Suntrust Bank v. Bickerstaff

• Decision Date: 06 March 2019
• Docket Number: A18A1519
• Citation: 824 S.E.2d 717,349 Ga.App. 794
• Court: Georgia Court of Appeals
• Parties: SUNTRUST BANK v. BICKERSTAFF.

349 Ga.App. 794

824 S.E.2d 717

SUNTRUST BANK

v.BICKERSTAFF.

A18A1519

Court of Appeals of Georgia.

March 6, 2019

Reconsideration Denied March 28, 2019

Certoriari Denied December 23, 2019

Rogers & Hardin, Richard H. Sinkfield, Michael L. Eber, Katherine L. D'Ambrosio, Atlanta; Troutman Sanders, Pete Robinson, William N. Withrow, Jr., Jaime L. Theriot, Lindsey B. Mann, Atlanta, for appellant.

Bondurant Mixson & Elmore, Michael B. Terry, Frank M. Lowrey IV, Steven J. Rosenwasser, Jason J. Carter, Joshua F. Thorpe, Atlanta; C. Ronald Ellington ; The Finley Firm, J. Benjamin Finley, MaryBeth V. Gibson, M. Kathryn Rogers, Atlanta, for appellee.

Gobeil, Judge.

In 2010, Jeff Bickerstaff, Jr.,¹ a customer of SunTrust Bank ("SunTrust"), filed a complaint against SunTrust on behalf of himself and all others similarly situated asserting that SunTrust's overdraft fees constitute unlawful interest charges and raising claims for violation of Georgia's civil and criminal usury laws ( OCGA §§ 7-4-2 and 7-4-18, respectively), money had and received, and conversion. This is the third appearance of this case before this Court. In the instant appeal, SunTrust challenges the Superior Court of Fulton County's order holding SunTrust's class-action litigation waiver unconscionable and granting Bickerstaff's motion for class certification, pursuant to OCGA § 9-11-23. SunTrust argues that the trial court erred in (1) finding the class-action waiver unconscionable, and (2) granting class certification. For the reasons that follow, we affirm.

Background and Procedural History

Like many banking institutions, SunTrust provides an automated overdraft program that allows an account holder's ATM or debit card transaction to be approved even if the approved amount exceeds the account holder's available balance. In other words, the customer has insufficient funds to cover the transaction and SunTrust advances the customer the necessary funds to cover the transaction, but, in return, charges the customer a flat fee per overdraft transaction. During the relevant time period, SunTrust charged a flat overdraft fee of $32 or $36 per overdraft transaction. In the complaint, Bickerstaff alleged that, on multiple occasions, SunTrust "advance[d] money to Plaintiff in amounts less than $3,000 and collected Overdraft Fees from Plaintiff in connection with each such advance." He maintained that SunTrust's overdraft fees in fact constitute interest charged by SunTrust for the use of the money SunTrust advanced/loaned account holders to cover overdrafts on their accounts, and that the rate of interest grossly exceeded the rate allowed under Georgia's usury laws.

The record reveals that, in 2009, when Bickerstaff opened his account with SunTrust, he, like all SunTrust customers, signed a document acknowledging receipt of SunTrust's Rules and Regulations for Deposit Accounts—an approximately 40-page, single-spaced, fine-print booklet ("the Rules and Regulations")—and agreeing to be bound by the Rules and Regulations. In relevant part, in an introductory section preceding the table of contents, the Rules and Regulations included a provision that "[a] determination that any part of this agreement is invalid or unenforceable will not affect the remainder of this agreement." On page 22 of the booklet, the Rules and Regulations included a mandatory arbitration provision, which provided as follows:

DISPUTE RESOLUTION

READ THIS PROVISION CAREFULLY AS IT WILL HAVE A SUBSTANTIAL IMPACT ON HOW LEGAL CLAIMS YOU AND WE HAVE AGAINST EACH OTHER ARE RESOLVED. For a Claim subject to arbitration, neither the Depositor nor the Bank will have the right to: (1) have a court or a jury decide the Claim; (2) engage in information-gathering (discovery) to the same extent as in court; (3) participate in a class action in court or in arbitration; or (4) join or consolidate a Claim with claims of any other person. The right to appeal is more limited in arbitration than in court and other rights in court may be unavailable or limited in arbitration.

ARBITRATION. Notwithstanding any other provision in these rules and regulations, if either Depositor or the Bank has any unresolvable dispute, controversy or claim ... whether founded in contract, tort, statutory or common law, concerning, arising out of or relating to the Account or these rules and regulations ... upon the demand of either party, it will be resolved by individual (not class or class-wide) binding arbitration[.]

Additionally, on page 24, the Rules and Regulations contained a jury trial waiver provision, which provided as follows:

JURY TRIAL WAIVER . FOR ANY MATTERS NOT SUBMITTED TO ARBITRATION, DEPOSITOR AND BANK HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND IRREVOCABLY WAIVE THE RIGHT TO A

TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED HEREON OR ARISING OUT OF THESE RULES AND REGULATIONS, RELATING TO THE ACCOUNT, OR ANY OTHER DISPUTE OR CONTROVERSY BETWEEN YOU AND US. FURTHER, DEPOSITOR AND BANK HEREBY AGREE THAT ANY LITIGATION WILL PROCEED ON AN INDIVIDUAL BASIS AND WILL NOT PROCEED AS PART OF A CLASS ACTION.

(Emphasis supplied.) The final sentence of the above paragraph is at issue in this case and is hereinafter referred to as the "class-action waiver."

After Bickerstaff filed the underlying complaint, SunTrust revised its Rules and Regulations and provided customers with the ability to opt out of arbitration. SunTrust moved to compel arbitration in the underlying case, which the trial court denied, finding that Bickerstaff effectively exercised his right to opt out of arbitration by filing the instant complaint.²

Subsequently, SunTrust entered into an agreed upon stipulation related to class certification, stipulating to the following:

1. SunTrust maintains documents and/or data sufficient to identify the following information related to individual consumer deposit accounts in which an ATM card or debit card transaction caused an overdraft of the account ("Overdraft") during the putative class period of July 12, 2006 to July 12, 2010 ("Class Period") and for which an overdraft fee and/or an extended overdraft fee was charged to the account (together, "Overdraft Fee"):

a. the individual customer's name, account number, and mailing address;

b. the date each Overdraft was incurred and the amount of the Overdraft; c. the date and amount of any Overdraft Fee that was charged to the account;

d. the dates that the account which had an Overdraft subsequently had any transaction that affected the account balance, including, but not limited to, any deposits, credits, or debits and the amount, nature, and posting date of such transactions;

e. the date that an account which had an Overdraft subsequently had a positive balance, if it did ever have such a positive balance; and

f. the date and amount of any adjustments, credits, or refunds of any Overdraft Fee incurred on the account.

2. With a sufficient amount of time and expense, it is possible to obtain and process the documents and/or data sufficient to show the information listed in paragraph 1 above. SunTrust will not argue that class certification should be denied on the basis that it would be unduly burdensome, difficult, or impossible to obtain and produce the documents and data referenced in paragraph 1 above. SunTrust reserves and retains all rights to object to Plaintiff's requests for production of documents.

3. The number of individuals who maintain consumer deposit accounts with Georgia mailing addresses which have been assessed an Overdraft Fee caused by an Overdraft during the Class Period exceeds 1,000.

4. SunTrust will not argue that class certification should be denied on the basis that the systems or processes used to record an Overdraft and assess an Overdraft Fee during the Class Period differ materially from customer to customer.

5. During the Class Period, the Overdraft Fee ranged from $32.00 to $36.00. SunTrust will not argue that class certification should be denied on the basis that the amounts of putative class members’ individual claims related to Overdraft Fees are sufficiently large for it to be feasible for such claims to be brought individually. ...

In 2013, Bickerstaff moved for class certification, pursuant to OCGA § 9-11-23. SunTrust opposed class certification, arguing, in relevant part, that (1) the class-action waiver in the Rules and Regulations precluded certification; (2) Bickerstaff could not opt out of the arbitration agreement on behalf of the class; and (3) Bickerstaff could not satisfy the numerosity, commonality, typicality, and adequacy of representation requirements for class certification under OCGA § 9-11-23. In reply, Bickerstaff asserted, among other arguments, that the class-action waiver was unconscionable, and, alternatively, was unenforceable as a matter of law because it was a non-severable part of the unenforceable jury trial waiver.

Following a hearing, the trial court denied Bickerstaff's motion for class certification, finding that the class lacked numerosity because Bickerstaff could not reject arbitration on behalf of the putative class.³ Bickerstaff appealed the denial of class certification (Case No. A14A1780), and SunTrust cross-appealed the denial of its motion to compel arbitration (Case No. A14A1781). We affirmed the trial court's denial of both motions. Bickerstaff v. SunTrust Bank , 332 Ga. App. 121, 770 S.E.2d 903 (2015) (" Bickerstaff I "). Bickerstaff appealed the class certification issue to our Supreme Court,⁴ and the Court reversed and remanded the case for further proceedings, holding that

the terms of the arbitration rejection provision of SunTrust's deposit agreement do not prevent Bickerstaff's class action complaint from tolling the contractual limitation for rejecting that provision on behalf of all putative class members until such time as the class may be certified and each member makes the election to opt out or remain in the class. Accordingly, the numerosity requirement of OCGA § 9-11-23 (a) (1) for pursuing a

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