Ohio Bell Telephone Co. v. BancOhio Nat. Bank

• Decision Date: 01 April 1982
• Docket Number: No. 81CV-07-3868,81CV-07-3868
• Citation: 1 Ohio Misc.2d 11,440 N.E.2d 69
• Parties: , 1 O.B.R. 415 OHIO BELL TELEPHONE CO. v. BANCOHIO NATIONAL BANK et al.
• Court: Ohio Court of Common Pleas

Page 11

1 Ohio Misc.2d 11

440 N.E.2d 69, 1 O.B.R. 415

OHIO BELL TELEPHONE CO. v. BANCOHIO NATIONAL BANK et al.

No. 81CV-07-3868.

Court of Common Pleas of Ohio, Franklin County.

April 1, 1982.

Thomas A. Linton, Cleveland, for plaintiff.

James R. Moats, Columbus, for defendant and third-party plaintiff.

Truman A. Greenwood, Toledo, for third-party defendant.

WRIGHT, Judge.

Pursuant to Civ. R. 12(B)(3) and 12(B)(6), third-party defendant First National Bank of Toledo (hereinafter Toledo) moves the court to sustain its Motion to Dismiss the complaint of third-party plaintiff BancOhio National Bank (hereinafter BancOhio) on two grounds, to wit: Improper venue and the statute of limitations.

Toledo, a national banking association, contends that Section 94, Title 12, U.S. Code, precludes it from being sued in Franklin County, and thus, its motion to dismiss should be sustained due to improper venue. The aforesaid statute provides:

"Actions and proceedings against any association under this Chapter may be had in any district or territorial court of the United States held within the district in which such association may be established, or in any state, county or municipal court in the county or city in which said association is located having jurisdiction in similar cases."

The court's initial impression is that the statute mandates that in all instances a national banking association may only be sued in specific jurisdictions where venue would be proper. However, case law reveals that in suits where the complaining bank is a third-party defendant, the law is divided on the issue. To determine the proper construction of the statute vis-a-vis a third-party defendant bank, an examination of the divergent views is warranted.

In Lazarow, Rettig & Sundel v. Castle Capital Corp. (1980), 49 N.Y.2d 508, 427 N.Y.S.2d 404, 404 N.E.2d 130, the Court of Appeals of New York also was asked to determine whether Section 94, Title 12, U.S. Code, was applicable to an action where the bank was a third-party defendant. In holding that the aforesaid statute was applicable that court reasoned that since the language of the statute was mandatory in character, no exceptions existed nor could they be created by the judiciary. While the principle announced in Lazarow remains good law, this court believes that Lazarow should not be followed. The court finds the decision in Herndon v. Herndon (D.C. Tex. 1980), 491 F.Supp. 53, to be the better reasoned and more persuasive.

In Herndon the court held that Section 94 does not create a venue right to be asserted by the third-party defendant bank. The court in Herndon held that the defendant's claim against a third-party defendant bank is within the ancillary jurisdiction of the federal courts under Fed. R. Civ. P. 14, and thus, there was no need for independent subject matter jurisdiction on the third-party claim. This court by concurring with the result reached in Herndon holds that Toledo may be sued in Franklin County on a third-party complaint as proper venue exists. See also 6 Wright & Miller, Federal Practice and Procedure, Section 1445, at 240, fn. 14 (1969 and Supp. 1979), 3 Moore's Federal Practice, Paragraph 14.28 at 14-614, fn. 4, which states:

"According to existing case law, the statutory venue limitations have no application to Rule 14 claims even if they would require the third-party action to be heard in another district had it been brought as an independent action."

In Ohio regarding third-party practice, governed by statute and Civ. R. 14, the court is persuaded by a portion of Robert A. Retske's law journal note entitled Third-Party Practice, 30 Ohio St.L.J. 216 (1969), which states:

"Some courts insist that a third-party defendant cannot be impleaded unless he could have been sued in an independent action in the forum county or district. However, it is the general rule that the venue of third-party proceedings is determined by the venue of the main action. * * *. To allow a defendant to object to venue would defeat the purpose of the third party statute, which is to secure determination of the rights of all parties in one action. * * *

" * * * Third-party practice is a far-reaching innovation and an excellent method for avoiding circuity of action, delay, added costs and unnecessary...