FILED 17-0065 12/20/2017 6:03 PM tex-21421836 SUPREME COURT OF TEXAS BLAKE A. HAWTHORNE, CLERK

No. 17-0065

In the Supreme Court of Texas

Compass Bank, Petitioner v. Francisco Calleja-Ahedo, Respondent

On Petition for Review from the First Court of Appeals in Houston, Texas Case No. 01-15-00210-CV

Petitioner’s Brief on the Merits

HIRSCH & WESTHEIMER, P.C. Michael D. Conner [email protected] State Bar No. 04688650 William P. Huttenbach State Bar No. 24002330 [email protected] 1415 Louisiana, 36th Floor Houston, Texas 77002 Telephone: (713) 223-5181 Facsimile: (713) 223-9319

Attorneys for Petitioner, Compass Bank

930505.20140273/2851932.1 Identity of the Parties and Attorneys Petitioner: Counsel: Compass Bank William P. Huttenbach, trial and appellate counsel State Bar No. 24002330 [email protected] Michael D. Conner, counsel in the Court of Appeals State Bar No. 04688650 [email protected] H IRSCH & W ESTHEIMER , PC 1415 Louisiana, 36th Floor Houston, Texas 77002 Telephone: (713) 223-5181 Facsimile: (713) 223-9319 Respondent: Counsel: Francisco Calleja-Ahedo Michael C. O’Connor, trial and appellate counsel State Bar No. 15187000 [email protected] Lesley C. O’Connor, trial and appellate counsel State Bar No. 24086952 [email protected] O’CONNOR & CRAIG 2825 Wilcrest Drive, Suite 261 Houston, Texas 77042 Telephone: (713) 266-3311 Facsimile: (713) 953-7513 930505.20140273/2851932.1 i Table of Contents Identity of the Parties and Attorneys ............................................................................ i Index of Authorities......................................................................................................... vi Statement of the Case ....................................................................................................... 1 Statement of Jurisdiction................................................................................................. 3 Issues Presented................................................................................................................ 6 Issue 1: The Court of Appeals improperly construed and applied Texas Business and Commerce Code section 3.406 without discussing and, thereby, rendering judgment in conflict with cited authorities from other jurisdictions in contravention of Texas Government Code section 311.028 and Business and Commerce Code section 1.103(c). ............................................................................... 6 Issue 2: The Court of Appeals’ decision conflicts with this Court’s decision in Martin where this Court concluded that the customer bears the risk of non-receipt of bank statements. ................................................... 6 Issue 3: Other courts have interpreted the term “made available” as it applies to Texas Business and Commerce Code section 4.406, and the Court of Appeals’ construction of section 4.406 differs from other courts when it determined that Compass had not made the bank statements “available” per section 4.406, which is likely a matter of first impression under Texas law. ................................................. 6 Issue 4: There are strong policy reasons for the Texas Supreme Court to decide this case and affirm the trial court’s judgment. .......................................... 6 930505.20140273/2851932.1 ii Issue 5: The Court of Appeals exceeded its authority by finding or impliedly finding facts necessary to its disposition which facts are not supported by or are contrary to evidence in the summary judgment record. See Texas Nat. Bank v. Karnes, 717 S.W.2d 901, 903 (Tex. 1986)................................................... 6 Issue 6: The Court of Appeals improperly analyzed summary judgment evidence and/or applied a different standard to Compass’ evidence as movant than that applied to Calleja’s evidence as cross-movant. .......... 6 Issue 7: To support its disposition, the Court of Appeals construed plain language in the trial court’s order granting summary judgment in a manner that effectively eliminated summary judgment evidence that otherwise supports the trial court’s judgment.................... 7 Issue 8: Even if this Court determines that the 2008 Deposit Agreement should apply, Section 4.406 still bars Calleja’s claims because Calleja did not timely report the alleged unauthorized disbursements. ............ 7 Statement of Facts ............................................................................................................ 7 The Account and transactions. ........................................................................... 7 The contract between Compass and Calleja. .................................................. 11 Summary of Argument .................................................................................................. 14 The Court of Appeals impermissibly found facts in support of its decision. (Issues 5 and 4) ......................................................... 15 930505.20140273/2851932.1 iii The Court of Appeals applied one standard for Compass’ custodian’s affidavit and a different standard for Calleja’s. (Issues 6 and 4) ............................................................. 16 Business and Commerce Code section 3.406. (Issue 1) ............................... 16 Business and Commerce Code section 4.406. (Issues 2 and 3) .................. 16 The 1988 signature card is a part of the parties’ contract, which the Court of Appeals erroneously failed to give effect. (Issue 8)............................................................................. 17 The Court of Appeals took expressly inclusive language in the trial court’s order and, without justification, called it exclusive. (Issue 7) ................................................................................ 18 Argument & Authorities ............................................................................................... 18 A. The Court of Appeals exceeded its authority by finding facts necessary to support its conclusions. (Issues 5 and 4) ....................................................... 18 B. The Court of Appeals failed to properly analyze competing summary judgment affidavits. (Issues 6 and 4).... 22 C. Calleja’s claims are precluded by Texas Business and Commerce Code section 3.406. (Issue 1) ................................. 29 D. Calleja’s claims are precluded under Business and Commerce Code section 4.406. (Issues 2, 3, and 8)........ 42 E. Other courts have interpreted the term “made available” as it applies to Texas Business and Commerce Code section 4.406, and the Court of Appeals’ construction of section 4.406 differs from other 930505.20140273/2851932.1 iv courts when it determined that Compass had not made the bank statements “available” per section 4.406, which is likely a matter of first impression under Texas law. (Issue 3) ............................... 59 F. There are strong policy reasons for the Court to decide this case and affirm the trial court’s judgment. (Issue 4) ................................................. 63 G. Without the 2012 agreement and without the 2008 agreement, there is only one writing material to the parties’ agreement in the record, the 1988 signature card. (all issues) ............................................ 65 H. The Court of Appeals improperly construed plain language in the trial court’s order. (Issue 7) .................... 66 Conclusion ....................................................................................................................... 69 Prayer ................................................................................................................................ 70 Certificate of Compliance ............................................................................................. 71 Certificate of Service ...................................................................................................... 71 Appendix to Petitioner’s Brief on the Merits ............................................................ 72 930505.20140273/2851932.1 v Index of Authorities Texas Cases 1/2 Price Checks Cashed v. United Auto. Ins. Co., 344 S.W.3d 378 (Tex. 2011) ............................................................................... 37, 38 American Airlines Employees Federal Credit Union v. Martin, 29 S.W.3d 86 (Tex. 2000) ....................................................................................passim Apache Indus. Painting v. Gulf Copper & Mfg. Corp., No. 01-08-00812-CV, 2010 WL 1611450 (Tex. App.—Houston [1st Dist.] Apr. 22, 2010, no pet.) ................................... 49 Avery v. LPP Mortgage, Ltd., No. 01-14-01007-CV, 2015 WL 6550774 (Tex. App.—Houston [1st Dist.] Oct. 29, 2015, no pet.) ................................... 24 Barfield v. Howard M. Smith Co. of Amarillo, 426 S.W.2d 834 (Tex. 1968) ................................................................................passim Calleja-Ahedo v. Compass Bank, 508 S.W.3d 791 (Tex. App.—Houston [1st Dist.] 2016, pet. filed) .............passim Castilla v. Citibank (S. Dakota), N.A., No. 05-11-00013-CV, 2012 WL 762822 (Tex. App.—Dallas Mar. 9, 2012, no pet.) ............................................................. 24 Childers v. Advanced Found. Repairs, L.P., No. 13-04-00193-CV, 2007 WL 2019755 (Tex. App.—Corpus Christi July 12, 2007, no pet.) ........... 23 City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) ............................................................................... 26, 66 930505.20140273/2851932.1 vi CBM Engineers, Inc. v. Tellepsen Builders, L.P., 403 S.W.3d 339 (Tex. App.—Houston [1st Dist.] 2013, pet. denied) ..................................... 27, 29 Coastal Plains Development Corp. v. Tech-Can Corp., 531 S.W.2d 143 (Tex. Civ. App.—Houston [1st Dist.] 1975, writ ref ’d n.r.e.) ................................. 48 Compass Bank v. Nacim, 459 S.W.3d 95 (Tex. App.—El Paso 2015, no pet.) .......................................passim Contractors Source, Inc. v. Amegy Bank Nat’l Ass’n, 462 S.W.3d 128 (Tex. App.—Houston [1st Dist.] 2015, no pet.) ...................... 23 Cross Creek Investments, Inc. v. First State Bank, No. 03-00-00439-CV, 2001 WL 459177 (Tex. App.—Austin May 3, 2001, no pet.) ...................................................... 43, 55 E.I. Du Pont De Nemours & Co. v. Shell Oil Co., 259 S.W.3d 800 (Tex. App.—Houston [1st Dist.] 2007, pet. denied) ............... 26 El Paso Field Servs., L.P. v. MasTec N. Am., Inc., 389 S.W.3d 802 (Tex. 2012) ...................................................................................... 67 FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868 (Tex. 2000) ........................................................................................ 49 Gellatly v. Unifund CCR Partners, No. 01-07-00552-CV, 2008 WL 2611894 (Tex. App.—Houston [1st Dist.] July 3, 2008, no pet.) ....................................... 24 Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003) ...................................................................... 20, 50 930505.20140273/2851932.1 vii Hathaway v. Gen. Mills, Inc., 711 S.W.2d 227 (Tex. 1986) ............................................................................... 48, 49 HECI Exploration Co. v. Neel, 982 S.W.2d 881 (Tex. 1998) ...................................................................................... 31 Heritage Resources, Inc. v. NationsBank, 939 S.W.2d 118 (Tex. 1996) ...................................................................................... 51 In Matter of Estate of Downing, 461 S.W.3d 231 (Tex. App.—El Paso 2015, no pet.) ........................................... 66 In re Estate of Berry, 280 S.W.3d 478 (Tex. App.—Dallas 2009, no pet.).............................................. 46 Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323 (Tex. 2011) ...................................................................................... 54 Jefferson State Bank v. Lenk, 323 S.W.3d 146 (Tex. 2010) ........................................................................... 4, 46, 59 Johnson v. Bethesda Lutheran Homes & Services, 935 S.W.2d 235 (Tex. App.—Houston [1st Dist.] 1996, writ denied)............... 23 Kachina Pipeline Co., Inc. v. Lillis, 471 S.W.3d 445 (Tex. 2015) ............................................................................... 53, 54 Kennamer v. Estate of Noblitt, 332 S.W.3d 559 (Tex. App.—Houston [1st Dist.] 2009, pet. denied) ........ 26, 66 Levine v. Steve Scharn Custom Homes, Inc., 448 S.W.3d 637 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) ........ 20, 50 930505.20140273/2851932.1 viii Lewis v. Aurora Loan Services, No. 01-15-00362-CV, 2016 WL 887176 (Tex. App.—Houston [1st Dist.] Mar. ^[8], 2016, no pet.).................. 21, 28, 49, 65 Miller v. Raytheon Aircraft Co., 229 S.W.3d 358 (Tex. App.—Houston [1st Dist.] 2007, no pet.) ...................... 25 Morrison v. Chan, 699 S.W.2d 205 (Tex. 1985) ...................................................................................... 56 Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546 (Tex. 1985) .................................................................. 21, 28, 49, 65 Okonkwo v. Washington Mutual Bank, FA, No. 14-05-00925-CV, 2007 WL 763821 (Tex. App.—Houston [14th Dist.] Mar. 15, 2007, no pet.)....... 43, 55, 56, 59-60 Rizkallah v. Conner, 952 S.W.2d 580 (Tex. App.—Houston [1st Dist.] 1997, no writ) .........23, 25, 26 Ryland Group, Inc. v. Hood, 924 S.W.2d 120 (Tex. 1996) ...................................................................................... 23 Schiro v. Texas Community Bank, 68 S.W.3d 55 (Tex. App.—Dallas 2001, no pet.) .............................. 43, 55, 56, 60 Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171 (Tex. 1997) ...................................................................................... 31 Shields Ltd. P’ship v. Bradberry, 526 S.W.3d 471 (Tex. 2017) ............................................................................... 49, 50 Sw. Bank v. Info. Support Concepts, Inc., 149 S.W.3d 104 (Tex. 2004) ................................................................................passim 930505.20140273/2851932.1 ix Tex. Mun. Power Agency v. Pub. Util. Comm’n of Tex., 253 S.W.3d 184 (Tex. 2007) ...................................................................................... 49 Texas Nat. Bank v. Karnes, 717 S.W.2d 901 (Tex. 1986) ........................................................................... 6, 20, 50 Trico Techs. Corp. v. Montiel, 949 S.W.2d 308 (Tex. 1997) .........................................................................27, 28, 29 Tyler v. Henderson, 162 S.W.2d 170 (Tex. Civ. App.—Fort Worth 1942, writ ref’d w.o.m.)........... 67 Union Bankers Ins. Co. v. Shelton, 889 S.W.2d 278 (Tex. 1994) ...................................................................................... 56 Via Net v. TIG Ins. Co., 211 S.W.3d 310 (Tex. 2006) .........................................................................31, 37, 41 Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732 (Tex. 2001) ................................................................................. 31, 41 Waite v. BancTexas-Houston, N.A., 792 S.W.2d 538 (Tex. App.—Houston [1st Dist.] 1990, no writ) ...................... 25 Non-Texas Cases Bank of Nichols Hills v. Bank of Oklahoma, 196 P.3d 984 (Okla. Civ. App. 2008) ................................................................... 40, 67 Borowski v. Firstar Bank Milwaukee, N.A., 579 N.W.2d 247 (Wis. Ct. App. 1998) ............................................................. 58, 62 Dominion Const., Inc. v. First Nat’l Bank of Maryland, 315 A.2d 69 (Md. 1974) ............................................................................................. 67 930505.20140273/2851932.1 x First Citizens Bank of Clayton County v. All-Lift of Georgia, Inc., 555 S.E.2d 1 (Ga. Ct. App. 2001).............................................................................. 46 Gast v. Am. Cas. Co. of Reading, Pa., 240 A.2d 682 (N.J. Super. Ct. App. Div. 1968) ..................................................... 68 General Petroleum Products, Inc. v. Merchants Trust Co., 160 A. 296 (Conn. 1932)............................................................................................ 63 John Hancock Fin. Servs., Inc. v. Old Kent Bank, 346 F.3d 727 (6th Cir. 2003) ..................................................................................... 34 Kaplan v. JPMorgan Chase Bank, N.A., No. 14-C-5720, 2015 WL 2358240 (N.D. Ill. May 12, 2015).............................. 56 LaSalle Bank Nat’l Ass’n v. Sleutel, 289 F. 3d 837 (5th Cir. 2002) ............................................................................. 56, 60 McMickle v. Girard Bank, 515 A.2d 16 (Pa. Super. Ct 1986) ............................................................................. 62 Myrick v. Nat’l Sav. & Trust Co., 268 A.2d 526 (D.C. 1970)....................................................................................passim Putnam Rolling Ladder Co., Inc. v. Manufacturers Hanover Tr. Co., 546 N.E.2d 904 (NY 1989) ..........................................................................35, 37, 42 Stowell v. Cloquet Co-op Credit Union, 557 N.W.2d 567 (Minn. 1997) .................................................................................. 61 Tatis v. U.S. Bancorp, 473 F.3d 672 (6th Cir. 2007) ..................................................................................... 57 Terry v. Puget Sound Nat. Bank, 492 P.2d 534 (Wash. 1972).................................................................... 31, 32, 37, 40 930505.20140273/2851932.1 xi Thompson Maple Products, Inc. v. Citizens Nat’l Bank of Corry, 234 A.2d 32 (Pa. Super Ct. 1967) ............................................................................. 39 Westport Bank & Tr. Co. v. Lodge, 325 A.2d 222 (Conn. 1973) ....................................................................................... 63 Wetherill v. Putnam Investments, 122 F.3d 554 (8th Cir. 1997) ..................................................................................... 62 Woods v. MONY Legacy Life Ins. Co., 641 N.E.2d 1070 (N.Y. 1994).................................................................................... 62 Statutes Tex. Bus. & Com. Code § 1.103 .............................................................. 4, 4, 6, 36, 38 Tex. Bus. & Com. Code § 1.201(b)(36) ...................................................................... 46 Tex. Bus. & Com. Code § 3.406 ............................................................................passim Tex. Bus. & Com. Code § 4.406 ............................................................................passim Tex. Civ. Prac. & Rem. Code § 33.001 ....................................................................... 34 Tex. Estates Code § 351.102 ........................................................................................ 46 Tex. Fin. Code § 34.301(a) ...............................................................................30, 53, 65 Tex. Fin. Code § 34.302 ................................................................................................ 30 Tex. Gov’t Code § 22.001(a) .......................................................................................... 3 Tex. Gov’t Code § 311.028 ............................................................................3, 6, 37. 38 930505.20140273/2851932.1 xii Rules Tex. R. App. P. 9.4(e) .................................................................................................... 71 Tex. R. App. P. 9.4(i) ..................................................................................................... 71 Tex. R. Civ. P. 166a(c) ................................................................................................... 27 Tex. R. Civ. P. 166a(f) ............................................................................................ 23, 24 Other Authorities Black’s Law Dictionary 284 (7th ed. 2001) ................................................................ 26 930505.20140273/2851932.1 xiii Statement of the Case Nature of the Case Bank customer, Calleja, sued Compass for paying unauthorized items. Compass asserted various defenses, including defenses under the deposit agreement, and under sections 3.406 and 4.406 of the Business and Commerce Code. Calleja argues he had no duty to notify Compass that he was no longer receiving his account statements. The parties also disagree as to whether bank statements were otherwise “made available” and whether Calleja timely reported the alleged unauthorized disbursements after not reporting same for 18 months. Trial Court 55th District Court, Harris County, the Honorable Jeff Shadwick presiding Trial Court Disposition On cross motions for summary judgment the trial court granted Compass’s motion and denied Calleja’s. Court of Appeals First Court of Appeals, Houston; Justice Evelyn V. Keyes authored the opinion for the panel also including Chief Justice Sherry Radack and Justice Laura Higley Court of Appeals Opinion Calleja-Ahedo v. Compass Bank, 508 S.W.3d 791 (Tex. App.—Houston [1st Dist.] 2016, pet. filed). 930505.20140273/2851932.1 Court of Appeals Disposition The Court of Appeals reversed and rendered judgment in favor of Calleja. Both parties moved for rehearing. The court of appeals denied both motions, but withdrew its original opinion (see No. 01-15-00210-CV, 2016 WL 2342758 (Tex. App.—Houston [1st Dist.] May 3, 2016)), and issued its superseding opinion.

930505.20140273/2851932.1 Statement of Jurisdiction

This case present questions of law which are important to the jurisprudence of the state. Tex. Gov’t Code § 22.001(a).

This case involves the issue of whether a bank customer’s failure to protect himself after previously experiencing bank fraud, identity theft, and failure to monitor his account for an extended period constitutes a “failure to exercise ordinary care,” which “substantially contribute[d]” to the making of a forgery under section 3.406 of the Texas Business and Commerce Code. See Tex. Bus. & Com. Code § 3.406(a). Construction and application of section 3.406 appears to be a matter of first impression for the Court.

It is important to Texas jurisprudence that construction and application of uniform statutes, e.g., sections 3.406 and 4.406 of the Texas Business and Commerce Code, be construed to effect the general purpose of such uniform acts to make uniform the law of this state with the law of those other states that have adopted them. Tex. Gov’t Code § 311.028; Tex. Bus. & Com. Code § 1.103(c).

This case presents a question of law of importance to Texas jurisprudence within the “statutory scheme reflect[ing] an underlying policy decision that furthers the Uniform Commercial Code’s (“UCC”) objective of promoting

930505.20140273/2851932.1 certainty and predictability in commercial transactions’ [citations omitted] … by allocating responsibility among the parties according to who is best able to prevent a loss.” American Airlines Employees Federal Credit Union v. Martin, 29 S.W.3d 86, 92 (Tex. 2000). This case presents the question whether “the risk of non-receipt of account statements”—applied by the Court in Martin—also applies beyond the 4.406 context. See Martin, 29 S.W.3d at 90; Tex. Bus. & Com. Code § 1.103.

This case presents a question of law of importance to Texas jurisprudence regarding the meaning of the phrases “makes available” and “made available” in section 4.406 of the Texas Business and Commerce Code. See Tex. Bus. & Com. Code § 4.406(a), (c), (f). The Court has addressed the issue, in part, in such cases as Martin, 29 S.W.3d at 92 (where there was no dispute that statements were mailed to customer’s correct address), and Jefferson State Bank v. Lenk, 323 S.W.3d 146, 149-50 n.6, n.7 (Tex. 2010) (addressing making statements available when the customer is deceased). This case presents the opportunity to address the meaning and application of “makes available” and “made available” in the context of the broader statutory scheme, including section 1.103(a) of the Texas Business and Commerce Code. See Tex. Bus. & Com. Code § 1.103(a)(1), (2).

930505.20140273/2851932.1 This case also includes the fundamentally important legal issue of the limitations on a reviewing court’s authority to make original findings of fact in support of its disposition.

These questions of law will likely recur. The Court’s resolutions of the questions presented in this case, including construction and application of statutory and decisional language, are important to the jurisprudence of the state.

930505.20140273/2851932.1 Issues Presented

Issue 1: The Court of Appeals improperly construed and applied Texas Business and Commerce Code section 3.406 without discussing and, thereby, rendering judgment in conflict with cited authorities from other jurisdictions in contravention of Texas Government Code section 311.028 and Business and Commerce Code section 1.103(c).

Issue 2: The Court of Appeals’ decision conflicts with this Court’s decision in Martin where this Court concluded that the customer bears the risk of non-receipt of bank statements.

Issue 3: Other courts have interpreted the term “made available” as it applies to Texas Business and Commerce Code section 4.406, and the Court of Appeals’ construction of section 4.406 differs from other courts when it determined that Compass had not made the bank statements “available” per section 4.406, which is likely a matter of first impression under Texas law.

Issue 4: There are strong policy reasons for the Texas Supreme Court to decide this case and affirm the trial court’s judgment.

Issue 5: The Court of Appeals exceeded its authority by finding or impliedly finding facts necessary to its disposition, which facts are not supported by or are contrary to evidence in the summary judgment record. See Texas Nat. Bank v. Karnes, 717 S.W.2d 901, 903 (Tex. 1986).

Issue 6: The Court of Appeals improperly analyzed summary judgment evidence and applied a different standard to Compass’ evidence as movant that applied to Calleja’s evidence as cross-movant.

930505.20140273/2851932.1 Issue 7: To support its disposition, the Court of Appeals construed plain language in the trial court’s order granting summary judgment in a manner that effectively eliminated summary judgment evidence that otherwise supports the trial court’s judgment.

Issue 8: Even if this Court determines that the 2008 Deposit Agreement should apply, section 4.406 still bars Calleja’s claims because Calleja did not timely report the alleged unauthorized disbursements.

Statement of Facts The Court of Appeals correctly stated the nature of the case. The following is offered for clarification and to further illuminate the context in which the case arises and the importance of the legal issues it implicates. The Account and transactions.

This dispute involves allegedly unauthorized transactions from a regular deposit account at Compass Bank (“Compass”). Respondent, Francisco Calleja- Ahedo (“Calleja”), had previously had his banking information compromised, and Calleja had previously suffered a loss due to bank fraud. Subsequently, in this matter, more than 18 months after the first allegedly unauthorized transaction, a $33.23 charge for blank checks (CR246), Calleja claimed various transactions and withdrawals from his account (#****3759; the “Account”) were also unauthorized.

930505.20140273/2851932.1 Calleja, a citizen and resident of Mexico, opened the Account in Texas. CR50, 230 (1988 signature card). Calleja, his wife, and his father all were signatories on the Account until it was closed in 2014. CR46, 50. The wife and the father are not parties to this suit and neither gave testimony or other evidence. See, e.g., CR420, et seq. The Account signature card includes on the address line “Hold All Correspondence”:

CR50; CR230. Paragraph 22 of the signature card, above, requires the customer to “notify Bank in writing of any change in the information given to” Compass. CR50; CR230. (A more legible copy of the signature card is attached as Tab 1 for the Court’s convenience.) From 1988 until the Account was closed in 2014, Calleja’s statements were available upon request at any Compass branch. CR397. Since before 2012, Account statements were available on-line had Calleja so chosen. CR397. 930505.20140273/2851932.1 For at least four out of the 24-plus years of the relationship, Compass also provided monthly Account statements by mail. According to Calleja, because he lives in a suburb of Mexico City, “prior to July 2012, [Calleja] directed the bank statements for the Account be mailed by the Bank to the address of [his] brother” in The Woodlands, Texas, where Calleja would “retrieve” the statements “from time-to-time.” CR46. The appellate record contains no evidence that Calleja’s “direct[ion]” to Compass (see id.) was in writing. See CR50; CR230. Compass accommodated the request. Nevertheless, the record contains no evidence of any writing informing Compass “of any change in the information given to the Bank” in 1988. CR50; CR230; see also CR65; CR212.

The statement for May 2012 activity is the last statement mailed to the brother’s Woodlands address. Similarly accommodating the request of someone possessing sufficient information to identify the Account and to identify himself as Calleja (and having his banking information), Compass mailed the Account statement for the period from May 31 through June 28, 2012, to an address in Cupertino, California. CR246. Subsequent statements were mailed to Sacramento (CR249-57) and, later, to Georgia. CR 258, et seq. Although Calleja claims he did not personally request these changes (see, e.g., CR46), he presented

930505.20140273/2851932.1 no affidavit or other evidence from the other two Account owners.1 There also is no evidence that Calleja, another owner, or Calleja’s brother contacted Compass to notify it that Account statements were no longer being received in The Woodlands.^[2] Calleja admits that he did nothing to monitor the bank account for over 18 months, even though he had previously been the victim of bank fraud.

On June 26, 2012, the Account was debited $33.23 for new checks; this charge appeared on the June statement. CR246. On July 30, 2012, a $38,700.00 check was paid from the Account. CR249. The debit appears on the July statement. Id. From June 2012 until January 2014, Compass received no notice from Calleja (or his wife, his father, or brother) of any complaint regarding the Account.

After ignoring his bank account for 18 months, Calleja alleges he “discovered a problem” in January 2014, when “an acquaintance” to whom he had written a check reported it as returned, marked “account closed.” CR47. When Calleja finally contacted Compass in the last week of January 2014, he was

1 Co-signatories on the Account, Ana Elizabeth Haller de Calleja and Francisco Calleja Cajigas, each also had the right to change the mailing address. CR65; CR212; see also CR412, et seq. (Compass’s motion to strike); CR685 (Order at ¶ 6, overruling Compass’s objection). 2 The lack of such evidence is significant under terms of the 2012 (or the 2013) deposit agreement. See CR212 (2012 deposit agreement at p. 6: “Notify us promptly if you do not receive your statement by the date you normally would expect to receive it.”). 930505.20140273/2851932.1 given information including a copy of the $38,700.00 check (id.) posted to the Account and listed on the Account statement a year and one-half earlier. CR71. He claimed the check was forged. CR47.

When asked what he did to monitor the Account after January 2012 (6 months before the first allegedly unauthorized transaction), Calleja answered under oath, “There was no need to ‘keep track’ of banking information because no authorized checks (except perhaps two checks described in response to Interrogatory No. 10) would be shown in statements after May 2012.” CR321- 22. Calleja’s brother who he had entrusted to receive his statements either told Calleja that he was no longer receiving statements after May 2012 (and Calleja did not care) or Calleja’s brother failed to tell Calleja that he was no longer getting statements (and again Calleja did not care to get his bank statements). The contract between Compass and Calleja.

In the trial court, the parties argued that distinct editions of Compass’ deposit agreement should apply during the relevant period.3 In addition to the 1988 signature card (CR230), Compass offered the 2012 edition of the deposit agreement described by its representative and records custodian as “the written

3 The respective deposit agreements in the record are poor copies. An accurate, more legible copy of the 2008 edition of the deposit agreement is appended at Tab 2 for the Court’s reference. An accurate, more legible copy of the 2012 edition of the deposit agreement is appended as Tab 3. 930505.20140273/2851932.1 contract governing the deposit relationship” and as “the agreement in effect between Plaintiff and Compass Bank.” CR202-03; CR205, et seq.

With his affidavit, Calleja submitted the 1988 signature card (CR50) and a 2008 edition of the Compass deposit agreement which he described as, “A true and correct copy of the Agreement pertaining to the Account, which I received from the Bank.” CR438; CR443, et seq.; see also CR51, et seq. Calleja did not say how or when he “received” the 2008 deposit agreement and did not specify how or when it “pertain[ed]” to the Account. CR438-41. The “true and correct copy” Calleja placed in the record bears Compass’ “bates” numbering. CR443, et seq.; CR51, et seq. 4 Thus, the exact copy of the document Calleja “received” from Compass was provided by Compass’ attorney after Calleja filed this lawsuit, well after the facts in dispute occurred.

The 2008 and 2012 deposit agreements are similar in several respects. Regarding periodic statements, for example, both editions provide:

If we have a deliverable address on file for you, we will mail or deliver to you periodic statements for your account at approximately monthly intervals …. …

4 Calleja also submitted a copy of the 2013 edition of the deposit agreement as an attachment to his counsel’s affidavit. CR 136, et seq. In addition to other revisions distinguishing it from the 2008 edition, the 2013 deposit agreement (like the 2012 edition; CR209) permits the “prevailing party” to recover attorney’s fees. CR139. 930505.20140273/2851932.1 [These materials] may be mailed to … the address shown in our records. … Our records regarding [the Account] will be deemed correct unless you timely establish with us that we made an error. … We may make statements, cancelled checks (if applicable to your account), notices or other communications available to you by holding all or any of these for you or delivering all or any of these items to you in accordance with your request or instructions. CR65 (2008); CR212 (2012). The 2012 agreement adds to prior editions and specifies that Calleja should “[n]otify us promptly if you do not receive your statement by the date you normally would expect to receive it.” CR212.5

Both the 2008 and the 2012 deposit agreements include Calleja’s (and the other account owners’) promise to “carefully examine each account statement ….” CR65; CR212. They include Calleja’s “agree[ment] to act in a prompt and reasonable manner in reviewing your statement or notice and reporting any exceptions to us.” CR65; CR212.

Compass debited the Account in June for new checks (CR246); it paid a check on July 30, 2012. CR249. Calleja did not report any problem or exception

5 While Compass believes that such a statement would be a “common sense” understanding, it nevertheless added such a phrase to its then current version of the deposit agreement. 930505.20140273/2851932.1 for over 18 months.^[6] Likewise, Calleja did not tell Compass for 18 months that statements were no longer being delivered to his brother’s address in The Woodlands. Calleja made no effort to obtain copies of statements from any Compass branch, via the internet, or otherwise, at any time between June 2012 and January 2014. See CR397.

Summary of Argument

As a predicate matter, the existence of the 1988 signature card together with the absence of pleading or proof that the contractual “Hold All Correspondence” language was ever modified in writing should inform the Court’s disposition. It informs Calleja’s lack of care under 3.406; it informs Calleja’s failure to report under section 4.406. The undisputed language of the signature card supports the concept and permits making account information available other than by mailing. The absence of evidence that the contract was modified informs the Court of Appeals’ errant process of review and illuminates that court’s disparate treatment of competing summary judgment affidavits.

6 Compass takes no position on any claims Calleja may have against his own brother. In other words, Calleja apparently entrusted his brother to receive his bank statements and possibly do other banking activities. If Calleja’s brother was supposed to be monitoring the account and notifying Calleja if the statements were received or not received, such issues would be between Calleja and his brother. 930505.20140273/2851932.1 Compass will begin its discussion with the Court of Appeals’ departure from normal review of cross motions for summary judgment. The Court of Appeals impermissibly found facts in support of its decision. When the Court of Appeals wrote, “Both parties agree that the 2008 Agreement was, at least at one point, effective as to Calleja,” the court exceeded its authority. The Court of Appeals either found or impliedly found facts to support its judgment. There is no evidence that the 2008 deposit agreement was “effective” at any time material to this case. There is no evidence that the parties ever agreed as the Court of Appeals said. Compass advocated the 2012 deposit agreement was “in effect and,” Calleja said the 2008 deposit agreement “pertained” to his account. In any event, assuming—as the Court of Appeals did—that the 2008 deposit agreement was effective “at least at one point,” the Court of Appeals’ judgment depends on the erroneous further assumption that the “at one point” was a material point in time. There simply is no evidence of the agreement inferred by the Court of Appeals on which its judgment is necessarily predicated. That judgment should be reversed.

930505.20140273/2851932.1 The Court of Appeals applied one standard for Compass’ custodian’s affidavit and a different standard for Calleja’s. The Court of Appeals incorrectly analyzed the competing summary judgment affidavits. First, it determined Compass’ records custodian’s affidavit testimony was conclusory. It is not. But, in any event, Calleja’s affidavit is no less conclusory on the salient point of which (if either) of the two editions of the Compass deposit agreement was in effect at material times. That is, to the extent the Court of Appeals’ analysis of Ms. Mueller’s affidavit is sustainable, the court was obliged to analyze Calleja’s affidavit on equivalent bases. It did not. Business and Commerce Code section 3.406.

The Court of Appeals gave only cursory consideration to section 3.406. That court omitted any reference to cited authorities from other jurisdictions holding to the effect that a customer’s inattention to her or his account statements constitutes negligence sufficient under section 3.406(a) to preclude recovery. The Court of Appeals’ failure to consider these decisions contravenes the statutory requirement that uniform acts be interpreted in a uniform manner. Business and Commerce Code section 4.406.

The Court of Appeals’ decision conflicts with this Court’s decision in Martin by too narrowly applying this Court’s conclusion that customers bear the

930505.20140273/2851932.1 risk of non-receipt of bank statements. By failing to properly allocate this risk, the Court of Appeals failed to apply the underlying policy that furthers the UCC’s objective of promoting certainty and predictability in commercial transactions. The 1988 signature card is a part of the parties’ contract, which the Court of Appeals erroneously failed to give effect.

There is only one writing both parties agree was part of the contract, the 1988 signature card, offered as summary judgment evidence by both parties. The Court of Appeals wholly failed to give effect to the unambiguous contractual language in the signature card: “Hold All Correspondence.” Regardless whether the 2012 version of the deposit agreement, the 2008 version, some other version, or no version of deposit agreement at all was “in effect” or “pertained,” the signature card is part of the contract. The Court of Appeals erred by failing to treat it as such.

The Court of Appeals further erred by determining, again without evidentiary support, that the signature card was modified. Neither the 2008 nor the 2012 deposit agreement includes language modifying the “Hold All Correspondence” term. To the contrary, both editions of the deposit agreement contemplate the possibility that a customer might ask Compass to hold

930505.20140273/2851932.1 statements as Calleja did. The Court of Appeals re-wrote the parties contract, and in doing so, it erred. Its judgment cannot stand. The Court of Appeals took expressly inclusive language in the trial court’s order and, without justification, called it exclusive. The Court of Appeals read an expressly inclusive sentence to be exclusive in order to support its conclusion that Calleja did not substantially contribute to the forgery of the $38,000.00 check. This strained reading of the trial court’s language effectively negated record evidence supporting the judgment and in conflict with the disposition by the Court of Appeals.

Argument & Authorities Because the Court may determine this case should be remanded to the trial court for determination of an essential fact—what edition, if any, of Compass’ deposit agreement was in effect at material times, Compass first addresses the Court of Appeals’ impermissible fact finding and its disparate treatment of the parties’ respective summary judgment evidence.

A. The Court of Appeals exceeded its authority by finding facts necessary to support its conclusions.

There is no evidence that the 2008 deposit agreement was “in effect” at any material time.

930505.20140273/2851932.1 As the Court of Appeals correctly stated, where parties both move for summary judgment, and the trial court grants one motion and denies the other, the court reviews both parties’ summary judgment evidence and determines all questions presented. Calleja-Ahedo v. Compass Bank, 508 S.W.3d 791, 797 (Tex. App.—Houston [1st Dist.] 2016, pet. filed) (citations omitted). Having further stated that it “must determine which version of the deposit agreement governed the parties’ relationship,” an inherently factual inquiry, without reference to summary judgment evidence, the Court of Appeals said, “Both parties agree that the 2008 Agreement was, at least at one point, effective as to Calleja.” Id. at 797. The flaw in using this statement as the predicate for reversing and rendering judgment is the utter lack of summary judgment evidence that the 2008 deposit agreement was “effective” at any time material to this case. Even assuming—as the court appeals did—that “at least at one point,” the 2008 deposit agreement was “effective as to Calleja,” the Court of Appeals’ rendition of judgment for Calleja necessarily further assumes there was no 2009, 2010, or 2011 edition of the deposit agreement.

The true state of the record is that Compass, as summary judgment movant, attempted to establish that the 2012 deposit agreement was “the written contract governing the deposit relationship” and was “the agreement in

930505.20140273/2851932.1 effect between Plaintiff and Compass Bank.” CR202-03; CR205, et seq. Calleja, also as summary judgment movant, described the 2008 edition of the deposit agreement as “the Agreement pertaining to the Account, which I received from the Bank.” CR438; CR443, et seq.; see also CR51, et seq. Contrary to the Court of Appeals’ unsupported “finding,” neither party agreed or conceded that if its version of the deposit agreement was not in effect at material times, then the other party’s version was. Thus, the Court of Appeal’s assumption that it was faced with a binary choice was just that —an assumption. Such an assumption constitutes harmful, reversible error in this case.

A court of appeals has no authority to act as fact finder. See, e.g., Levine v. Steve Scharn Custom Homes, Inc., 448 S.W.3d 637, 653 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) (citing Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003). “[A] court of appeals cannot make original findings of fact; it can only ‘unfind’ facts.” Texas Nat’l Bank v. Karnes, 717 S.W.2d 901, 903 (Tex. 1986) (citations omitted). The Court of Appeals ran afoul of this established rule by setting up—without factual foundation—its either/or—if not one then necessarily the other—decision.7 This is impermissible fact

7 There is no stipulation and no evidence or other indication that the parties agreed that if the 2012 agreement was not the operative agreement, then the 2008 agreement necessarily must be. 930505.20140273/2851932.1 finding: that no other deposit agreement existed between the 2008 and 2012 editions. Calleja did not prove that to be the case. As summary judgment movant, Calleja is not entitled to any such inference in his favor. See Lewis v. Aurora Loan Services, No. 01-15-00362-CV, 2016 WL 887176, at *2 (Tex. App.— Houston [1st Dist.] Mar. ^[8], 2016, no pet.) (citing Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548–49 (Tex. 1985)). The classic aphorism, the absence of evidence is not evidence of absence, should obtain, especially where the judgment under review is a summary judgment.

Calleja’s affidavit does not supply the missing facts. See CR46. In order to be entitled to the rendition of judgment he got in the Court of Appeals, Calleja must have conclusively established with admissible evidence that the 2008 deposit agreement was in effect (or still in effect) at material times after January 2012, the point from which Calleja admitted he paid no attention to his account. He did not. Calleja’s affidavit does not aver that the 2008 agreement was in effect at any material time. See CR46. Calleja says only, “A true and correct copy of the Agreement pertaining to the Account, which I received from the Bank, is attached hereto at Attachment 2.” Id.; CR438; see also CR51-70 (the 2008 agreement). Notably, he did not say when or how he received it. CR46; CR438. As above, “Attachment 2” to the affidavit is a bates-labeled document produced

930505.20140273/2851932.1 by Compass during discovery. CR51, et seq.; CR443, et seq. Calleja did not say, moreover, that the 2012 agreement (or some other interim edition) did not “pertain” to the account, and he did not deny “receiv[ing]” the 2012 or any other edition of the deposit agreement. Calleja offered no testimony or other evidence about which edition, if any, of the deposit agreement was in effect at a particular time, or ever. Thus, the Court of Appeals’ assumption—if not the one, then necessarily the other—has no factual support, and rendition of judgment in Calleja’s favor was reversible error.

B. The Court of Appeals failed to properly analyze competing summary judgment affidavits.

The Court of Appeals stated: “As a threshold issue, we must determine which version of the deposit agreement governed the parties’ relationship.” Calleja-Ahedo v. Compass Bank, 508 S.W.3d 791, 797 (Tex. App.—Houston [1st Dist.] 2016, pet. filed). Compass’ custodian of records, Ms. Mueller, testified by affidavit that, among other things, “the [2012] account agreement evidences the agreement in effect between the Plaintiff and Compass Bank.” CR203, ¶ 8. The Court of Appeals determined Mueller’s affidavit testimony was conclusory. Calleja-Ahedo, 508 S.W.3d at 799. It is not. But in the event the Court agrees with the Court of Appeals, Calleja’s affidavit is no less conclusory; his affidavit is not

930505.20140273/2851932.1 evidence, certainly not conclusive evidence, that the 2008 deposit agreement was (or that the 2012 edition was not) in effect at any material time.

Mueller’s statement is supported by additional facts, and it is clear, positive, direct, and readily controvertible. Though he could have, Calleja did not controvert the factual statement that the 2012 deposit agreement was “in effect.” See, e.g., Childers v. Advanced Found. Repairs, L.P., No. 13-04-00193-CV, 2007 WL 2019755, at *2 (Tex. App.—Corpus Christi July 12, 2007, no pet.); Johnson v. Bethesda Lutheran Homes & Services, 935 S.W.2d 235, 239 (Tex. App.— Houston [1st Dist.] 1996, writ denied) (Hedges, J., concurring) (stating that logical conclusions based on stated underlying facts are proper in both lay and expert testimony). Affidavits “shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein.” Tex. R. Civ. P. 166a(f); Contractors Source, Inc. v. Amegy Bank Nat’l Ass’n, 462 S.W.3d 128, 133 (Tex. App.—Houston [1st Dist.] 2015, no pet.). The Court of Appeals relied on the general rule stated in Contractors Source, a case considering expert witness affidavits. Calleja-Ahedo, 508 S.W.3d at 799; see also Ryland Group, Inc. v. Hood, 924 S.W.2d 120, 122 (Tex. 1996); Rizkallah v. Conner, 952 S.W.2d 580, 587-

88 (Tex. App.—Houston [1st Dist.] 1997, no writ) (reviewing for “some

930505.20140273/2851932.1 support in the record” for factual statements of interested witness). Mueller, a Compass employee, was not offered as an expert; she testified as custodian of records. CR202-03. The Court of Appeals omitted reference to cases stating that an affiant’s testimony establishing her status as a custodian of records and her relationship to the facts of the case satisfies the personal knowledge requirement of Rule 166a(f). See, e.g., Avery v. LPP Mortgage, Ltd., No. 01-14-01007-CV, 2015 WL 6550774, at *2 (Tex. App.—Houston [1st Dist.] Oct. 29, 2015, no pet.); Castilla v. Citibank (S. Dakota), N.A., No. 05-11-00013-CV, 2012 WL 762822, at *6 (Tex. App.—Dallas Mar. 9, 2012, no pet.); Gellatly v. Unifund CCR Partners, No. 01-07-00552-CV, 2008 WL 2611894, at *5 (Tex. App.—Houston [1st Dist.] July 3, 2008, no pet.). Mueller’s affidavit is based on personal knowledge (CR202, ¶ 1); she is a Compass employee and “[i]n this capacity” has “personal knowledge of accounts held at Compass Bank.” CR202, ¶ 2. Mueller testified that she is “a custodian of records” for Compass, that “Tabs 1 and 2” to the affidavit are “true and correct” copies of bank records, and that “[she is] personally familiar with the records.” CR203, ¶ 8. These are admissible, uncontroverted facts about which Mueller testified. Mueller stated clearly, positively, and directly, “the account agreement [2012] evidences the agreement in effect between the Plaintiff and Compass Bank.” CR203, ¶8. The statement is

930505.20140273/2851932.1 her logical conclusion based on stated underlying facts. See Rizkallah, 952 S.W.2d at 588; Bethesda Lutheran Homes & Services, 935 S.W.2d at 239. Calleja could have, but did not controvert the statement.

Further, identifying herself as an employee and custodian of Compass’ records (CR202-03) “shows how [Mueller] gained personal knowledge.” See, e.g., Waite v. BancTexas-Houston, N.A., 792 S.W.2d 538, 540 (Tex. App.—Houston [1st Dist.] 1990, no writ); see also Miller v. Raytheon Aircraft Co., 229 S.W.3d 358, 365-66 (Tex. App.—Houston [1st Dist.] 2007, no pet.). She identified Calleja’s account as a “regular bank account.” CR202. She said, “Attached as Tab 1 is a copy of the written contract governing the deposit relationship between [Calleja] and Compass Bank.” Id. Mueller identified the 2012 agreement as a business record of which she had personal knowledge and as the agreement “in effect between” the parties. CR203.8

Mueller’s second affidavit provides additional facts supporting her statement that the 2012 agreement “evidences the agreement in effect between [Appellant] and Compass Bank.” CR396-98; CR202-03. She states that the 2012 agreement has a revision date of February 2012—prior to the events at issue.

8 The words “believe” and “belief” do not appear in this affidavit. CR202-03; see Calleja- Ahedo, 508 S.W.3d at 799. 930505.20140273/2851932.1 CR396. That fact “has some support in the record.” See Rizkallah, 952 S.W.2d at 588; see also CR228 (final page of 2012 agreement). Mueller referenced Calleja’s allegation that an imposter changed the account address in the summer of 2012; she referenced the account signature card and its provision regarding amendments to the account agreement. CR396; CR230. Those statements have support in the record. CR46-47, 50 (Calleja’s affidavit recounting his version of events with signature card attached); see Rizkallah, 952 S.W.2d at 588. Mere use of the words believe or belief in the second affidavit does not render the testimony in the first affidavit conclusory.

“The term ‘conclusory’ is defined as ‘[e]xpressing a factual inference without stating the underlying facts on which the inference is based.’” E.I. Du Pont De Nemours & Co. v. Shell Oil Co., 259 S.W.3d 800, 809 (Tex. App.— Houston [1st Dist.] 2007, pet. denied) (citing Black’s Law Dictionary 284 (7th ed. 2001)). Reviewing the entire record, there is ample support for Mueller’s statement—without resort to inference—that “the account agreement evidences the agreement in effect between the Plaintiff and Compass Bank.” CR203; see also City of Keller v. Wilson, 168 S.W.3d 802, 824 (Tex. 2005); Kennamer, 332 S.W.3d at 566.

930505.20140273/2851932.1 Further, “summary judgment based on the uncontroverted affidavit of an interested witness is proper if the evidence is clear, positive, direct, otherwise credible, free from contradictions and inconsistencies, and could have been readily controverted.” Trico Techs. Corp. v. Montiel, 949 S.W.2d 308, 310 (Tex. 1997); Tex. R. Civ. P. 166a(c); CBM Engineers, Inc. v. Tellepsen Builders, L.P., 403 S.W.3d 339, 346 (Tex. App.—Houston [1st Dist.] 2013, pet. denied) (noting that readily controvertible means the factual assertions “could be ‘effectively countered by opposing evidence.” (quoting Trico Techs. Corp., 949 S.W.2d at 310)). Mueller testified that the 2012 agreement was “in effect between” the parties. CR203. On this record, the testimony satisfies all requirements for a summary judgment affidavit. Calleja could have, but did not controvert the testimony.

The totality of Calleja’s evidence about the deposit agreement is: “A true and correct copy of the Agreement pertaining to the Account, which I received from the Bank, is attached hereto at Attachment 2.” CR46; CR438; see also CR51-70 (the 2008 agreement). Calleja did not say that the 2012 agreement did not also “pertain” to the account; he did not say he did not “receive” the 2012 agreement; and he did not controvert Mueller’s testimony by saying the 2012 agreement was not in effect or that the 2008 agreement was in effect at any

930505.20140273/2851932.1 material time. By his own admission, Calleja was not reviewing communications from Compass in February 2012, when the account agreement was revised. Nevertheless, he could have, but failed to controvert the testimony. See Trico Techs. Corp., 949 S.W.2d at 310.

Like the appellee in Trico Techs. Corp., in discovery Calleja could have inquired about, “the meaning of the ‘Al Nova Branches Only.” Compare Trico Techs. Corp., 949 S.W.2d at 310, and Calleja-Ahedo, 508 S.W.3d at 798. Calleja could have inquired about how Compass gave notice of the amendment. See Trico Techs. Corp.. Rather, Calleja relied solely on the statement that a 2008 document “pertain[ed]” to the account, and he “received” a copy from the bank. CR46; CR438. Notably, the “true copy” Calleja relied on bears Compass’ “bates” numbers on each page. Calleja “received” the copy he attached in discovery in this case, undermining any inference 9 or implication that Calleja received the 2008 agreement in the normal course of his banking business but did not receive the 2012 agreement the same way. See CR51-70. Thus, the Court of Appeals’ conclusion that Compass did not establish that the 2012 deposit agreement was “ever effective as to Calleja” is based on its outline of additional,

9 As cross-movant for summary judgment, Calleja is not entitled to any favorable inference. See Lewis v. Aurora Loan Services, No. 01-15-00362-CV, 2016 WL 887176, at *2 (Tex. App.—Houston [1st Dist.] Mar. ^[8], 2016, no pet.) (citing Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548–49 (Tex. 1985)). 930505.20140273/2851932.1 hypothetical evidence that Calleja did not present to controvert Mueller’s factually supported assertion that the 2012 agreement was the agreement in effect between the parties. See Trico Techs. Corp., 949 S.W.2d at 310; CBM Engineers, Inc., 403 S.W.3d at 346. Respectfully, Calleja is not entitled, by judicial fiat, to the benefit of an available litigation strategy that he did not pursue. The Court of Appeals erred by reversing the summary judgment in favor of Compass.

C. Calleja’s claims are precluded by Texas Business and Commerce Code section 3.406.

A customer’s actions can help prevent bank fraud. Even if a customer has never experienced fraud on a bank account, it is his duty under the law protect his own interests. In this case, Calleja had already been the victim of bank fraud and either knew or should have known that he needed to take care to protect himself. At a minimum, Calleja should have reviewed his monthly statements and kept his banking information protected, as he agreed to do in the Account agreement. Calleja should have asked his brother each month for a copy of the statement that his brother purportedly received on Calleja’s behalf.

If Calleja had monitored the Account after January 2012, he would have noticed that his June statement did not arrive as expected. Both the 2008 and the 2012 editions of the deposit agreement provide: “You agree to act in a 930505.20140273/2851932.1 prompt and reasonable manner in reviewing your statement or notice and reporting any exceptions to us.” CR65; CR212. This should include noticing a statement does not arrive when expected. The 2012 deposit agreement expressly incorporates this common sense idea: “Notify us promptly if you do not receive your statement by the date you would normally expect to receive it.” CR212. Calleja did not notice the May-June statement never arrived. Therefore, he did not notice or report a $33.23 charge for blank checks (CR246) that he later claimed was not authorized. Likewise, Calleja did not notice the absence of monthly statements until January 2014. CR47.10

Regardless whether the 2008 edition, the 2012 edition, or some other version of the deposit agreement was in effect, the deposit agreement between Compass and Calleja is “a contract in writing for all purposes.” Tex. Fin. Code § 34.301(a). The contract “may be evidenced by one or more agreements, deposit tickets, signature cards,11 or notices as provided by Section 34.302, or by other documentation as provided by law.” Id.; see also Tex. Fin. Code § 34.302.

10 Calleja’s failure to notice that he did not receive statements until late January 2014 is even more egregious since he had already been the victim of prior bank fraud on a different bank account. 11 See CR50. 930505.20140273/2851932.1 As the Court has written:

Contracting parties are generally not fiduciaries. See Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171, 177 (Tex. 1997). Thus, due diligence requires that each protect its own interests. See Barfield v. Howard M. Smith Co. of Amarillo, 426 S.W.2d 834, 840 (Tex. 1968) (“As a party to arm’s length business transactions, respondent had a duty to use ordinary care for the protection of its own interests”). Due diligence may include asking a contract partner for information needed to verify contractual performance. See [Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732 (Tex. 2001)] at 736; [HECI Exploration Co. v. Neel, 982 S.W.2d 881 (Tex. 1998)] at 886. If a contracting party responds to such a request with false information, accrual may be delayed for fraudulent concealment. Wagner & Brown, 58 S.W.3d at 737; HECI, 982 S.W.2d at 886. But failing to even ask for such information is not due diligence. See Wagner & Brown, 58 S.W.3d at 736; HECI, 982 S.W.2d at 886. Via Net v. TIG Ins. Co., 211 S.W.3d 310, 314 (Tex. 2006) (emphasis added). By failing even to ask about the May-June Account statement (or any subsequent statement), Calleja demonstrated a lack of diligence which, under similar facts, the Supreme Court of Washington said was “substantial evidence of negligence” under section 3.406. See Terry v. Puget Sound Nat. Bank, 492 P.2d 534, 535 (Wash. 1972) (per curiam).12 In addition to their failure to “inquire of the bank” about the absence of three successive months of statements, the Terry plaintiffs left blank checks in an unlocked drawer, easily accessible to the bad actor. See id. Similarly, in

12 Terry was tried to a jury. The Washington court reviewed and found sufficient evidence to support submission of the bank’s 3.406 affirmative defense. 930505.20140273/2851932.1 addition to failing to inquire of Compass about the absence of at least 18 monthly statements, Calleja, or one of the other account owners, left sufficient personal information unguarded and accessible for an interloper to have Compass redirect Account statements before the first transaction. Calleja failed to discharge his duty to use ordinary care for the protection of his own interests. Barfield, 426 S.W.2d at 840; Tex. Bus. & Com. Code § 3.406(a); Terry, 492 P.2d at 535. Despite Compass’ citation to Terry, the Court of Appeals did not discuss the case.

The first transaction Calleja claimed was not authorized was the imposter’s order for blank checks. CR246. The charge appeared on the May-June statement. Id. The statement had been redirected. Calleja did not ask why it did not arrive as expected. The next statement shows a $38,700.00 check paid on July 30, 2012. CR249. Calleja did not contact Compass to ask about this missing statement either. See Terry, 492 P.2d at 535.13

13 Under Calleja’s analysis, if a bank customer such as Calleja instructs the bank to mail statements to a relative, and then the bank complies as requested, there could be scenarios where a bank customer then never has to monitor the account. For example, if that bank customer then intentionally or inadvertently lets their banking information become compromised to allow an imposter to call the bank and have all the necessary information to change the address to which statements are sent, and such future statements are sent to a different address, under Calleja’s analysis, Calleja never has to notice that his account statements are no longer being sent per his direction, and he can simply ignore the account for 18 months. 930505.20140273/2851932.1 In Myrick v. Nat’l Sav. & Trust Co., a case from the District of Columbia court of appeals, the customer received only one bank statement and a few cancelled checks over about nine months. See Myrick v. Nat’l Sav. & Trust Co., 268 A.2d 526, 527 (D.C. 1970). The Myrick court affirmed judgment n.o.v. for the bank where “[t]he record is devoid of any evidence justifying [customer’s] failure to inquire of the bank as to her lack of receipt of monthly statements and cancelled checks” and “[held] that Miss Myrick was negligent as a matter of law in not making this inquiry of the bank ….” Id. at 527-28. Quoting its version of 3.406, the court held Myrick’s “‘negligence substantially contribute(d) [sic] … to the making of an unauthorized signature,’” precluding her claim. Id. Despite Compass’ citation to Myrick, the Court of Appeals did not discuss the case.

From at least as early as January 2012, six months before someone used his personal and account information to redirect the bank statements, Calleja ignored his account. He said, “There was no need to ‘keep track’ of banking information because no authorized checks (except perhaps two checks described in response to Interrogatory No. 10) would be shown in statements after May 2012.” CR321-22. It is not “authorized” activity that demands vigilance. See Barfield, 426 S.W.2d at 840 (stating that a party to an arm’s length business transaction has a duty to use ordinary care for the protection of his

930505.20140273/2851932.1 own interests and is charged with knowledge of all facts that would have been discovered by a reasonably prudent, similarly situated person). Rather, it is the risk of unauthorized activity which the customer is in the best position to guard against and demands Calleja’s diligence. See Martin, 29 S.W.3d at 92, 94 (noting the UCC’s purpose of allocating responsibility to the person best able to prevent loss and placing the risk of non-receipt of bank statements on the customer in the 4.406 context); Sw. Bank v. Info. Support Concepts, Inc., 149 S.W.3d 104 (Tex. 2004) (resolving perceived tension between Texas Civil Practice and Remedies Code Chapter 33 14 proportionate responsibility and UCC section 3–406’s comparative fault and liability scheme allocating the loss between two negligent—but innocent—parties.); John Hancock Fin. Servs., Inc. v. Old Kent Bank, 346 F.3d 727, 732 (6th Cir. 2003). Calleja willingly accepted the risk that unauthorized transactions could go undetected by asking Compass to mail statements to his brother’s home in The Woodlands then, “from time-to-time,” retrieving them, unopened. CR46; CR152. Calleja claimed he “never signed up for online access and relied completely” on reviewing statements mailed to The Woodlands. CR321; but see CR50. Where Calleja’s complete reliance (CR321) on retrieval of unopened statements “from time-to-time” meant Calleja did not

14 Tex. Civ. Prac. & Rem. Code § 33.001, et seq. 930505.20140273/2851932.1 review statements for at least 18 to 24 months (see id.), there was, as the trial court determined, a failure to exercise diligence as a matter of law. CR735; see also, Barfield, 426 S.W.2d at 840.

Unlike the trial court, the Court of Appeals focused on Calleja’s inattention to his affairs during the 18 months after the first transaction. As to the six months preceding the first transaction, the Court of Appeals noted, “there is scant summary judgment evidence concerning the circumstances under which the unknown third party obtained Calleja’s banking information and used that information to change the account address, obtain a debit card, order blank checks, and forge Calleja’s signature on several checks.” Calleja-Ahedo, 508 S.W.3d at 806. But scant evidence about how it occurred does not change the undisputed fact that someone obtained and used Calleja’s information.

There is no dispute that Calleja’s personal information was allegedly purloined and used to effectuate the fraud.15 Precisely because there is “scant evidence” of how that occurred, section 3.406 is implicated. Without evidence to the contrary, one assumes Calleja and Compass are both “innocent,” if potentially negligent, parties. With “scant evidence” (there is none) how Calleja’s

15 Calleja provided no evidence to the trial court that other signers had not changed the address. In other words, even if Calleja swore that he did not change the address, if another signer on the account had properly changed the address, the bank was doing as an account owner had directed. 930505.20140273/2851932.1 personal information was compromised, section 3.406 serves the “important objective” of the UCC “of promoting certainty and predictability in commercial transactions … [b]y prospectively establishing rules of liability that are generally based not on actual fault but on allocating responsibility to the party best able to prevent the loss by the exercise of care ….” Putnam Rolling Ladder Co., Inc. v. Manufacturers Hanover Tr. Co., 546 N.E.2d 904, 908 (NY 1989); Sw. Bank v. Info. Support Concepts, Inc., 149 S.W.3d 104, 109-10 (Tex. 2004). As the trial court recognized, Calleja was that party.

Calleja was in the best position to safeguard his personal and account information used by an interloper to telephone the bank and redirect monthly statements. 16 Regardless of the circumstances by which it was compromised, Calleja (or one of the other account owners or the brother) failed to protect his own interests by failing to safeguard the information. Barfield, 426 S.W.2d at 840. Further, it was Calleja’s choice to “rel[y] completely” on his sporadic (at best) approach to reviewing statements. CR321. Liberal construction and application

16 If this Court follows Calleja’s logic, one who has experienced bank fraud can notice that he did not receive a bank statement for a month, and under Calleja’s analysis, the law purportedly allows him to do nothing. Under Calleja’s analysis, even a person who has experienced bank fraud on another account does not have to review bank statements for as long as it takes to drain the entire account and then still can make a claim against his bank to recover the entire amount of the loss. Calleja’s argument cannot be reconciled with this Court’s prior determination that a customer is generally in the best position to prevent the loss. 930505.20140273/2851932.1 of section 3.406 in service of the purposes and policies of the UCC dictates that Calleja, not Compass, was the party best able to prevent the loss. Tex. Bus. & Com. Code § 1.103(a); Info. Support Concepts, Inc., 149 S.W.3d at 110; Martin, 29 S.W.3d at 93.

Having done nothing to keep track of his account since at least January (“there was no need” (CR321-22)), when the May-June 2012 statement did not arrive at The Woodlands address, like the Terry and Myrick plaintiffs, Calleja’s failure to make any inquiry compounded his negligence.17 Consistent with Terry and Myrick, applying the Government Code, and under the same rule employed by this Court in TIG Ins. Co., the Court of Appeals should have affirmed the trial court’s judgment. Tex. Gov’t Code § 311.028; see TIG Ins. Co., 211 S.W.3d at 314; 1/2 Price Checks Cashed v. United Auto. Ins. Co., 344 S.W.3d 378, 391 (Tex. 2011) (“The UCC should be construed to promote uniformity with other jurisdictions.”). In service of the important objectives of the UCC, the Court of Appeals should have affirmed. See Putnam, 546 N.E.2d at 908; Info. Support Concepts, Inc., 149 S.W.3d 104.

17 Had Calleja promptly informed Compass that his May 31, 2012 – June 28, 2012, statement was not received and requested a copy, he would have seen a debit for checks he claims he did not order. Had Calleja exercised a modicum of diligence, the July 31, 2012, transaction could have been prevented or, if not prevented, made known to Compass while viable opportunities for recovering the funds still existed. 930505.20140273/2851932.1 Rather than properly applying section 3.406, the Court of Appeals based its decision on the perceived absence of an explicit “operative statutory or contractual[18] provision that required Calleja to notice that he was not receiving statements … and to report those missing statements to the Bank within thirty days.” Calleja-Ahedo, 508 S.W.3d at 805. The court’s reliance on the conjunctive, “to notice” and “to report … within thirty days,” conflates sections 3.406 and 4.406.19 Section 3.406, a comparative negligence statute, recognizes a duty of ordinary care and precludes Calleja if his failure to discharge his duty “substantially contributes … to the making of a forged signature.” Tex. Bus. & Com. Code § 3.406. Thus, contrary to the statement by the Court of Appeals, section 3.406 is the “operative statutory … provision.” Calleja-Ahedo, 508 S.W.3d at 805. It is the operative statutory provision of a uniform law which the Court of Appeals glossed over with no reference to cited decisions of other jurisdictions. See Tex. Gov’t Code § 311.028; Tex. Bus. & Com. Code § 1.103(a)(3); 1/2 Price Checks Cashed, 344 S.W.3d at 391.

18 The 2012 deposit agreement includes the term, “[n]otify us promptly if you do not receive your statement by the date you normally would expect to receive it.” CR212. Both the 2008 and the 2012 deposit agreements require the customer to “report exceptions to us within thirty (30) days after we send or make the statement or notice available ….” CR65; CR212. 19 Indeed, there are two different sections in the UCC for a reason, and in this case, Calleja is trying to avoid both UCC sections and claim he never needed to review a bank statement if an imposter gets his banking information and changes his address. 930505.20140273/2851932.1 The Court of Appeals also failed to properly analyze the causation element of 3.406. See Calleja-Ahedo, 508 S.W.3d at 805. The court first erroneously tied Calleja’s duty of ordinary care to the “trigger” of 4.406. Id. It then utilized a questionable textual analysis of the trial court’s order to discount the effect of Calleja’s “from time to time” method of monitoring the Account on the interloper’s ability to drain the Account. Calleja-Ahedo, 508 S.W.3d at 806. The Court of Appeals read an expressly inclusive sentence to be exclusive 20 to support its conclusion. This analysis runs counter to the recognized objectives of the UCC, including certainty, predictability, and allocation of responsibility to the party best able to prevent the loss. See Info. Support Concepts, Inc., 149 S.W.3d at 109-10.21

Comment 2 to section 3.406 explains “what is intended” by use of “substantially contributes” in subsection (a), referencing Thompson Maple Products, Inc. v. Citizens Nat’l Bank of Corry, 234 A.2d 32, 34 (Pa. Super Ct. 1967). See Tex.

20 The trial court’s order states: “In particular, but not as the sole reason for this ruling, the Court rules that where the check at issue was cashed on July 30, 2012, and the Plaintiff did not notify the bank until January 29, 2014, as a matter of law Plaintiff has failed to exercise diligence in protecting himself from alleged fraud regardless of any shortcomings in sending bank statements.” CR539. 21 Under the Court of Appeal’s analysis, a bank customer can intentionally or inadvertently allow a third-party to get his bank information and call the bank and change the address. Then, the bank customer can do nothing indefinitely; and, if the bank account is drained, the bank is apparently absolutely liable. 930505.20140273/2851932.1 Bus. & Com. Code § 3.406 cmt. ^[2]. As one Oklahoma court explained (in a case not involving bank statements), “Section 3–406 requires less stringent proof than the ‘direct and proximate cause’ test for general negligence. Conduct is a contributing cause of an alteration or forgery if it is a substantial factor in bringing it about, or makes it ‘easier for the wrongdoer to commit his wrong.’” Bank of Nichols Hills v. Bank of Oklahoma, 196 P.3d 984, 986-87 (Okla. Civ. App. 2008) (citations omitted). The summary judgment record supports the trial court’s determination that Calleja’s chosen method of monitoring the Account by relying “completely” on reviewing statements delivered to The Woodlands, which he did not bother to retrieve for at least two years (CR321-22), together with the undisputed fact that some third party gained access to his personal and banking information made it “easier for the wrongdoer to commit his wrong.” Bank of Nichols Hills, 196 P.3d at 986-87.

In the Terry v. Puget Sound case mentioned above, the Washington court, relying on section 3.406, precluded the customers’ recovery for their failure to “inquire of the bank” about the absence of three successive months of statements, coupled with leaving blank checks in an unlocked drawer. Terry, 492 P.2d at 535. In the Myrick case, the District of Columbia court affirmed judgment n.o.v. for the bank where “[t]he record is devoid of any evidence

930505.20140273/2851932.1 justifying [customer’s] failure to inquire of the bank as to her lack of receipt of monthly statements and cancelled checks” and “[held] that Miss Myrick was negligent as a matter of law in not making this inquiry of the bank ….” Myrick, 268 A.2d at 527-28. Quoting its version of 3.406, the court held Myrick’s “‘negligence substantially contribute(d) [sic] … to the making of an unauthorized signature.’” Id. Despite Compass’ citations, the Court of Appeals did not discuss either case.

Ordinary care includes diligence to protect one’s own interests. See Via Net, 211 S.W.3d at 314. Like the customers in Myrick and Puget Sound, Calleja’s “failing even to ask” for information about his account was “not due diligence.” Id. (citing Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 736 (Tex. 2001)). Calleja’s cavalier, “[t]here was no need to ‘keep track’ of banking information because no authorized checks … would be shown” (CR321-22), was “not due diligence.” Via Net, 211 S.W.3d at 314.

As between Compass and Calleja, Calleja was in the best position to protect his personal and banking information. Calleja had experienced bank fraud in the past and should have had an even greater motivation to monitor his banking activities. He was in the best position to know if he was not receiving bank statements where and when he would normally expect them. Calleja was the party

930505.20140273/2851932.1 best able to prevent the loss by the exercise of ordinary care. Info. Support Concepts, Inc., 149 S.W.3d 104; Putnam Rolling Ladder Co., Inc., 546 N.E.2d at 908. [The Court of Appeals erred by reversing the trial court’s judgment.]

D. Calleja’s claims are precluded under Business and Commerce Code section 4.406.

While Article 3 of the Texas Business and Commerce Code, “Negotiable Instruments,” governs rights and duties of parties to negotiable instruments like the check at issue here, Article 4, “Bank Deposits and Collections,” governs the relationship between a bank and its customer. In Martin, a live-in girlfriend took funds from Martin’s account without his permission and concealed her fraud by intercepting monthly statements. See Am. Airlines Emps. Fed. Credit Union v. Martin,

29 S.W.3d 86 (Tex. 2000). Martin argued that since he never received the bank statements, he never had a duty to report unauthorized transactions. This Court rejected this argument and explained that the customer’s burden to discover unauthorized transactions “includes the risk of non-receipt of account statements.” Id. at 94.

Calleja claims that because the monthly bank statements were sent to the new address, Calleja had no duty to review the statements, report any alleged improper disbursements, or alert the bank that he was no longer receiving statements. Calleja acknowledges that he did nothing to monitor the account for

930505.20140273/2851932.1 approximately 24 months and did not notice that funds were taken from the account during this time. CR46-49; CR321-22. Between a customer and his bank, the customer is in the best position to know whether he received his monthly bank statement, and the customer should notify the bank accordingly and request a duplicate copy.

This argument ignores the UCC statutory scheme, which “provides for an allocation of responsibility between the customer and a financial institution according to which party is best able to prevent loss.” Okonkwo v. Washington Mutual Bank, FA, No. 14-05-00925-CV, 2007 WL 763821, at *6 (Tex. App.— Houston [14th Dist.] Mar. 15, 2007, no pet.).22

The customer’s duty to exercise reasonable care to discover and report unauthorized transactions is triggered when the bank provides “sufficient information,” which is “statutorily defined as a bank ‘send[ing] or mak[ing] available to a customer a statement of account showing payment of items for the account….’” Okonkwo, 2007 WL 763821, at * 6 (quoting Tex. Bus. & Com. Code § 4.406(a)) (emphasis added); see, e.g., Schiro, 68 S.W.3d at 57. The official UCC comment makes clear that: “[t]he ‘safe harbor’ provided by subsection (a) serves to

22 See also Schiro v. Texas Community Bank, 68 S.W.3d 55, 57 (Tex. App.—Dallas 2001, no pet.); Cross Creek Investments, Inc. v. First State Bank, No. 03-00-00439-CV, 2001 WL 459177 (Tex. App.—Austin May 3, 2001, no pet.). 930505.20140273/2851932.1 permit a bank, based on the state of existing technology, to trigger the customer’s duties under subsection (c) ….” Tex. Bus. & Comm. Code § 4.406, cmt. 1 (emphasis added).

Compass made “available” to Calleja a statement of account and supplied “sufficient information” identifying the disbursements and checks at issue.23 See CR397. Again, if Calleja did not receive a statement, he should have exercised ordinary care and contacted the bank to request a statement. See CR397. Calleja presented no evidence that he did so.

Calleja argues that he had no duty to monitor his monthly banking activity unless and until Compass sent a monthly bank statement. This argument ignores both provisions in the deposit agreement and that section 4.406 is entitled, Customer’s Duty to Discover and Report Unauthorized Signature or Alteration, and that this Court stated as follows:

Section 4.406 acknowledges that the customer is best situated to detect unauthorized transactions on his own account by placing the burden on the customer to exercise reasonable care to discover and report such transactions.

23 If a bank customer’s account information becomes compromised, the bank is called with that information, and the address is changed so the customer never receives another monthly statement, under Calleja’s arguments, the customer never has to notify the bank that he has not received statements, and he can recover damages from the bank for an indefinite period of time once the account has been completely drained. 930505.20140273/2851932.1 Martin, 29 S.W.2d 86 at 92. Later in its opinion, this Court stated, Further, as we have said, the purpose of section 4.406 is to place the burden on those best able to detect unauthorized transactions so that further unauthorized transactions can be prevented, and this burden includes the risk of non-receipt of account statements. Necessarily then, the burden must fall on the customer, the one most familiar with the underlying transaction. Id. at 94 (emphasis added). A bank customer is in the best position to know whether he received a monthly statement, and if not, the exercise of ordinary care requires that he alert the bank. Allowing a customer to avoid a duty to report unauthorized transactions in this situation undermines the reasoning of Martin.

Even if the statements were no longer sent to his brother’s address—a situation that apparently neither Calleja nor his brother were monitoring—Calleja could have obtained additional copies of statements. Moreover, Compass made them available in several different ways. See CR397-98. Calleja received statements until the address was changed in 2012. All of the statements Calleja admitted receiving stated, “If you have any questions about your statement, call Customer Service at 1- 800-266-7277.” CR397. Thus, Calleja had information available to contact the bank to inquire about the status of his account. See CR397. Compass did not refuse to make them available. See CR397-98. Calleja could also have visited a bank branch to obtain them. See CR397. Alternatively, Calleja could have reviewed the statements by obtaining online banking for free. See CR397-98. The

930505.20140273/2851932.1 Court of Appeals used a strained interpretation of the contract and purported facts to avoid holding Calleja responsible for failing to timely notify the bank.

It is settled under section 4.406 that by mailing properly addressed statements to the customer the bank makes them available. See, e.g., In re Estate of Berry, 280 S.W.3d 478, 480–81 (Tex. App.—Dallas 2009, no pet.); Tex. Bus. & Com. Code § 1.201(b)(36); see also Jefferson State Bank v. Lenk, 323 S.W.3d 146, 149 (Tex. 2010). The limits of what else may constitute making bank statements available in particular circumstances are not yet defined.

The Court determined in Lenk that when the customer is deceased and no representative appointed, a bank holding statements makes them available. Lenk, 323 S.W.3d at 149 (noting an estate administrator’s authority and duties under the Probate Code—now the Texas Estates Code—including, to “collect and take into possession the personal property … of the estate ….”); see, e.g., Tex. Estates Code § 351.102. The Court distinguished its decision in Lenk from a Georgia Supreme Court case, First Citizens Bank of Clayton County v. All-Lift of Georgia, Inc., 55 S.E.2d

1 (Ga. Ct. App. 2001), on the basis that the customer there was not deceased. Lenk, 323 S.W.3d at 150, n. 7. The Georgia court found “that a bank does not make statements available within the meaning of [4-406] by merely holding statements and doing nothing more.” All-Lift of Georgia, Inc., 555 S.E.2d at 3. The

930505.20140273/2851932.1 Georgia court further stated that the bank’s policy of holding statements pursuant to a written request would “probably qualify as making them available within the meaning of [4.406].” Id. But, in that summary judgment case, the bank produced, “at best, only circumstantial evidence” of any such request and, All Lift’s president submitted an affidavit providing direct evidence that the customer never authorized the bank to hold statements. Id.

The 1988 signature card states in the “mailing address” blank: “Hold All Correspondence Fuente De Baco #13 Tecamachalco, Mexico D.F.” CR50, CR230. The same document, a part of both Calleja’s and Compass’ summary judgment evidence, provides: “Depositor shall immediately notify Bank in writing of any change in the information given to Bank as appears herein.” CR50; CR230. Unlike the All-Lift case, the record here includes more than mere circumstantial evidence of Calleja’s written instruction to hold bank statements. And, in this case, there is a complete absence of evidence that Calleja ever gave Compass written notice changing the “information given to the Bank” in 1988. CR50; CR230.

With no evidence of any written notice, the Court of Appeals credited Calleja’s affidavit testimony that he “directed that the bank statements” be mailed to his brother’s address (CR46), and that neither he nor another signatory “requested or directed the Bank at any time after 2008 to change the address on

930505.20140273/2851932.1 the Account … or to retain the Account statements at the Bank.” Calleja-Ahedo, 508 S.W.3d at 803. Upon this affidavit testimony, the Court of Appeals concluded that “the parties contractually limited the ways in which the Bank could make account statements available to Calleja, and both parties are bound by this limitation.” Id. (citing Compass Bank v. Nacim, 459 S.W.3d 95, 108 (Tex. App.—El Paso 2015, no pet.)).

Parties, of course, have the power to modify their contracts. See, e.g., Hathaway v. Gen. Mills, Inc., 711 S.W.2d 227, 228 (Tex. 1986). However, whether a contract has been modified depends on the parties’ intent, a quintessentially factual inquiry. Id. at 228-29 (citing Coastal Plains Development Corp. v. Tech-Can Corp., 531 S.W.2d 143 (Tex. Civ. App.—Houston [1st Dist.] 1975, writ ref ’d n.r.e.)). Here there are no facts to support a modification. By its terms, the signature card requires notice “in writing of any change in the information given to” Compass. CR50; CR230. Calleja presented no evidence or authority that would exclude changing the record “Mailing Address” … “Hold All Correspondence Fuente De Baco #13 Tecamachalco, Mexico D.F.” from the requirement for written notice. CR50; CR230. In order to prove the contract was modified as the Court of Appeals concluded, Calleja had the burden of proving (conclusively as summary judgment movant) that he changed his mailing address of record by the agreed

930505.20140273/2851932.1 method, written notice. See Hathaway, 711 S.W.2d at 229. There is no such evidence—certainly no conclusive evidence. There is a complete absence of evidence that Calleja notified Compass in writing or that Compass agreed at any time that mailing statements to Calleja’s brother’s address would be the exclusive method for making statements available.24

Further, as summary judgment movant,25 Calleja is not entitled to an inference that when he “directed” Compass to send statements to his brother’s address that the direction was in writing.26 See Lewis v. Aurora Loan Services, No. 01-15-00362-CV, 2016 WL 887176, at *2 (Tex. App.—Houston [1st Dist.] Mar. ^[8], 2016, no pet.) (citing Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548–49 (Tex. 1985)). Calleja is not entitled to an inference that by accommodating the

24 Both editions of the deposit agreement include a “nonwaiver” provision: “No departure by us from the provisions of this Agreement … shall constitute a waiver by us of any further right to impose … or enforce the provisions of this Agreement ….” CR70; CR218. Nonwaiver provisions in contracts are binding and enforceable. Shields Ltd. P’ship v. Bradberry, 526 S.W.3d 471, 481 (Tex. 2017). 25 The parties filed cross motions for summary judgment, and the court of appeals reversed the summary judgment entered in favor of Compass (under which it would be proper to grant an inference in favor of Calleja) and instead directed judgment be entered on Calleja’s affirmative motion for summary judgment (under which all inferences should be resolved in favor of Compass, as the non-movant). See, e.g., Apache Indus. Painting v. Gulf Copper & Mfg. Corp., No. 01-08-00812-CV, 2010 WL 1611450, at *2 (Tex. App.—Houston [1st Dist.] Apr. 22, 2010, no pet.) (citing FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000); Tex. Mun. Power Agency v. Pub. Util. Comm’n of Tex., 253 S.W.3d 184, 192, 199 (Tex. 2007)). 26 Calleja produced no evidence in the trial court that other signatories had also not called Compass or shared the banking information. 930505.20140273/2851932.1 request Compass agreed that mailing statements to the brother’s address became the exclusive method of making them available or that it waived the right to rely on the signature card as a component of the written contract. Id.; see also Shields Ltd. P’ship v. Bradberry, 526 S.W.3d 471, 481 (Tex. 2017) (acknowledging nonwaiver provisions in contracts are binding and enforceable); CR70; CR218.

The Court of Appeals, moreover, has no authority to find or impliedly find such omitted, necessary facts. See, e.g., Texas Nat’l Bank v. Karnes, 717 S.W.2d 901, 903 (Tex. 1986); Levine v. Steve Scharn Custom Homes, Inc., 448 S.W.3d 637, 653 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) (citing Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003). Without proof of those facts, there is a complete absence of support for the Court of Appeals conclusion, as stated, that “the parties contractually limited the ways in which the Bank could make account statements available to Calleja.” Calleja-Ahedo, 508 S.W.3d at 803. There is no evidence that the parties formed the contract the Court of Appeals conclusion necessarily implies. Because the signature card formed a part of the agreement at all times, moreover, any contractual limitation on how Compass could make statements available necessarily includes Compass’ right to “hold all correspondence,” unless and until that “information” was changed by written

930505.20140273/2851932.1 notice, regardless whether the 2008 deposit agreement, the 2012 deposit agreement, or neither of them was effective at material times. See CR50; CR230.

The passage from the Nacim case quoted by the Court of Appeals is part of the El Paso court’s contract analysis to determine the effect of what it determined was a contractually modified section 4.406 “trigger” date. Nacim, 459 S.W.3d at 107-08. With respect for both courts, the ambiguity analysis in Nacim is inapposite, if flawed,27 and the Court of Appeals reliance on Nacim in this case is misplaced.

The deposit agreement language in Nacim and in this case is the same:

You agree that you will carefully examine each account statement or notice you receive and report any exceptions to us promptly after you receive the statement or notice. You agree to act in a prompt and reasonable manner in reviewing your statement or notice and reporting any exceptions to us. If you do not report an exception to us within thirty (30) days after we send the statement or notice to you, you agree that we will not be liable to you for any loss you suffer related to that exception. This means that, if you do not report exceptions to us within thirty (30) days after we send the statement or notice to you, we will not reimburse you for any loss you suffer, including, but not limited to, any amounts lost as a result of: paying any unauthorized, forged, or altered item .... 27 “‘A contract is ambiguous when its meaning is uncertain and doubtful or is reasonably susceptible to more than one interpretation.’” Nacim, 459 S.W.3d at 107 (quoting Heritage Resources, Inc. v. NationsBank, 939 S.W.2d 118, 121 (Tex. 1996)). Contrary to the El Paso court’s interpretation, the deposit agreement does not “require[]” in the first two sentences quoted above that “the customer report questionable transactions once the customer actually receives the account statement.” Nacim, 459 S.W.3d at 108. Rather, those sentences embody the customer’s agreements to carefully examine and report exceptions after receiving a statement and to act in a prompt and reasonable manner in reviewing statements and reporting exceptions. See id. The two sentences which follow do not create ambiguity; they merely specify when (“after we send the statement”) the agreed, thirty day reporting period begins and what that means to the bank’s liability.

930505.20140273/2851932.1 Calleja-Ahedo, 508 S.W.3d at 803 (emphasis by Court of Appeals); Nacim, 459 S.W.3d at 108; see also CR65 (2008 deposit agreement). The El Paso court in Nacim reviewed the contract for ambiguity as to when the agreed, thirty day period to report exceptions began to run. Nacim, 459 S.W.3d at 107. The parties’ agreement that thirty days was the measure of “reasonable promptness” (Tex. Bus. Com. Code § 4.406 (c)) in examining statements was central to the bank’s defense in Nacim where thirty three days elapsed between “sending” and reporting. Nacim, 459 S.W.3d at 104. In this case, Compass’ defenses did not require reliance on a contractually agreed notice period—Calleja did not notify Compass of any exception for over eighteen months. And neither party here suggested ambiguity in any part of the deposit agreement.

To the extent the Court of Appeals relied on Nacim to hold that Calleja’s duty to report “never arose under the 2008 Agreement” (Calleja-Ahedo, 508 S.W.3d at 803) based on use of the word “send” (or “receive”) in the above quoted excerpt, Compass and Calleja, nonetheless, agreed on the meaning of “made available” in both the 2008 and the 2012 deposit agreements, and they expressly agreed in the signature card that that Compass would hold all correspondence.

Paragraphs (a) and (c) of section 4.406 each use the disjunctive, “sends or makes available”; paragraph (f) uses the past tense, “made available.” Tex. Bus. &

930505.20140273/2851932.1 Com. Code 4.406(a), (c), (f). These provisions of the UCC “shall be liberally construed and applied to promote its underlying purposes and policies.” Martin, 29 S.W.3d at 93. Calleja and Compass agreed in 1988 that Compass would “hold all correspondence.” CR50; CR230. They agreed in 1988 that the “Depositor [Calleja] shall immediately notify Bank in writing of any change in the information given to Bank as appears herein.” CR50; CR230. The signature card is part of the agreement between Compass and Calleja. Tex. Fin. Code §§ 34.301(a). Compass and Calleja reiterated in 2008 (and in 2012) their agreement that Calleja would give written notice of any change of address. CR65; CR212.

Compass and Calleja agreed in 2008 (and in 2012) that Compass “may make statements … available” by “holding” them or delivering them to Calleja “in accordance with your request or instructions.” CR65; CR212. Neither the 2008 nor the 2012 editions of the deposit agreement amends the terms of the signature card to the effect that Compass can no longer “hold all correspondence.” To the contrary, both writings permit it and expressly provide that by doing so, Compass made such statements available. CR65; CR212. When courts interpret a contract, they are to examine the entire agreement and give effect to each provision so that none is rendered meaningless. See, e.g., Kachina Pipeline Co., Inc. v. Lillis, 471 S.W.3d 445, 450 (Tex. 2015).

930505.20140273/2851932.1 To conclude that the language quoted by the Court of Appeals and by the court in Nacim obviates the parties’ express agreement as to what constitutes making statements available is contrary to this basic tenet of contract construction. The agreement that, “We may make statements … available to you by holding all or any of these items for you, or delivering all or any of these items to you, in accordance with your instructions” (CR65; CR212), would be rendered meaningless in the context of either deposit agreement. Kachina Pipeline Co., 471 S.W.3d at 450. It cannot have been the “true intention of the parties” (Kachina Pipeline Co., 471 S.W.3d at 450 (quoting Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323, 333 (Tex. 2011)) that an agreement to a specific period in which to report exceptions following receipt of a statement or the sending of a statement means that when a statement is either not received, or is it made available other than by sending, the customer is absolved of all responsibility to monitor his account for all time. Such a result would undermine the UCC’s “carefully considered allocation of responsibility” between a bank and its customer. Info. Support Concepts, Inc., 149 S.W.3d at 107.

As the Court stated in Martin:

Section 4.406 acknowledges that the customer is best situated to detect unauthorized transactions on his own account by placing the burden on the customer to exercise reasonable care to discover and report such transactions.[] The customer’s duty to exercise this care is

930505.20140273/2851932.1 triggered when the bank satisfies its burden to provide sufficient information to the customer. Martin, 29 S.W.3d at 92 (footnote omitted). Section 4.406 permits a bank either to send or to otherwise make available the account information. Tex. Bus. & Com. Code § 4.406(a), (c), (f). As in Martin, when Compass satisfied its section 4.406 burden by making sufficient information available as agreed, i.e., “by holding all or any of these items for [Calleja] in accordance with [his] instructions” (CR65; CR212; see also CR50; CR230), Calleja’s duty to “promptly notify” Compass was triggered. Tex. Bus. & Com. Code § 4.406 (c). As the trial court correctly determined, Calleja failed to discharge that duty. The judgment of the Court of Appeals should be reversed and the judgment of the trial court reinstated.

Other Texas courts have recognized and applied the UCC statutory scheme, which “provides for an allocation of responsibility between the customer and a financial institution according to which party is best able to prevent loss.” Okonkwo v. Washington Mutual Bank, FA, No. 14-05-00925-CV, 2007 WL 763821, at *6 (Tex. App.—Houston [14th Dist.] Mar. 15, 2007, no pet.) (citing Martin, 29 S.W.3d at 92); see also Schiro v. Texas Community Bank, 68 S.W.3d 55, 57 (Tex. App.— Dallas 2001, no pet.); Cross Creek Investments, Inc. v. First State Bank, No. 03-00- 00439-CV, 2001 WL 459177 (Tex. App.—Austin May 3, 2001, no pet.). The courts uniformly recognize the disjunctive nature of 4.406, that the customer’s

930505.20140273/2851932.1 duty to exercise reasonable care to discover and report unauthorized transactions is triggered when the bank provides “sufficient information,” which is “statutorily defined as a bank ‘send[ing] or mak[ing] available to a customer a statement of account showing payment of items for the account….’” Okonkwo, 2007 WL 763821, at * 6 (quoting Tex. Bus. & Com. Code § 4.406(a)) (emphasis added); see, e.g., Schiro, 68 S.W.3d at 57.

In Texas, the “cardinal rule of statutory construction is to ascertain the ‘legislature’s intent,’ and to give effect to that intent. The duty of the court is to construe a statute as written and ascertain the legislature’s intent from the language of the act.” LaSalle Bank Nat’l Ass’n v. Sleutel, 289 F. 3d 837, 839 (5th Cir. 2002) (citing Union Bankers Ins. Co. v. Shelton, 889 S.W.2d 278, 280 (Tex. 1994); Morrison v. Chan, 699 S.W.2d 205, 208 (Tex. 1985)). Further informing the legislative intent, the official UCC comment makes clear that: “[t]he ‘safe harbor’ provided by subsection (a) serves to permit a bank, based on the state of existing technology, to trigger the customer’s duties under subsection (c) ….” Tex. Bus. & Com. Code §4.406 cmt. 1 (emphasis added). Existing technology includes on- line access to account statements. See, e.g., Kaplan v. JPMorgan Chase Bank, N.A., No. 14-C-5720, 2015 WL 2358240 (N.D. Ill. May 12, 2015). The plaintiff in Kaplan argued that she had not seen account statements, and this was why she waited

930505.20140273/2851932.1 more than a year to report alleged unauthorized disbursements. The bank confirmed that the account statements were made available online each month. Kaplan claimed that she had problems using her online banking access, but the court concluded the statements were made available after reasoning that plaintiff also could have obtained her account statements by going to her local branch by requesting them either in person or by phone.

Here, if Calleja—who knew statements were being generated—could have used online banking but chose not to, or he could have called the bank and requested a copy of any monthly statement. See Tatis v. U.S. Bancorp, 473 F.3d 672, 675–76 (6th Cir. 2007) (finding that where Tatis, who knew that monthly statements were generated and originally had elected to have his statements held by the bank, that “the statements were ‘made available’” under Ohio’s version of section 4.406). Like in this case, there was no evidence in Tatis that the bank ever refused to provide any copy or refused to provide online access. CR397; Tatis, 473 F.3d at 675. Plus, the backs of the statements that were mailed to Calleja’s brother’s address had both addresses and phone numbers for Calleja to call to get information from Compass. See CR397. Nevertheless, Calleja never contacted Compass to get a copy of his statement or to inquire why statements were no being received at the Woodlands address. See CR397. Calleja elected not to take

930505.20140273/2851932.1 advantage of the existing technology, online banking; he did not visit or contact any Compass branch; Calleja made no effort for eighteen months to review any bank statements.28 See CR397-98. Nor did Calleja ever contact Compass to verify the balance of his account. Calleja wholly failed to monitor the status of his bank account for six months before and eighteen months after the first unauthorized transaction. There is no evidence that he would have reviewed the statements even if the statements had been delivered to his brother’s apartment.

Again, if Calleja did not receive a statement, he had a duty of ordinary care and should have contacted Compass to find out why statements were no longer being sent to the Woodlands. Compare Borowski v. Firstar Bank Milwaukee, N.A., 579 N.W.2d 247, 250 (Wis. Ct. App. 1998) (stating where properly addressed statements are intercepted by an interloper, the customer still is not relieved of his or her responsibilities to either examine the statements or find out why they are not coming). Calleja presented no evidence that he made any effort to discharge his responsibility. See Barfield, 426 S.W.2d at 840.

28 Calleja, through his brother who was allegedly receiving the monthly statements, knew or should have known if the statements were, in fact, not being received. See CR306. 930505.20140273/2851932.1 E. Other courts have interpreted the term “made available” as it applies to Texas Business and Commerce Code section 4.406, and the Court of Appeals’ construction of section 4.406 differs from other courts when it determined that Compass had not made the bank statements “available” per section 4.406, which is likely a matter of first impression under Texas law. The Appellate Court relied in part on Jefferson State Bank v. Lenk in trying to analyze the “made available” provision in section 4.406. See Jefferson State Bank v. Lenk, 323 S.W.3d 146 (Tex. 2010). In that case, the bank customer had died, and the Court discussed what banks need to do after a customer’s death because the customer was no longer able to receive statements or report purported unauthorized transactions. The present case is distinguishable because Calleja has always been alive throughout this dispute. Calleja simply failed to review any of his bank statements for approximately two years. See CR46-47.

There does not appear to be any Texas case that has construed what constitutes “mak[ing] available” bank statements when the customer is alive and never tells the bank that he is not receiving statements or when an alleged imposter causes bank statements to be sent to a new address, and the customer fails to inform the bank he is no longer getting statements.

Under section 4.406, “[t]he plain language of the statute [thus] simply require[s] the Bank to ‘send or make available’ account statements.” Okonkwo

930505.20140273/2851932.1 v. Washington Mutual Bank, FA, No. 14-05-00925-CV, 2007 WL 763821, at *6 (Tex. App.—Houston [14th Dist.] March 15, 2007, no pet.) (emphasis added); see also Schiro v. Texas Community Bank, N.A., 68 S.W.3d 55, 57 (Tex. App.— Dallas 2001, no pet.). In Texas, the “cardinal rule of statutory construction is to ascertain the ‘legislature’s intent,’ and to give effect to that intent. The duty of the court is to construe a statute as written and ascertain the legislature’s intent from the language of the act.” LaSalle Bank Nat’l Ass’n v. Sleutel, 289 F. 3d 837, 839 (5th Cir. 2002).29

Here, if Calleja had called the bank and requested a duplicate copy of the monthly statement, and the bank had refused to provide a duplicate copy, then this would show that the statements were not made available. The backs of the monthly statements Calleja did receive had several addresses or phone numbers for Calleja to call to get information from Compass. However, Calleja in this matter never contacted Compass to get a duplicate copy. See CR305; CR397. Calleja could have used online banking, visited a branch or done other things to review statements. 30 See CR397-98. Instead, Calleja wholly failed to monitor the

29 Surely the legislature did not intend for a bank customer to never have to notify a bank if they stop receiving bank statements. 30 Calleja, through his brother who was allegedly receiving the monthly statements, knew or should have known if the statements were not being received. See CR306. 930505.20140273/2851932.1 status of his bank account. There is no evidence that he would have reviewed the statements even if the statements had been delivered to his brother’s apartment.

The Supreme Court of Minnesota analyzed the issue of placing the risk of non-receipt of bank statements on the bank customer as opposed to the bank. See Stowell v. Cloquet Co-op Credit Union, 557 N.W.2d 567 (Minn. 1997). In Stowell, the customer argued that the customer had not received statements and said the statements were not “made available” under the UCC. The credit union mailed duplicate statements, but Stowell claimed not to receive them, likely because they were intercepted by the purported wrongdoer. At no time did Stowell go to the bank branch and ask that a statement be printed or otherwise provided to him. The court explained, “[a]llowing accountholders to avoid their duty to inspect their account statements by denying receipt of the account statements would place unreasonable financial burdens on banks and other financial institutions by forcing them to prove receipt either through the use of certified mail or by individually contacting the customers, or to confirm that they had, in fact, received their account statement. Such measures would often be prohibitively expensive.” Id. at 572 (emphasis added).

930505.20140273/2851932.1 Likewise, the court in Borowski confirmed that, even if a customer claimed that the bank was at fault for allegedly not properly sending out the statements, the bank customer is not relieved of his or her responsibilities “to either examine those statements and/or find out why they are not coming.” Borowski v. First Star Bank Milwaukee, 579 N.W.2d 247, 250 (Wis. Ct. App. 1998). In Wetherill, the court explained that for several years, the plaintiff sought never to review the account statements and never contacted the bank to ensure that everything was as it should be. See Wetherill v. Putnam Investments, 122 F.3d 554, 556 (8th Cir. 1997). In Wetherill, the plaintiff argued that the statements were not “properly addressed” because they were mailed to an address other than the one that plaintiff had agreed to for the receipt. Id. at 556. However, the court held that had Wetherill exercised “reasonable diligence”, he would have discovered the forgeries years before he did so. Id. at 557.

Similarly, other courts have held that bank statements were “made available” although the depositor did not receive the statements. See Woods v. MONY Legacy Life Ins. Co., 641 N.E.2d 1070 (N.Y. 1994); McMickle v. Girard Bank, 515 A.2d 16 (Pa. Super. Ct 1986) Myrick, 268 A.2d at 527 (holdings that (Myrick) was negligent as a matter of law for failing to inquire with the bank as to her lack of receipt of monthly statements and cancelled checks).

930505.20140273/2851932.1 In Westport Bank & Tr. Co. v. Lodge, 325 A.2d 222 (Conn. 1973) the bank depositor failed to receive her bank statements and did not notify the bank. See Lodge, 325 A.2d at 223. Because the fraudster had changed the mailing address on her bank account, Lodge failed to receive bank statements for more than two years. Id. Lodge at no time attempted to reconcile her bank statements or inquire of the bank during the two years, and the court held that the lack of effort to examine the bank statements on the part of Lodge constituted negligence so as to preclude liability of the bank. See also General Petroleum Products, Inc. v. Merchants Trust Co., 160 A. 296, 299 (Conn. 1932).

F. There are strong policy reasons for the Court to decide this case and affirm the trial court’s judgment. Because there is a substantial likelihood that similar facts will occur in the future, this Court should continue to interpret and apply the UCC in a way that clarifies that customers are responsible for monitoring their banking activity and are not to be rewarded for their failure to do so. This Court should not excuse Calleja’s admitted, intentional failure to monitor his account for two years (particularly after he had already experienced bank fraud). See CR46-48. If the court’s decision stands, nothing will prevent a bank customer from entrusting oversight of an account to a friend or relative, abdicating all personal responsibility. If the person allegedly monitoring the account has the

930505.20140273/2851932.1 customer’s account information and personal information, the person can have the bank change the account address without the customer’s knowledge. Then, by omission or design, that person could fail to mention to the customer that statements are not being received where the customer expected them for six months, eighteen months, or two years. The customer’s willful ignorance would allow a bad actor (or co-conspirator) to drain the account, supposedly without the customer’s knowledge.

Accordingly, if the Court of Appeals’ ruling in this case stands, the customer has no duty to discover and to report the “loss” he facilitated by failing to protect his banking information and willfully ignoring his account, leaving the bank liable for the loss. There would be no way for the bank to prevent this type of fraud. Permitting a customer to not report that he did not get bank statements for 18 months and bear no responsibility is an unjust result. The customer is in the best position to monitor his own account activity. Sound policy dictates that there must be some degree of responsibility for a customer to notify the bank if monthly statements stop arriving.

930505.20140273/2851932.1 G. Without the 2012 agreement and without the 2008 agreement, there is only one writing material to the parties’ agreement in the record, the 1988 signature card. The only writing both parties agree was part of the contract is the 1988 signature card; both offered the card as evidence. See CR46, 50; CR203, 230. Regardless whether the 2012 version or the 2008 version, or some other version of deposit agreement also might have been “in effect,” the signature card is part of the contract. Tex. Fin. Code § 34.301(a). The card includes the parties’ agreement that Compass was authorized to “Hold All Correspondence”:

CR50; CR230. Calleja offered no evidence that he rescinded his agreement authorizing Compass to “hold all correspondence.” As a movant, he is not entitled to any inference in his favor. See Lewis v. Aurora Loan Services, 01-15- 00362-CV, No. 2016 WL 887176, at *2 (Tex. App.—Houston [1st Dist.] Mar. ^[8], 2016, no pet.) (citing Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548–49 (Tex. 1985)). Calleja offered no evidence or authority that Compass’ subsequent agreement to provide copies of statements to Calleja’s brother necessarily revoked the existing, written agreement authorizing Compass to hold all correspondence. By the clear terms of the only writing in the record which both 930505.20140273/2851932.1 parties agree applies, Compass made all statements available at its banking locations as expressly agreed between the parties. Calleja’s claims are precluded by the contract and by section 4.406 of the Business and Commerce Code. CR50; Tex. Bus. & Com. Code § 4.406.

H. The Court of Appeals improperly construed plain language in the trial court’s order. The Court of Appeals’ interpretation of the trial court’s statement that Calleja “has failed to exercise diligence in protecting himself from the alleged fraud” as referring only to “Calleja’s lack of diligence post-forgery” is impermissibly narrow. See Calleja-Ahedo, 508 S.W.3d at 806. Rather than “the context of the final judgment itself” (id.), the scope of the context should have been the entire record: “Reviewing courts do not disregard the evidence supporting the motion.” City of Keller v. Wilson, 168 S.W.3d at 824 (Tex. 2005); see also Kennamer v. Estate of Noblitt, 332 S.W.3d 559, 566 (Tex. App.—Houston [1st Dist.] 2009, pet. denied).

The Court of Appeals read an expressly inclusive sentence to be exclusive31 to support its conclusion. See In Matter of Estate of Downing, 461

31 The trial court’s order states: “In particular, but not as the sole reason for this ruling, the Court rules that where the check at issue was cashed on July 30, 2012, and the Plaintiff did not notify the bank until January 29, 2014, as a matter of law Plaintiff has failed to exercise diligence in protecting himself from alleged fraud regardless of any shortcomings in sending bank statements.” CR539. 930505.20140273/2851932.1 S.W.3d 231, 238 (Tex. App.—El Paso 2015, no pet.) (citing El Paso Field Servs., L.P. v. MasTec N. Am., Inc., 389 S.W.3d 802, 805–06 (Tex. 2012); see also Tyler v. Henderson, 162 S.W.2d 170, 175 (Tex. Civ. App.—Fort Worth 1942, writ ref’d w.o.m.) (“We must give verity to the judgment of the court having such jurisdiction; we will not construe its language so as to destroy its legal effect ….”). The trial court’s judgment does not exclude or negate reliance on the conclusively established facts that Calleja failed to safeguard his personal and banking information and ignored his account for six months before account funds paid for blank check stock in June (CR246) and before one of those checks was paid in July, 2012 (CR249). See also CR321-22. Had Calleja paid attention, personally or through his brother, he would have noticed when— before any forgery occurred—his bank statement did not arrive at the Woodlands address. See Myrick, 268 A.2d at 527-28. The Court of Appeals’ restrictive reading of the judgment fails to give due effect this material part of the summary judgment record; i.e., Calleja’s lack of diligence pre-forgery, including his obvious failure to safeguard his personal information, making it “easier for the wrongdoer to commit his wrong.” Bank of Nichols Hills, 196 P.3d at 986-87; Tex. Bus. & Com. Code § 3.406(a).

930505.20140273/2851932.1 As the Maryland court of appeals stated, “[t]he common thread running through [cases discussing section 3-406] is that the substantial contribution test under the UCC includes negligent conduct on the part of the [person precluded] which previously had been viewed as too remote in the chain of causation to preclude recovery.” Dominion Const., Inc. v. First Nat’l Bank of Maryland, 163, 315 A.2d 69, 73-74 (Md. 1974). The “new” UCC standard replaced proximate cause with the “substantial factor” test. Id. The New Jersey court explained: “[t]he language of [section 3.406] … states plainly that it is the contribution to the forgery rather than the negligence that must be substantial.” Gast v. Am. Cas. Co. of Reading, Pa., 240 A.2d 682, 685 (N.J. Super. Ct. App. Div. 1968). Thus, Calleja’s inattention to his account, the obvious failure to safeguard his personal information and his “failure to inquire of the bank as to [his] lack of receipt of monthly statements,” was “negligent as a matter of law.” Myrick, 268 A.2d at 528. Just like Myrick’s, Calleja’s conclusively proven “negligence substantially contribute(d) … to the making of an unauthorized signature” precluding his claim. Id. (internal quotations omitted). The trial court’s judgment should be affirmed.

930505.20140273/2851932.1 Conclusion This Court should not excuse Calleja’s admitted, intentional failure to monitor his account for two years. It should not shift responsibility from Calleja to Compass for Calleja’s failure to properly safeguard his personal and banking information. If the Court of Appeals’ decision stands, nothing will prevent a bank customer from entrusting the receipt of account statements to a friend or relative, abdicating all personal responsibility. The Court of Appeals decision sanctions Calleja’s chosen method of monitoring his account by relying “completely” on reviewing statements delivered to The Woodlands, then not bothering to retrieve a single statement for at least two years. The Court of Appeals’ decision improperly shifts the burden of loss to Compass where Calleja was always in the best position to protect against the loss. It was Calleja’s willful inattention to his own interests and affairs that made it easier for a bad actor to drain the account. If the Court of Appeals decision stands, Calleja will have been absolved of all duty to discover and to report a “loss” he facilitated by failing to protect his banking information and willfully ignoring his account. There will be no way for a bank to prevent this type of fraud. Common sense, sound policy, and the law dictate that an account owner bear a degree of

930505.20140273/2851932.1 responsibility for protecting his own interests. The Court of Appeals’ decision absolves Calleja and wrongly places the burden on Compass.

Prayer Compass respectfully asks this Court to reverse the decision of the Appellate Court and to affirm the summary judgment in favor of Compass. In the alternative, Compass asks the Court to remand the case to resolve all issue of fact necessary to disposition of this case.

Respectfully submitted, HIRSCH & WESTHEIMER, P.C.

By: /s/ Michael D. Conner Michael D. Conner [email protected] State Bar No. 04688650 William P. Huttenbach State Bar No. 24002330 [email protected] 1415 Louisiana, 36th Floor Houston, Texas 77002 Telephone: (713) 223-5181 Facsimile: (713) 223-9319

Attorneys for Petitioner Compass Bank

930505.20140273/2851932.1 Certificate of Compliance

I do hereby certify that the relevant contents of this document consist of 14,956 words, in compliance with Tex. R. App. P. 9.4(i) and this document complies with the typeface requirements of Tex. R. App. P. 9.4(e) because it has been prepared in a proportionally spaced typeface using Microsoft Word 2013 in 14 point Garamond font, except for footnotes which are in 13 point typeface.

/s/ Michael D. Conner Michael D. Conner

Certificate of Service

I hereby certify that on this 20th day of December, 2017, a true and correct copy of the foregoing document was served via e-service as follows:

Michael C. O’Connor [email protected] Lesley C. O’Connor [email protected] O’CONNOR & CRAIG 2825 Wilcrest Drive, Suite 261 Houston, Texas 77042 Telephone: (713) 266-3311 Facsimile: (713) 953-7513

/s/ Michael D. Conner Michael D. Conner

930505.20140273/2851932.1 No. 17-0065

In the Supreme Court of Texas

Compass Bank, Petitioner v. Francisco Calleja-Ahedo, Respondent

On Petition for Review from the First Court of Appeals in Houston, Texas Case No. 01-15-00210-CV

Appendix to Petitioner’s Brief on the Merits

Signature Card (CR50) Tab 1 Consumer Disclosure (2008 deposit agreement; CR51 et seq.) Tab 2 Consumer Deposit Account Agreement (2012 deposit agreement; CR205 et seq.) Tab 3

930505.20140273/2851932.1 Tab I

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" *'lltltlt' i,J t f t -a¡Lrl lljlhôarrrd rsÍrlgTb t ¡suüättrà'r$ tt{Ëüf¡rü} Tab 2 CoxsunrrEn DsclosuRE Effeelive August 2e 20Oo Compass Banlç a member of the BBVA Group Consumer Disclosure Highllghts 1. Changes to Consumer Deposit Account Agreement 2 2 Changes to Checking and Savings Accounb 4 Other Fees and Scrvlce Charges I Consumer Depoclt Account Agte€ment 11 1, Definitions 11 2. Account Operations 12 3, Accouni Staiements and Notices t3 4, AccountTransactisns 14 5. Deposits, Colleetlons and Payment of ltems 15 6, Withdrawals 17 Z Sub"accounls 17 L Arbikation '18 9. Whiver of Jury Trial 19 10. Dormant and Abandoned/Unclaimed Accounts 19 11. SetOff 19 .l2. Waivers 19 13. Other Services 10 14. lnterest¡ lnteres't Reporting 2A 1õ. Changes to Account Stah¡s 20 16, Applicable Law 20 17 Additional Provisions 20 Fund¡ Arailabi llty Dlsdosure 21 Elsctronic Ê¡nd ïtan¡fer Olsdosuro St¡tsment 22 Terpayer ldentlllcati on Nu m b ars (Eadtup Witlth oldlng) 24 Gompass Consumer Prir¡ct Dlcdosure 26 lmportant tnfo¡maüon About Your Gheddng Account (Gh€d( 21) 29 Vleao Gltedr Card Agreernent end Dl¡closurê 9tatement 31 HtGHuGl{ï5 Cha n ges to Gons umer Depos it Âccou¡tt Agreem ent This Disclosure Booklet con{ains the terms and condiäons that will govern your consumer deposit accounts at Cornpass Bank beginning August 22,2OA8,4 consumer deposit account includes any Çpe of checkíng,'saving+ monéy market or NOW ectount to which funds may be deposited and that is'used primuily for personal, family ol household purposès. Please qqêfully review tte Conguma.r -11-21 Oapoiît Aø.tnl $ru'cment on pages of this Consumer Disclosure Booklet and keep Ìt forir,¡ù-rre reference, Many terms of yòur Compass account will be difÞrent from those at Taras Staie Bank, including, but not limited to, lhe followfngl f Postlng Onler and Ordêt of Payment At Compass Bank, checks and other debits to your account rnay be posted and/or paid in a ditferent order than at Texas State Bank lf two or more items are piesenied for payment from your account on the same day, we may Pay or clraçe the iterns to yòur account in any order. To avoid olerdrawing your account make surelou have a suffic¡eni available balance-in your account before you write a check use your Check Cârd or authorize an electonic paymenl r rAvailable Balanca, and '¡Posted Ealancal'At Compass Bank, we dislinguish batween the "available balanceo and the 'posted balancen for your accounl The term 'available balance" re{ers to the balance o{ funds in your account that ls avallable for immediate withdrawal. Unlike the posted balancq the avaíaÈle belânce reflects any holds placed on your accounl The term 'posted balance' refers to lhe balance of funds in your account based solely on items that ha,re been posted as credÍts or debits to your accounl Your available balance mqy be more or less Ú¡an the àmount of your posted balancê, but dses not include any cre/it available under any Compass Bank Overdratt Protect¡on Line of Credit you may have, ¡ l{olds lor Chod( Card Tlans¡ctiong. lf we issue a Msa6 Check Card for your account and you use your Ca¡d for cerùa¡n t¡ansactions (including every POS and many Visa transact¡ons), the merihant accepäng your Card may requesl advance aulhorization of that transaction. lf we auihorize a trarrsaction, we may place a temporary 'hold' on your accourtt for {he amount requested by the merchant Ihis hdd ls not payment for an authorized transacüoq and may be placed on yoor account bebre he scàJal fensactlon ls presented to ts fø paymenL Fot more infømdion abor¡t these holdg when they âre ß¡ease{ their effÊct on your sttor¡nt and the authori¿ations rcquested by nerciranfs, please relerlo the Check Card Agreenrent and Discbsure Statamant induded with put new Chedc Card, r Una¡¡llþilzgl llans¡cüo¡¡ t¡d,lot Forgprlo¿ lt ls essantialthat any accounl erorc, una¡thorized bansac{ions, alteratfonq unauthorksd signatr.¡æq foqedq encodlng enors, pocting erorq or any other improper bansac{ons on your âccq¡nt (collcc{ively rebned to æ 'ctceptions) be repoded ùo us as soon as reasonabþ positrb. You must carefulþ acamine eacà accouttt statament or noüce you lece¡ve and eport any orceplions to us pronptly afur you recefue the statemoflt or noüca lf you do rmt report an orcepüon to ug within tñlËy (30) dafs afbr vyg sand he sbtsment or nolice to yor¡ we mây not be liable to you for any bss ¡ou sufror ßlat€d to thet encepüon. Different ruþs may appþ to ilems lhat a¡e eþcbonic fund bursfrß. ¡ Ferolvlng Dis$¡bs Relrted to Your A¡cor¡nt lf a dlspute of any ldnd adses under your account agreement or ¡elales to ¡lour account or any lransaction* involving your acounl, either yor¡ or s/e can choose lo have that dlspute resolvad þ bindlng ubikatlon. ll (0 neither ¡ou nor we seek b compel arbitraüon of any dlspule wå ha\¡ê related b thls Agreemen[your æcunl orany fansactlons lnvolvirg your aocoun! or (10 some or allol the srblbdion prølsion is unenforceûble arrd we are ln a dispute ln a court of bw, üren êaú ol uÊ agreßs to waiva any rþht we may have to a jury bial ùo the artent pennltbd b la¡.lìa ¡rÞtb¡üon ¡nd lü¡y ùlal railergrovùrlonc ln yoqr ¡ccûunt agrÊcmelrt llmit your abillty to litigate dalm¡ ln court rnd your llght io a iury lrial. You should rsvlew lftese pmrlrlons carefully. r Congunar fttlYrcy Dlrrdæurê. Tho Compass Consumer Prfuacy Oisclosun is included in thls tonsumer Oisclosura Booklel. The Frivacy Disclosure conl¿lns information on Compass'sharing prac'tices within lhe Compass lamlþ of companies and provides information on how you may choose to limil markeling S our af{iliales basad on lnforrnglion lhat Cornpass sh¿res with ihern, For informdion on Miscellaneous fues at Compass Elanlq please see pege I of this Booklet.

Ghanges to Che*ing and Savings åmunts conf¡nued Here as highlights to tha chargee in lhe Þrms a¡rd fuaù¡ree of your acrounls after lhey transfø lo Compass Bank I lexas Sþþ CompasBanlt Please l{oûe Ch¡nges to These l¡cot¡ttt Bank Torms and Feaü,¡re¡

Group lnteæst Che*ing Build-To-Order No monthly SeMce Charge or minimum end Grcup Banklng Free Checklng balance requirement Unlimited tansaclions, wih lnterest Choose one premiurn feaü.lre al no c*large (additional batures are $2./sdement clcle): Free foreìgn ATMs, rebates oT ATM fees other banks charge, up to $26 cash on your account anniversary, cash back on Visa Check Card purchases, double Msa Extras Rewards polnts, one overdraft fue waiver peryear, lnterest on your checking account balance is a preselested : premium feature, The following Rate lets apply: I $O-$1,9991 $2,00F$9899; $ lQ00G t $24999; $25,000-$7499s¡ $?500Gþ. Customers enrolled in Add-On Val.¡es will be I converted to CompassPlus and will be I assessed a $5 monthly fee. ! I I i Regul¡rSe$ngs and Basic Savings $15 quarterþ Service Chaçe. $500 minimum i I I Border Savlngs daily collected balanee required to waive I quarterly Se¡vice Charge. Accounts with more than four (4) withdrawals per quarter will i I I rcceive a $3 Servíce Charge for eaú additÍonal ; wi{hdrawal. The following Raie"lier applies: $O¡.

Grcup Savings Baslc Savings No rnonthly Service Charge or rninimum balance requiremenl Accounb with more tran four (4) withdawals per quarter wfll receive a $3 Service Charge for eadl addítional wilhdrawal. The following Rate Tìe¡ appliesr $0+,

StudertSavlngs Young Savers No quarterly Service Charge or minimum balance requirement Accounts wíth more than four (4) withdrawals per quarier will recEfue a $3 Service Charge for each additional withdra'val. The followlng Rate Tier applitx: $0+.

Consurner No monthly Service Charge or minimum Prefened balance reguiremenl Unlimited in-person Monryllanaganent Money Markei transactions A $10 excessit/e bans{er fuE is SåvlngF, and Prtcmier assessed per staiement cycle for pr* Moneyila¡kst authorized or ùelephone transfers over six (6) per sbùcmenteple- A $10 excessive checkwiling fea is ast*ssed per stntement cyde for d¡ecks over hree (3) per statement cycle. Iheîollorvhg Rate Tbrs appltr $G$9999; $to,oo&$ |990û $?0,00G$a9,999; $50,00e$ggB99; $100,00ùS¿49,ggq $2ã0,me$9g0pg9¡ $1,000O0Þ$2'4909991 $2,500,00$S4P99,9O9; $6,0oQ000r.

Anniversary. lf the cash bonus leature is selscled al account opening and subsequently de- selected prior to the Account Anniversary the cash bonus ar¡¡ræd prior to the deselectlon of the feature will not be paid, Cash bonus wlll be dírecdy deposlted fnto the Build-to-Order Checking accounL .l Umit two bonus fea{ures per customer, ¡¡ Doubla Vlsa Extras polnts Usa Extras prograrn enrollment required. Standard Visa Extras poinb will be earned 0n ihe month following ycur Msa Exlras account update, Compass will match those points earned in the previous month, thereby giving double the rewards. Points are paid only on Oualifying Purchases. A 'Oualifying Purchasen is any signature-based purchase, lntemet purchase, phone or mail'order purchase, bill payrnenl contactless purchase {purchases made by holding your Visa card or other ðevice up to a sècure reader insiead of swiping your card), or small dollar purchase for which you are not r'equked to sign, made with an enrolled Visa card, that is processed or submitted through the Vsa USd lnc, payment sysiem. A Oualifying Purchase does not include a pur*rase made using a Personal ldenti{icatlon Number (PlN) or purchase you initiate through identification technology that substituies for a PlN. Additional reslrictions apply, For msre information on qualifying purchases, sêe program terms and conditions' .ã Gash Bad< on Visa Ghed( Cõtd trancâ¿{on¡ x Available for the prirnary Check Card for the account only, Earn cash back on Oualifying Check Ca¡d Purchases' routed through Visa fsee'Double Visa Exhas Points'for Oualifying furchase definltionJ x $0.05 will be eamed for every signatr:re-based purchase (exc{uding teller cash disbursements and rnerchar¡t authorizations lhat are not completed), u ln addlton, $0.06 will bo earnsd for every two P|N-based purchaoes (excluding cash t¡ansactions, ATM tansadions, quasi-cash transaclions, paymenb made for prepald or re loadsble cards suclr as certâ¡n gift cardq Visa Buxx and sirnilar cards, transac*Íons conducted at Global Access Cash Terminals and pre-authorizatisns for transactions). n Retums or debits of a Visa Check Card ciarge will be deducted from the cash calculation, n Cash back rewa¡ds will be credited at he end of the statement cyde for lhe Bulld-to-Oder Checking accq¡nt línksd to lhe primary Chock Card Tlre pos$ng date ñor a quelilytng bansaclion will determlne the dete of the transaction for purposes of this feature. Credik for the net purchase activi$ witl be made atthe end of the q¡cle period. lf tre Bulld-to.Order Checking account is dosed, lhe cash back retilards accrued in lhe cunent statement qcle willnot be paid ;¡ Ons Ocerdraft Frs (NSF Ghargo) Fo¡glycncss p€ryorr Applies to one NSF Charge-Paid ltem or one NSF Charge-Ratumed ltem (seo'Mlscellaneous Fees'), The Overdraft Fee (NSF Chuga) Forgheness fualure must be redeemed dudng your anniversary year in whích lhls featurs is selected or lt wlll be iorfeitedl ürls leelurs does nol accrue or car¡y lonflard into subssquent years Once you redeem lhis feah¡re lt will remain a selocbd feahre unlll the Acca¡nt furníversary. You rnay carrcel thls fealure afrer he AcæuntAnniversary before you redeem it in Sre next Anniversary Year. lf you select olher featurcs dudng tre year, and have redeemsd the Fee Forgiveness fuature, tbey will be in addition lo this feaù.¡re This feah¡re may not be used lor lorglveness of Extended Overdraft Service Charge* :;r klc{ng: n Two Teatures provided free ol charge r Addilional features may be selected lor an'Add{n Benelit Charge'ol $?.0O each. {'¡dd-On Benaftt Charge'will be tre dascription on yorrr monthly account slatemenü For example, il five hatures are chosÊn, the account will be cfraçed an '¡¿¿-tn Eensftl Charge'ol $ô pàr rnontlr, n The lAdd-On Baneflt Chargo' r¡vill reflect tha highest number of fesùrres s¿lec.ted durirq üre given statement cycle, regrrdless of ürE nunrber of days the feahrres were in effoct The 'Add- On EþneÊt Charge'will be incurred on the daylhe sta-temenl b generatcd. q The feature¡ selected at 8:00 pm/CSI at he end of a bankirg day will be the features glven far (Êrnmple: lf doubls points ere selec'ted at 10:0O em, card is used during the da}, and $a!{aV. double pôints is cftonged io lnle¡est in {he aænlng of lhs ssr¡e dry, double poinis wllt NbT ¡e awarded¡ rather the account will have lnteregt â.s tha featura) a Notel Features are calculated based on statement cycle, not month, B

-' _ -"' -' -_'i

Other Fees and Service Charges lor Consumer Accounts ATM/Check Card Replacement Fee ttrnrl (applies to non-personalized Compass ATM/Check Ca¡ds)

Bank Bags Zryper Locked-*.* *t20.00 Bond Coupon Collection Fee,**-.* ,-'-'""**J5.00 Check Charges RrsonalÞed check orders ae debited lrom your account when your order is receiv?d, Personalized check oder charges very b,l/ style, check design chosen by customer, and number of checks ordered. Collection ltem lncoming:

èÕE^ñ Non-Customer 0utgoing:

lntemational* --.-*$20'00 +costs Cønpass Fbe lor Using Another Bank's ATM-,*",--- -$2.ffi/lransaction Deposit Correc'lion Fee.-"-,*,* $2.õO/itern

Direct Deposits

Extended Overdnft Service Charge thoutd your accou* become o¿edrawn and conf¡nue wilh a negative bslance for ¡lx (6) cons€ctlüu€ caþnde¡ dayq ur utendcd $,€rdralt lêe of $?8 ($a2 effective January 1, 2009) wiü be ôarged. Thereafbr, if your asr¡rt cmtinuos to maintaln a negaliva balance, ¿ fus of $? g cdendu-day wfll be assessed þhnlng on ltæ sovsnb (?th) ialend¡r day and willconlinua unlil day lhhfy (30) of oßrdrdt status or unT{ lhe account is brought b a posiù'vê balancg vrfri,óerer occuns first this a\ieflded overdraltfee is in addition to any NSF fees you may incur as a result of items being presented against insufthient funds. Garnishments, Levieq Court Orders +attorneyfees

lnter-Account Transfer Fee..,*,. -$'10'00/ùanster

Transfers funds from cuslomer{esfgnated accountlo cover potential overdrafb in úecking accounL

lSFFee lntemslional Transactions gre hose trensactìons using your debii card made outside of the United States. An Internatìonal Service Fee flSFl amounling to 1o¡ö for ATMtransactions and 39t of üe üansaction amountlor tansactions made some place other tran an ATlvl will be poslad to your accourd for any lntemationsl lransastion, even ü'¡ose in US dotløs A full desaiption of the cunency cor¡version Process is conbined in this agreement on page 16.

Item Resented for Payment Against lnsutficient Funds (NSÐ NSF Charge - ftid item*- ''.,"*,$38.00 NSF Charge - Retumed These charges are applied lor processing ilems presented for payment against insutficient funds (NSÐ with a maximum of six (6) charges per day. These charges are imposed on items created by drec*, in-person withdrawal, A'IM w{ürdrawal or other electronic means, New Account Closed WÌtirin 18û Ðays-,,.',^ **.,,."-.,*$25,00 Non Slaff-Assisted 1.O0/call over 15/monlh ;

Check Card "*.$10.00 i Ii L_.*-

Reconcile Statemenl*,- --**.*-*$25.00lhour Research ,J25.00/houq $3'00/coPy or fax - Return of CancelledChec{<s-",*, $500/month Returned Depasited llem*-"-,**.-* ,.i,,¡n¡B¡os.,¡¡*,n¡s ,-"$7'00/item

Rerun Depositred

Rolled coin'- *'--*'$o'10/roll ô¡¡ tv.t Special Staternent' Stop Payment Request*-",,* -$30.00/request S'tatf-Ass'sied cdl'*-*** '**--$1o0/ca¡lorær 5/montt Skapped Curtency..,,",*, ..'*-,"--'..-",,-$0,20/eaah

Telephone Transler Fee,,-.,* -*--*-$3.0o/tansfer Temporary Checks (minimum h¡o checks) ,,, -.. -- , ,-. .. .- , ., 1.00

Wire Transfers lncoming(Cusiomer)*.#.@tu **-**$i2'00 Ma¡rual0utgoing (Customer)* $20.00

Manual Outgoing (Repetitive),-- "-*.'.-$18.00 with Conlirmalionr Fax./Enail.- ***-$2300 Mail we pûid ü€ olher ibm befora we rcceived nolice ol any of ürese exceplions from you Bceprl æ p¡ottided þ applicable lnrf you also agree thet we will nst be re$rired b reìmburse you lor any oceptions caused by yorrr own neglþnce Dlflerent rules may apply to iterns hat ara electonh fund tmsfers ln atry case, you agree prompüy b æpay u: any anount cædted b your scca¡nt in eror, snd you åuhorhe us lo dcbit you sæounllo obtrln po¡mentof any erøeous credit seærd Ratffon. \le wli rebln ary ¡tem pa¡d on your accaunl lor a perlod ol ftfteen (lô) business days from üE fua fie liem psb b your eccowt ltb will retain copres ol those items for saæn CI) years 4 Àccoul{r rRÂr¡sÂcÏroils Slgrnh¡lú¡ F¡c¡ùnlle Slgnafuna !{Þ may rely on eadr s(pdr.rre on a signahre card for lhs account or cn plor aulhorized items in dl tr¡nsacliors connecled wr'lh the acÊouni lf you use a fac¡lmile signdure or otrer medranice¡ or elecfon'ic deirice for rigning ø autræltrcaling itørns {rawn on yqJr . aÀounl you acsume tre enüre r{sk lh¿t üe farsimile signatrre or davice rnay be used impropaly T by an unauthorired person, Wb wtll not neimburse you or uy oher peaon for items drawn in lhis fashion by any uneuthorized iærson or by any person who àxceeds tiis or her autlndty to do so, and we may honor-allol fheselypa iteins presenÉd tó ùs You agres to lndemnilyand hold us h¡rnless from ul tg59 resullirg lrom our honörhg an itern in arry iruturce in vrhidr the itgrn Fa,-s or plrports lo bw a tacslrdla signatuæ . resembling ã signature on llla with us, regadless ol þ u*rom or by what means llre acluel or purported signature was affxed 1o the iþnt - Ro.¡uthod:ad ltem* tf you glw inforrnatìon about your account lo any person who represents to.pu lhat in the ordinary course ol ils buslnass, it will present uruigned items lor payment or initiale l¡ansfers frorn your accounls, theh any itern iniliated by üral peison willbe deemed authorired byyou udmoy be chuçd io your accounl You a;eums the anlita*sk lhal tlre info¡mation yo.l {umistred may be usad impropaþ or by an-unauûrori¿ed person. Vlb will not reimbursc yol or any olhar pøson for ltems drawn ln his fashion,Þy_any unaulhorized person or by srìy psrso{r wt'lo exceeds lús or her aùthuity b do so, and we nay hrror all of heseþpe items praeentedlo us. Wira lbrnsfgr* lÂlhen we accept a wire bansler paynrcnt order lnsùrrting payrnent to you or lo yout account we will nolify you of ar recelpt ol payment by lndicating the arnountin yrur accq¡nt stalemenl lf tÌre pa¡mentorder does rrcl specify an account un may deposit tho payment into any account hat pu maintajn wllh us (nduding mulüple parly accurnbl Your accounl state¡nent wlll be he onþ nothe ol æceipû which wo will provido you, and no interest will be pald on wira lransfor payments deposited lñlo yout accoünl unlesÉ lhe account olhenrise pays lnteresl You agree b pay all drargæ lor wire lrsngfer se¡vices stated in our schedule of service clralges, as ãrîendêd torn üme to lime. Papnenl ordars vrdl bo not acceptod until execded by us. $/e ft$eñ,€ he dght b rcfuse lo accept any peyment order. tf there ls arer any incontisbrtcy ø ør¡flict betwem he account numb¿r and åe name ol a reciÉmt on an insbuctbn or payment ordø we msy rely etdusiveV on lhe a¿çount number snd bank fdenlilication nun¡ber conb¡ned h a payrmr* order ¡athe¡ than th€ name Amendmeñts to a paynent oder must be prûvided to u¡ at leåst üìree business days pdor b our oceortim of the payrnent ordEr. Wb may reæd ury blephone conversathns or data ùansmlssioos thgt initide or aneod paynnnt orders The óango rale on a retum peyment ordar shall be the nte in aflect at the l¡må the refum i¡ raceivd. lruülfldent Âvail¡bls Balanc¡ ¡nd Ovardr¡lts lf your arail*la batance ls insüfìcient to pay lhe totsl amor¡nt ol items presented against youraccounlvr€ may al our opllon, reù.rm øry of the ilens unpald or pay any or all o{ the ltemg even hough payment will cause an trardnlt ol ywr aeor¡nt Wle may reh¡m any itern at any üme if your aruilable b¡hnce is insufficleût b pay that ttern, s,Ên lf rvs previorsly harc pernitled overdrsfts. You are not entilhd to rely* aly pkn act þ us wiûr respcct b your acccunt Our elêcüon to pey o,ædrafb does not eshblish a course of deallng between you end us or modity üre bms of thls Agreemenl You agree that il your anlhble Hance is insufident b pry arry ilem presented againsl your accounl yan pmmpüy will pay boh our selice åeqe for handling and processlng *¡at iþm sr¡d the amount of any o¡erdraft wilhoul lurürer notice ordernand.Vour lailure t¡ pay these amor.fits prumpüy may r¿sult in additjonal service d¡arges lc your account Esdr sccount own¿r wlll be þnty and sanralþ llable for he charges regødhss of vrhidl account o¿rn¿r i¡ respon¡ible fø heir occunsnce ln üre evørt yoir {a[ {r påy the arnounl of rny overdralt and aü ssso&led ssrv,ice dmçes urd wa rebr you ovardra¡¡n a¡count 1o an attomey lor collection, you agree b pay dl reasonatfe açensss, indudng v*thout limiUtoß attomds feês and court costs inanlred by us as a result of toul account beho orerd¡arvn lnþl'Ârtounttlrlnrfrrs"lf you gre an ûnr¡år ol hro or mors ãonsumer eccounb lhat we allou{ to be linked you rnaf ry separala agreenrant desþmte one sf those accounb as a secondåry accounl from whi,ch lunds rqy be tranÊfeffed to cover items (hdivirlually and collec{ivdy calhd e 'cwóred ilernJ presenbd for psyrneflt out of another, primary account lf you make ú\in designaborteill¡er at lho time you opén your accounts or later and if the ava¡lsble bdance in the pdmuy muñt is lnsutfrcienl to pay triamount df any coæred itsm at lha lime ol presentmenl then urs rryill autdrnatically trans{er fiom the'sácondøy account in'to the gimuy acrount ü¡e speciflc amor¡nt necessary to pay tral co¡erd ilenr You agtee to påy *re $¡ßetlly oppli,ca$e sewke charge each lime furds ua hansfened url ol your second¡¡y account sird tnto yarr primary account to pay â coveÍed item, We will have no obligation to pay any cc'vered itern if the combined available balancæ in the secondary ac-æunt and primary account ai the time the covered item is presenied to us for payment are insufficieni to pay dre covered item or if the secondary account is in dormant inas{ivq orfrozen sbfus, ln {his siluation, if no funds are tansftne{ you will not be assessed any sewice ctrarge for the ùansfur, but your primary account will be sudect to lhe provisions regarding insufficient oailable balances and overdralb disqssed above. Your designallon of primary and secondary accounts will not affect whelhøany elecbonic transaction is aulhorized for paymonl.lf an elec'lronict¡ansaclion requhes authorizatíon at lhe time of the ùansaction (e.9,, poinl-of-sale, ATM and Check Card hansactions) itre autlrorizalion will be based on the available balance in the primary account and noi on the available balance in lhe secundary account regardless of any dæignalion of a secondary accounl Stop Payment Orders. You rnay request us to stop payment on any chedç draft or similar wriiten order or instruc'tion drawn on your account by giving us the iniormation we may requesi, including the account numbet fte Ítem numbe6 the date of fte ilern, the payee of the item, and lhe exact amount o{ ihe ilsí\ and by paying our slop payment service drarge \{Þ will s€aldr for your lbm by æmputer, so it is essenti¿l lhat all informatlon you give us be accuraùr To bo efieclive we mr¡st reeeita any abp paymut order in time to aflord us a ro¿sonaHe opporhrniþ b act We wlll conllrm yo{¡r oral stop papnnt ordr ût wriüng, and lhe fnformation included in our writlen conlinnation will b€ condtdveþ preeu¡ned b be conect unless you notity us wiûrin lourteen (14) days of lhe daþ of lhe conlirmation. Conlinned slop payment orders wíll be conbnued in effecl tor a pedod o{ two (2) yeam lrom the dals the ini[al olal stop payment order ,¡¡as placæd. A conflrmed stop payment o¡der will expire at the end of lhe t¡o'yesr period untess yot revoke it at ân eårlfer dåtÊ or rûnÊw it in vrdting fcr an qddilianal tvepar pøiod end pay orr stop payment seruice druga You may not stop payment on a¡ itgm lt nc have va¡ifisd to the pa¡¡ee that the avallable balmca ln ¡our account is suflicient to pay such item, or lf we hao accepH that ilem by payment or oûremlse. Any account owner or aulhorized signer may placa a stop payment order, and we ere not required b rdeæe a sbp payment order unlocs requested lo do so by the account owner or lhe aulhorized slgner wtro requested it You agree b lldønnlff us Bnd hold us harmlsss lrom and agahst any losq darnages, anc e¡penses (lncludlng attome/s fee) sre mry lncrr by reason of ot¡r ßlusal to pay any ltem upon wtrictr you have stopped paymenl For stop payment orders on peauthorized eleclronic funds transfers, please refer to üe Elecùonic Fund Transfer Disctosuæ Statement in tris booklet llleg¡l îansacüon+ You agree lhat you will not use your accountfor any transaction that ls lllegal in the jurìsdicäon where ¡nu livq in tre jurisd'rction where lhe tansaction is çonsummahd, or in any other jurisdic{ion affecied by the bansaction. You agree ürat it is your responsibilily b deþrmine the legality of each of your transadions in all applicable juñsdictions before entering into lhe transac-tion. You acknowledge and agree lhat we have no oblÍgation to monibr, to review or to evaluate üe legality of bansactions on your accounL You also agree frat you will not use your account in connection with any lntemet or online gambling trensactioq wielher or not gambling is legal in any applicable þtsdlctisr lile reserw üe right b røtum any item $d wa bellcv¿ ls rehted lo an ilþal b¡nsacfioq an lnbrnst or mlhe gønbling barsaclion or a htgh-dsk bsnsacthn To he fulles{ o<tent permltted by h,t yor.t agee to pay for any item that you auhorized, s¡en if he trånsac{jon related lo that itern is detêfin¡ned b be üegat 5, DEPOSffi¡, CO[LEsTrOilS Àr{D pAyitEf{T OF fIEttS Dcpoûlt* Wb rnay require a minimum lnitbl doposit to open an accounl You rnay make gddtional deposls of any amotnt of $1.00 or more åccornpånied þ a èompleted deposit slip (unless yarr deposil is S elecbonic funds bansfer) either in penron, Ð mail at an ATù1, a nþht depository, or þ olec:lronic funds trûsfer. We may chugo for deposþ and we also mey refuse to accepl lor deposrt or æflestion any hbm pu otfur lø dapos( accept all or any part of a deposlt for cotlacton onty, ø limit the amount of the deposit lf your doposil is oürer than cash, lor exampþ checks, wa may without pdor nolice to you (except wtrsre prior notice is requked by law) place a hold on tre account lor üre amsunt of depasited ilemt for lhe app,roximate period of üme it hkas us to wiþ that lhe items rrill bo paid û:dng $e hold period interest$euing scæünb wlll gam lnlerest in accordance wih üre intalast sdredulc. llemn accepted for deposlt and drawn on a non-U.$ inslitulion nray be subþct to a sarvicÊ &arge. lVe may accept an item for depoot to ytur acrsüot from an¡one and wíhant queslion r vedfying the auhority of lho person making üre deposil Credit for any ilem we acæpt {or deposit to your amr.lnt includíng funds thal are doposited by electronic lransler, ls povlsional arrd may be æroked il lhe itsm is not finalty peld, for any roâsor\ in cash or its equivalent Our psltcy ûn the availabflity of dapo$tr lor willdrawal i¡ descnbed in lhe Funds Availability Oisdosura prtion of this bookle! Colledon ae Agenl iþms delþered lo us for deposit or collec'lion are rccelved by us ae your agent for collection and at your risk We may accept an item for collection only (such as a refurned deposited ihm or an item drawn on a nm-US. insiih¡tíon) and impose a sonice drdlge for aüempüng colledion of the item. ln situations where we actept an item for collection only, væ wül not giß yûu cash or an offrcisl úEck for the items unlil &e items have been pid, We are oblígated only to aercise ordloary care ln handling and collecting items delivered to us lor deposü or colleetion, We shall no't be lÍable forfie misconduct, negled savíngs sub?ccounL V1b do not cunentþ e,rerr'lse Ërat rþht wih respoct to thesa savings suÞaccounb.ln the evert wa dertermine to exerc¡s€ tbat dghl we wil dose he savings srb-aæarntarrd bansh¡ allfurds back to your o:nent aocourt and cease lhe sub-account agreemenl Yrur depoait snd wÍlhdrðwal c+abfliües âre not dþct6d by our decüon !o estâHlsh the sub.amo¡¡l

8. ÂR8tTRÁllON By opening ø mainhining lhe aæount yul agrea trat if a dispute of øty kind adses under this Agreement or relates to your acrount ol any tnnsaclions involving your accor¡nt, dtÌpt yo{¡ or vrre can choose trhave that dispute æsolræd by binding aÉihati.ør ltl¡ r¡ùit¡ton provl$on lln{ts yon abilily to litlgate claims in court and your dghtto a iurytrlal You should rwiew thlssection carcfulþ. You will not have the dght to participate as a dass represeniatíve or member of any class o{ ciaimants for any claim subjeclto arbiiratign, Arbikaäon is usually an lnformal proceedlng in whidr dlsputes øe decided b,y one or more neutral arbitmtors who receive the evidence at a hearing and then issue a binding ruling ìn lhe form , of an award. Ysu and we understand that discovery and olher procedures in arbibalion may be more limited " han discovery in court proceedings and lhai he abiliiy ro modify, vacate, ol appæl an award by an arbiirato(s) is limited. You and we ägree, upon written demand made byyou or us, to submittro binding arbilraiion alldisputes' contloversies, and claims, whetrer based on conkact, fraud, tort lntentlonãl tort sblule' regulation' conslihÎiorl common laq equit¡ or any oiher legal basis or freory and whether preexisling presen[ or {uturg frat arise from or relaie to this Agreemenf the accounl any tansaction invofving ttre accounl or any advertisemenls, promotions, or oral or writte¡ slatemenb rehied to lhis Agreement or lha agcorll the refationshipc fqt ^ iesult lrom lhis Agreement t¡nc¡ud¡ng, to lhe fullsst e¡i'tÊnl-permifted by applicable law, rs¡ationEhiPs wilh $ird parties who ere not perties to Ll"ris Agreanent or lhis eòiMon praÍsionl or he scope or enlorceablity of this Agreøment (colleclively, a'Claim1, All parlies rebln üre rþht lo seok relief in a small c,laims cot¡rt for dbgrtes or dalms withh üre scope of the iurisdictkrn ol üre small claims court You or lre may choose eilher t¡d ¡¡nøca¡r Arblbation Assodehon ('¡¡Á1 e¡ gì€ Natic,nal Arblþâüoñ Forum ('f'.lAF) witrh târ ( l0) days of tre wriüen demand for arbibalioq bc conduct aty arUbetim under this dgreønont oryou urd rve msy sgres upon a difbent albllralor. ln arry ann[ any arbit¡aüon under thls Âgreementshell bo condwted h accordance wilh úre applicable arbikalion rul¿s of the srbiùahr or arbtlration organizsli:n fRulesl lf an aÉúhafu olher than tlre AÅA lË chosen, lha Rules of lhe A,{A ïrlll be applied to any drcumsiame thal is ml gddressed by he Rules of the chosen årùibator. ln lhe a¡ent ol any incorsisterpy between üris Agreement and tre Rules b be used for an arbibatlo4 $¡c¡ hconsislencl shdl be ¡esolred Tn lwor of lhis Agreemenl Thb srbihel¡on prwislon ls made punuant to a fansaclim inwfuing intersbb cornmeræ, and tro frderd futtHion Acl (tre 'FAA1 shallapply b the comlruc{ion,lnterprelrtioq and enforceability of thls Agreement noùdbstanding any othar choice of law provûion contalned ln ürls Agreanent Eilher you or we may iniliele ¡¡blbaf¡on by giving wdtlon not¡ce of lhe intan$on to eóltnle b üre oher perty ad by filhg notke wlth he AAA or lhe l.lAF h aærdence ltdh the Rules in effod al tre $me the not¡co is îled The demqnd for arbibatlo¡ may be made before or altsr commencement of any litigalion, Yorl shor.üd conlact the AA.A at 8æ-?78-?8fr9 or wwwadr.org. or the NAF at 8W474-2371 x www¡¡þforuraco¡n, for more lnformatlon abor.rt a¡bltrsüorì" lf for any æason üe AAA or $re NAF ls unable ot unwilling b serue as arbihalion administralor, or you erd rrve are unable to agrae on another arUtrator, we wiltsubbtute anotrer ndond or reglonal ari¡ibalbn orgmization Demand for arblùdion under lhis Agreerrent must be made before ttre dale when øry jrrdkJ,al aclion upon the sarne Cleln would be bañed under any appllcable skùJle of llmitationq olhonvise, lhe clalm also is be¡rsd in arbitaüon Any dispute as to whe,lher any gtatula of limitalions, estoppel, vaiver, hche*, or alher doctine bars ûre arbtHion ol any Claim shall be decided by arbitration in accordanæ wllh üre provislons of lhis Agreeme.nù AClalm by, oron behslf of, other persons will not be considsred ln, jolned with, orconsondated wih,{he aü'ifalion proceedings between ¡lou and us, and a Chln shal nol b€ arblhaþd on a dsss ect¡orì púnte attorley gonerrl or olher repæsenblive basls. A,ny dispute regarding û¡e prohibitions ¡n üre pior sentørce shall be moolved by the arbihab(s) ín accordance wiür lhis agreemenL Nothing in this arbibaüon ¡rovision shall limil tre dght of yru or uq wñeürer bofure durhg, or aRer üra pondcncy ol arry arbikation proceedíng, to exercise eny rdf-help remedias, such es set off oirepossession and 5aþ sl coüateral, or to obbin provislonal or andlluy remedies or injunctiræ or oürer lradilionally equ'rbble relief, such as llling ar intorpleader aslion. You and vre agrea thal lhe tàldng of these actiors or any oùrer pattkipation ln llllgetion by you or us does not waire any right that eÍlher pu or ,,,1e traæ b denanà arbitralim at any {i¡ne wilh respact to arry subs*quant or a¡nerded Clslm fil€d agalnst you or us after commÈnoemcnt of lltigatlon betweon you üd us Ul|o* th* a-ggryaþ of all Clalms by both you ud us does not exceed $.ltr,000, ury erpdited fgcedqts provided in ths Rules fËxpedited Proæduresl shrll appl¡ and a s¡ng¡s arbilråtûr'iha[ decide tte Claims' lâf¡ere the aggregale of all Qaims þ bolh you and ua excse¿s $10O004 a panolof ürree eôúhators I ZO. GOìtERXlllG L!lH: $Cì|ERAS|UTY: Ihis Agrecment and any claim, dlspute or controcrsy aÈirq ftoln or lelalíng to hlr Agaemn[ lhs Cård, ø any anounts conlracted for, cfrargod or ncåived undgr lhis Agreernnt whethar based on contract lorl lrsud and olhor lnisnllonel lorb, ltahtb, regulation, conslihtion, common law andlor equlty, are govemed by the lars o{ tre stato in whidr your inltial Pt¡,nuy Checkhg Account was opcnsd (without regud to ¡nlema¡ principhs of conllicts o{ l¡w} and rpplicrble lede¡al hw, ll rny pnislon.ol lhls furcemenl l¡ found to bs irwslH or unenlorceable, lhr rorndn¿ng ptonisions wlfl rardn h fullforce and cthcl 2f . AnEfmÀn0lft 'lbu r¡ne tlrrt our l¡mncs ol tùc C¡rd and pcrfom¡nos of li. tdilod 5e¡5¡oc¡ ptovldod undr tilr Agrooncnt tekâ plr€c la rnd ¡ubct¡dalþ rfüacù lnt*rt¡la comtltrrtq ¡nd att l¡rrocebÐ ted b your DopoCt ¡rounts You ¡l¡o egrcr lhrt uW dbpr¡ts arirln¡ outdo¡ru|¡ttte ln enyre¡bürbAgrmønrnt¡lufl bar¡lü¡d by blnrtln¡ ¡Élffiort s@¡dÍg þlltob¡rrr prstldtd lo ü¡ rgrsmantloryourDogodtAær¡nt lbrl rboegrnoto gtye up tlrc dghr þ rrd( ?ilredþr ln canrt lndudlng thc rfSl¡l b r lury trlal to your accounl or place a hold on .vour acccunt ¡n lhe amount requesled lry the merchant ìmmediately upon au[horization of such transaction, even lhough we have no¡ then actually received lhe item for paymenl, We will make payment for a lransaclìon only after the actual transaction is presented [o us phlsrcally 6¡ 6lsç¡6nically. tach such hold will reduce the Available Baiance in ycu accollnf by the amount of the hold. Telephone Calls: Calling, Monitoring and Recording. When you gìve a telephone numler direclly to us or place a lelepnone calllo ui yoir consent and authorize us to place calls to you at that number. You understand lhat a "telephone numlæi' includes, but is not lir¡ited lc a cell phone or other v¡ireless device nLlmber ancl 'calls' include, but are not iinriled to, lelephone calls, prerecorded 0r ari¡ticial volce message calls, iext messages, and calls made by an automatìc telephone dialing systcm from Lls or our alfiliaies and agents As examples, we may place calls to you about fraud aierts. deposit holds, anci amoun¡s you owe us (collection calls) on your accounts. This express conser{ appiles to each telephon"o number lhal you provide to us now or ¡n the luture ancl permiis such calls regardless of lheir purpose Calls and messages may incur charges from youi conimunicatìons provider. Ycu consenl and aLlthorize us tc monitor, ancJ to record, telephone convenatlons and other electronic collmunications you have wilh us and wiih Our rcpresentalives for reasonable bLsiness purpoæs, includlng security and quality assurance. \{e wili not remlnd you lhat we inay lle mon¡toring or ræording a call al the outseÌ 0f the call unless requirecl by law to do so.

4. ACCOUNÎ STATEMENTS AND NOTICTS Periodic Statements. ll we have a deliverabie acldress on file lor you, we n4ll mail or dellver to you perìodic statenents for i,our deposit account at approxìmately monthly intervals uniess we spæify lo you another interval peilod when you open your account or thereatler. The account stalement wìl¡ describe each item by item num[:er (where appropriate), amount, and date of debit or credit. For certain types of accounls, the periodic statemenl ntay Lr accompanied by lhe ìtems or ¿ facsimile oi those ilems listed on the statement, unless the item or an image of the itenl ¡s unavaìlable for any reason, for example, when an ¡lerr is electrcnically pi'esented (or re-prcsented) for payment against vour acccunt. lf we comply ruith the foregoing provisions ol this Sect¡on, you agree thai the statement and ilems all have been made available to you in a reasonable manner. We will noi be responsible for any indirect, special or consequenlial darrages under any circumslances for 0ur inabìlily to provlde copies 0f checks.Off liabiliLy, lf any, wi! nof exceed the iace amounl of the check in question [4ailing and Availability. Petiodic statements and canceled checks, to the extent we have agrced to provlrle eilher of lhem lor your account, and written notices ol dishonor or rclurn oi unpaid deposiled ìlems, cr any oiher noiice or communicalicln, may be rnailed to you âr. tlæ addrcss shown in our records ot a forwalding address lor you ìf one is on lile with lhe U5. Postal Service" Hov,rever, we will not mail any account ¡nformation lo an ¡ddress lhat theU.S. Postal Service has infonred us is indeliverable'or otherwìse invalirl. \Ale Lrse rcasonaille elforts to nrarntain the first slatement(s) returned as undelivenble for srxty (60) days, or such longer period oltime as may be required bv applicable law. aller whìch time we may dtspose of the stalement and orig¡nal itenr. However, we retaìn printable versions ol your account statements fol seven (7) vears. or longer periods as may be rEulred 0y applicâble law. You êgree to give us wr¡tten notice of any change of your acidress. Periodìc slatements, and wrilten notices of dishonor or retum of unpaicl deposited rtems, or any other nolice or communication, rray be delivered io you electronically if you have agreed to receive such notìces and commun¡cations elætronically. Notily us promptly if you d0 not receive your statement by the date you normally would expect t0 teceive il. We may, but âre nol required to, change the address for you in our ræords if the U.5. Postal Service not¡les us of a new address for you, and you waive any and all claims againsl us that ariæ in conneclion with any rnail forwarded to you or sent to an address for you suppliecl to us by the U.S Poslal Service. Any accounl owner 0r authorizecj signer of a joint âccount may change lhe mailing address lor your accOunt. Notice [o any One account owner shall constitut€ notlce to all j0inl accounl owners in a joint account We nray make statements, canceled checks (if applicable lo your account) notìces or other communications available lo vou try hoiding all or any of these items lor you, or delivering all or any of these items to you, in accotdance tvith youi reguest 0r ¡nslruclions. lf nie hold statements 0r notices to you at your request or because you laiì lo provide us with a cunent adcìress. they r,vill be deemed delivered lo you when they are prepared (for held statemenls), mailecl (for returned maiI) or othenvise made available to you, Errors; Unauthorized Transactions and Forgeries. 0ur records regarding your accounts will be dæmed correcl unless you linrely establìsh with us tlæt n'e made an errol lt is essential lhal any account er¡crs (including nlsslnq depos¡ts), unauthonzed tiansactions, alle ratìons, unaLrihorized signatures, unauihorized or forged endorsemenls, iorgeries. encocjing errors, pOst¡ng e[0rs (sLlch as debits ol credits posted twìce debits posteci as credits or credils posted as debils), unauthorized or disputed fees (of any kìnd) or any other improper transactions 0n your åccouni kolieclively refereci to âs "exceptìons") be repoiled to us as soon as reasonably possible.Otherwise. we mall nol be llab¡e for lhe exceptìons, v,ou agree lhai you wlll carelully examÌne each account slatement 0r notice you receive and €port any exceptio¡s to us prompily af ter you receure the statemenl or nolice Ycu agrÊe to act iil a prompi and reasonable manner in rev¡ewÌng \,our stalement 0i notice and reporting any exceptìons to us. lf you dc nol rcpori an exceplion to us within lhirty €0) days after we send or make the statement oi notice availabie to you, vou agree that we wjll not be liable lo you for any loss you sulfer relatcd t0 thai elicept¡on ând that you cannot lalel dispLrte the trcnsaclion amounls and infornralion contalned in the slatemenl- îhis means that, ìf you c10 not repori excepi¡ons tc us wimin rhlr ty (30) cJays af ter we send or nnke the stalement o¡ notice available tt you, i've wll not reimbulse you for any such disputed amounls or anr¡ loss you suffer, inclucìinç, bui not linritecl to, any amounts losl as a ¡esult of: paying anv unauthorizecj, forged, or altered item, or paying any other item alterec or lorged by the same wronqdoer if tle paid the other item befOre we lecelted nottce of any ol lhese exceplions lrom you. Ëxcept as provided by applicable lar,v, you also agræ thal we will not be required to reimburse you for any exceplions caused by your own negligence Different rules nay appiy to iîenis thal are electnnic fund iransfers ln any case, you agree lo repay us prompily any anlount credlted lo your account in erro¡ and you autlrolìze us to debit your accounl lo obtain paymeni of any erroneous crediI and yolrr primðry ãcccunt lvill be surject to the provÌsnns regarding insulficienl funds and overdrafts cliscussed above- Vfe lviil have no obligation to pay âny covered item i[ the secondary accourrl is in rjormant, inaclive, or fozen stalus. In this situatìon, il no funds are iransferred, you will not be assessecÌ any service charge for the transfet but your primary account wili be sLrbjccl lo the provisions regarclìng ,mufficienl available balances and overor¿f ts discussed ab.rve Stop Payment Orders. You may rec¡uest us t0 stop payment on any chæk, drafl or similar written ordei or insfuciion drawn on your account by giving us lhe infotrralion ive may request, includinç the accounl numkr, the ilem number; the date ol the ìtem, the payee of the itenl, and the exacl amount ol the item, and by paying out stop payment service charge, We will search íor ya;r item bV computer, s0 it is essenlial thal all ¡nformatìon you qive us ile accurate lo be elfective, we must recerve any stop paymeni order rn time lo aflorcl ls a rcasorable opportunìty l0 acl We will conlrrm ¡'our oral stop paymen¡ orûer in wriiing, and the infornration inclucled in our written conlirmalion wlll be conclusively oresumed to læ conect unless you notify us wiihn fourteen fi4 Cays ol the clate of the confirmation. Conlirmed stop paymenl orders wrll be conlrnued in eflect for a period of two (2) years kom the date tlte initiaì oral stop payntent order was placerl or such oLher periorl of lirne as reqLred or Lnder applìcâble la\r¡, regulâtion of rule (inciuding, but not l¡m¡led to, iiìe UCC as enacted under any applicable ìaw regulatìons issuecl by the Fedelal Reserve Board ancl rules issued i:y lhe Nalìonal Cleainghouse Assocìat¡on) A confrmed stop payrnent orcler wìll exprre al the end of the hvo-year period unless 1,ou revoke it at an earlie¡ date oi' tenew if in u'rit¡ng for an additional two-year peiiod and pay our sto0 pâyment service charge You may not stop paymenl on an item if lve have verified to the payee thai the available balance h Voilr accoL,nt is sufficient to pay such ltenr, or ìf we have accepleil thal ilem by paynell or othetwise. Any accounf ownet 0r authorized signer mav place a slop payment ordet, ancl we are not requiled lc release a stop paymenl order unless recìuesleri to do so by the accounl owner or the author¡/ed signer $rho requested it You agree to indemnify us and hold us harmless frcm and against any loss, damages, ancl expenses (nciLrding altorneys fee) we nry incLrr by reason of our refusal to pay any ilern upon whicii you have siopped paymenl. lor stop paymenl orders on pre-authorized eleclronic lunds transfers, please refer to the Eleclronic Fund Tnnsfer Disclosu¡e Statement in this booklel lllegalTransactions. Yori agree that i,ou will not use your accounl Íor any lËnsêction that is illegal in lhe jirrisdiction where you lir¡e, ln the juriscliction whete the transaclion is consurnmated, or ì1 êny oiher jurisdiction allected by the transaction You agree lhat it is your responsibility lo detennine the legalily of each of your transact¡ons h all applicable ¡urisdict¡ons before eniering into the lransäct¡on. You acknowledge anii agree ihat we lwe no obligation to nlonitol lo review or lo evaìuale lhe Iegality oí lransaclions on your account, YoLr also agree that you will not Lrse 1lour account in conneclion with anv lnternet or online garnbling kansaction, whether or not ganrblìng is legal in any applicable jurisdiction. !\¡e reserve ¡he tight to reluse or relurn any ¡tem thät we belier,,e is relaled lo an illeçal transâclion, an lnlernel or online gambling transaction or a high+isk fansactìon. To lhe lullesl extent permitted by law, you aEee to pay for any itern that you authorized, even if the transaclion re¡ateC to lhat item is deternlined to be iilegal

6. DEPOSITS, COLLTCTIONS, AND PAYMTNT OF ITT[4S Deposits. We may requlre a nlin¡mlrm initìal deposlt to open an account, You may make additional deposits of any amount of $1.00 or niore accompanial by a cOnlpleted deposit slip (unless yout cleposit ìs by elect¡onic funds transfer) eithei' in penon, by mail, at an ATM, a nÌghl clepository, or bv electronic ftlncs transfct. \tfe ruy charge lor deposjts, and r,re also mav refi:se to accepl for deposil or colleciion any ¡iem you offel ior ct,"posit, accept all or any parl of a deposit for colleclion on\4 or l¡mil the amount ol the deposil ll your deposlt is other than cash, for example, chæks, we may without prior notice [o you (except where prior notice is requirecl by larv) place a hold on the account for the amountof depositecl items for the approximate periocl of lime it takes Lrs to verify lhat the iterns will be paid. During lhe holcl perìod, inlereslbear¡ng accounts will earn interest in accordance with the inlerest schedule ltems accepted for clepositand draln on a non-U,S. institution may be subject to a service charge \{/e may accept an item foi deposit to your account lrom anyone and wìthoirl questioning or verìfy¡nQ the authOrlty of the ærson mak¡ng the cleposit. Any ttem thal we cash or accept for deposit may be subjecl. to later verllication and final paymenl. We may deduct lunds from your account if an item is lost (uniess such ¡tem was losl due lc Compass Bank s negligence) stolen or destnyecl in the collection process, il it is returned to us unpaid. or if il was inpropedy paid, even if yoL; have alreaciy Lrsed lhe funds. Cash depos¡ts are also sublect to iater verifrcation. Credit lor any item we accept for deposit lo your account, includinE funds thai are deposited by elecfon¡c transfe¡ is provisional and may be revoked ¡f the item is not finally paid, for any reas0n, in cash or its equivalent We nlây give casÌr back to any aulhorizeci acccunt signe(s) or agent{s) in connection with ìtems payable t0 any olner, whe[her or not lhe ilems have been endorsed by tþs ¡\a,r*', ¡f you make a deposi¡ ot pâymenl that ]s ilol âcconpanied by insln.rctions lndlcaiing holv or where ii io be aediled. we mav apply il at our discrction to any loan or deposit account any of you ma¡ntã¡ns w¡th us, \ /e n]ay is endorse ancjlor coil""cl items depositæ to your account vüithout yow endorsement, but rlay lequtre your personal enclorsement plior to accepting an iiem for deposit. lf you deposit an ¡tem that flears lhe endorsemenls of more than one person or petsons who a¡e not known to us, we may refuse the item, rcquiie all endorsers to ln present, or rcquire that lhe enclorsemenl be guaranleed by ênother f¡nanclal inslitrfion äcceptable to L.ls before we ¡ccept the ìtem. Our policy on the avaìiabiiity of cieposits ior withdrawal is ciescribed rn the Funds Âvallabllity Disclosure portion of this bookle| Collection as Agent, ltems dellverecl i0 'Js for depôsit 0r collection are i'eceived by us as your agent for collælion ancJ at your risk. We nay accepl an item for collælion only (such as a returned deposiied ilem or an iiem clrawn on a non-U.S. tnstitut¡od and impose a service charge for attempting ccllection ol the itenl, ln sìtuations where we accept an ilem lor collection onlii we will noi give you cesh cr an oflicial check for the itenrs untiì tne ilems have been paid. We are 0llligated only to exercise ordinary care in handling and collecling iiems delivereci lc us for deposit 0r collection. We shall not be liabie for lhe misconduct, neglecl insolvency, mistake, or íault of other pei'sons or eniities, or for loss or destrLrtion of any iteir in lransil or in the possession of others or for loss of use as a result of thefl, iìre, or olher event beyond our reasonable control. lf any item depositæ io your account ls payable by a payol lhat is nct a bank we mãy seûd ihe ìtem direclly l0 tnat payor. ltems payable through another bank n'ny be sent

Õ direclly tc lhal bank or to colleclinE agents $/h0 l¡kewìse shâll have the right to send lhe ilems d¡recil, t0 the bank on which they arc drawn tr ¿l urhich they are payable Payment of these itenrs mev b€ accepted in cash or drafts and ne¡ther we nor any collecting agents shall be liable for lailure lo collecl such dralts Each collecting ðgent deemed to be your agent. No collecting agent shall be liable for loss arising kom any act or omÌssion of another agent 's

Check Cashing For Others. You should not use voLrr accounl t0 cash checks for others v,rho are ¡ot well knou¡n to you. hlthough we may make lunds provìsionally available to you and may lake sleps lo determine whelher a chæk wìli be paid, you ae responsible tor any loss tlnt occurs if the check is returned to Lts for any reason (e.g., because it is counterfeit) Our employees cannot plomise lhat checks cjrautn on c¡ issued by us or olher instliuL¡ons, inclurl¡nq cashiers checks, will be pairt. ACH Credits. Credit lor an aLto¡nated clearinghouse (ACH") fansfer is provisjonal unll final payrent is received by ihe payee-s financial institutìon. Until ¡hat happens, lhe pô(y originating the transfer is not deerned to have mâoe payment L0 lhe benefic¡arv, and the payees bank is entitled to a refund of the provlsional credit. lf we give yor provisional credii for an ACH transfer. but do noi ræeive final paymeni, you become obligated to us for the fuliamounl without prìor notìce or demand.We a¡e not required to llive you a separ¡te mtice of our receiptol an ACH transfer. lf we accept ACH credlls tc your account, you wili receive nolice olthe cledit on your nexi. regular"perioclic statement, Allhough we may send notice oia non-ACH incoming flnds transfer ie.g., a wire), we assume no obllgation to clo so. You also can conlact üs t0 determ¡ne if a transler has been crediled io your accounl. US Dollar Cash Deposit Limitations, BBVA Compass will irnpose iinriiations on the amoL;nt of US tlollar cash deposils oy non{esideni cusl¡rters, Under lhis policy if you are an indivìdi¡al niho is not a US rcsident, the aggregate amount of US rlollar cash cleposils that may be made inlo vour account during any calendar month rs limited lo $4,000. This limilation will noÌ apply to deposits n€de by check 0r Òther j-lon-cash deposits At our discretiOn, we may ât any time tl4lfroL[ prior wrilten ¡roiice to you (exepi where prior notice Ìs required by law) eslablÍsh or cnange the aggregate US dollar casn deposit iimil by posting the maximum US dollar lìnrii in each of our banking centers, We reserve the righl lo refuse any US rlollar cash deposit tliat exceeds. or tryoulci cause the aggrEate of such deposìts to exceed, our established aggregale US dollar cash cìeposil ltir¡talìons. Joint Deposits. lf an account is a joint account or a P.0.D account (including a 'Totten" trust acccLrrrù, our rìghls ancj liabilities Tor paylent of any sLms on rieposil shall be governed by [he laws of the state in vuhich we nrintain your account. Deposits by Minors, Agents or Trustees. A deposit accepted f rom or 0n behall ol a minot at our option. and subjeci lo applicable law may be paicJ [oorforlheminolandthepaymenlshail bevalideventhoughnot executedbylhenl¡norsguardiari, clrstodbn,orlegal representative.Wherea ciepcsit is accepted from an agent, ttustee or othel representative, we do not have lo inquire as to Ihe aLtlhoriiy of ihe reoresentatìve, ând the c,eposlI may be paid to lhe accounl owner or to the representative wilhout inquiring as to the disposìtìon oithe deposit. Uniform Transferto Min0rs Act (UTMA) Deposits. A gift ol money to a rninor-named as beneficiary of a UTlt4A account ls ir¡evocable. wili be consideled made in accorciance wìlh thÊ provls¡ons 0t êppl¡cable state statutes governinq uniform translers to mrnors, ¿nrj shall include all interest eanrecl on the accoLlnl, Check Endorsement Standards. lf you deposit checks into your account, you are responsible for the conciìtion ol the back of the check when it is deposited. The back 0f the check ¡s usecJ dur¡nÇ lne check collection process io record the identìfic¿tion of banks processrng the check. lvlost of lhe back of the check is reselved lor bank use. Ycu agrce that the endorsement of the check rnust be contained in the payæ endorsement area, which ts limited to l'1/2 inches frolr the trailing edge of the check on the back, The trailino edqe 0t lhe check ¡s def¡ned as the lett side of the check lookrng al it lrom the konL Any wrilinq, stamp, 0r mârking 0ulside of lhe payee enrJorseirent aleê may delay lhe proper reiurn of any unpaicl check ycu have deposiled. You aqree to indemnily us kom any loss or liabilily, includìng attorneys {ees, tkt may be caused by your failui"e lo adhere lo lhe endorsement starldards of the Federal Reserve Syslerr. Foreign Currencies. Deposits in folggn currenciL.s will be corve{ed to U 5 dollais ¡t tne exchange rate in effect at Ìhe time cf final cojtectlcn \bu lviil be responsible foi- verii¡cation ol any exchãrue rate ìnformation pmvided bv us in advance cf final colìecUorr. Exchange rates may fluctuate siqnificanlly in a short periorl ol lime. Y¡u bear ali exchange risk related to depcsits of foreign currency. ATM Depositories, Night Depositories, Direct Deposit, and Deposits by Mail.Our ATMs night depositories, direct cieposìi serr¿ice, and deposit by mail service ae for your convenience We arc not account¿ble for rJepos¡ts mar1e in thls rnanner until the deposii is aclually accepleel and processed bv our authorizeci emplovees. Deposiis made in lhis manner will be posted to your account on lhe date acceplai by our authorized employees, Oul records arc conclusive proof of what depos¡ts \ ,€ rece¡ved fiom you ihrough ATfvi deposrtoriet night deposilories, 0r the maii serv¡ce, lf any dlrect deposit is rccalled, ne are authorizeci lo ievese the deposit without prior nolice to you, except :s otherwise reqLtired by lavrr. Your clain that an item was depcrsìted, which is now missing, wili ¡'lot creale a presumpi¡on that there is a missing item or Inat we falied lo act wìlh or¡linary care

-ihis Chargebacks. section applies t0 ilenls that yolr deposit or cash ln the evenl a cashd or deposited itenl drawn on us (an "on us' item) ts deiermined by us nol t0 b€ ilayðbie lol any teason or a ceshed or deposited ìtem rJrâwn 0n any other payor is rcturned to us lor any reason, nrithout regard lo tvhether the other payor rciurnei the item lo us læfore its deadline to do sc. v¡e may chaçe the item (a ''chargeback ilem") to your accounl or to any accortnt of which you are an owner {including any j0¡ni accounl) or an aulhorized signer \À/e rnay debil all or parl of a chargeback item lo your account even ilrjoìttg sc results in or caLrses an overdrafl of yoLir accounl and regardiess ol whether lhe ¡tem can be physìcaliy returned to you, You waive nolice of dislionor in connæiion wilh any ltem thai is noi finally paid in full and that we charge back to your account. We may recover from you ðny amount wiihdi'awn by you against a chargeback ltem. ln the event thaï our d€b¡t 0f all or part of a chargeback ilem results ,n 0t causes ¿n ctterclrall of your account, vte may obtain ancj rela¡n possessìon of the ilem, if it is ôvailable untiiwe rccover from you the amount of any overdraft ol yortr accolrnt end for a reasonable iìme lhe¡eafler lf oLr deUi ol all or part of a chargeback itern that is an "on ui item does not result ln 0r cause an overclrall. of your accounl, oui deadline for return [o you ol the item, il il is avaìlable, shall be six blsiness days a[ter rrye make such determination. lf \,ve are notìiìed tha[ any item for which you received payment or credit lo lcur acccunl is nol properly payable, you agrce that, w-iihou[ notice to you, we may aulnotize ihe drawæ bank to hold the item and try to oblaÍn paymenl. !i/e will not lnìlially decide urhether a cashed or deposited iÌem has been improperly returnei; if yol believe that ã cashed or deposiled item has been improperly returneo,,vou shouid contaci !s ¡nlmed¡alely. We will nol be responsible for faiIng to pay âny ¡tem presen¡etj ¿galnst your accounl belore a deposit becomes evallable for withdravral, as set forth above, if the available lalance in ¡cur accounl, withoul regard to such deposli, ls insullìcient to pay the item, as provìded in Seciion 5. Service Charges; trror Co¡rection. We may oebit a service charge from your acccunl lcr each depositeci ilem that: is relurned to us L:npaid {wiælher for the fii'st or a sLrbsequent ti¡e) Sears an unauthorized signâture prior t0 deposit, has been altered, eGsed, delaced or mutilatecl; or ts incorrectly described on the rleposil slio. Erros in posting, addition, subtraction and calculation, rvhether by ycu or us, are sublæl tc correctron by Ls at any time; ptovided thal we may not be obligated to correcl certaìn errors ii you fail to notify us of the exceptions in a timely manner as described rn Section 4. You agree to rcpay Ls promplly anr¡ amount credited ic 1'our account in error, and you au¡horize us to charge yOur âcc0unt or âny Cllher äccounl Of whìch you are an account owner, to oblain pavment ol any erroneous payment or crediL, Allocation of DepositslSplit Deposits. You may requesi that ihe total amounl of a deposit be allocated h portions ãnd cred¡ted to inlo multiple accounti which may include a loan account. We may, in our sole discrelion, declìne any split deposìt requesl and iequirc tl."at tlrc deposit be macle inlo one accoLlnt. ll a holci {as desc¡ìbed ìn the Depos¡ls sub-seclion above) is placed on all or any pofion of the depostt, the imld may be placecl on dny one accounl to which funds were deposìled for tlæ lolal amounl of lhe hold, not\i/ilhstanding the spiil deposìt ln lhe eveni a deposìted ilem becomes a chargebacl( ilem, we mây debit all oi' pall ol the chargeback item lo any one accouni to which fLlnds were deposìtecl, even ìf dorng so resul[s ill or causes an overdraíl of the accounl Stale and Postdated Checks and Checks Bearing Notations; Miscellaneous. We ma¡r in our discrelion and wltholrt notìce to you, eilher pay oi return any check that is presenled to Lrs for paymenl rnore than six 6) monlns alter the dale cf thai check (a "stale-dated' check) even if the prcsentêliOn Occurs afler the exprraiiOn o¡ a slOp pêyrxent oúer We normally do not exarnine lne dale on checks presented for payment. You agree thal ì,ve aie not reiluired tc identily stale-dated chæks or to seek your permission lo pay them. We also may. in our discretion and wilhoui notice io you, eilher pay or relun any chæk we receive oefore the daie on thal check unless you have complied w¡lh any applicable statute regarding postdated checks and you have provided us wilh notice of the p0stdaling in tlme for us [o have a reasonable opportuniiy t0 act on it before ihe chæk is presenteci to us for pavment \bu¡ notice aboirt any postdated chæk musì be given in the same nranner ês a stop payment order and must provide lhe same informalion rcquired ior stop payment oders. Each postclated ¡tem cclverecj by â notice 0l postdatrng \,vilÌ F sublect to a servrce charge, We niay disregard any inforrnation on an item drawn on your account o[her lhan lhe siqnalure of the authorlzal signer, lhe amouni of lhe ilem, the date of llæ item 6ubjæl to the provis¡ons 0f this Agreement reg¿rding stale ênc' postdated check$, ihe account number the endorsements, and any olher infoi-mation vuhich appars in magnetic ink at the boltom of the check. Althoirgh r,ve are not o[rligated tq we may pay or accepl checks and olhel items beailnç restrictions or notalions {e.9., 'void afier 6 monlhs,' "iwo signatui'es required," "payees endorsement tequìredJ "nol good for more lhan $(amount), 'void if not paid in (nurnber) daysl "payment in fulll' and the llke) whether on lhe h onl or back, in any form or format lf you cash or deposit ôn ltem oi wrÌte a check with such a notati0n, yolr ðgree ihat it applies only between you an{i the payee or maker. The notatìon \,vìll have no effecT on ls, and you aqree to accept responsibility for paymenl o[ lhe itern We sliall havc the right. but no: the cbligalion. i0 process any ilem ihal is r¡aier¡ally inconpleie or has been allered. T.WITHDRAWALS You may withdraw pai"l or all of your accounis avaiiable balance. Any account oirvner 0r- âulhorized signer 0f a loint accounl may w¡lhdraw all 0r pari of lhe available balance in ihe account, regardless of wllo depos¡led the fi¡nds inlo lhe account. We accepl no responsibility or oblígat¡on. except as rcquireri by law to supervise or revieni the use of your accounl Restrictions on Withdrawals. Your accounl may be subject io ceriain ti'ansaciion l¡mitetions, which are shown ìn the disclosure provided to you at fhe time you operteci your accounl We may âi any time and withorf priOr not¡ce lÕ you {except where prior notice is requrred by lalv)esiablish or change transaction lirilations for any account lf these iiml¡alions are exceeded, you will be subject to any ch.lrges in eftecl at tTc tmc ln adrJition, we may stop paying interest on an intefest"beârinç accounl, or we mey ciose lhe acccunl rivithoul prior notice lo you bxcept where prior notice is requìrei bv laid. We also irny rEuire yûu l0 prov¡de notice beiore you may withdrairv nnney konr certa¡n tyges olaccounts. Althougl'ì your signature card, resolutions or your checks may indìcate that nue lhan one siqnature is required or checks anci for the vvilhdrawal or:ransier ûf iuncs, tnat notation ¡s pr¡ncipally for your cwn purpose. We expresslv disclaii'n a duty Lo enforce muliiple signatrre requìrements. As such, we expresslv disclalm a duty to confìrm thal two 0r more (cr any combinatiorù ol authoirzeci users have approveC êny trânsâction. We may acl upon the instructìons ol ordel of any one aulhorized signer. All clæcks writien on youi account must be drawn in U.S. clollars. We may (but are nol obligated tot require suitable ìdentilicatlon and/or presenlation 0f accouni ownership records lor any wrthdrawal or account closure At our discrel¡on, we may require ail ol your signatures for the wiihclrawal ol funds and/or lhe closing olany accounl. We may f€qliire noncuslomers to fuesent L$ wìth suitable ìdenliÍication, lncluding valid phOto iilent¡{¡cation, in conneciion wiih lhe cashing ol your checks al one cT ol'offices. Cash wilhdrawaior paynenis at any branch nray be resticteC due 1o the lirnited amou¡il of currency o:¡ h¡nd lf ne do nol have sulficienl cash for a large wiihdravral or paylent, we may make arrangeinenls lor a latel cash paymeni or offer lo make payment with a Bank check \,Ve assurne no responsibility to provide personal protection for customers who eiecl io carry large sums of money of of our premìses Wrthoul prior wrilten nolice iO, SET OFF You acknowledge that. except as othemise pnhibried lLy law, we liave the nght lo chaqe or set olf against tlour account any Ìndebtedness or other obltgations wh¡ch you or âny owner ole us, at any time, withoul any fiirlher notice to or demand on you, whether the indebtedness o¡ other Obl¡gaLions exisï at the ilme lhe accou¡t is opened ot arise later. The indebtedless includes, \,vitholû limitalion, ail cliarges and overdrafts incured on aily accOunl you hold $/¡in us Ybu agtee lhat we niay sct ofl against the accounl any clairn whìch we have aOainsî you tllßhout recard to lhe sourc€ or ownership o[ the funds on cieposit in the accounl and without reouilement Lhat the claim be owed tc us by all ol the account owners You also agtee lhal, lo the extent allowed by law, we may sel off any Ìndebtedness or other obligations which you owe us under this Agreenænt againsl anr¡ other acc.ount or property in which you have an orvnership interest thôt is in our possession or control. ll.WAIVTRS You waive and agree tnal we may waive certain lEal requircmenls called presentmenl, demand for payment, prolest, notice of prolest. and notice of dishonor with respect to any and all items for which you recelved payment or credit kom us. No departLrre by iLs f om lhe provìsions of this AEeemen[ or any waiver of any fees and cha|ges rvith respect t0 youí Account shail conslitute a waiver by us of any fwther right lo impcse any charges or enfolce lhe provrsiotts oi lhìs Agreen.rent or a coirse of dealing cliflerent from thc lcrms of tnrs ,{greernent I2, OTHER STRVICES lf you have chosen to receive any of our other Banking Selvices olTe¡ed ln conneciion lvith ycur accounl, sLrch as Chcci< Carcls, ATlvl carcis, overilraft lines of credit and online bankìng, we may provide the specìfic terns ancl conciilions of lhe addilional serv¡ce to you in a sepanle âgreement or disclcsure.

13. INIEREST INTTRTST REPORTING Interest will be paid 0n inteiesLbearìng accounts at the tlmes and al the rates adopted from lìtre to lime by us. 0n each interest paymenl date, inlere,t will be paid only ll on that rJate, the ledger balance for the account is EUal t0 ü n]orc than the min¡mum amount required by us ¡n order for you t0 receive tnlercst on that account. Ai any time and without priol notice to you (exced where prior notice is reQuired bylai¡,,) we may change lhese retes and minimum ledÇet balance amounls or discontinue lhe paynrent of ìnleresl, The originally effeclive intercst rates and requued minimum le.dger balance amounls are shown on the inleresl scltedu¡e prcvÌded to you at the iime you opened your accounl, and a schedule containìng cunent interest rates and requiræ ntinìmuÍr ledger balance amounts ìs available lo yOu Llpon tsquest lnterest paid to you is reportabie to the lnternal Revenue Servìce as havìng been received by ihe lirst account o\Árner shown on the signature carC mainlainerl for the account. We may b€ required to w¡thholci a portion of your intercst paynænt anc remrt il t0 the lnternal Revenue Servrce .I4, CHANGES TO ACCOUNT STATUS Converting Your Account, We reseive the rrght to change your consumer account to a business accoLlnl ilwe determine that it ìs used for business purposes (meaning that the account is nol used primarily for personal, family, or household purposes) Your account nuy be considered a business accOunl if, amonÇ olher reasons, it fils inlo one or more 0f the follon/ing exampies: yow accoLnt has a business nâne; deposits include se.dit card drafLs: yoLlr account has over 100 withdrcwals per monlh: deposits regularly contain over $2,500 ¡n cesh: or your account has over 10 deposits per monlh lf we discontinue your lype of accounl we may convert your account lo another lype of accounls. We may alsc converl yout accounl to anolher type of account based on ow evalLnlion of how you use the accounL lf we conveft your ðccount, \4/e w¡ll provide you w¡th ¡nformation containing the terms and conditions ol your new account. Changing Checking or Savings ProductlAccount Type, lf you should change kom one checking oi savings ploiJucllåccount type tô anolher rluring the slatemenI perlod, your account will be subject to the periodìc charges and fees and requirernents of lhe new producl/accounl type for lhe entire periori, l5.APPLICA3LE LAW Except as otherwise provÌded by law, this Agreeirient and all accounts aie governed by the lav¡s of the stale wherc we mainlaìn your account anC applicable iedetal laws and regulalions tn eflect from time to tirrc and are suoject io any applicable aulomaied or olher clearinghoirse ruies and regulattons A determination that any provision of this Agreement ls ilnenforceable or invalid shall not affeci the enforceabiliiy or valioity of any other provisìon of this Agreement. For purposes 0f this Agræmenl, your account wiil be deemed to be mainrained ìn the state where you opened your account Your accOunt ¡s coiìsidered to haire been opened: if you opened youi' accourlt in peísOn, at lhe branch off ice where you opened your account; if you opened your.accOunl by nlall, al lhe location where the maìl r¡¡as received by us; or if you opened yolr account electronically iincluding by telephone) and your addtess is in a stale where lrye have l¡ranch offices, in the state of your addrcss at the lime you opened your account; or ¡f otherwìse, in Aialrama. I6. ADDITIONAL PROVISIONS Checks, Check prices vaq, ðccordinq to the types cf checks you select. Ycir can obtain information on the cu;'renl price of checks lry contaciìnq us. Check charges may vary from time to time wilhcut specifíc not¡ce to you. You are respons¡ble for veíily¡ng lhe accuracy of all inlorn¡ailon shown on your chæks and deposit tìckets. lf yotj find an eror. please notify us inureriialeiy. We are not liairle for losses resulting fi'om incorrectly printed checks or cìeposit tickels. lí you d0 nol purchase your clæcks thlough us, we may chaqe a fee for each check that re¡ecls during processing due to poor cualtty ot other teæons You agtee nol. io ìssue chæks wilh leatures or marks tnat obscurc, alter 0r Ìmpa¡r informati0n il ihe frOni or nack of a check or that olherw¡se prevents ils or another bank fronr capturing such information ciuring automated cnæk processtng. You agi'ee to safeguard yol"rr blanK and cancelled checks, and tc take reasonable sleps t0 orevent their unauthorized use if your chæks are losl or stolen, you aqee to notif y us immediately For securlty rcasons, we reserve lhe riçhl to ciose your account and tlansler the balance lo a ner,v account. ll we do, all checks wrÌlten bul nût yet paid may be relurned lo payees with notations such as "Account Closed" or "Refer to Maker.' You wlll be responsìble loi- issLting any replacemenI checks. Closing Your Account. We reserve lhe right to close your accclunt ai any time, for any reason or for no reason, withoul ihe necessily of piior written nolice lt \,ve clOse youi account, we will nolify you by rnaìl or teiephone that we have closed your accounl unless ycur account has had a zero balance for lhirty (30) days or nnre. lf yor have agreed tc receive notices electronically, we may nô¡¡fy you eiectronically. We may (but rJo not lnve to) nai! yoLi a check lor lhe available balance in your accouni, oi you nay pick up a check for iiie ¿vail¿ble balalrcc at our oflice Written notice that the accoL¡nl has been closed and a check, ìf any, vlill be sent lo any address sholn on oLlr ræords for you, or if the account is a jo¡nl accoun¡, io any account owner to whom we elect lo send it. Once we have closec your accounl you aOree thal we can: . Refuse lo honol any checks you have written or any other ite¡¡s lvhich are presented to ir iol payment aflel wp have ciosed your âccolnl, ' Refuse lo coilecl any check you have deposited in your accouni, to collecl any check you have depodled to your closecl accoilnt. 0r t0 ilccept any automate0 leposiI lo your accotrni . Assess any service charge oiherwise applicable aQainst ani, ¡s¡1¿¡¡inq balarice in yout accounl We ¿n: not respo¡tslble to yoL: lor atty damages you rt-iay suffer as a resuli of yorr accounl rrerng cl0scd li you atiempt to m,lke ¿ rjep0s¡L l0 ån ¿ccounl we closed Õue lo non-pay,rtenl ol an ovedraft ol otherwise, we n"ay collc.cl the deposii and set ofl yoLr indeblecjness to us and collect a seniice charqe from the amount you deposi[ed. Any lunds in excess of 91,00 will be rcturned to yoL¡, We reserve lhe righl lo reluse your reqrcsl to close ycur accounl. if your accoll¡tl is not iiì goôd standing. ll you inlenc to close your account, you should noÌify r,s Sirnply reducing your account b¿lance to $000 is ¡nsufficienl notice and nay resull in addilional fr:cs charqed lo your ai"count ll you close ycur accouni yOu are responsible for fansact¡Ons you inii¡aled or aulhorized, inckriiing rhose tlæi we receive afler the account is closed. Indemnification. Except as otherwise set Torth in ihis Agreement, ycu agrce lo Ìndernnify, defend a¡d hold us harmless Írom a¡l claims, aciions, pioceedings,lines. costs ancl expenses (inclLtding, wlthout lim¡tation, altorney fees) related to or arÍsing oLrt of b) yoLr actions and onrissions ln connætìon with youl accounls 0t out servlces, and {d our aclions and om¡ssions, provided that lhey are taken/omitled in accoldance wiih lhis Agi"eenent or your lnstruclions This provision shali sun¡ive the terminatìcn of this Agreement. Survival ol this Agreement. All provisions ol thls Agreement, including, buf not limìted t0 the dspule resoli.:tìon provisions contained in Section 2, shall survìve the termìnaiion of lhis Agteement or closure of your accountß) by eilher party for actlons arising in ccnnection vrith this A!rcenlenl 0r your accounl(s) AmendmentslChanges to this Agreement We may allend or change (adci lo, delete or alter) the teims of this Agreement from time lo time upon grvìng prìor nolice to you. Amendments 0l thìs Agreentenl may include modifying ald cieletiç existing provisions ând addìng nevu provisions. We agree to provide yr:L: notice of any amendment (except an amenrJnlent benefitìng .vou) at leasl thlity ß0) Cays, or a longer period ìf required by leW before that ¿mendme¡t becomes efective by maìling you notice of lhe amerdmenito the i¿st aildless shou/n on our recolcls, electronical\¡ it you have agreed to receive such notices elætronically by making the rrotice available vlìth lhe periodic slatement of your account (as applicable) by posiìng nolice of lhe aniendmcrtl lr: our offices, or by posting nolice olthe amencJment on the SBVA Compass webste or 0nllne tsanklnQ (if applicable). We may, but are not rEuired to, give you nolice if the amendment will be lo your benefll lf there is nlore than one accouni ownet, we send the notice of amendmenl to only one of yor.r. 3y continulng t0 mainiain your account, conducling a transaction or obla¡ring set vices 0r \ryill products relating to this Agreement or your account afler the anrendment becomes effective, you agtee tc lhe anendrnert of lhis Agreenent V/e also rny, in our sole discretion, substilute services or discontinue certain kinis of services, prorlucts ancl accoLlnts, and place lestrictions on cerlain t\ipes ofâccounls. lf we discontinue the kir¡d of accouni,vou have, we can lransfer your acccunt balance to another ly¡:e of account, In ihat case, we wìll maÍl ycu a nolice at i€ast thuty {30) clays before the transler {akes efect By continujnçl to maiitta¡n volr act.ount, conduci a lransaclion, or obtain seruices or ptoducts ftor us after lhe I ansfer i¡kes e[,ecl, you cxpressly lgree lo ïhe change in {he kind ol accounl you have Sevetability. lÍ any one or more of the p¡ovisions containec in this Agrcement shall for any reason be held invalid, ìllegal, or unenlciceable for any reason, such holdìng shôll not ìnvaìidale or render unenforceable any other provisions oÍthis Agreement, To the exteni permiüed by applicable law the patties hereto waive any provisiOn oi law which prohibits or renders uneniorceable any provisÌon iereol and to the extent ihat such wâiver is nol permiiied byappltcable iaw, ihe ¡ærties intencl lhat such provision lx inlerpreted as modifre.d to the mlnimum exlent necessary to ieitder such provision enlorceable. 17. ËLECIRONIC BANKING sERVICIS We may provicìe you with an ATli4 carcl, check card or other device o[ secilriiy cocie to access vour accounl elætronically or you may be requilecl lo create one oi more security codes lo access your accOunt electror ricallir Please review ihe agreemeni that govelns the use of and ihat cotnes with tlie card, device or ihe securily code carefully. You agree ic use lhe card, devae or sæurity code only ìn ti"ìe manne. and for the purposes described in the applicabie agreement, lf you altempt to use the catd, cleviæ or security cotie in any other nanner or for any olher purpose, we may rciect lhe lansaction, or ai our discretion, we nay complele it wilhout incuiring any obligatlon ia honor tne same type cf lrãnsaciion in ihe luiure We maj- ienninate a ca¡ci, clev¡ce or sÊcurily code ãt any lime without notìce to Vorl ¡n Ordel t0 prevent unauihorized access t0 ycur acccunt, you agree lo maintain the coniiclentiality and securiiy oi the card, devìce o securiïy code You agræ io not1fo us immediately if you believe your card, dev¡ce $ secur¡ty code may have become slbiect lo unauthorized use, We may

'13 suspend or cancei your caid, device or security cocie even r¿vithout ræeiving such notice fronn you ¡f we susp€ct your calc, device 0r securìty code is beinq used in an unauthorizecj o¡ frauclulent manner You agree that lhe use oi the securiiy code const¡iules a conmercially reasonable secl{ty procedure loi vou You understanC that anyone i,r"ho obtains your securily codes rnay access your accounts and may ¡nitiate lransactions on your accounls li you permit anl,olher person to use ycur card or your secur¡ty code ôr otller means t0 access your accolrnls, you are rcsponsible for all transaclions initiated by such person. BBVA Compass ['lobile Eanking. BBVA Compass Mobile Banking S.^rvice allows clsloi"ners lo obta¡n ceriâin services vÌa a cell phone or other handheid nlobile device, as describeci below (ihe Mcbile Sanking Service"), This seciion of the Agreemenl contaiirs the te¡ms ol use fTerms of Use')that specifically apply to the Mob)le Banking Service. SBVA C0nìpass may assìqn or deieqate any ü all of its rights ând responsibililies under these Terms of Use t0 one ü rmrc ìndepencienl contractors or other thircj part)¡ service providers, and any rights or resgcnslbìlities so assigned or deleçaTed may Lre exercised ot peformed by either BBVA Conrpass or its seivice provider. ßv using the lr4ob le Bankinç Service, you agtee t0 all Õi the terms and conditions of lh¡s Aqreement, spæifically including but not limiteci to îhese ïprns oi Use. ln order to access the [4obile Bankinç Service, yor nl st have 0 a handheld device that cal'ì sencl and receive intormaiìon usirig llæ teclinology that supports this Mobile Sankinç Service (an "iligible Mobile Device") and (ii) all infornration reqllrred to €nroll, \rynìch will be ciescribed ¡n the BßVA Compass Mobile Banking Application ('Mobrle Applrcation) al the time of enroÌlmenl Eligìble Mobile Dev¡ces necessðry tc obtarn the h,lobile Banking Servicearedescribp-cionlheBanksWebsiteaiwnw.bbvacornpasscom/golmobile.3B\tACompassmayupdateEligiblelvlobileDeviceskontime io time The lechnicai standards required to access anrl use the lüoblle Banking Setvice {the "lrilobiie Technical Standalds") vary annng the iypes of ËltgibleMobrleDev¡cesandie¡econlrnunicatÌonscan'iersthatsupporlThlsSen¡ìce, TheMobileTechnicalstanciarrlsare¡iescribeclontheBanksWeb sìte, ând mêy be Lrpdatec kom time to time to rellæt changes in the tæhnology thal suppofs the Mobile Banking Servìce. Wlth the M0bile Bankitg Senrlce, you may use youi fli0ible Mobile Device lo access certain accounis that are nlade available tc you through lhe Mobile Applicatioti þach, a "Motrile Accounl), and -vou may use your ilìgìble Mobile Device to {t) view balances ancj recenl transactions for each Mobile Account: (ii) make immediate, one"lir¡e l'anslers of funds beiween your Mobile Accounts: and (ii0 access acidilionai se¡vices tl'at rnay be availabìe thrcugh a Mobiie ApplicaLioll Additional terms and condilions {Addendum"or'Addencia) may apply in orderto access certain ¿ddìtional services thal may be availabie through a Mobìle Application Your use of the h4obile Bankìng Service will æ governecl by thrs Agreement, all Addenda and all other terms and conditions in agreemenls governing accounls you may liave r¡vjlh us or servlces we provicle to you. We do not currently charge ycu any iee to rcgìster ior or access the Mobile Banking Service or to download any Mobile Applicalion. Howevet you may incur charges to receive internet, cellular or oiher clala sen{ce on your tligibìe fi,lobile Devlce. You may also ìncLrr charges from your teleconlmunications carier when sending and receivirg intormation in connectìon wilh yoLtr use of the N4obile Banking Service. You are responsible for mainlaining the sæuriLv of your Mobile De.vice anrl any securily codds) yoLl have createcl fol the purpose of accessing the Motile Banking Sei'vice, and you ate i'esponsible for all transactions you iniriate o authorize using lhe Mobile Banking Service. lf you allow any person l0 obtaìn or to use your lúobile Devlce or security code(s) you will have aulhorlzed that person l0 access your Mol)le Accounts, and you agree lhat you will lre bound by any agreements thal person accepis or acknowledges electronlcaily through the Mobìle Banking Senrice. Notify us at once if the phone number fot tTour Mobìle Device is changed or service to your il4obile Device is terminatecj, or if yoLt lælieve tlrt your Mobile Device has been losl or deslroyed, or if you believe that your secur¡ty code(s) has been conrpromìsed, or that your lvlobile Devìce or any of your Mobile Accounts h¡ve been accessed ot Lrse.d without your auihorization, or if any ærlodic staiement shows a transaction on a Mobile Account lhat you did not rrake, including anv unaulhorized transaclion rnade via the Mobile Banking Service Contaclii-tg ß ¡mmediãtely by telephOne will help you avoid responslb¡l¡ty for unauthoiÌzed transactions anci w¡ll help you and us reduce possible losses. Call us at:1.800273-1057 or write to us at;

BBVA Compass 0nline Banking Suppcrl P.0, Box 10566 Sirn1ngham, AL 35295 You ate gtanted a no|-excìLlslve non'licens¿ble, non"fansferable, personãi, l¡miled license t0 insiall ânci L6e the MCIbile Application only on an iliçìble N4obìte Device that 'l'ou own ü control, solely for your personal use and as expressly permitted herein. lt is solely your responsibility to downloarl and install any Mobile Applicalion lhat is ldentiiied on the 3ßVA Compass Web site as requìred ln orcer to access lhe Mobile Bankrng Service through pur Eligible Mobile Device. BBVA Compass has nc responsìbilìty t0 notlíy yoir cl any changes to or new releases for any required lvlobìle Applicailon. You acknowleclge tint ionr time {o line. lhe [4obile Banking Seii,ìce rrny be delayed, interriipted 0r unava¡lable f for ên indeterminaie peri¡d 0f t¡me. BBVA Compass and iis aff ìliales shall noT be liable lor any claiir arising koin cr related lc lhe Mobile Bankirig Service arisìng fom any such delay, interruplion of unavailability. ln no event wlli BBVA Conrpass or its alliliates be iiabie for indii'ect, consequential or special damages, includinç1 lost prolits, aristng from or relaled to ihe Moblle Banking Senrice, even Ìl such damages lvere reasonably íoresæable and noiice was given regarding them. These l¡mltalions will apoly to all c¿uses of acUon, whether arising kom ûreacl'i ol contract, tori {including ne.gligence) or any olher legal iheory. BBVA Compass disclaims allwarranties with respect to any Mobìle Appìicatron, wheiher express, imnlied 0rstâtutory,lnclud¡ng without limitation ìmplied wananties 0f merchantabiìily. salisf,3cloÍy qualily, titness for a pai'ticular plrrlrose, accuracy timeliness, and non.inkìngement o[third parly ¡iqhts. You release SBVA

14 Comcass, lls servìce ptovtders, attd its ¡íftliaies Íronr all claims anci cl-rmages thêt Ílay al"se lron: or relale to you use of any fMobile Appllcalion You agtee nol to reverse engineet, decompile disasser*le ü ãltempl t0 learn il¡e source code ol any li4obile Applical¡on, ând you may not redisiribuie any Mobile Applicat¡on All rights not expressly granted to yoLi hereln are reservecl bv us. By identify¡ng an tltglble Mobile Device lor use wilh ihe Mobiie Bankrng Seivice, 3B\A Contpass does nol recommend. endorse oÍ make any representation or warGnty 0f ðny kind regaroinq the perlormance or operalìon of such devìce. You are responsible foi the seleclion ol an Ðìqible Mobile Devir-e anci fo¡ all issues relati¡tg lo the cperation, peiiorntnce. and costs associated wiih such device v'/ilh your lelÊc¡n¡municatrons catner BBVA Compass and iis service proviciers have no obligat¡on lc coreci any bugs. defects or errors in rhe ¡lobile Bankinq Servre or Mobìle Applications, 0r to oiherwise suppor¡, nrainlâin, imp0ve, modilr,l upgrade or enhance the Moblle Banking Service or Mobile Applications Subject io applicable law or regulations, BBVA Corrpass may lerminate your use of lhe l\,lobile Banking Service, expand, reduce or suspe nd lhe type and/or ciollar annunls of transactions aliou,ed usinÇ tne service, change the enroliment process, ancllor change the transacl¡on l¡mìts associêled with lhe fi/obile Banking Servìce al any lime,in its sole discrelion w¡lhûul priÒr nolice You acknowlerlge and agiee that BBVA Compass may collect, transmit, store, and use lechnÌcal, location, and login or other personal data and i'elated informalion, including but not limitecl to technical infcrrmation about your devce, sr¡slem and âpplicalion soflwa¡"e, and perìpherals, and informalion regardinq your locai¡on, thal is gathered petiodìcally lo facilìtaie the pnvisìcn ol upcJates to fvlobile Anplìcatrons and procJLrcl support, for securìiy reasons,lof marketing purposes, and for other sei'vice t0 you ûian-v) ¡elated lc or jn conneclion wlth, rhe Mobile Banking Seivrcc. You agree ihat you will not use the lVobile Banking Service or any serv¡ces relatei lherelo while driving \bu asume all lsl< assotiated with the use ollhe Mobile Bankig Serviee, incluciinç,'tiie use of any Mobile Application. You agree ihat you will not use the lvlobiie Bankinç Service or any services relaled thereio for any putposes prohibited by Untteci States lawr and shall not use or otherwise export or re.export ihe Mcbi¡e Applicalion(s) except as aulhorìzed by UntlÊd Släles law and the laws of the ¡uriscliciion in vvhich lhe lvlobile Applicationß) rvas obtained, You hereby represenl and warranl {ù you are not ìocaterl in a counlry that is sublect to a U,S. Government embargo, or has been designateti by the U.5 Governmeni as a "terorist supporting'' counfy; and üi) you are noi listed on any U.S. Government lìst oi proliiit¡lec or reslì-bled part¡es. ln any instance whele ycu are not subjeci to thls AgreemenL ü ihe ternn ol ills Agreement are deemed not to appi-v, then the llvrs of the state ¡n which each Mobile Accoun[ was opened, \i/ilhoul rega¡d io its conflicts of iaws rules, shall govern lhese Terms of Use. By enrolling in the Mobile Banking Service, y'olr consent to receiving ûild acceptinq the terrns and condilions ol Ìhese Terms of Use and any Acldencja or amendmen[s to ìt eleclronically, inciudlng, bül nOt limited to, via en€ii, lext message oi lhrough ihe Mobile Appluìati0n h lhe event âny amendmeni requìres prìor notice to you, vre nty notify you via email at the email acfdress you have provided to us for use wiih the Mobìle Banking Service, Thls enlail nay- tnclude any new or ciifferenl lernrs and condlrions or provide you wüh a link lo a \4reb site containing such new or different terms and conditions ior any information hat you have ägreed to teceive eleclronically, we have no obliçat¡on to prov¡de yo! or any other owner or authorized sigtter on the relateLl arount wilh ¿ paper copy o[lhe communicat¡on unless and until your consent for eleclronic communìcalions is withdrawn as desctibed belorry. We teserve lhe right. but assume no obligaticn, tc pfovide a paper copy ol anv conlmunicalìon thal yoLi have agreed lo feceive e¡ecfOnically. We may, but are not re.quired 10, make available paper copies ol any communÌcâtiOns lhat v,/ere provided to yOu electtonically We reserve the rigit, subject to applicable lani to charge a fee to provìde a paper copy of any communicalion previously delrverd l0yûuelectronically. Youmaycali usatl'80027.¡105TtoiindoutaboLrttne availabìlityo[apapercopyof ani;parlìcularcomn]unicalion.and the amouni ot any fæ you will be charged ior ¡hat paper copy. You may withdraw your consent to havinq lhese Terms oÍ Use and any Addenda or anrcrìdments lo it provided to you electronically Oy conlactinq us by telephone al 1"800 2731057 Howevq if you do so, we iar¡ll automãt¡cally unenroll you from the Mobile Banking Service. ll ìs solely your responsibilily to assu¡e lhat the emall addi'ess you have pi'cvicied to L¡s in connection with yout' ise ol the Mobile Banking Sen/¡ce is cureni accurêle. You may make clianges to this enlâil adclress by signing in to BBVA Conrpass ai^rd Online Banking artcl accesstnç lhe Service Ccnlcr tab Anv change to your email actdi'ess niìli be clTecttve imnrediatey BBVA Compass rcserves lhe right to teintinate your access lo ihe lvlobile Banking Serv¡ca 0r any pottion 0f ìl in its sole dìscreiion, \i/¡inout nolice ênd wilhoul linitatìon, except as may be requned b,v law.

ATM Saiety and Security, The lollowing are sûme tips on exercising care wlen usrng an A-lM: . lf tnere are any suspìcious circumslênces. dc not i;se the AT|\X . lf you notice ¿nything silspicicus wilìle transact¡ng busìness ãt ihe AlM, cancel lhe transaclion, pocket your Carcl and Leave. . Be c¿¡eful when ';sing the ATM and be aware oi the sunoundings, espæÌally at nighl or ìn an isolated area , Park near tile ATI\4 in a wellliçhted area. . Ai night, havesomeoneaccompany you when possible. . Do nol api:roach a da'k Atlr4. . Do not accept assistânce from anyone whiie using fhe ATM. . lo nct tlisplav yo:l casn; pockei it aild then count il latel in lhc safety of your liome or oífice. . Besure tosaveyourlransaction receiptsand checkthem againstyo.Lilslatements regularly. . Preoare ceprsìis at hone to nlhlnlize your time at tne Ailr,,l . li¡laks sure you salEuarcl your PIN Do not write your PIN on your CarC or cêrry ll ln your lvallet or purse, . Always sæure vour CarC lust as you wouìd cash, check ancl c"edil caxls. . Do nol to rJisciose or olhenruise make your Card or PIN available io others. . lmmediately reporl all cr.inæs to local law enfcrcemeni and lo tne ATM operatol TLËCTRONIC FUND TRANSFER DISCLOSURE STATTMËNT The followng disclosures ate rnacje in accordance \4/ith ihe federal law regarding elecfon¡c paymenis, deposils, trånsters 0f luncls and olher electronic lrânslers to and from your account(d There may be limitalrons on acc0unl act¡v¡ty thal reslricl your ability lo make elecuonic fund lransfers. Any such limits are disclosed in lhe applopriate agreements qovernÌng your account The separate agreei:ient and dtsclosure slatemenl governing your use of a BBVA Conpass Chæk Card cr BBVA Compass ÁJM card initìally wili be provided to yoL¡ eithei al lhe time you op€n an accounl or by mail afier !'ou 0æn en account, aiid it v¡ilj conlrol if there ls äny conflict between that par[iculai agrcement anci disclosure statement and this Dìsciosure Statemenl. Any aulhorized signer on your account iliay act aìone in conducting elecfonic fund transactions, regarciless oí the nLrnberof iequiredsignersindicatedontheaccountssignaturecard, lfyouuseanATMthatìsnoloperalæbyus,youmaybechaEedaleebyus. the operator and/or the ¿iitoÍraied transfe¡ network 1. Definitions: tlectronlc Fund Transfer: Any transfer of funds, other lhan a transaclìon originated by chæk, dËít or similar paær instrument, llït is in¡tiated thou0h an electronic terminal, telephone, computer or magnetic tape to instruci Lls to cjebit or credil an account. Elætronic Fund Transfers incllde sucn elecllonic transaclions as drect deposits or withdrawals of funds, automated teller machine transiers, transfers inìi¡ated by telephone. and Check Card transaclions. Preauthorized ilecironic Fund Transfei An tleclronic FL¡ncl Tlansfer thal you have authoi¡zecj in advance to ræur at subslanlially regular intervals; fü Êxample. drrect Ceposl[s inl0 ff wìthdrawal of funds oul of your account. ^[2]. Your Liability: Auttnrized Transfers:You are liable lor all Elecfonic FlncjTransfers that you authorize,lvhether drertM or indirecily. UnaLfhorized Tiansfeis Tell us at once ìl you believe -vour account or PIN is lost or slolen or nas been or may be subject lo unauthorized Eiætronic Fund Tlarcfers, Telephone us immediately al lhe number prov¡deri ìn Seciion 3 below to keep your possible lûsses to ê minimum \bu coulcj lose all the money in you accountis) (p[rs Lne amount of lunds available in an overcrafL ilne of credit) ll you tell us r,viihin two 2) biisiness days afiet learning of the loss or lhefl oí your Check Card, ATM carc, o¡ other account access Cevice, or alter learning of any other unauthorizeci lranslers from your account involving your Check Carcj, ATM card, or olher accounl access devÌce, you can lose no mo¡e lhan g50 ìf Electranic Fund Transfers are made w¡lhout ycur permission. Foi ihese transactions. if you D0 NOT tell us r,vithin two (2) business days after learning of lhe loss, thelt or L.¡nauthorized Lrse, and we can establish that we could have prevented the unaulhorized transfeß) il you had told us in linle,

you could lose as much as $500. lf you are a C;rlifoi"nia resirlenL, yor-r will not be liabie for the $500 amount described in the prior sentence lor Lnauthorized Check Calcl or ATM transaclions nowevel ìlyou faìl to reporl an unaulhorized use ihat appears on a peíodic slatement niithin 60 days of our transmittal of your periodic stalerìeni, fhen you may be liable for lhe amount of each unaulhorized lransfei that occurs aller the cìose of lhe 60 days and before ;,ou plovicie notice to us, unless the delay in notilying us was due to extenualing circurnstances beyond your reasonable conlrol

Your ltability ltmils for rlecironic Fund Transfers involving unaulhonzed Vsae Check Card purchases are different trorn your liability linrits noiecl herc, Please rcfer tc your agteetnent and disclosure slaiemenl for youI Compass Check CarC for these limits.

Also if your periodlc accolnt stalement shows unauthorizql lransfers and you D0 NOT teil us within sixty (60) days after the stalemenl was maÌled to you, you mav nol gel back any money you lose after the sixty (60) day period if ra,e can prove that ure could have preventecl the unautnorized transfe(s) if you häd told us rn time. lf an extenuating crrcumslance {such as extended travel 0r hospilalization) prevents you from promptly notifying Ls of a suspæted lost or slolen card or other access device oi' of any other sus¡æcted unaulhorized fansfe(s) lhe time periods speciiied in this Section 2 may tæ extendecl lor a reasonable period. 3. Our Telephone Number and Address: lf you believe your accounl{s) Iras bæn or will be sLrbject to unaLthorized Electronic Fund Trðnsters, CALL:1-800t66'7277 and make the appropriate selection fom ihe voice menu, 0R WRITt: Compass Bank, Customer Service Departmenl p0. Box 10566, Birmingham, Alabama 35296.

4. Compass Bank Business Days: li/onday through Fr¡day, exciuding holìdãys Account Access: The types ol Elætronic Fund T¡ansfers that you may rnake ciepend upcn specific account typeß) and ihe sen/ices which ./ou obtain, as well asthe spæific types oi fleclronic Fund Tl'ansfers you have aulhorized. 5. Charges: [xcepl as may be provicled by a specifrc agreement with us, ihere is no additìonal chrge for makìng Pre"author'ai Elecfonjc Fund Transfels. However, each Pre-authorized tlectronic Fund Transfer will be subjecl lo the reguiar accoLnt service charges, ìf any, in accoldance with the terms of lhe rel¿ted account(s) ìn eflect frost ti¡le to time

6. Your Documentation of Transfers: a. Receipts: Each lime you make a lransâctiOn at our aLltomatd teller machine. ycu will have the option to obiain a rcceipt. b. Pre'aulhorized Transferc: lf you have aranged to have diræt deposits made to your accouni, yOu môy call us tc determ¡ne if the deposit has been ntde. lf you have arranged for iEular paymenls of varying amounts ic be made fronr your accounl the æßon yol¡ agree to pay should tell you ten (10) days before each payrnent the amount of lhe paymenl and when it will be made. c. Periodic Statemenls You ttill receive a sraþment 0f your account each monlh you make an Eiecfonic tund Transfer 0therwise, you yvill

receive a statement at least quatterly. YoL,r per¡odlc stalemenl will show the details olany nætlonlc Filnd Transfer you made and the detalls of any Pre-authorized Transfers to o¡ lrom your account that you instructed us to make. 7. Your Rightto Stop Payment: ll you have aulhorizecl us to mâke legulâr Pre-authorized äeclonlc Fund Transler payments ou{ ol your account, you may stop any paymenl by CALLING US at: 1'800266:1277 anc making the appropriate selætion from lhe rcice menu, o¡ by WRITING US at: Compass Bank, Customer Serv¡ce Department, PO Box 10566 Birrningham, Alabaira 35296. You nust notìfy us in time for us l0 recelve your lequesl ðl ieast thrcc ß) l¡usìness days before the payment ¡s schedulecl lo be nuile You musl pn:virJe us wilh su'llcìent inlormalion [o identily the paymenl, as well as olher infonnation we mav rEuest. ll you deliver your stop paymenl requesl tly telephone, you must confirm yout stop paynrcnt order to us ln i¡rriting within twenty-one 01) days ol your oral stop payrenl order. An oral stop payment rriuesl w¡ll not b€ binding on us af ter twenly'one 0i) days if you lail to provide the required wrltlen conlirrnat'on \ /e âlso lequ¡re that yau provicÌe us wìthin twenry-one (21) days oí our receìpl of yoir oral 0r $i iitten stop payment order a copy oÍ your wrìtten nolice to lhe payæ revoking lhe payees authority toeiectronically obtain paymentsfrom your accounl.lf we do not ræeivea copy of that nolicekom you within twenty-one 2l)days of our receipl of vour o¡al or written stop payment tequesi your stop ¡:ayment requesl will no longer be binding on us ln order to fulfill your stop payment requesl on any Ple'authorized tlæ$orlc lund Tnnsfer, we may, ¡n our d¡scretion, bllt are not required to, stop all paymenls t0 the patticular payæ, ot we may, in our discretion, notify you that your siop payment request cannot be fulfiiled other than by closing you acccunl lf ycu properly request ß to sl00 paylent and vue fail to cJc so, we will reimburse you lor losses or danrages you sufÍer, lf any, causeri by our

¡â¡lule to stop payment as requested. Please see yoLr agreement and disciosure statemenl lor your Conpass Check Card or Compass ATM cad lor d jffe¡ent reqLtÌrements lhat may apply io stop payment of any Pre-auihorizecl flectmnic Flncl Transfer involvìng use of lhose cards or lhe account numbers on those cards. ^[8]. Our Failure to Make Ttansfers: ll vue do not complele a transfer to or fron your account on Lîne or in lhe colrect amount accordinq to our

agreement wilh you, we will reimburse Vou lor ¡ny losses or riamages that you suffer as a resull of our f¡ìlure to act accordrng lo our agreenrent with ,vou. However, lhere are sorne exceptions where we will nol be liâble, such as, but nol limited t0, the iollowing: if, th¡ough no faull of curs, other lhan exercise oi our righi ol se[ off, you do noi have money in your accoi:nt lc covel lhe transfer if the lranslel woukj cxceecl lhe available credil of any overdrafi linê of credit you may have; if the money in your accounl is being held subjæt to legal process or cther encumluance restrìcting lransfets ttl or lrorn your account: ií we have received not¡ce 0f a dispute âs lo the r¡ghls of part¡es to lhe accounts or their creditors 0r repi'esentatìves and we have placed a hoid on llie accounl until resolution olihe dispute:or ilcircumsiances beyond our control prevenl the lansfer despite oLr rcasonable præautions. 9. Disclosure of lnf0rmation to Third Parties: We may disclose infonrration to ihlrd parties about ),our account and the transfers you make as described in our Consumer Privacy Disclosure as amenrJerl or modiliec from l¡me l0 lime. '10. ln Case of Errors or Questions About Your Electronic Transfers: Telephone or wriie us, as soon as you can. at lhe telephone nurnber or addrcss in SecLion 3 above, il you think your statement or ieceipt is wrong or if you næd more lnlorrnation aboul a lansfer on the statement

or receipt. We must hear from you n0 later tllan s¡xty (60) days after we seni you the FIRST slaternent 0n which lhe error or problem appeared. Your inquiry must include Your name and account number AND a clescrìption of the enor or the transfer you are unsure abou[, and as cleariv as you can, an explanalion of why you belleve there ìs an error or why you need nlore infornlation: AND the dOllar amount of the suspecled

enor. lf you tell us orally, we may require that you send us your inquiry in writing w¡lhin ien (10) business days We will investigate your rnqury and will conect arty etror promptly We will îell you the tesults of oir invest¡gation w¡lhin ten i10) nushess days flwenty (20) business days for claims 0n accounts open iess than thirly (30) calendar daysl after we hear koni yoLr; howevel, we may take up to forty{il,e (45) calendar days

lninety (90) calendar days for claims on accounts open less than thrrty (30) calendar days, foreign-initiated lransaction claìms, and point"ol sale Iransaclion claìms]Lo investigate your questions. lf we neeii addit¡0nal time t0 investilale, we wìli provisionalV re-cledit your account niithln

ten (10) business ciays ltwenty {20) business days ior claims on accounts open less than thirty 00) calendar daysl fcr the amount you lhink is in error s0 that yOu llill have lhe use ot the money during the time it takes us to complele our investigation. lf we ask you lo put your irquiry ir wr'ting, and do not receive yolr \¡/ritten inquiiy v'l¡thin len (10) business days, we may choose not t0 provs0nally re-credil your account. lf we find that thete u¡as no enor, we will send you a written explanation withÌr three €) business days after we fÍt¡sh our investigation You may ask for copies of the documenls we used. FUNDS AVAILABILITY DISCLOSURI 0ur policy is io malte funds fiom your oeposits avallable to yoLr for the payment of checks presenlecl through normal chæk collection channels 0n the first bus¡ness cay after the day we i'eceive your clepcsit. Electronic Cireci deposits wll be available on lhe day we ræeive your deposit. Once the¡, a¡g ¿rr¡¡rr,a you can \A/ilhdrâ\'v the funds ìn cash and we u/ll use the funds lc pay checks y,ou have written. Certain exceplions to our funcjs availability policy are described below Business Day, For deLerrnining ihe availabilrty of yoLrr deposits, every day is a business day except Saturdays, Sundeys and federal holidays. Cut'Off Time. Generally, il you make a deposil with one of our lellers before 2:00 p.nr,, or at one of our automatecj teller nnchines belore 100 p.rri, or at one of our nighl deposilory tacil¡ties belore 700 a.m.. on a business day we are open, we will consider that Cay to be the day of deposìt, 0lhen¡/ìse, we will consìder that the deposil was nrade on the nexl business cay we are open ilowever, in many locaiions, we offe¡ lale¡ cut:off limes. Please chæk fot specific limes llnt are posled in each banking cenler and cìsplayed on AJM message screens. lf no time is posled in the banklng center, the culoff time tor the bankrng cenler is the lime the bar*ìng cenler closes, Delayed Funds Availability for 0utgoing Wire Transfers and the Purchase of Cashier! or 0ther 0fficial Checks and Money Orders. Funds from depOsiled checks processed through the Fecieral Reserue S1stem wlll be availabiefor outgoing wlre transfers and lhe purchase of cashiers or olher cfficial checks ancl *rorrey orders no la[er than lhe second busines d;y after lhe day of your deposil Longer Ðelays May Apply. ln sorne cases, we wilì not make ali of the Íuncls that irou deposil by chæk avarlabie to r¡ou on the first business day af ler ihe day ofyour deposil. Depending on the iype olcheck that vou deposit, r,irnds may not be avallable uniil lhe second busì¡ess day ôfler lhe.jãy of your rleposìt. Howevet the firct $200 of yoLrr deposits w¡ll be rìade avåilable 0n lhe f¡rst businæs day af ter the day ol your rleposit lf we are not going lo make all cf lhe funds from your deposit available to you on the first business day after the day of deposil, lve t¡lill nolify you at the lime you make youi'deposit. We will also tellyou when the funds will be available. lf we decide to delay availability after yoLl have left the bank premises, we will mail you a notice n0 later ihan lhe flrsl business day after the clay you make the rieposit, or we dedde to place the hcid. Funds forthe following deposits are available on the first business day after the day ofdeposit if you make the deposit in person to one ol our tellers and ask them to place a stamp on your deposit siip indicating thât special checks are included in the depositr

1 State or local governmenl checks that are payable dirælly to you, deposited ¡n person inlo an accounl held by you, tn a bank located ln the state that issued the checks. ^[2]. Cashiers, cettified and other checks drarryn dnectly by a financlal instilution Lhal are payable directly to you and rleposited in person into ân account held by you. ln addilion, funds you deposìt by che.ck (including those mentioned above) may be delayed for a longer period of llme underthe following cì¡cumstances

. We believe a check you deposited will nol be paìd. . You cJepûsit€d one or more chæks Lotêling nlore than 95,000 on ariy one day. . You rede¡rsita check lhat has bee¡r previously relurned unpaid. . You have overdrawn your account repeatedly in the last six nmnths . There is an emergency, such as a failurc of commun¡cations ff computer equipmenl We wlll nol¡fy you if we delay your abilily to rvithclraw funds for any of these reasons. and nre will tell you when lhe funds will be available. They will generally be available nc later than the seventh ltLlsiness day alter the day 0f Voilr depo_{l Special Rules for New Accounts lf you are a new cuslomer, the following special rules vrill apply dur¡ng the first 30 davs your account ìs open. Funds from electronic diræt deposits to your account w¡l| b€ avs¡lable on the day \rye receive lhe deposil. tunds kom deposits of cash. wìre transfers, and the lirst $5,000 of a days total deposits of cæhiers, certlfied,lellers, travelers and federal, state and localgovenmenl chæks will læ ava¡lable 0n the ftrsl business day after lhe day of your deposit il the deposii mæts cerlain conditions. For example, lhe chæks musi be payable to ¡,ou and you ask one ol our tellers to place a slamp on your deposit slìp tndKating lhat special checks are included in the dep0slt. The excess over $5,000 wìil be available n0 laier than ihe njnth business da)' after lhe day of your deposit, lf yoL:r cleposit olthese chæks (other than a U.S. Treasury chec0 is not made in person to one of our employees, the fitst $5,000 will nol be avaìlable until the second business day atter the day of your deposit Funds fom alì other check deposits will genetally be avaìlable no later than the ninth business day after the clay ol your deposit. lf you neeci lunds from a rleposit at a specilic time, you should ask us when the lunds will be available. TAXPAYER IDENTIFICATION N UMBERS (Backup Withholding) The lnternal Revenue Service (RS) ìs responsible for ensuring thal all persons pay the correct ðmount of federal incon:e tax. In order to accompltsh this task. they must match the inconte reported by businesses for individuals (salary, interest, dividends. etc ) to the income shown on lnclìvrcJual tax returns. Taxpayer ldentification Numbers {for indii¡iduals, then Sæial Security Numbers) âre used as the basis for matching these records. A federal law requires all payers of intercst (such as a banÐ to report interest paid to individuals by Taxpayer ldentification Nurnbel Therefore, you must provide your correct Taxpayet Icìentification Numls to us so that we may meet these repofiìng rEUirements This law also stipulales that should a bank or other payer of inLeresl not have your cotrecl Taxpayer ldentification Number on fìle, then 28% of inlerest. d¡v¡cjends and Other paymenis made lo you must be withheld anci forwarded to the IRS to insure that taxes on this income are paid. This aclvanæ paynent is known and refened lo by the IRS as "backup wilhhoding. Backup withholding is not an adcjitional tax. Rather, the amount of taxes you normally would ole wili be reducecl by the amount of tax withheld. lf an overpayment of iaxes results fom backup withholdìng, a relund may be oblâ¡ned ftont the lRS, Unless the IRS has instructed us to withhold from your interest and dividend payments, yoll c¿n avoid lh¡s 28% backup withholding by providing us lvilh y0ur coreci Tâxpâyer ldentif¡cation Numbel Addìtionally, you must cerlify that the Iaxpayer ldentilication Number you prov¡de us is c0rrecl and Lhat you have not lreen advised by the IRS that yoir are subjæt to backup withholdrng. The IRS is empolerecl to impcse penalties on you and us if youl conect Taxpayer ldentilication Number is not provided. (Please see "Penallieg' laler' ìn th¡s section,) HOW BACKUP WITHHOLDING WORKS Unless you are an exempt rccipient ßee txempt Recipieni sectiorù you are subject to backup wiihholding ii: You fail to lurnish us your Taxpayer lcientificatìon Numbel 0R the IRS nolifies us ihat you fumished an incorræt Tarpayer ldentification Number, 0R lhe IRS notifies us lhl you are subjæt io backup withholdinç funder Seclion 3406(a)fiXC) of the lnternal RevenL¡e Codel) OR for an interest or dividend account opened after December 31,1983, you fail to cerlrfy t0 us lhat you êre N0T subject to backup withholding, or lail tc certily your Taxpayer ldentiticat¡on Number ¡s correcl. Howto Avoid Backup Withholding: When you open an acccurtwlth us, we wllprov¡de you with the necesçry forms tocomplete in older to provide and cerlify your Taxpayer ldentificat¡on Numb€r I0 AVOID BACKUP WITHHOLDING, all you have to do is provide us wilh your correcl Taxpayer ldentficatlon Number and sign the certification statement t0 certify ihat the number you are prcvid¡ng 1s correct and ihat ycu are nol

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subJecl ro backup wìthholding, Taxpayer ldentificat¡on Number: lf you are an individual, your Taxpayer ldentification Numlær is yolr Social Sæurity Nunrber lT you are not an indivìdual, the nutnber is your [mployer ldenlilication Number. ln all inslances, the number you give us should be lhe number of the ot,'lnel0f the account. Guidelines for Determ¡ning the Proper ldentification Numberto 6ive to Compass:Socialsecurity Numbers have nlne digils separated by two hyphenE ie,XXX-XX-XXXX. tmployer ldenl¡ficalìon Numbers have nine digìts separated by only one hyphen: 1e.,00 0000000. The table below will help you delerrnine the number to give t0 us.

Revision Feb2012. Al Nova Branches Onty BBVA Compass is a trade name of Compass Bank, a member of the BBVA Group. Compass Bank, Member FDIC 99-36-2A67