BANK OF HAWAII INTERNATIONAL CORP v. MARCO TRADING CORP (1999)

Judgment, Supreme Court, New York County (Franklin Weissberg, J.), entered November 25, 1998, awarding plaintiff damages, and bringing up for review prior orders, same court and Justice, entered March 6 and October 29, 1998, which, in an action for unjust enrichment, denied defendant's motion for summary judgment and granted plaintiff's motion for summary judgment, unanimously affirmed, with costs.   Appeals from the orders, unanimously dismissed, without costs, as subsumed in the appeal from the judgment.

 Plaintiff, a collecting bank (UCC 4-105[d] ), inadvertently delivered documents of title to defendant without first obtaining defendant's acceptance of the accompanying draft, and, as a result, was compelled to pay the draft itself.   Defendant, who took possession of the goods covered by the draft, refuses to reimburse plaintiff on the ground that it never signed the draft, relying on UCC 3-401(1), which provides, “No person is liable on an instrument unless his signature appears thereon.”   The motion court held that although defendant could not be held liable on the draft, it was “nevertheless ․ liable otherwise” for the price of the goods it accepted but never paid for.   We agree.   The Uniform Commercial Code does not displace common-law causes of action unless a particular Code provision expressly so provides (see, Hechter v. New York Life Ins. Co., 46 N.Y.2d 34, 39, 412 N.Y.S.2d 812, 385 N.E.2d 551), and nothing in UCC 3-401 so provides.   “Nothing in this section is intended to prevent any liability arising apart from the instrument itself” (UCC 3-401, Official Comment 1), including a liability for unjust enrichment (see, Midwest Indus. Funding v. First Natl. Bank, 973 F.2d 534, 538 (7th Cir.1992)).   Defendant took possession of the documents of title and received a shipment of goods without paying for them.   Plaintiff, having made the drawee whole, is entitled to recoup its actual losses under the common-law theory of unjust enrichment.

MEMORANDUM DECISION.