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John & Mary Markle Foundation v. Manufacturers Hanover Trust Co.
Citations: 209 A.D.2d 587; 619 N.Y.S.2d 109; 1994 N.Y. App. Div. LEXIS 11535
Court: Appellate Division of the Supreme Court of the State of New York; November 20, 1994; New York; State Appellate Court
In a breach of contract case, the defendant appeals an order and judgment from the Supreme Court, Nassau County, which awarded the plaintiff $356,310.50 after granting a motion for summary judgment. The case centers on a wire transfer from a two-signature checking account, executed upon the oral request of only one signatory, which violated the bank's own corporate resolution requiring two signatures for fund withdrawals. Article 4 of the Uniform Commercial Code (UCC) does not apply, as it does not address electronic funds transfers, and Article 4-A of the UCC is inapplicable to wire transfers made before January 1, 1991. The court determined that the bank improperly processed the transfer without adhering to the corporate resolution's requirement for dual authorization. Consequently, the bank's failure to follow these explicit instructions absolves the plaintiff from being held accountable for not objecting to account statements sent by the bank. The bank did not present sufficient evidence to dispute the authority of the depositor's treasurer to make withdrawals, and the court found that the treasurer's exclusive dealings with the bank did not imply authority to bypass the corporate banking resolution. The appellate court affirmed the lower court's decision, dismissing the bank's additional arguments as meritless.