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Pivoris v. TCF Financial Corp.

December 7, 2007

MARILYN PIVORIS, ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFF,
v.
TCF FINANCIAL CORPORATION D/B/A TCF BANK, A DELAWARE CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Judge Rebecca R. Pallmeyer

MEMORANDUM OPINION AND ORDER

Plaintiff Marilyn J. Pivoris ("Pivoris"), a client of Defendant TCF Bank ("TCF"), filed a five-count complaint in the Circuit Court of Cook County, Illinois, on behalf of herself and a class of TCF account holders. Pivoris's complaint challenges the propriety of TCF's practices for crediting deposits and the manner in which TCF discloses the schedule for such credits. Pivoris alleges that TCF's practices violate the Illinois Consumer Fraud and Deceptive Business Practices Act, are unconscionable, and constitute conversion and unjust enrichment. TCF removed the action to this court under the provisions of the Class Action Fairness Act, 28 U.S.C. § 1453, and as preempted by federal law, and now moves to stay the proceedings and compel arbitration pursuant to the arbitration clause in the account agreement between Pivoris and TCF. For the reasons set forth here, the motion is granted.

BACKGROUND

On July 27, 2006, Pivoris, a resident of Illinois, opened a TCF Plus E Checking Account and a Goal Savings Account (the "Accounts") in her name at a TCF Bank in Chicago, Illinois. (Compl. ¶¶ 2, 6; Account Agreement, Ex. 1A to Defendant's Motion to Stay ("Def.'s Mot.") In connection with opening the Accounts with TCF, Pivoris signed an Account Agreement which provided:

DISPUTES UNDER THIS ACCOUNT MAY BE SUBJECT TO BINDING ARBITRATION IF EITHER YOU OR TCF SO ELECTS. IF TCF ELECTS TO ARBITRATE ANY SUCH DISPUTE, YOU WILL HAVE NO RIGHT TO A JURY TRIAL FOR THAT DISPUTE, AND VICE VERSA, AND CERTAIN OTHER CONSEQUENCES APPLY. SEE "ARBITRATION OF DISPUTES" IN THE ACCOUNT CONTRACT.

(Account Agreement at 2, Ex. 1A to Def.'s Mot.) Pivoris both signed the Account Agreement and separately initialed the above paragraph, acknowledging that she understood and agreed with its terms. The Terms and Conditions for Checking and Savings Accounts are incorporated in the Account Agreement. (Terms and Conditions for Checking and Savings Accounts, at 4, Ex. 1B to Defendant's Motion [hereinafter, "Terms and Conditions"].) Included among the provisions set forth there is a section labeled "Arbitration of Disputes." (Id. at 15.) The document cautioned Pivoris to "[r]ead this Arbitration provision carefully," and warned that it limited her rights to a trial, to pursue a class action, to obtain discovery, and to take an appeal. (Id.) The Terms and Conditions also explained that Pivoris was entitled to reject the arbitration clause by "mailing a written rejection notice" within thirty days. (Id. at 15-16.) Should she choose to reject the arbitration provision, the Terms and Conditions made clear that this choice would "not affect any other provision of your account Contract or the status of Your Account." (Id. at 16.)

The Arbitration clause provided that, in the event of a dispute between Pivoris and TCF, either TCF or Pivoris would be entitled to "elect to resolve the Claim by binding arbitration" by providing written notice to the other party. (Id.) And the document explained that arbitration is a method of resolving disputes in front of one or more neutral persons (called "arbitrators"), instead of having a trial in court or in front of a judge or jury. This Arbitration provision governs when and how any disputes between You and TCF will be arbitrated -- instead of decided in court -- even if one party initially chooses to bring the case in court . . . . (Id.) The Terms and Conditions described the claims subject to arbitration broadly as including "any claim, dispute, or controversy between You and TCF that arises from or relates to" Plaintiff's account contract, or documents connected to the account; the arbitration clause itself; the "validity, scope, enforceability, arbitrability, or interpretation" of her account agreement; and any prior or future dealings between Pivoris and TCF. (Id. at 17.)Contract, tort, statutory, and fraud claims were included, as were claims under "any other theory." (Id.) The only matters carved out from the scope of the definition of "claim" were "the use by [Pivoris] or TCF of any self-help or non-judicial remedies," including "non-judicial remedies to protect TCF's rights, right of set-off, or any individual judicial action by a party that is limited to preventing the other party from using a self-help or non-judicial remedy and that does not involve a request for damages or monetary relief of any kind." (Id. at 18.)Also carved out from the scope of arbitration were any claims brought in small claims court or in bankruptcy, and any dispute concerning Pivoris's waiver of her right to bring a class action. (Id.)

The Terms and Conditions assured Pivoris that any arbitration hearing would take place "at a location that is reasonably convenient" to her, and that TCF would pay fees charged by the arbitrator up to $2,500 and would consider any reasonable request for reimbursement of additional fees the arbitrator might charge. (Id. at 19-20.)TCF would "under no circumstances" seek to recover amounts TCF itself paid for the arbitration services, or its own attorneys fees. (Id. at 20. The agreement anticipated that the arbitrators would "apply the substantive law that is applicable" to any claim and would be authorized to "award all remedies permitted by the substantive law that would apply if the action were pending in court." (Id.)

Finally, the Terms and Conditions make clear that, if applicable, the arbitration clause would preclude any class action:

If arbitration is chosen, You and TCF waive the right to have any Claim arbitrated as a class action or a private attorney general action. The arbitration will be limited to Your or TCF's individual Claims only. Notwithstanding any other provision in this Arbitration provision, if You or TCF elects to arbitrate a Claim, neither You nor TCF will have the right to: (1) participate in a class action in a court or in arbitration either as a class representative or a class member; (2) act as a private attorney general in court or in arbitration; or (3) join or consolidate Claims with claims of any other person. The validity and effect of this Section 11 shall be determined exclusively by a court and not an arbitrator. (Id. at 21) (boldface in original).

Plaintiff's Claims

The allegations of Plaintiff's complaint, presumed true for purposes of this motion, establish the following: On or about October 11, 2006, Plaintiff deposited a check for $30,767.43 in her checking account; the drawee of the check transferred the funds to TCF on October 13, 2006. (Compl. ¶ 7.) Although the funds actually cleared on October 13, 2006, Plaintiff alleges, TCF placed an eleven-day "hold" on her funds. TCF sent her a letter entitled "Notice of Hold Delaying Availability of Funds," informing her that because the check was in an amount greater than $5,000, $25,767.43 of her deposit would be held until October 26, 2006. (Id. ¶¶ 8-9.) As noted, TCF removed Pivoris's five-count complaint to federal court, and now seeks an order staying further proceedings and compelling Pivoris to arbitrate the dispute on an individual basis in accordance with the Account Agreement.

DISCUSSION

I. Enforceability of Arbitration ...


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