Caesars Riverboat Casino, LLC v. Kephart , 903 N.E.2d 117 ( 2009 )

OPINION

MATHIAS, Judge.

Caesar's Riverboat Casino, LLC ("Caesar's") filed suit in Harrison Cireuit Court alleging that Genevieve M. Kephart ("Kep-hart") failed to provide funds to cover checks written while gambling at Caesar's establishment. Kephart countersued alleging that Caesar's took advantage of her pathological gambling condition to unjustly enrich itself,. Caesar's filed a Trial Rule 12(B)(6) motion on Kephart's counterclaim. The trial court denied Caesar's motion and Caesar's appeals. Concluding that Indiana's common law does not provide Kephart a private cause of action in negligence against Caesar's in the form of a counterclaim, we reverse.

Facts and Procedural History

On March 18, 2006, Kephart visited Caesar's after Caesar's offered her a free hotel room, drinks, and meals. While at the casino, Kephart gambled and lost $125,000 in a single evening through the use of six counter checks provided to her by Caesar's.

Subsequently, Kephart's checks were returned for insufficient funds. Caesar's filed suit against Kephart on January 23, 2007, for payment of the checks, treble damages, and attorney fees, all as provided by Indiana law.¹ On April 2, 2007, Kep-hart filed an answer and counterclaim in which she alleged that she is a pathological gambler and that Caesar's knew of her condition and took advantage of her condition to enrich itself. She seeks to recover damages for past, present, and future mental, emotional, and psychological damages; destroyed and/or strained relationships with family members and friends; doctor, hospital, pharmaceutical, or other medical expenses; loss of quality of life and enjoyment of life; and other expenses not yet known to her.

Caesar's moved to dismiss the counterclaim pursuant to Trial Rule 12(B)(6) and the trial court denied that motion. Caesar's filed a motion requesting that the trial court certify its order for interlocutory appeal.² The trial court granted that request and we subsequently accepted interlocutory jurisdiction.

Standard of Review

A motion to dismiss under Trial Rule 12(B)(6) tests only the legal sufficiency of the complaint, not the facts supporting it. Thompson v. Hays, 867 N.E.2d 654, 656 (Ind.Ct.App.2007), trams. denied. The court may only look to the complaint and may not look to other evidence in the record. Id. A motion to dismiss should be granted only if "facts alleged in the complaint are incapable of supporting relief under any set of cireumstances." Godby v. Whitehead, 837 N.E.2d 146, 149 (Ind.Ct.App.2005), trans. denied. We will review a trial court's ruling on a motion to dismiss de novo. Thompson, 867 N.E.2d at 656.

Discussion and Decision

Indiana courts have not addressed the precise issue now before us, most likely because of existing state regulation of Indiana's gaming industry and the relatively short history of that industry. However, two cases from Indiana have addressed compulsive gamblers' claims against casinos for gambling losses. In Merrill v. Trump Ind., Inc., 320 F.3d 729 (7th Cir.2003), Merrill, a compulsive gambler, alleged that the riverboat casino failed to prevent him from gambling after he asked to be evicted from the casino if he entered. The Merrill court determined that in light of the state regulation of gambling in Indiana, the Indiana Supreme Court most likely would not conclude that the legislature intended to create a private cause of action. Id. at 782. The court found that the regulations would at most impose a duty upon the casino operator to the State through the Indiana Gaming Commission, not to the individual gambler. Id.

The Merrill court also addressed whether a common law duty of care existed, a question not yet answered by any Indiana court. The court determined that casinos would be held to the same standard of care as that of other businesses. Id. at 783. The court analogized Merrill's claimed duty to dram shop liability. However, it held that just as a patron who drinks, drives, and is personally injured cannot recover from the tavern that served him alcohol, a gambler cannot hold a casino Hable for the gambler's personal damages incurred through his own gambling. Id. The court did not consider how one's status as an alcoholic bar patron or a compulsive gambler might affect the question of duty.

Next, Stulajter v. Harrah's Indiana Corp., 808 N.E2d 746 (Ind.Ct.App.2004), specifically addressed whether Stulajter could sue Harrah's for failing to prevent him from gambling at their casino, despite Stulajter's participation in the voluntary self-exelusion program administered by the Indiana Gaming Commission. Stulajter sought to sue Harrah's alleging that Har-rah's violated regulations pertaining to the self-exelusion program when it did not prevent him from gambling at its casino. We determined that the gaming statutes and regulations did not create a private cause of action against a casino operator to protect compulsive gamblers from themselves. Id. at 749. Our court also cited Merrill and adopted its holding.

However, neither of these cases is entirely dispositive in the present case. Merrill addressed the availability of common law negligence recovery against casinos and analogized the losing gambler to an injured, intoxicated bar patron but did not consider whether the result would be different in the case of a known alcoholic bar patron or a known compulsive gambler. Stulajter addressed the issue of whether Indiana's gaming laws and regulations allow a private cause of action for failure to comply with those gaming laws, specifically with the self-exclusion list. The case now before us requires that we examine whether an Indiana casino operator can owe a duty to a patron or potential patron who the casino knows to be a compulsive gambler as alleged in Kephart's counterclaim.

I. Negligence Theory

Kephart argues that, because Cace-sar's knew her to be a compulsive gambler at all relevant times, the casino owes her a duty under common law to protect her from its enticements to gamble. Indiana common law requires that Kephart must establish three elements to recover on a theory of negligence: (1) a duty on the part of the defendant to conform its conduct to a standard of care arising from its relationship with the plaintiff, (2) a failure of the defendant to conform its conduct to the requisite standard of care required by the relationship, and (8) an injury to the plaintiff proximately caused by the breach. Miller v. Griesel, 261 Ind. 604, 611, 308 N.E.2d 701, 706 (1974).

"No better general statement can be made than that the courts will find a duty where, in general, reasonable persons would recognize it and agree that it exists." Gariup Construction Co. v. Foster, 519 N.E.2d 1224, 1227 (Ind.1988) (quoting W. Prosser & J. Keeton, Prosser & Keeton on Torts § 53, at 359 (5th ed.1984)). To determine whether the law recognizes any obligation on the part of Caesar's to conform its conduct to a certain standard for the benefit of the plaintiff is a question of law. Webb v. Jarvis, 575 N.E.2d 992, 995 (Ind.1991). To determine if a duty exists, we must look at (1) the relationship between the parties, (2) the reasonable foreseeability of harm to the person injured, and (8) public policy concerns. Id. We will examine each component in turn.

A. Relationship between the Parties

Kephart argues that the relationship between the parties is that of a business invitee and proprietor. To determine whether a relationship exists, we must look to the nature of the relationship, a party's knowledge, and the circumstances surrounding the relationship. Downs v. Panhandle E. Pipeline Co., 694 N.E.2d 1198, 1203 (Ind.Ct.App.1998), trans. denied. "A duty of reasonable care is not owed to the world at large, but must arise out of a relationship between the parties." Bowman ex rel. Bowman v. McNary, 853 N.E.2d 984, 990 (Ind.Ct.App.2006). Kephart has alleged that the relationship is based on her trip to gamble at Caesar's casino upon Caesar's invitation.

Kephart cites to Burrell v. Meads, 569 N.E.2d 637, 639 (Ind.1991), for the proposition that a business owner like Caesar's owes a duty to its business invitees to use reasonable care for their protection while they are on the landowner's premises. Then she refers to the Burrell court's adoption of the Restatement (Second) of Torts Section 348 (1965) to support her claim against Caesar's. However Section 343 subjects the landowner to lability for physical harm. Restatement (Second) of Torts § 348 (1965). In Kephart's counterclaim, she does not allege any direct physical harm from a condition or improvement upon Caesar's premises, but rather asserts that Caesar's caused her mental, emotional, and psychological distress. Therefore, we believe that Section 343 is distinguishable.

It is also instructive for us to look to other business owners who sell goods and services to the public in order to examine their duties to invitees. While it is clear that such owners owe patrons a duty to protect them from physical risks while on the premises, we have not discovered any case law from any state that imposes an additional duty such as that which Kep-hart seeks to impose on Caesar's. For example, department stores have no common law duty to refuse to sell goods and services to a known compulsive shopper. The fact that such a shopper may have borrowed the funds used or will become indebted to the store's own or a third-party eredit card company for the purchase is not the department store's responsibility, even if the invitee's compulsiveness is known. We believe that Caesar's relationship to Kephart is much the same.

B. Foreseeability

We will impose a duty only where a reasonably foreseeable victim is injured by a reasonably foreseeable harm. Webb, 575 N.E.2d at 997. "The duty of reasonable care is not, of course, owed to the world at large, but rather to those who might reasonably be foreseen as being subject to injury by the breach of the duty." Thiele v. Faygo Beverage, Inc., 489 N.E.2d 562, 574 (Ind.Ct.App.1986). An inquiry into the existence of a duty and an inquiry into proximate cause are concerned with exactly the same factors. Prosser & Keeton, supra, § 53. Both inquiries look to the consequences of the challenged conduct that should have been foreseen by the actor who engaged in it.

Since Webb v. Jarvis was handed down by the supreme court in 1991, the concept of foreseeability as to duty has developed into two lines of thought. The first has sought to apply a broad definition of duty foreseeability that considers the broad type of plaintiff and harm involved without regard to the facts of the actual occurrence. See Goldsberry v. Grubbs, 672 N.E.2d 475, 479 (Ind.Ct.App.1996), trans. denied; see also Williams v. Cingular Wireless, 809 NE.2d 473 (Ind.Ct.App.2004), trans. denied.

In Goldsberry, the plaintiff sued GTE, among others, alleging negligent placement of a telephone pole which was struck by a car in which she was a passenger. The trial court granted summary judgment for GTE, determining that a telephone company does not owe a duty to the motoring public to exercise reasonable care when placing telephone poles along Indiana highways. We sought to delineate between the inquiry into the existence of a duty and the inquiry into proximate cause, labeling the first a question of law and the second a question of fact. Id. We concluded that duty foreseeability must necessarily be a lesser inquiry than proximate cause foreseeability since a determination of duty foreseeability using the same standard would make a determination of proximate cause foreseeability unnecessary. Id. We also determined that the inquiries implicated both a question of law and a question of fact that would require different evaluations. Id. We reversed the trial court's decision granting GTE's motion for summary judgment, finding that GTE owed a duty of reasonable care in connection with its placement of a telephone pole near a roadway.

However, the majority of cases follows a second line of thought that more narrowly defines the inquiry and focuses on the particular facts of the situation to determine the foreseeability of duty. In NIPSCO v. Sell, 597 N.E.2d 329 (Ind.Ct.App.1992), a motorist left the traveled portion of a road and struck a utility pole. Our court concluded that in some cases this would be a reasonably foreseeable situation, however, under the facts of Sell, such a situation was not reasonably foreseeable. Id. at 834. Our analysis focused on the particular facts of the particular situation, not on general concerns. Id. Other cases have followed the Sell court's analysis to determine foreseeability. See eg. State v. Cornelius, 637 N.E.2d 195 (Ind.Ct.App.1994); Indiana Limestone Co. v. Staggs, 672 N.E.2d 1377 (Ind.Ct.App.1996).

A more recent case in this line is Hammock v. Red (Gold, Inc., 784 N.E.2d 495 (Ind.Ct.App.2003), where our court considered whether the owner of a tomato processing plant could sue a motorist for negligence after the motorist struck an electric utility pole, ultimately causing a power failure that affected the plant. We determined that the plant was outside the "zone of danger" that immediately surrounded the accident, but that this alone did not indicate the existence of or the foreseeability of a duty. Id. at 502. We then looked to the types of harm that befall a business that has its power fail to determine whether the injury suffered by Red Gold was reasonably foreseeable. Id. at 502-08. We agreed with the rationale of Restatement (Second) of Torts § 281 (1965), Comment (e) that " '[wlhen harm of a kind normally to be expected as a consequence of the negligent driving results from the realization of any one of these hazards, it is within the scope of the defendant's duty of protection'" Id. at 508. We concluded that while it may be foreseeable that damage to an electric utility pole could cause a plant to shut down and that might cause damage to perishable food items, it is extremely unlikely that the damage suffered was the kind of harm which would normally be expected as the result of an automobile accident. Id. at 508.

Our supreme court has not directly addressed the issue of duty foreseeability but did address the issue indirectly in Estate of Heck ex rel. Heck v. Stoffer, 786 N.E.2d 265 (Ind.2003). In that case, the court looked to the specific facts to determine whether the harm was indeed foreseeable but specifically "decline[d] to take a narrow view of Webb's foreseeability of harm prong[.]" Id. at 269. The court determined that the parents of a fugitive from police owed a duty to an officer who was shot by the fugitive to exercise reasonable and ordinary care in the storage and safekeeping of the parents' handgun used in the crime and that a genuine issue of material fact existed as to whether the parents breached that duty. This would seem to be a position that encompasses both Goldsberry and Sell, as well, by looking not only to the facts of the particular case, but also examining the broad type of victim and harm involved.

Without more, Heck, Sell and Goldsber-ry might therefore support finding foreseeability of harm on the part of Caesar's. However, what was not addressed in these cases is the effect of "bilateral" foreseeability, or the foreknowledge of both the alleged tortfeasor and victim, of the possible harm that occurs. Heck, Sell, and Goldsberry did not have reason to consider bilateral foreseeability. None of the injured parties in Heck, Sell, or Goldsberry voluntarily placed themselves in the way of foreseeable harm, as Kephart did by choosing to travel to and gamble at Caesar's casino. For this reason, we believe that Kephart's situation is more akin to that of a participant injured during a sporting activity, than to that of a traditional negligence plaintiff.

The general rule in sports injury cases is that, "voluntary participants in sports activities . cannot recover for injury unless it can be established that the other participant either intentionally caused injury or engaged in conduct so reckless as to be totally outside the range of ordinary activity involved in the sport." Mark v. Moser, 746 N.E.2d 410, 420 (Ind.Ct.App.2001). In Mark, we held that "it is a question of law for the determination of the court, whether the injury-causing event was an inherent or reasonably foreseeable part of the game[.]" Id. at 420.

Bowman ex rel. Bowman v. McNary, 853 N.E.2d 984 (Ind.Ct.App.2006) considered whether a student golfer could claim negligence when a teammate swung her club and accidentally hit the student golfer. In Bowman, our court concluded that while we do not follow Mark's reliance on primary assumption of risk, it is correct and consistent with Webb to evaluate, under an objective standard and as a question of law, " 'whether the injury-causing event was an inherent or reasonably foreseeable part of the game'" Bowman, 853 N.E.2d at 988 (quoting Mark, 746 N.E.2d at 420).³

This reasoning extends comfortably to the case before us. Beyond being foreseeable, it is common knowledge that more money is lost than is won by patrons at any casino. Common sense tells a reasonable person and all gamblers, compulsive or otherwise, that "the house usually wing." It is also foreseeable that marketing by the casino may lead an individual to gamble and lose at the casino.

"When a patron wagers at a casino, he is not simply 'giving' money to the casino, but instead he is spending his money-purchasing a chance to win even more." Schrenger v. Caesars Ind., 825 N.E.2d 879, 884 (Ind.Ct.App.2005). While Kephart lost the money she wagered, it is an injury that she chose to risk incurring. She wagered her money to purchase a chance to win even more. Indeed, it is extremely unlikely that she would have brought suit had she won her wagers.

Accepting Kephart's allegations as true, as we must, Caesar's knew that Kep-hart was a compulsive gambler and marketed to her with that in mind. However, we conclude that even these allegations taken as true do not surmount Kephart's own foreknowledge of the risk of her injuries. See Mark, 746 N.E.2d at 420, Bowman, 858 N.E.2d at 995. We also conclude that a casino operator does not act in a reckless manner by marketing to individuals it knows to be compulsive gamblers.⁴ For gamblers, compulsive or otherwise, just as for shoppers, compulsive or otherwise, marketing by a vendor is not reckless conduct.

C. Public Policy

"Duty is not sacrosanct in itself, but is only an expression of the sum total of those considerations of public policy which lead the law to say that the plaintiff is entitled to protection." Webb, 575 N.E.2d at 997. Factors that bear on this consideration include convenience of administration, capacity of the parties to bear the loss, a policy of preventing future injuries, and the moral blame attached to the wrongdoer. Ousley v. Bd. of Comm'rs of Fulton County, 734 N.E.2d 290, 294 (Ind.Ct.App.2000), trans. denied.

As to this public policy component, the most salient feature of the case before us is the General Assembly's decision to legalize and regulate certain types of gambling, including Kephart's activities. In so doing, the General Assembly established the Indiana Gaming Commission ("Commission"). Ind.Code § 4-383-3-1 (2002). Under Indiana Code section 4-33-4-1, the General Assembly gave the Commission the power and duty to administer and regulate gaming in Indiana with concomitant enforcement authority. Pursuant to this authority, the Commission promulgated detailed regulations regarding casinos and their operations. The power to revoke, suspend, restrict or place conditions on gaming licenses rests with the Commission. Ind.Code § 4-83-4-8. The Commission may also impose fines and take other actions as necessary to ensure compliance with Indiana's gaming law. Id.; 68 TA.C. 13-1-21(b).

In addition to having the power and duty to administer and regulate gaming in Indiana, the Commission is also ordered to adopt rules for the purpose of preventing practices that are detrimental to the public interest and "providing for the best interests of [] gambling." Ind.Code § 4-83-4-2(8). The Commission is further required to adopt rules for "imposing penalties for noneriminal violations of this article." Ind. Code § 4-83-4-2(5).

In the exercise of its authority, the Commission established and implemented a voluntary exclusion program. Ind.Code § 4-33-4-3(a)(9). The Commission also established a toll-free telephone number for the prevention and treatment of compulsive gambling be posted in each riverboat and on each admission ticket and uses a portion of gaming revenues to combat compulsive gambling. Ind.Code § 4-33-4-12.2; Ind.Code § 4-838-12-6. Casino marketing, directly or through complimentary items, is regulated by the Commission in Indiana Code section 4-83-4-3 and 68 Indiana Administrative Code 1-12-1 et seq. Indiana Code section 4-83-4-3 requires that the Commission promulgate rules that require casino operators to make all reasonable attempts, as determined by the Commission, to cease all direct marketing efforts to a person participating in the self-exclusion program. 68 Indiang Administrative Code 1-12 controls how the casinos may use complimentary chips or tokens for marketing purposes. One may argue that this statutory framework does not provide enough protection for compulsive gamblers, but that argument is more properly addressed to the Commission or to the General Assembly.⁵

D. Balancing of Duty Factors

The relationship between Kephart and Caesar's is not remote. Under Heck, Sell and Goldsberry, the harm is quite foreseeable, indeed predictable. However, the bilateral foreseeability of the harm associated with gambling does not support the establishment of a common law duty on the part of Caesar's. The small opportunity to win and the substantial likelihood of losing is implicit in the act of gambling and is reasonably and equally foreseeable to the casino and to the gambler alike. See Schrenger, 825 N.E.2d at 884. Moreover, marketing by casino operators to compulsive gamblers is not reckless conduct.

Most importantly, public policy does not support the imposition of a unilateral duty on casinos to protect compulsive gamblers from the casinos' marketing activities and hosting. The General Assembly has made the public policy decision to legalize gambling and has set up a statutory and regulatory framework to govern how casinos do business in Indiana.

Even if we were to assume that, under the facts presented in Kephart's counterclaim, Caesar's does indeed owe a duty to compulsive gamblers beyond that which is owed to any other business invitee, Kep-hart's own behavior tips the balance of the duty factors. Despite knowledge of her proclivity towards compulsive gambling, Kephart took no action to cut off her ties with casinos. Additionally, Kephart only decided to seek treatment after losing a large amount of money that she could not pay back. While Caesar's actions in allowing her to write six checks totaling $125,000 are extremely concerning and should be examined by the Commission under Indiana Code section 4-83-4-2(8), Kephart has a responsibility to protect herself from her own proclivities and not rely on a casino to bear sole responsibility for her actions.

Kephart has argued that the Restatement (Second) of Torts section 343 applies to Caesar's under the facts pleaded in her counterclaim. Appellant's Br. p. 6. The Restatement section 343 provides, in pertinent part, that:

A possessor of land is subject to liability for physical harm caused to his invitees by a condition on the land if, but only if, he

(a) knows or by exercise of reasonable care would discover the condition, and should realize that it involves an unreasonable risk to invitees, and

(b) should expect that they will not discover or realize the dangers, or will fail to protect themselves against it, and

(ec) fail to exercise reasonable care to protect them against the danger.

Although we have held supra that section 348 is distinguishable because Kephart was not physically harmed by a condition on or improvement to real estate, implicit in seetion 348 is a responsibility on the part of invitees to take reasonable measures to discover or realize dangers and to protect themselves against those dangers. Kep-hart actually knew the dangers involved in gambling and could have easily protected herself against those dangers but apparently chose not to do so.

In this regard, Kephart could have, but failed to participate in the self-exclusion program established by the Commission, through which compulsive gamblers can voluntarily exclude themselves from casinos and casinos are called upon to make their best efforts to avoid marketing to them and to prevent them from entering and gambling at the casinos. Stulajter tells us that that solution, and likely no other solution, will be a perfect solution to gambling abuses. But in a heavily-regulated industry like gaming, the issues raised by Kephart's counterclaim are most properly directed to the Indiana Gaming Commission and to the General Assembly, where they can be considered as matters of public policy which are the sole and proper province of the legislative branch of government.⁶

The legalization and regulation of gaming is not that different in concept than the legalization and regulation of alcohol sales and consumption, which are regulated legally by the General Assembly and administratively by the Alcohol and Tobacco Commission. Indeed, this observation brings us back to a straightforward extension of the analogy first put forth by the Seventh Circuit more than five years ago in Merrill.

Conclusion

For all of these reasons, the facts alleged in Kephart's counterclaim "are incapable of supporting relief under any set of cireumstances." Godby, 837 N.E.2d at 149.⁷ There is no common law duty obligating a casino operator to refrain from attempting to entice or contact gamblers that it knows or should know are compulsive gamblers. Caesar's motion to dismiss under Trial Rule 12(B)(6) therefore should have been granted by the trial court.

Reversed.

DARDEN, J., concurs. CRONE, J., dissents with separate opinion.

1 . Ind.Code § 34-24-3-1 (1999).

2 . We held oral argument on this matter on September 18, 2008, at Anderson University. We thank faculty, staff, and students for their hospitality and additionally commend counsel on the quality of their oral and written advocacy.

3 . The Bowman court also held that, even in a sporting activity, liability might attach for injuries caused by the reckless conduct of a participant. Bowman determined that "recklessness requires that a participant in a sporting activity be (1) conscious of his or her misconduct; (2) motivated by indifference for the safety of a co-participant or co-participants; and (3) know that his or her conduct subjects a co-participant or co-participants to a probability of injury." Bowman, 853 N.E.2d at 995. The Bowman court re-emphasized the general rule that "the defendant's conduct must be so reckless as to be totally outside the range of ordinary activity involved in the sport." Id. In this regard, we are troubled by the fact that Caesar's allowed Kephart to cash six counter checks in order to wager and lose the amount at issue. We are also sympathetic to the fact that Indiana Code section 34-24-3-1(1999) may authorize Caesar's to recover treble damages and attorney fees for the checks that were dishonored. However, we believe that regulation of this questionable conduct is the responsibility of the Indiana Gaming Commission, under Indiana Code section 4-33-4-2(2002) and as explained infra in fn. 6.

4 . We further note that any governmental restriction on the casino operator's marketing could also implicate the operator's right to commercial free speech as guaranteed by the First Amendment. However, Caesar's raised no First Amendment defense and we will therefore not address the free speech implications of a restriction on casino marketing.

5 . A review of regulations in states that currently allow gaming reveal that iwelve have legislation or regulation providing for a self-exclusion list; Florida, Illinois, Indiana, Louisiana, Maine, Michigan, Mississippi, Missouri, Nevada, New Jersey, New York, and Pennsylvania. Another eight states do not currently have a self-exclusion program for problem or compulsive gamblers: Colorado, Delaware, Towa, New Mexico, Oklahoma, Rhode Island, South Dakota, and West Virginia.

6 . In Taveras v. Resorts Int'l. Hotel Inc., No. 07-4555, 2008 WL 4372791, *5, Slip op. (D.N.J. Sept. 19, 2008), the court determined that there was no common law duty that required the casinos to restrain compulsive gamblers. It recognized that the majority of authority does not support finding a common law duty. The Taveras court also determined that based on New Jersey's "extraordinary[,] pervasive and intensive" gaming regulations, it would appear that the State deliberately chose not to impose such a duty. Id. Also notable is the court's recognition that the State had expressly absolved casinos from liability for failing to exclude self-excluded persons from gambling. Id. In contrast, Indiana's regulatory framework already in place provides that casinos shall be subject to disciplinary action under 68 LA.C. 13 for failing to comply with requirements related to the self-excluded persons, among others, by "knowingly refusing to withhold direct marketing, check cashing, and credit privileges." 68 LA.C. 6-3-4(e)(2).

7 . We agree with Judge Crone's dissent in that our observations in this opinion are limited to Kephart's counterclaim and are not intended to limit Kephart's right to assert affirmative defenses to Caesar's claim for payment of the counter checks, including incompetency, impaired capacity, breach of the covenant of good faith and fair dealing, duress, and un-conscionability.