Rogers v. Wells Fargo Bank

• Docket Number: 126,127
• Decision Date: 07 June 2024
• Citation: 551 P.3d 142
• Parties: Regina M. ROGERS, as Administratrix of the Estate of Craig Rogers, Sr., Appellant, v. WELLS FARGO BANK, N.A., Appellee.
• Court: Kansas Court of Appeals

551 P.3d 142

Regina M. ROGERS, as Administratrix of the Estate of Craig Rogers, Sr., Appellant,

v.WELLS FARGO BANK, N.A., Appellee.

No. 126,127

Court of Appeals of Kansas.

Oral Argument Held October 17, 2023.

Opinion Filed June 7, 2024.

Appeal from Butler District Court; Chad M. Crum, judge.

Kenneth H. Jack, of Davis & Jack, L.L.C., of Wichita, for appellant.

Michael Rudd, of Fox Rothschild, LLP, of Kansas City, Missouri, for appellee.

Before Warner, P.J., Atcheson, J., and Mary E. Christopher, S.J.

Warner, J.:

Kansas law favors resolving claims on their merits.In general, this means that a plaintiff may seek redress in Kansas courts if they file a petition that includes a short and plain statement that provides notice of the plaintiff’s claim and a description of the relief sought.But not all petitions present questions that require discovery or trial.Motions to dismiss under K.S.A. 60-212 allow courts to resolve claims early, before a defendant files an answer.In particular, K.S.A. 60-212(b)(6) allows a defendant to ask the court to dismiss a petition that raises no legally supportable claims.

As the circumstances of this case illustrate, relief under K.S.A. 60-212(b)(6) is the exception, not the rule.When Craig Rogers, an Andover resident, died, he had about $38,000 in his checking and savings accounts at Wells Fargo Bank.Shortly after his death, a Wells Fargo branch in California dispersed Rogers’ money to a person named Bryan Greenelsh.Rogers’ estate sued Wells Fargo for wrongfully dispersing those funds and requested Wells Fargo to reimburse the money.Wells Fargo moved to dismiss under K.S.A. 60-212(b)(6), asserting facts that were not included in the Estate’s petition, and presented three documents relevant to the Estate’s claim.The district court granted Wells Fargo’s motion and dismissed the case.

The Estate now appeals.It argues the court should not have considered matters outside its petition when evaluating a motion to dismiss under K.S.A. 60-212(b)(6).Rather, it should have allowed the Estate an opportunity to conduct discovery on Wells Fargo’s assertions and to meaningfully respond to the bank’s factual allegations.The Estate also argues that the district court erred when it determined that its claim was barred as a matter of law.After carefully reviewing the parties’ arguments and the Estate’s petition, we agree the district court erred.We thus reverse the district court’s dismissal and remand the case for further proceedings.

Factual and Procedural Background

Rogers died in January 2022 and had been living in Andover for some time.Rogers’ estate was probated in Butler County District Court, but that probate case is not part of this appeal.

In June 2022, Rogers’ daughter—acting as the administrator of her father’s estate—filed a lawsuit against Wells Fargo.The petition indicated that Rogers had previously held savings and checking accounts at the bank.According to the petition, someone named Bryan Greenelsh arrived at a Wells Fargo branch in March 2022, seeking to withdraw $38,260.28 from Rogers’ accounts, and Wells Fargo wrongfully dispersed those funds to Greenelsh.The petition alleged that the Estate had subpoenaed Wells Fargo in the probate case, requesting documentation relating to those payments, but Wells Fargo had not complied with its request.The Estate sought repayment of the wrongfully distributed funds and other relief.

Wells Fargo moved to dismiss the Estate’s petition under K.S.A. 60-212(b)(6).The bank’s motion included several factual statements not contained in the petition:

• Rogers opened checking and savings accounts at Wells Fargo while he was living in Utah in 2008.

• In March 2022, Greenelsh presented a Utah Affidavit of Collection of Estate Assets to a Wells Fargo branch in California.This affidavit said that Greenelsh was entitled to the funds in Rogers’ accounts and that no estate had been opened in any state.(These statements in Greenelsh’s affidavit were false.)

• This affidavit caused the Wells Fargo branch in California to disperse the requested approximately $38,000 to Greenelsh.

Wells Fargo attached two documents to its motion—the Utah Affidavit Greenelsh had presented to the California branch and an account application Rogers filled out in 2008.

Citing Kansas choice-of-law principles, Wells Fargo argued that Utah law should govern this case, as the account agreement was filled out in Utah and the original bank account was opened there.The bank claimed that it would not be liable to the Estate under Utah law, as Utah imposed no obligation on persons receiving affidavits such as the one Greenelsh provided to ascertain the truth of that information.Instead, Wells Fargo asserted, the Estate’s only remedy was to pursue a claim against Greenelsh for wrongfully claiming and accepting the funds.

The Estate responded that the allegations in Wells Fargo’s motion to dismiss were improper because they included allegations and documents that were not part of the petition.The Estate argued that Wells Fargo’s motion should be treated as a motion for summary judgment, and the Estate should be given an opportunity to conduct discovery regarding the allegations and documents there, along with any other matters material to the case.Alternatively, the Estate argued that if the district court declined to treat the motion as one for summary judgment, it should be permitted to amend its petition to include other allegations and clarify its claims.

Wells Fargo filed a reply, attaching an account agreement covering all Wells Fargo consumer accounts that had been updated in October 2021.The account agreement, which was roughly 40 pages long, contained a choice-of-law provision in a section titled, "Laws governing your account."This provision stated: "This Agreement, your accounts, services and any related disputes are governed by United States law and (when not superseded by United States law) the laws of the state where you opened your account (without regard to conflict of laws principles)."Wells Fargo asserted that under this provision, Utah law must govern Wells Fargo’s handling of Rogers’ accounts, including its payment of the account funds to Greenelsh by way of the Utah Affidavit.Wells Fargo argued that it would be futile to allow the Estate to amend its petition because the court would be faced with these same arguments and defenses regardless of the claims raised.

After a hearing, the district court granted Wells Fargo’s motion and dismissed the case.The court first concluded that it need not treat the bank’s request as one for summary judgment.The court found that it could consider the documents attached to Wells Fargo’s motion and reply—the 2008 account application, the 2021 account agreement, and Greenelsh’s affidavit—in deciding Wells Fargo’s motion to dismiss, as those documents were "simply the contractual documents’’ and thus "not matters outside of the pleadings," Thus, the court concluded that Wells Fargo’s motion was not required to comply with the procedural safeguards applicable to the summary-judgment stage.

After reviewing these documents, the district court ruled that Utah law applied.It then found, based largely on Wells Fargo’s allegations, that Utah law released Wells Fargo from all liability for dispersing funds to Greenelsh.Based on this finding, the court concluded the Estate’s petition did not state a claim for relief.The court also denied the Estate’s motion to amend its petition, agreeing with Wells Fargo that any amendment would be futile.The court thus dismissed the Estate’s petition.

The Estate moved to set aside the judgment, disputing the district court’s dismissal and the procedure leading up to that ruling.The court again denied the Estate’s motion.It found that even if the Estate had not received some of the documents attached to Wells Fargo’s filings until after the bank filed its reply (in the case of the account agreement), the Estate had that agreement at the time of the hearing on the motion to dismiss and for purposes of the postjudgment filings.And the court reiterated its ruling that Utah law governed this case and, in the court’s assessment, immunized Wells Fargo from any liability for its payments to Greenelsh.The Estate appeals.

Discussion

[1–3]Kansas district courts are courts of general Jurisdiction.This means that a person filing a lawsuit in Kansas does not need to affirmatively demonstrate that they may pursue their claims in our courts for a case to proceed.Instead, the Kansas Rules of Civil Procedure merely require a petition to include"[a] short and plain statement of the claim showing [the plaintiff] is entitled to relief" and "a demand for judgment."K.S.A. 2023 Supp. 60-208(a)(1);John Doe M.J., 315 Kan. 310, 317, 508 P.3d 368(2022).In other words, to initiate a lawsuit in Kansas, a petition need only include " ‘a short and plain statement of a claim that will give the defendant fair notice of what the plaintiff’s claim is and the ground upon which it rests.’ "315 Kan. at 317, 508 P.3d 368.Courts commonly refer to this practice as notice pleading.See315 Kan. at 317-18, 508 P.3d 368.

[4]K.S.A. 2023 Supp. 60-212(b)(6) allows a petition to be dismissed if it "fail[s] to state a claim upon which relief can be granted."Under this provision, a district court may dismiss a petition at the outset of litigation—before any responsive pleading is filed and before any discovery takes place—when the petition raises no legally cognizable claims.Kansas appellate courts have repeatedly cautioned, however, that dismissal under this provision "is the exception, not the rule."Minjarez-Almeida v. Kansas Bd. of Regents, 63 Kan. App. 2d 225, 232, 527 P.3d 931(2023).

[5, 6] When a defendant requests dismissal under K.S.A. 60-212(b)(6), the district court" ‘must resolve every factual dispute in the plaintiff’s favor.’ "Kudlacik v. Johnny’s Shawnee, Inc.,309 Kan. 788, 790, 440 P.3d 576(2019)....