Cita Trust Company AG v. Fifth Third Bank
879 F.3d 1151
11th Cir.2018Background
- Cita Trust (Swiss trust) contracted with Fifth Third Bank (U.S.) in 2011 for custody of ~428 million in Luxor bonds; Cita paid custody fees and received periodic account statements.
- In August–September 2013 Fifth Third transferred the Luxor bonds out of Cita’s account and informed Cita the bonds had been sent back to the issuer; Euroclear stopped reporting the balance and the bonds were delisted.
- Cita sued Fifth Third in December 2015 in federal court (M.D. Fla.) asserting breach of contract, negligence, and breach of fiduciary duty.
- The Custody Services Agreement contained an Ohio-choice-of-law clause and a contractual provision requiring claims be brought within one year after the cause of action arose.
- Fifth Third moved to dismiss as time-barred under the contract; the district court applied Ohio law, found the one-year limitation clear, unambiguous, and reasonable, and dismissed with prejudice.
- On appeal, Cita challenged enforcement of the one-year contractual limitation and the denial of leave to amend; the Eleventh Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Enforceability of one‑year contractual limitation | Contract provision is unconscionable and unenforceable | Provision is clear, unambiguous, and reasonable under Ohio law | Enforceable — district court correctly applied Ohio law and enforced the one‑year limit |
| Accrual date of claims | Claim accrued later (discovery, fraudulent concealment, or not yet accrued until maturity) | Claim accrued no later than Sept. 2013 when Cita was informed the bonds were transferred | Accrued by Sept. 2013; suit filed Dec. 2015 was untimely; alternative accrual theories not raised below and would not help Cita |
| Tolling doctrines (discovery/fraudulent concealment) | Tolling should extend the contractual deadline | No adequate district-court presentation of these doctrines; Cita had notice in Sept. 2013 | Arguments not preserved for appeal; even if considered, Cita alleges no new facts post‑Sept. 2013 so tolling fails |
| Denial of leave to amend | Request dismissal without prejudice so Cita could amend | Cita never properly moved for leave nor identified proposed amendments; amendment would be futile | No abuse of discretion: request was embedded in opposition (improper); amendment would be futile because claims remain untimely |
Key Cases Cited
- Angel v. Reed, 891 N.E.2d 1179 (Ohio 2008) (parties may validly shorten limitation periods so long as the shorter period is reasonable and clear)
- Browning v. Burt, 613 N.E.2d 993 (Ohio 1993) (terms "arose" and "accrued" are synonymous for accrual questions)
- O'Stricker v. Jim Walter Corp., 447 N.E.2d 727 (Ohio 1983) (cause of action accrues when wrongful act was committed, subject to discovery rule exceptions)
- Access Now, Inc. v. Sw. Airlines Co., 385 F.3d 1324 (11th Cir. 2004) (appellate review normally will not consider issues not raised below except in narrow circumstances)
- Long v. Satz, 181 F.3d 1275 (11th Cir. 1999) (proper request for leave to amend must be a motion that sets out or attaches the proposed amendment)
- Rosenberg v. Gould, 554 F.3d 962 (11th Cir. 2009) (a request for leave to amend embedded only in an opposition brief is not properly raised)
- Fla. Evergreen Foliage v. E.I. DuPont De Nemours & Co., 470 F.3d 1036 (11th Cir. 2006) (denial of leave to amend reviewed for abuse of discretion)
- Universal Windows & Doors, Inc. v. Eagle Window & Door, Inc., 689 N.E.2d 56 (Ohio Ct. App. 1996) (one‑year contractual limitation held reasonable and enforceable)