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Bruce Doxey, Karen Smith and Ksbd Contracting v. Christine Irwin


April 4, 2012


On appeal from the Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-5203-09.

Per curiam.


Submitted February 27, 2012

Before Judges Skillman and Hoffman.

In this action for conversion, defendant Christine Irwin appeals from an April 13, 2011 order entering judgment against her, following a bench trial, in the amount of $42,714.64. For the reasons that follow, we affirm.

We present the facts as adduced at trial. Karen Smith and Bruce Doxey, who are married, owned and operated a construction company named KSBD Contracting (KSBD) (collectively, "plaintiffs"). For about two years, starting in 2004, KSBD employed defendant, who is Doxey's sister, as a part-time bookkeeper. In the course of her duties, defendant had access to the company's checkbook. Defendant was authorized to write checks from the company account, but as a matter of custom gave the checks to Doxey or Smith for signature.

In 2006, Doxey received a call from his bank advising that KSBD's checking account was overdrawn. As Doxey explained in his testimony at trial:

I went down to the bank to discover why it was overdrawn. And, then they . . . gave me a printout and there was some payments to Ford Motor Credit, to the Pennsylvania Power, and some electronic transfers.

And, at the time, I thought there might be identity theft and - since Karen and myself and Christine were the only people that had access to the checking account, I called Christine from the bank . . . and asked her about those charges.

And I said, "Chris, I can fill an affidavit out with the bank now. They'll reimburse me the money and they'll go after the person, whoever it was, that did this." And then she admitted to me on the phone that it was h - her payments, that she had to make -

After an objection from defendant's counsel, Doxey continued:

That she had made the payments because - the Ford Motor credit had come to the house to repossess the van and . . . the power company was going to shut off the power at her house."

Defendant denied making any such confession.

At trial, the parties stipulated to the admission into evidence of a package of documents consisting of, among other items, signed statements made by plaintiffs to the police; affidavits of forgery; photocopies of forged checks; and a four-page chart showing the amounts, dates, and payees for ninety-four charges that plaintiffs contended were fraudulent. Of these charges, forty-two were checks with signatures allegedly forged by defendant and fifty-two were electronic withdrawals or payments from the company account.*fn1

Both Doxey and Smith testified they were the only persons authorized to sign checks on KSBD's checking account, and that they never authorized defendant to sign their names on any checks. They also confirmed that defendant was the only other person with access to the checks and account information. Defendant testified that plaintiffs had in fact authorized her to complete and sign their names to KSBD checks.

At the conclusion of the trial, the court found defendant's testimony on this issue not credible, and concluded that plaintiffs had not authorized defendant to sign checks on behalf of the company. The court also credited Doxey's testimony that defendant had confessed to him that she had used company funds to pay personal debts. The court specifically found that defendant's testimony on this issue lacked credibility, and otherwise rejected her denials of forgery and misappropriation.

The court therefore concluded that each of the ninety-one transactions constituted an improper conversion of funds from KSBD's business account. After deleting the items that were paid for valid KSBD bills, the court determined the total amount misappropriated by defendant, and entered judgment in favor of plaintiffs in the amount of $42,714.64, plus interest and costs.

Defendant raises these points on appeal:



Initially, we note that we are bound by the trial judge's factual determinations when supported by adequate, substantial and credible evidence. Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974). On appeal, we will not disturb the trial judge's factual determinations "unless we are convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice." Fagliarone v. Twp. of N. Bergen, 78 N.J. Super. 154, 155 (App. Div.), certif. denied, 40 N.J. 221 (1963). We review credibility determinations deferentially, as such determinations "are often influenced by matters such as observations of the character and demeanor of witnesses and common human experience that are not transmitted by the record." State v. Locurto, 157 N.J. 463, 474, (1999).

Here, there was substantial credible evidence to support the trial court's findings. As testimony from Doxey and Smith on the one hand and defendant on the other diverged as to whether defendant had permission to make payments from KSBD's account, witness credibility was a critical issue at trial. On this point, the court made the following findings:

I found the testimony of the plaintiffs to be candid, unexaggerated, and straight forward. In contrast, I found the defendant's testimony lacked credibility. While denying that she ever - confessed to her brother of her wrongdoing, I believe her brother's testimony that she did - and that she improperly forged [Smith]'s signature to checks and used the funds for her own purposes.

It is certain in this case, that there were only two signatories to the checking account; Bruce Doxey and Karen Smith. And that no one else had access to the checks . . . or the routing numbers[,] other than [the] plaintiffs and [the] defendant.

Defendant principally challenges the sufficiency of the evidence as to the fifty-two electronic withdrawals and payments from the company account.*fn2 Doxey testified he reviewed the company's records and determined these fifty-two withdrawals and payments were fraudulent. These withdrawals and payments occurred during defendant's employment as KSBD's bookkeeper, and overlapped the time period the forged checks were issued. During this time, only plaintiffs and defendant had knowledge of the account and routing numbers, and access to the account checkbook. Finally, the court rejected as not credible defendant's testimony that she had been authorized to make certain personal payments.

In sum, we conclude that adequate, substantial, and credible evidence supported the judge's determinations. See Rova Farms, supra, 65 N.J. at 484. Accordingly, we discern no basis to disturb the judgment entered by the trial court.


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