Miami Beach First Nat. Bank v. Edgerly

Citation82 A.L.R.2d 927,121 So.2d 417
CourtUnited States State Supreme Court of Florida
Decision Date08 June 1960
PartiesMIAMI BEACH FIRST NATIONAL BANK, a banking corporation organized under the laws of the United States, Petitioner, v. R. J. EDGERLY and Elizabeth Edgerly, Respondents.

Blackwell, Walker & Gray, Miami, for petitioner.

Anderson & Nadeau, Miami, for respondents.

O'CONNELL, Justice.

On motion of the petitioner, Miami Beach First National Bank, the District Court of Appeal, Third District, has certified that its decision in this cause, reported as Edgerly v. Schuyler, Fla.App.1959, 113 So.2d 737, is one which passes upon a question of great public interest 'because the decision involves an important new point of law relating to certain rights of depositors in banking institutions.' We therefore have jurisdiction to consider the cause on certiorari. See Susco Car Rental System of Florida v. Leonard, Fla.1959, 112 So.2d 832.

Petitioner, both in its motion to certify a question of great public interest filed in the district court and in its brief filed with this Court, urges that the question to be answered by this Court is:

'Whether, in the absence of fraud on the part of a bank, the statute of limitations begins to run against the depositor's cause of action to recover on a check bearing a forged endorsement upon receipt of the depositor's statement and return of the cancelled checks.'

In its opinion the district court stated the question to be :

'When does a cause of action accrue to a depositor against his bank for the wrongful payment of a check upon a forged endorsement?'

We think the answer to both questions is the same and that the decision of the district court correctly answered them, saying in 113 So.2d at page 741 of its opinion:

'* * * the period of the statute of limitations begins to run from the discovery of the forgery by the depositor unless it can be demonstrated to the satisfaction of the trier of fact that at an earlier time the depositor would have discovered the forgery if he had exercised ordinary business care. The determination of the time for the beginning of the period of the statute of limitations becomes a question of fact * * *.'

The district court then held that the limitation prescribed in § 95.11(5)(e), F.S.A., was applicable to an action such as here involved.

The facts of this cause are set forth in the opinion of the district court under review. We will not delve into them here except to say that the cause originated as a suit on a $20,000 promissory note brought by the Edgerlys against the Schuylers and Schmuklers, as makers and endorsers of the note. During the course of the proceedings in the trial court the defendants, or one of them, denied execution of the note and denied receipt of a $20,000 check drawn by the Edgerlys on the petitioner-bank, payable to Sam Schuyler, who denied endorsing the check. The bank was made a party defendant and charged with having wrongfully paid the check and charged it to the Edgerlys' account, on a forged endorsement. The bank was not joined in the suit until more than five years after the payment by it of the check on the allegedly forged endorsement. The trial judge held that the action against the bank was barred by the statute of limitations and granted summary judgment in favor of the bank.

The district court reversed the trial court for the reasons given in that portion of its opinion above quoted.

We are convinced, after careful study of the briefs and authorities cited by the parties, and after independent research made by us, that the rules of law announced by the district court are sound and fair. We hereby approve them.

While it may seem to some that the result of the rule which holds that the statute of limitations does not begin to run until the depositor discovers, or by the exercise of ordinary business care would have discovered, that the endorsement is a forgery may be unduly harsh in its effect on banking institutions, it does not in fact place any new burden on such institutions. As a matter of fact we think it is less harsh than the rule followed in some jurisdictions. In considering the fairness of the rule in question it must be remembered that the law unquestionably places upon a bank the duty to ascertain the genuineness of endorsements on checks presented to it for payment and to pay the proceeds of the check only to the payee, or to those as directed by him through endorsement thereon. The law is well settled that if a bank pays a check with a forged endorsement it pays out its own funds, not those of the depositor. Reason and logic, as well as the law, dictate that this be so for a check is but an order to a bank to pay a specified sum to a named person. It is the unconditional duty of the bank to pay the money only to the payee, or his order, and it is the responsibility of the bank, solely, to determine the genuineness of the endorsement and the identity of the person presenting the check for payment. When the check is presented for payment the bank has ample opportunity to do these things, whereas the maker of the check has no such opportunity.

It is true that the maker has the opportunity to view the endorsement when the check is returned to him, after payment by the bank, but unless the maker be extraordinarily observant of and have unusual acquaintance with the signature of the payee...

To continue reading

Request your trial
25 cases
  • Senfeld v. Bank of Nova Scotia Trust Co. (Cayman) Ltd.
    • United States
    • Court of Appeal of Florida (US)
    • 1 May 1984
    ...will not arise until the plaintiff knows or is chargeable with knowledge of an invasion of his legal right, Miami Beach First National Bank v. Edgerly, 121 So.2d 417 (Fla.1960) (action against bank for payment on a forged endorsement does not arise until maker receives, or by exercise of re......
  • Perkins State Bank v. Connolly
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • 19 December 1980
    ...endorsements on the bank which deals with the forger and is therefore best able to protect itself. See Miami Beach First National Bank v. Edgerly, 121 So.2d 417 (Fla.1960); Federal Deposit Insurance Corp. v. Marine National Bank of Jacksonville, 303 F.Supp. 401 (M.D.Fla.1969), affirmed, 431......
  • Hearndon v. Graham, 92-3842
    • United States
    • Court of Appeal of Florida (US)
    • 14 April 1998
    ...City of Miami v. Brooks, 70 So.2d 306 (Fla.1954); Seaboard Air Line R. Co. v. Ford, 92 So.2d 160 (Fla.1957); Miami Beach First Nat'l Bank v. Edgerly, 121 So.2d 417 (Fla.1960). The doctrine became described as a "discovery rule," see Edgerly, 121 So.2d at 420 ("[T]he statute of limitations b......
  • Bufman Organization v. F.D.I.C., 93-5137
    • United States
    • United States Courts of Appeals. United States Court of Appeals (11th Circuit)
    • 13 May 1996
    ...the bank and the customer. See Edgerly v. Schuyler, 113 So.2d 737, 742 (Fla.Dist.Ct.App.1959), aff'd sub nom., Miami Beach First Nat'l Bank v. Edgerly, 121 So.2d 417 (Fla.1960).8 The parties do not argue, and nothing in the records suggests, that the terms of Bufman's contract of deposit we......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT