(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).
( NOTE: This Court wrote no full opinion in this case. Rather, the Court's affirmance of the judgment of the Appellate Division is based substantially on the reasons expressed in Triffin v. Bridge View Bank, 330 N.J. Super. 473 (App. Div. 2000), on which the Appellate Division relied in this case.)
Argued April 5, 2007 -- Decided May 2, 2007
PER CURIAM.
In this appeal, the Supreme Court must determine whether an assignee of the
rights and interests in a dishonored check is entitled to enforce the midnight
deadline of N.J.S.A. 12A:4-302 against a payor bank, thereby making the bank strictly
liable for the check, regardless of whether it was properly payable.
The payor banks, predecessors-in-interest to TD Banknorth, N.A. and Wachovia Bank, N.A., dishonored
several checks that had been cashed by check-cashing entities. They allegedly returned the
checks in violation of the midnight deadline rule, N.J.S.A. 12A:4-302, which provides that
a payor bank is accountable for a check “whether properly payable or not”
if it fails to return the check or send notice of dishonor within
the midnight deadline referred to in the statute.
Thereafter, Robert Triffin entered into assignment agreements with the check-cashing entities, pursuant to
which he purchased their rights and interests in the dishonored checks. He later
filed separate small claims actions against TD Banknorth and Wachovia. He alleged that
the banks wrongfully dishonored the checks in violation of the midnight deadline rule
and were strictly liable for the amount of the checks. TD Banknorth moved
for dismissal, and Wachovia moved for summary judgment. The trial court granted both
motions.
Triffin appealed. The Appellate Division consolidated the cases and affirmed. The panel held
that an assignee of the rights and interests in a dishonored check may
not enforce the statutory liability created by N.J.S.A. 12A:4-302 because the Legislature intended
that statute to benefit only the payee, collecting banks, and others who may
have received the check before it was dishonored.
The Supreme Court granted certification.
189 N.J. 426 (2007).
HELD: The judgment of the Appellate Division is affirmed substantially for the reasons
expressed in Judge Coburn’s published opinion in Triffin v. Bridge View Bank,
330 N.J. Super. 473 (App. Div. 2000), on which the Appellate Division relied in
this case. Where an assignee of all rights arising from a dishonored check
becomes the assignee after the check’s untimely return and with full knowledge of
its dishonor, the assignee has no vested interest in the timely payment or
return of the check and thus has no standing to bring a cause
action for the bank’s violation of N.J.S.A. 12A:4-302.
1. As Judge Coburn explained in Triffin v. Bridge View Bank, after a
dishonored check has been untimely returned, an assignee with full knowledge of its
dishonor has no vested interest in the timely payment or return of these
checks. A contrary argument would misconstrue the nature of an enforcement action under
N.J.S.A. 12A:4-302, which is a cause of action for breach of statutory duty,
not an action for collection of a negotiable instrument. (p. 3-4)
2. N.J.S.A. 2A:25-1, which permits assignment of “all choses in action arising on
contract,” is not applicable. The action pursued in this case is not based
on a contractual right, consequently it is not assignable. To the extent Triffin
v. Mellon PSFS,
372 N.J. Super. 3 (App. Div. 2004), suggests otherwise, it
is disapproved. (p. 4)
The decision of the Appellate Division is AFFIRMED.
CHIEF JUSTICE ZAZZALI and JUSTICES LONG, LaVECCHIA, ALBIN, WALLACE, RIVERA-SOTO and HOENS join
in this opinion.
SUPREME COURT OF NEW JERSEY
A-
84 September Term 2006
ROBERT J. TRIFFIN,
Plaintiff-Appellant,
v.
TD BANKNORTH, N.A., (SUCCESSOR IN INTEREST TO HUDSON UNITED BANK)
Defendant-Respondent.
ROBERT J. TRIFFIN,
Plaintiff-Appellant,
v.
WACHOVIA BANK, N.A., (SUCCESSOR IN INTEREST TO FIRST UNION NATIONAL BANK)
Defendant-Respondent.
Argued April 5, 2007 – Decided May 2, 2007
On certification to the Superior Court, Appellate Division.
Robert J. Triffin argued the cause pro se.
Joseph M. Cerra argued the cause for respondent TD Banknorth, N.A. (Forman Holt
& Eliades, attorneys).
John D. North argued the cause for respondent Wachovia Bank, N.A. (Greenbaum, Rowe,
Smith & Davis, attorneys; Mr. North and John B. Nance, on the brief).
Per Curiam
The question presented in these consolidated appeals is whether an assignee of the
rights and interests in a dishonored check is entitled to enforce the midnight
deadline of N.J.S.A. 12A:4-302 against a payor bank, thereby making the bank strictly
liable for the check, regardless of whether it was properly payable.
This case arose when the payor banks (TD Banknorth, N.A. and Wachovia Bank,
N.A.)
See footnote 1
dishonored several checks that had been cashed by check-cashing entities. Those banks
allegedly returned the checks in violation of the midnight deadline rule, which provides
in relevant part:
If an item is presented to and received by a payor bank, the
bank is accountable for the amount of:
(1) a demand item, other than a documentary draft, whether properly payable or not,
if the bank, in any case in which it is not also the
depository bank, retains the item beyond midnight of the banking day of receipt
without settling for it or, whether or not it is also the depository
bank, does not pay or return the item or send notice of dishonor
until after its midnight deadline; or
(2) any other properly payable item unless, within the time allowed for acceptance or
payment of that item, the bank either accepts or pays the item or
returns it and accompanying documents.
[N.J.S.A. 12A:4-302(a).]
Plaintiff, Robert Triffin, entered into separate assignment agreements with check-cashing entities, pursuant to
which he purchased their rights and interests in the dishonored checks. Thereafter, he
filed small claims actions against TD Banknorth and Wachovia alleging that they wrongfully
dishonored the checks in violation of the midnight rule and, accordingly, were strictly
liable for the amount of the checks. Wachovia moved for summary judgment, and
TD Banknorth moved for dismissal.
See footnote 2
The trial judge granted both motions.
Triffin appealed. The Appellate Division consolidated the cases and affirmed. The panel held
that an assignee of the rights and interests in a dishonored check may
not enforce the statutory liability created by N.J.S.A. 12A:4-302 because the Legislature intended
that statute to benefit only the payee, collecting banks, and others who may
have received the check before dishonor.
We granted certification,
189 N.J. 426 (2007), and now affirm substantially for the
reasons expressed by Judge Coburn in his thorough and thoughtful opinion in Triffin
v. Bridge View Bank,
330 N.J. Super. 473 (App. Div. 2000), on which
the Appellate Division here relied. As Judge Coburn explained,
after [the check’s] untimely return and with full knowledge of its dishonor, [the
assignee] has no vested interest in the timely payment or return of these
checks. . . . Any argument to the contrary would misconstrue the nature
of an enforcement action under [N.J.S.A. 12A:4-302]. It is a cause of action
for a breach of statutory duty, not an action for collection of a
negotiable instrument.
[Id. at 478 (internal quotations and citations omitted); see also Am. Title Ins.
Co. v. Burke & Herbert Bank & Trust Co.,
813 F. Supp. 423,
428 (E.D. Va. 1993), aff’d,
25 F.3d 1038 (4th Cir. 1994) (holding only
payee has standing to bring suit for bank’s violation of midnight rule).]
We likewise note that Triffin can garner no support from N.J.S.A. 2A:25-1, which,
in relevant part, permits assignment of “all choses in action arising on contract.
. . .” The action pursued in this case is not based on
a contractual right, consequently it is not assignable. To the extent that dictum
in Triffin v. Mellon PSFS,
372 N.J. Super. 3, 7-12 (App. Div. 2004),
suggests a contrary conclusion, it is disapproved.
The judgment of the Appellate Division is affirmed.
CHIEF JUSTICE ZAZZALI and JUSTICES LONG, LaVECCHIA, ALBIN, WALLACE, RIVERA-SOTO, and HOENS join
in this opinion.
SUPREME COURT OF NEW JERSEY
NO. A-84 SEPTEMBER TERM 2006
ON CERTIFICATION TO Appellate Division, Superior Court
ROBERT J. TRIFFIN,
Plaintiff-Appellant,
v.
TD BANKNORTH, N.A.,
(SUCCESSOR IN INTEREST TO
HUDSON UNITED BANK),
Defendant-Respondent.
ROBERT J. TRIFFIN,
Plaintiff-Appellant,
v.
WACHOVIA BANK, N.A.,,
(SUCCESSOR IN INTEREST TO
FIRST UNION NATIONAL BANK),
Defendant-Respondent.
DECIDED May 2, 2007
Chief Justice Zazzali PRESIDING
OPINION BY Per Curiam
CONCURRING/DISSENTING OPINIONS BY
DISSENTING OPINION BY
CHECKLIST
Footnote: 1
The banks named as defendants here are successors-in-interest to the payor banks: TD
Banknorth is successor to Hudson United Bank, and Wachovia is successor to First
Union National Bank.
Footnote: 2
Wachovia’s motion was based solely on the ground that Triffin lacked standing
to bring the claim against it. TD Banknorth also raised a standing argument
and reserved its “right to contest each and every fact asserted by []
[Triffin] in this action.”