Bischoff, Morgan and Rizzi.
Plaintiff appeals from a judgment of no cause of action entered in this nonjury case contending that the challenged judgment resulted from the trial judge's incorrect application of principles of negotiable instruments law to the facts of this case.
The evidence disclosed that plaintiff, a depositor with defendant bank, maintained a savings account with that institution which, on April 27, 1971, showed a balance of slightly over $12,000. On that date she sought withdrawal of $5,000 therefrom, not in cash but by way of check made payable to her uncle, Samuel Clerico. In compliance with her request defendant bank issued a check in the requested amount, drawn on its own account in the Federal Home Loan Bank and made payable to plaintiff's uncle. Although the check was drawn near the close of business hours on April 27, 1971, it bore the date of April 28, 1971, a procedure apparently used by the bank to accommodate the closing of its books near the end of every business day without inconveniencing its customers. Plaintiff's passbook was debited to reflect the $5,000 withdrawal.
From the bank plaintiff went to a relative's home where she turned the check over to her uncle's son, Anthony, who endorsed the check in his father's name and left with it. A later conversation with her uncle confirmed her suspicions that Anthony had endorsed the check without the authorization of his father, the payee on the check. Concluding that the payee's endorsement had been forged, a conclusion later shown to be erroneous, she called defendant bank the next morning, spoke with the branch manager, Mrs. Wimberg, and asked that the bank stop payment on the check. Mrs. Wimberg testified that the call was made on April 29, not April 28 as testified to by plaintiff.
At any rate, Mrs. Wimberg completed a stop payment form on April 29 and forwarded it to the bank upon which the check was drawn, the Federal Home Loan Bank of New York.
The check, bearing the endorsement of Samuel Clerico (by his son, Anthony) and one Martin Simon had been cashed by another branch of defendant bank on April 28, 1971, the day before the stop payment form had been completed and the same day plaintiff testified she had asked the bank to stop payment.
The stop payment had been sent to the drawee bank without the realization that the check had already been cashed by defendant. Without waiting to see whether the stop payment order would be effective (it ultimately was, the drawee bank never paid out on the check) and presuming that the check would not be cashed on presentation, Mrs. Wimberg authorized the recrediting of plaintiff's account in the amount of $5,000. A few days later, when she learned that the check had been cashed, she asked plaintiff to bring in her passbook so that the $5,000 could again be deducted. Plaintiff refused and brought suit to recover the entire $12,000 balance in her account.
Although we agree with plaintiff that the provisions of the Uniform Commercial Code relied upon by the trial judge have no application to this case, we nonetheless conclude that the result reached was a partially correct one although for different reasons. It is essential to an understanding of this case to emphasize that plaintiff was not a party to the check in question; defendant bank was the drawer, the Federal Home Loan Bank of New York was the drawee, and Samuel Clerico was the payee. Clerico, who admitted during the trial that the endorsement of his name was not unauthorized, appeared as an endorser as well as did Martin Simon. Clearly since plaintiff is not a party to the check in question, her rights with respect to it are not governed by that section of the Uniform Commercial Code defining rights and liabilities with respect to parties to negotiable instruments. Hence, contrary to the ruling of the trial court, N.J.S.A. 12A:4-303 does not control disposition
of this case. The same is true with respect to N.J.S.A. 12A:4-403 and N.J.S.A. 12A:4-407.*fn1
Rather, the rights of plaintiff against defendant bank, if any, in the given circumstances are governed by the contract of deposit between plaintiff and bank, the specific contents of which were never disclosed by the record. Nonetheless, certain aspects of that relationship are inferable from what occurred in this case. Traditionally, the relationship between a depositor and bank is viewed as that of creditor and debtor. F.I.N.N.E., Inc. v. National State Bank of Newark , 74 N.J. Super. 86, 89 (App. Div. 1962); Forbes v. First Camden Nat'l Bank & Trust Co. , 25 N.J. Super. 17, 20 (App. Div. 1953). When plaintiff withdrew $5,000 defendant ...