Before Judges King, Newman and Fall.
The opinion of the court was delivered by: King, P.j.a.d.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued: February 18, 1999
On appeal from the Superior Court of New Jersey, Law Division, Essex County.
The opinion of the court was delivered by
This is an appeal from a summary judgment in favor of defendant First Union Bank, a successor to First Fidelity Bank. Judge Mochary granted summary judgment against plaintiff Triffin, a commercial discounter and purchaser of dishonored instruments, in an action he brought as assignee of a negotiable instrument. See Triffin v. Cigna Ins. Co., 297 N.J. Super. 199 (App. Div. 1997); Triffin v. Dillabough, 716 A.2d 605 (Pa. 1998). We affirm the decision in the Law Division which was based on the efficacy of a "risk-shifting" agreement between plaintiff's assignor and defendant's predecessor, First Fidelity Bank.
On October 6, 1995 First Fidelity and American Express Travel Related Services Company, Inc. jointly issued a $929.15 Holiday Club check to Cheryl Gardner. Later in October 1995, Cheryl Gardner, or someone purporting to be her, cashed this Holiday Club check at D&S Check Cashing (D&S) in Newark, New Jersey. Plaintiff alleges that when D&S cashed the check, it had no knowledge of any defenses or claims by any party to the check. At oral argument speculation arose that the check was lost or stolen and the payee Gardner's endorsement was forged before presentation at this inner-city check-cashing agency housed in a liquor store, but no one really knew the operative facts surrounding the negotiation or reason for stop-payment on the instrument.
Sometime after Gardner, or someone else, cashed the check at D&S, payment was stopped on the check. The record is unclear why payment was stopped but again the parties speculated at argument that the check might have been reported to the bank as lost or stolen. There is no claim in this action that First Fidelity was at fault or acted in bad faith in connection with the stop payment.
Since March 7, 1994 D&S and First Fidelity had operated pursuant to a written Cash Management Services Agreement. The parties refer to the Agreement as an "exculpatory" clause or agreement. We prefer to characterize it as a "risk-shifting" agreement, at least in respect to this context and this suit.
Paragraph four of the Agreement states:
4. WARRANTY. Although Bank [First Fidelity] shall provide the Services in accordance with the prevailing reasonable commercial standards of the banking industry, Bank shall not be responsible for any loss sustained by Customer [D&S Check Cashing] unless and to the extent that such loss was caused by Bank's gross negligence or willful misconduct. Except as may be expressly set forth in this Agreement or the Service Schedules, Bank makes no representations or warranties, express or implied, with respect to the Services or this Agreement or the Service Schedules. NOTWITHSTANDING ANY OTHER PROVISION HEREOF, IN NO EVENT SHALL BANK BE LIABLE TO CUSTOMER, REGARDLESS OF WHETHER ANY CLAIM IS ...