
    TAFCO, INC., Plaintiff, v. NATIONAL BANK OF COMMERCE OF DALLAS, TEXAS, Defendant.
    Civ. A. No. 79-1807.
    United States District Court, W. D. Pennsylvania.
    April 10, 1980.
    Bart J. Tyson, Pittsburgh, Pa., for plaintiff.
    Norman J. Cowie, Thomson, Rhodes & Grigsby, Pittsburgh, Pa., for defendant.
   OPINION

SNYDER, District Judge.

In this action for an alleged wrongful dishonor of a letter of credit, Defendant National Bank of Commerce of Dallas, Texas (Bank) has moved to dismiss or transfer for improper venue. The Motion to transfer will be granted.

Garland Restaurant Corporation (Garland), a Texas corporation with its principal place of business in Texas, was awarded a contract by the United States Government for kitchen remodeling at the Fort Campbell Air Force Base in Kentucky. Garland invited Tafeo, Inc., a Pennsylvania corporation with its principal place of business in Pittsburgh, Pennsylvania, to submit a bid on nine walk-in coolers, and in September, 1978, Tafeo entered into a contract with Garland to manufacture and deliver the coolers to Garland at a cost of $57,425.00. All negotiations for the contract were conducted in Texas between Garland’s representative and David Ettinger, whom Tafeo describes as “an independent contractor who earns a commission for sales he initiates between prospective customers and Tafeo.”

After execution of the contract, Tafeo became concerned with Garland’s precarious financial condition and, by letter mailed to Garland, demanded some guaranty of payment. Garland contacted the Bank and applied for a letter of credit in Dallas. There were some telephone calls and written correspondence between the Bank and Tafeo. Following the usual internal processing, Letter of Credit # 3323 was issued in Dallas, Texas on January 22, 1979 and mailed from Dallas to Tafeo in Pittsburgh. (Exhibit A hereto.)

In August, 1979, Garland notified Tafeo that it would not accept delivery on any of the units. Tafeo treated the notice as final and presented a sight draft to the Bank for $11,485, the damages alleged incurred by Garland’s breach. The Bank refused to honor the draft and Tafeo brought suit.

I.

The Bank is a national bank organized under the laws of the United States, with its principal place of business in Dallas, Dallas County, Texas, which is in the Northern District of Texas, Dallas Division. The Bank does not have a branch office or any other office or place of business located in the Western District of Pennsylvania.

The Bank moved to dismiss or transfer Tafco’s action for improper venue under 12 U.S.C. § 94 which provides:

“Actions and proceedings against any association under this chapter may be had in any district or Territorial court of the United States held within the district in which such association may be established, or in any State, county, or municipal court in the county or city in which said association is located having jurisdiction in similar cases.”

The National Bank Venue Statute, 12 U.S.C. § 94, limits the availability of courts for suits against national banks to federal courts sitting in counties in which the national banks are “established” (and to state courts sitting in the county or counties in which the bank is located). While the language of the statute suggests that its application might be permissive, it is well settled that its provisions are mandatory. Mercantile National Bank v. Langdeau, 371 U.S. 555, 83 S.Ct. 520, 9 L.Ed.2d 523 (1963).

A national bank is “established” for purposes of federal court venue only “ ‘in the place where its principal office and place of business is as specified in its organization certificate.’ . . . Even establishment of a branch office in another district will not suffice to [establish] the bank there for venue purposes. ... In essence the statute confers on national banks immunity from suit outside the district, territory, county, and city where it is located.” Northside Iron & Metal Company v. Dobson & Johnson, Inc., 480 F.2d 798, 799-800 (5th Cir. 1973). (The Supreme Court held in Citizens & Southern National Bank v. Bougas, 434 U.S. 35, 98 S.Ct. 88, 54 L.Ed.2d 218 (1977), that, for purposes of state court venue, a bank is located in charter county and county in which it conducts business at an authorized branch.)

However, the venue provision of 12 U.S.C. § 94 has been held on many occasions to be a privilege personal to the national bank, which the national bank can waive. Helco, Inc. v. First National City Bank, 470 F.2d 883 (3rd Cir. 1972); Buffum v. Chase National Bank of City of New York, 192 F.2d 58 (7th Cir. 1951). A national bank may waive the privilege in one of three ways: by express declaration, by failure to assert the privilege, or, by actions which are inconsistent with the assertion of the privilege. Northside Iron & Metal Co. v. Dobson & Johnson, Inc., supra; Stutsman v. Patterson, 457 F.Supp. 189 (C.D.Cal.1978).

The thrust of Plaintiff’s argument is that the Bank waived its venue privilege by delivering (via U.S. Mails) a letter of credit to Tafeo in Pittsburgh, payable upon a shipment of goods to Kentucky.

The case law is contrary to Plaintiff’s position. See Stutsman v. Patterson, supra; D. Nelsen & Sons, Inc. v. FDIC, 440 F.Supp. 1000 (N.D.Ill.1977); Anthony v. Drovers National Bank of Chicago, 405 F.Supp. 626 (D.S.C.1975); Tanglewood Mall, Inc. v. Chase Manhattan Bank, 371 F.Supp. 722 (W.D.Va.), aff’d 508 F.2d 838 (4th Cir. 1974). For example, in D. Nelsen & Sons, Inc. v. FDIC, supra, the court held that issuance of a letter of credit into another state did not waive the venue privilege, since doing business in a state does not in itself manifest a bank’s intent to waive its venue privilege, citing Northside Iron & Metal Co. v. Dobson & Johnson, Inc., supra.

We note, as did the court in Anthony v. Drovers National Bank of Chicago, supra at 628, that to hold that a bank waives its venue privilege by sending a letter of credit outside its “location” would “ ‘bend the law too far from the obvious intent of the legislature and render altogether meaningless the Congressional enactment favoring local suits of national banks.’ ”

An appropriate order will be entered granting the Bank’s Motion to Transfer to the Northern District of Texas, Dallas Division.

EXHIBIT A 
      
      . Suit was originally filed against Garland and the Bank. Garland moved to dismiss and, pursuant to agreement of all counsel, the motion was granted.
     
      
      . At oral argument, counsel for the Bank agreed that even if venue were improper, the case was more properly one for transfer. This is consistent with our reading of the law that, absent an indication that suit was commenced in an improper venue for purposes of harassment, transfer of the case is preferable to dismissal. See De La Fuente v. ICC, 451 F.Supp. 867 (N.D.Ill.1978).
     