Smith v. First Nat. Bank of Atlanta

• Decision Date: 26 February 1988
• Docket Number: No. 87-8506,87-8506
• Citation: 837 F.2d 1575
• Parties: , 10 Fed.R.Serv.3d 749 Selma SMITH, Plaintiff-Appellant, v. FIRST NATIONAL BANK OF ATLANTA, Defendant-Appellee. Non-Argument Calendar.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1575

837 F.2d 1575

101 A.L.R.Fed. 739, 10 Fed.R.Serv.3d 749

Selma SMITH, Plaintiff-Appellant, v. FIRST NATIONAL BANK OF ATLANTA, Defendant-Appellee.

No. 87-8506

Non-Argument Calendar.

United States Court of Appeals,

Eleventh Circuit.

Feb. 26, 1988.

Kenneth A. Smith, LaGrange, Ga., for plaintiff-appellant.

Richard M. Kirby, Hansell & Post, Atlanta, Ga., for defendant-appellee.

Appeal from the United States District Court for the Northern District of Georgia.

Before RONEY, Chief Judge, KRAVITCH and JOHNSON, Circuit Judges.

PER CURIAM:

After a remand by this Court for the district court to consider under the proper standards a motion by defendants for leave to file an out-of-time response to plaintiff's request for admissions, defendant was permitted to file its response pursuant to Fed.R.Civ.P. 36(b). After the response was Plaintiff Selma Smith sued the First National Bank of Atlanta alleging a violation of the Fair Credit Reporting Act and of her right of privacy, and for libel. The Bank had reported that Smith was delinquent in her Visa account when an ex-husband had signed her name to the application for the account and, in fact, she had no account with the Bank.

filed, the district court entered summary judgment for defendant. Plaintiff appeals. We affirm.

The defendant Bank failed to respond, within the 45 days required by Rule 36, to a lengthy request for admissions. That failure, by operation of law, admitted all matters alleged including liability for $50,000 in actual damages and 1.5 million dollars in punitive damages.

The district court, applying a local rule, permitted a response, reopened discovery, and entered summary judgment for the defendant Bank. On appeal, in an unpublished opinion, this Court held the district court had improperly applied the local rule inconsistently with Rule 36(b), which establishes a two-part test in considering the withdrawal of admissions: first, that the presentation of the merits will not be subserved by the withdrawal, and second, that the party obtaining the admissions would not be prejudiced in its presentation of the case by the withdrawal. Smith v. First National Bank, 797 F.2d 980 (11th Cir.1986). The district court having reinstated the Bank's response to admissions and having reissued the summary judgment, the purpose of this review is to determine whether it complied with the prior mandate of this Court and properly applied Rule 36(b), and whether summary judgment was proper.

The district court, in granting defendant's motion to reopen discovery and to respond to the plaintiff's request for admissions, stated:

The court concludes that the presentation of the merits of this action will be subserved by permitting the defendant to respond to the request for admissions. It would be manifestly unfair and grossly unjust to permit the plaintiff to obtain a judgment of the magnitude she is seeking due to the inadvertence of the defendant which is at most excusable neglect. The ascertainment of the truth and the development of the merits would be enhanced by permitting the defendant to respond, especially in view of the absence of some particularized allegations of the prejudice caused by the delay. In the absence of such a showing, plaintiff cannot establish the requisite prejudice that would justify the denial of defendant's motion. Therefore, the court concludes that the defendant is entitled, under both parts of the Rule 36(b) test, to relief.

Discovery was reopened for 60 days. Smith was also awarded $18,275 in partial compensation for expenses incurred up until remand. The court provided that plaintiff could seek relief from the withdrawal of admissions if she discovered in the course of the proceedings "that the delay has in any way affected her ability to obtain appropriate discovery." This was done by a motion to reinstate the admissions. The district court carefully considered, but rejected, every allegation of specific prejudice.

Thus, the district court properly applied the two-part test in Fed.R.Civ.P. 36(b). The district court noted that the defendant's failure to timely respond to Smith's request for admission was inadvertent and "at most excusable neglect." There is nothing in the record that shows such finding was erroneous. Cf. Reyes v. Vantage S.S. Co., Inc., 672 F.2d 556, 557-58 (5th Cir.1982) (district court's withdrawal of admission pursuant to Rule 36(b) affirmed where admission was based on "faulty assumption"); Asea, Inc. v. Southern Pac. Transp. Co., 669 F.2d 1242, 1248 (9th Cir.1981) ("In a proper case ... such as when an admission has been made inadvertently, Rule 36(b) might well require the district court to permit withdrawal.").

Rule 36(b) "emphasizes the importance of having the action resolved on the merits, while at the same time assuring each party that justified reliance on an admission in preparation for trial will not operate to his The prejudice contemplated by the Rule is not simply that the party who initially obtained the admission will now have to convince the fact finder of its truth. Rather, it relates to the difficulty a party may face in proving its case, e.g., caused by the unavailability of key witnesses, because of the sudden need to obtain evidence with respect to the questions previously answered by the admissions.

prejudice." Fed.R.Civ.P. 36 advisory committee's note. Smith has not satisfactorily shown on this appeal that the district court was wrong in deciding that withdrawal has prejudiced her in maintaining the action on the merits.

Brook Village North Assoc. v. General Elec. Co., 686 F.2d 66, 70 (1st Cir.1982).

The district court properly granted the Bank's motion for summary judgment. First, where the Bank has reported information based solely on its own experience with one of its customers, the Bank is not acting as a "consumer reporting agency," within the meaning of the Fair Credit Reporting Act, because, inter alia, it has not furnished a "consumer report" as that term is defined in the Act. A "consumer report" does not include "any report containing information solely as to transactions or experiences between the consumer and the person making the report." 15 U.S.C.A. Sec. 1681a(d), (f); Rush v. Macy's New York, Inc., 775 F.2d 1554 (11th Cir.1985). Accord Freeman v. Southern Nat'l Bank, 531 F.Supp. 94 (S.D.Tx.1982). Here, the Bank did no more than furnish information regarding an account in the name of Selma Woody to a credit reporting agency. Plaintiff argues that the Bank's information was not as to a transaction between it and a consumer, because Smith was not, in fact, a customer of the Bank. The record supports, however, the district court's finding that from the Bank's point of view, until it received an affidavit from Smith indicating there had been a forgery, which enabled it to take immediate action to correct the reports it sent, it believed Smith was its customer and responsible for the delinquent account. The district court properly applied the Act in deciding these facts did not make the Bank's information a consumer report.

The key to Smith's argument that the Bank has willfully intruded upon her seclusion or solitude or into her private affairs, so as to amount to an invasion of her right to privacy, is whether the Bank acted in bad faith in issuing the report. See Peacock v. Retail Credit Co., 302 F.Supp. 418, 422-24 (N.D.Ga.1969), aff'd, 429 F.2d 31 (5th Cir.1970), cert. denied, 401 U.S. 938, 91 S.Ct. 927, 28 L.Ed.2d 217 (1971) (discussing applicability of tort of invasion of privacy where alleged false credit reports have been issued) and Haggard v. Shaw, 100 Ga.App. 813, 818, 112 S.E.2d 286, 291 (1959) (containing broad language to the effect that cause of action for invasion of privacy may be maintained where information sent is done for the purpose of doing injury to the plaintiff). There is nothing in this record to contradict the district court's finding that bad faith was not present in the case.

As to plaintiff's libel claim, the report issued was not libelous per se. Therefore, absent a showing of special damages, plaintiff cannot recover damages from the Bank. See Hood v. Dun & Bradstreet, Inc., 486 F.2d 25, 27-28 (5th Cir.1973), cert. denied, 415 U.S. 985, 94 S.Ct. 1580, 39 L.Ed.2d 882 (1974). No showing of special damages was made. Smith admits that she has not been denied credit, and has in fact received credit since the reports were issued.

Apparently the Bank furnished erroneous information about plaintiff's indebtedness, after her contact with the bank, as a result of confusion because the VISA account was in the name of Selma Woody, whereas plaintiff was challenging the Bank's information under the name of Selma Smith. After receiving clear notification that the plaintiff had not signed the application, the Bank corrected its error.

AFFIRMED.

APPENDIX

MOTIONS FOR SUMMARY JUDGMENT

Both the plaintiff and defendant Bank have filed motions for summary judgment. The plaintiff in her complaint has asserted claims based on alleged violations of the Act, 15 U.S.C. Sec. 1681, of her right to privacy, and of O.C.G.A. Sec. 51-5-1(a), Georgia's libel statute. The basis of the plaintiff's motion for summary judgment is defendant Bank's failure to timely file responses to her request for admissions. Because this court has granted defendant Bank's motion for leave to file its responses, the plaintiff's motion for summary judgment is without merit since defendant Bank is not deemed to have made the requested admissions. Accordingly, the court overrules and denies the plaintiff's motion for summary judgment.

1. Fair Credit Reporting Act Claim

Defendant Bank has moved for summary judgment under Rule 56, Fed.R.Civ.P., as to each of the plaintiff's claims, stating that there are no material facts in dispute. With respect to the plaintiff's first claim, defendant Bank contends that it is not a "consumer reporting agency" within the meaning of 15 U.S.C....