Irving Trust Co. v. Leff
| Decision Date | 06 May 1930 |
| Citation | 253 N.Y. 359,171 N.E. 569 |
| Parties | IRVING TRUST CO. v. LEFF. |
| Court | New York Court of Appeals Court of Appeals |
OPINION TEXT STARTS HERE
Action by the Irving Trust Company against Joseph Leff. From a judgment of the Appellate Division, First Department (227 App. Div. 283, 237 N. Y. S. 577), reversing a judgment of the Special Term, denying motion for summary judgment on the pleadings, and granting motion, defendant appeals.
Judgment of the Appellate Division reversed, and motion for summary judgment for plaintiff granted, and order of Special Term affirmed in part.Appeal from Supreme Court, Appellate Division, First department.
A. S. Cutler, of New York City, for appellant.
William A. Onderdonk and Paul E. Mead, both of New York City, for respondent.
The Appellate Division, reversing the Special Term, granted plaintiff's motion to strike out the counterclaim set up in the answer and for summary judgment on the pleadings. The only question presented on this appeal is as to the sufficiency in law of the defendant's counterclaim.
The complaint states a cause of action for a balance of $4,933, with interest thereon from March 18, 1929, due on a promissory note made by defendant for $10,000 payable to himself and indorsed to plaintiff.
The answer denies that no part of the note has been paid except $5,067, but it appears that the amount due on the note is correctly set forth in the complaint. It further alleges by way of counterclaim that at all the times thereinafter mentioned defendant was a depositor in the plaintiff's bank and had a checking account with it; that on or about March 10, 1928, the defendant delivered to one Bragin a so-called check in the sum of $1,000, drawn on plaintiff, and having on its face the following words: ‘Void unless and until title to premises 502-14 Liberty Street, Camden, New Jersey, is taken by Joe Leff’ (the defendant); that on or about March 16, 1928, Bragin surrendered this check to defendant's attorney, and received in exchange therefor defendant's unconditional check for $1,000, drawn on plaintiff's bank which check was paid to Bragin by plaintiff; that Bragin stole the surrendered conditional check from the possession of defendant's attorney, and the plaintiff thereafter cashed the same without making any inquiry of the defendant as to whether the conditions on the face of the check had been met, wherefore defendant demands judgment for $1,000 against plaintiff. The counterclaim arises out of an alleged breach of contract between the bank and its depositor to pay on the depositor's account only upon the actual direction of the depositor. ‘The relation existing between a bank and a depositor being that of debtor and creditor, the bank can justify a payment on the depositor's account only upon the actual direction of the depositor.’ Critten v. Chemical Nat. Bank, 171 N. Y. 219, 224,63 N. E. 969, 970,57 L. R. A. 529.
Affidavits were read in support of the motion for summary judgment and in opposition thereto. The plaintiff bank was not shown to be chargeable with actual knowledge of the transaction between defendant and Bragin. The defendant proceeded on the theory that the bank should not have paid the check to Bragin without inquiring of him as to whether title to premises 502-14 Liberty street had been taken by defendant, and that, if such inquiry had been made, although the bank would have learned that title had been taken, it would also have learned that the check had been surrendered by Bragin to defendant, and was no longer a valid obligation of the defendant.
A check, strictly speaking, is a negotiable instrument, i. e., a bill of exchange drawn on a bank payable on demand (Negotiable Instruments Law [Consol. Laws, c. 38] § 321), and it is a misnomer to speak of a nonnegotiable check. This order on the bank was a nonnegotiable instrument, which we will for convenience continue to refer to as a check. It did not ‘contain an unconditional promise or order to pay.’ Negotiable Instruments Law, § 20, par. 2. The bank, of course, took the chance in paying that the condition expressed on its face had been performed. It might have obtained this knowledge from Bragin or from any other available source. No duty rests on a bank to call up its depositor when a genuine check comes in to inquire whether it should be paid. The defendant's signature was genuine. The instrument was complete in form. The condition precedent to payment had been fulfilled. On defendant's theory of a breach of duty of inquiry as to the fulfillment of this condition, he cannot prevail if the check was a valid instrument as between the maker and the bank.
On the pleadings, however, the...
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Morissette v. United States 8212 10, 1951
...to take away from one in lawful possession without right with the intention to keep wrongfully.' (Italics added.) Irving Trust Co. v. Leff, 253 N.Y. 359, 364, 171 N.E. 569, 571. Conversion, however, may be consummated without any intent to keep and without any wrongful taking, where the ini......
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Lund v. Chemical Bank
...also In re Dulak's Will, 209 N.Y.S.2d 928 (Surr.Ct.1960); Grannis v. Stevens, 216 N.Y. 583, 111 N.E. 263 (1916); Irving Trust Co. v. Leff, 253 N.Y. 359, 171 N.E. 569 (1930). The same analysis has been applied under the U.C.C. Authorities have held that § 3-419(1)(c) requires delivery on the......
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In re Roman Crest Fruit, Inc.
...As such, the reasoning of these cases is inapplicable to the case at bar. For formal contracts exception see Irving Trust v. Leff, 253 N.Y. 359, 171 N.E. 569 (1930) (negotiable instruments not effective until delivery); Birch v. McNall, 19 A.D.2d 850, 244 N.Y.S.2d 60 (4th Dept. 1963) (fact ......
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Aini v. Sun Taiyang Co., Ltd.
...York v. Barclays Bank of New York, N.A., 76 N.Y.2d 533, 536-37, 561 N.Y.S.2d 697, 698, 563 N.E.2d 11, 12 (1990); Irving Trust Co. v. Leff, 253 N.Y. 359, 363, 171 N.E. 569 (1930) ("A check has no valid inception until delivery."). The possession and production of a negotiable instrument by a......