Edward Fineman Co. v. Superior Court of L.A. Cty.

In the present matter we review the trial court’s order of summary adjudication that a bank customer’s claim for damages based on the bank’s payment of checks issued from 1991 through 1993 containing less than all of the required signatures is barred by the retroactive application of California Uniform Commercial Code 1 sections 4111 and 4406, subdivision (f).

We issued an order to show cause and set the matter for hearing. Having reviewed the pleadings and record and having heard oral argument, we deny the relief requested.

Factual Background

The Edward Fineman Company maintained a payroll checking account at Bank of America between 1991 and 1997. Under the terms of the account, *1115 withdrawals were authorized on one signature if signed by either Edward Fineman or Fred Fineman or by two signatures of either Barbara Graver, Joann Mathieson, or Gregory K. Hanssen.

Between January 1, 1991, and June 1, 1996, Bank of America honored and paid 83 checks in the aggregate amount of $248,000 drawn on the Fineman account signed only by Graver, Fineman’s accounting manager. On May 24, 1996, Fineman contacted Bank of America directing the bank to remove Graver as an authorized…

I concur in the judgment because I agree that under former California Uniform Commercial Code section 4406, properly construed, Gruver’s signature, alone, was an unauthorized signature.

We reached the opposite conclusion in Far West Citrus, Inc. v. Bank of America (1979) 91 Cal.App.3d 913 [ 154 Cal.Rptr. 464 ]. Looking at the question purely on the basis of the statutory language, without consideration of anything else, I think the Far West Citrus decision is understandable. After all, if two persons are authorized to sign a check, and the drawee bank is not permitted to honor the check unless both signatures are present, it is logical to say that each signature is “authorized.” If there was nothing more to consider, I probably would reach that conclusion today.

But there is more. The statute we are construing is part of the Uniform Commercial Code, probably the most familiar of uniform laws. In construing a uniform law, the court must be “mindful of the importance of securing uniformity in the interpretation of the provisions . . . among the various jurisdictions.” (Bank of America v. Security Pacific Nat. Bank (1972) 23 Cal.App.3d 638, 643 [ 100 Cal.Rptr. 438 ].) In promoting…

Deborah S. Gershon, John M. Redmond and Ullar Vitsut, Los Angeles, for Real Party in Interest.

CHARLES S. VOGEL, Presiding Justice.

In the present matter we review the trial court's order of summary adjudication that a bank customer's claim for damages based on the bank's payment of checks issued from 1991 through 1993 containing less than all of the required signatures is barred by the retroactive application of California Uniform Commercial Code [1] sections 4111 and 4406, subdivision (f).

We issued an order to show cause and set the matter for hearing. Having reviewed the pleadings and record and having heard oral argument, we deny the relief requested.

The Edward Fineman Company maintained a payroll checking account at Bank of America between 1991 and 1997. Under the terms of the account, withdrawals were authorized on one signature if signed by either Edward Fineman or Fred Fineman or by two signatures of either Barbara Gruver, Joann Mathieson, or Gregory K. Hanssen.

Between January 1, 1991, and June 1, 1996, Bank of America honored and paid 83 checks in the aggregate amount of $248,000 drawn on the Fineman account signed only by Gruver, Fineman's accounting manager. On…