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A bank sustained its burden of showing that its arbitration agreement amendment was received by a customer by presenting an affidavit from a third-party mailing company stating that the customer's correct name and address was in its mailing database, according to a federal district court in Pennsylvania.
In Baylis v. Wachovia Bank, N.A., No. Civ. A. 08-3392, 2008 WL 5055746 (E.D. Pa. Nov. 25, 2008), Baylis sued Wachovia, alleging conversion of her checking accounts. Wachovia moved to compel arbitration of the claims in accordance with an arbitration agreement contained in an amendment to the deposit agreement mailed to Baylis. Baylis opposed the motion, arguing that she never received the amendment or consented to its contents. Alternatively, Baylis argued that the agreement was unconscionable.
The Court compelled arbitration, noting that Wachovia had presented an affidavit by a third-party mailing company that the amendment was mailed to Baylis at her home address in June of 2003. Specifically, the affidavit recited that her name and address appeared in the database used by the company for that mailing project.
Without contrary evidence of any sort, Baylis could not overcome the presumption that she received the amendment three days after it was mailed. Furthermore, Baylis continued to use the account after the presumptive mailing, thereby consenting to the arbitration agreement created by the amendment.
The Court also held that the agreement was not unconscionable, noting that Baylis had effectively consented to the agreement and had not exercised her right to terminate her accounts after the agreement was amended. Accordingly, the Court granted Wachovia's motion to compel arbitration and dismissed the claims.
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