; Francisco Solis, of California, Trustee of Messenger Trust One ("the Trust"); and Michael S. Henderson, of New Mexico, Successor Trustee of the Trust (collectively "Plaintiffs") sued Metropolitan Bank and Trust Co. ("Metrobank"), a corporation headquartered in the Philippines, for the face value of a manager's check¹ allegedly issued by Metrobank and interest accrued since the instrument was issued. In an order issued on November 21, 2006 (the "November 21 Opinion"), I granted Metrobank's motion to dismiss the Complaint on the ground of forum non conveniens.² On December 11, 2006, Plaintiffs moved for relief from that order and judgment pursuant to Rule 60(b) of the Federal Rules of Civil Procedure and, in the alternative, for reconsideration under Rule 59.³ For the reasons that follow, Plaintiffs' motion for reconsideration is granted and, upon reconsideration, Metrobank's motion to dismiss is denied.

II. BACKGROUND

The background to this action is fully set forth in the Court's November 21 Opinion.⁴ In short, on March 21, 2000, a manager's check with a face value of twelve billion pesos⁵ was issued to Jocelyn S. Duran, as payee, for interest payments on some accounts held at Metrobank ("the Check").⁶ When Duran attempted to have the Check converted to cash, Metrobank dishonored the Check.⁷ Duran then transferred the authority to negotiate the Check to Janito C. Perez.⁸ In 2002, Perez delivered the Check to David M. Henderson and assigned the Check to Henderson, individually and as a trustee of the Trust.⁹ Henderson died on September 11, 2003, and his interest in the Check is an asset of his estate.¹⁰

On February 9, 2006, Plaintiffs filed suit against Metrobank seeking to enforce the Check.¹¹ On November 21, 2006, this Court granted Metrobank's motion to dismiss on the ground of forum non conveniens, subject to conditions that would ensure that the Court's refusal to exercise jurisdiction in favor of the Philippines would not prejudice Plaintiffs and the action would be resolved on the merits.¹²

After the dismissal, Plaintiffs' counsel contacted a lawyer in the Philippines and inquired about the rules governing the filing of the case in the courts of the Philippines.¹³ The lawyer advised that the filing fee for a claim for damages of twelve billion pesos was $4,898,989.90.¹⁴ On December 11, 2006, plaintiffs moved for relief from the Court's order and judgment pursuant to Rule 60(b) of the Federal Rules of Civil Procedure or, in the alternative, for reconsideration under Rule 59.¹⁵ Plaintiffs have represented to the Court that they do not have the financial resources to pay the filing fee.¹⁶ They have requested that the Court reconsider the November 21 Opinion and deny Metrobank's motion to dismiss on the ground of forum non conveniens.¹⁷

III. LEGAL STANDARD¹⁸

The standards governing motions to alter or amend judgment pursuant to Rule 59(e) and motions for reconsideration or reargument pursuant to Local Rule 6.3 are the same.¹⁹ A motion for reconsideration under Local Rule 6.3 is appropriate where "the moving party can point to controlling decisions or data that the court overlooked & matters, in other words, that might reasonably be expected to alter the conclusion reached by the court."²⁰ Local Rule 6.3 must be "narrowly construed and strictly applied so as to avoid repetitive arguments on issues that have been considered fully by the Court."²¹ A court should deny a motion for reconsideration when the movant "seeks solely to relitigate an issue already decided."²² The restrictive application of Local Rule 6.3 helps "to ensure the finality of decisions and to prevent the practice of a losing party examining a decision and then plugging the gaps of a lost motion with additional matters."²³

Reconsideration is also justified by "`an intervening change in controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.'"²⁴ "The granting of, a motion for reconsideration is ... within the discretion of the court whose order is the subject of the motion."²⁵

IV. APPLICABLE LAW

A. Forum Non Conveniens

A full discussion of the doctrine of forum non conveniens is contained in the November 21 Opinion.²⁶ Nonetheless, I will briefly restate the standard here. "Forum non conveniens is a discretionary device permitting a court in rare instances to dismiss a claim even if the court is a permissible venue with proper jurisdiction over the claim."²⁷ Courts may decline to exercise jurisdiction under this doctrine when it is determined that, weighing "relative advantages and obstacles to fair trial" in the alternative fora, and practical considerations of which forum will "make trial of a case [more] easy, expeditious and inexpensive," "the balance is strongly in favor" of the defendant's request for dismissal in favor of a more convenient forum.²⁸

In deciding whether to dismiss on this ground, courts in this Circuit undertake a three-step analysis. First, courts determine the degree of deference due the plaintiffs choice of forum.²⁹ Second, courts examine whether there is an adequate alternative forum for the dispute.³⁰ Third, courts balance the competing private interests of the parties in the choice of forum, and the public interests of the alternative fora under consideration.³¹ The defendant bears the burden of showing that each stage of the analysis "tilt[s] strongly in favor of trial in the foreign forum."³² "The action should be dismissed only if the chosen forum is shown to be genuinely inconvenient and the selected forum significantly preferable."³³

B. Filing Fees Requirement in the Philippines

1. In General

When filing suit in a Philippine court, a plaintiff must pay a filing fee.³⁴ The amount of this filing fee is proportional to the amount of damages that the plaintiff seeks.³⁵ Philippine courts lack jurisdiction over an action unless the plaintiff either (1) pays the entire filing fee when the suit is filed,³⁶ or (2) is indigent.³⁷

If a plaintiff's claim is successful, the plaintiff will recover the costs of the suit & including the filing fee & "as a matter of course."³⁸ Regardless of the outcome, however, a court has discretion to assess the costs of the action against either party or to divide the costs "as may be equitable" between the parties for "special reasons."³⁹

2. Effect on Forum Non Conveniens Analysis

Procedural aspects of a foreign forum that differ from those of the American legal system and that can make a lawsuit financially burdensome do not render the foreign forum inadequate as a matter of law.⁴⁰ Similarly, it is well established that a forum is not inadequate as a matter of law merely because it requires a filing fee proportionate to the damages that the plaintiff seeks, even if the plaintiff cannot pay the filing fee.⁴¹ This is because a foreign legal system's rules pertaining to such procedural matters "reflect policy judgments about the goals of that legal system, the incentives for and against litigation, and the availability of representation in various circumstances."⁴²

3. Factor in the Balancing of Conveniences

"Balancing the plaintiff's financial burdens as one of several relevant [private] factors [in the forum non conveniens analysis] serves the `repeatedly emphasized ... need to retain flexibility' in the application of the doctrine."⁴³ Filing fees and other procedural differences that increase the cost of litigating in a foreign forum — even though they do not render a forum inadequate — may be considered as a private factor when considering the balance of conveniences.⁴⁴ The court should also consider the plaintiffs financial situation in determining how much weight to give to the expenses of litigating in the foreign forum.⁴⁵

V. DISCUSSION

A. Reconsideration Is Granted

Plaintiffs have not pointed to any law or facts that the Court overlooked in reaching its decision. Rather, plaintiffs point to the filing fee they are required to file in order to bring suit in the Philippines & which was not before the Court when the motion to dismiss was decided⁴⁶ & as a basis for reconsideration. Under the circumstances of this case, failure to consider the impact of the filing fee in the forum non conveniens analysis could effect "a manifest injustice."⁴⁷ Plaintiffs argue that given their inability to pay the filing fee, they are effectively foreclosed from prosecuting their claim in the alternative forum. Given that possibility, and its consequences, namely that the merits of the case may not be heard, the Court finds that reconsideration of the November 21 Opinion is warranted.⁴⁸

B. Upon Reconsideration, the Motion to Dismiss Is Denied

The filing fee does not have any bearing on the amount of deference shown towards a plaintiffs choice of forum. Nor does the fee requirement render a forum inadequate, as discussed above. Indeed, this Court makes no judgment as to the fee requirement, which is plainly the prerogative of the Philippine court system and is an expression of its judicial policy, as is the case with many foreign courts. However, on reconsideration, the filing fee does affect the case-specific balance of the private and public factors under the present facts.

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