MIDTOWN COPYING DUPLICATING SERVICES INC v. BANK OF NEW YORK (2000)

Judgment, Supreme Court, New York County (Helen Freedman, J.), entered February 10, 1999, after a nonjury trial, in favor of defendant and against plaintiff, unanimously affirmed, with costs.

 We affirm the judgment for defendant bank on the ground that, regardless of any negligence by the bank in failing to give effect to the amended corporate resolutions and signature cards submitted by plaintiff's principal, the record establishes that plaintiff's principal was fully aware that the employee previously authorized to sign checks drawn on plaintiff's bank accounts was continuing to do so, and, with such knowledge, plaintiff's principal endorsed and deposited the checks the employee drew that were payable to him, thereby ratifying the employee's continued check-signing both expressly and, through the acceptance of the benefits thereof, impliedly (see, UCC 3-404;  Matter of New York State Med. Transporters Assn. v. Perales, 77 N.Y.2d 126, 131, 564 N.Y.S.2d 1007, 566 N.E.2d 134;  Latallo Establissement v. Morgan Guar. Trust Co., 155 A.D.2d 214, 219, 553 N.Y.S.2d 686, appeal withdrawn 76 N.Y.2d 890, 561 N.Y.S.2d 552, 562 N.E.2d 877).   That plaintiff's principal was purportedly unaware of the allegedly improper purposes for which certain of the checks were drawn does not negate ratification as to the bank (see, Stella v. Dean Witter Reynolds, 241 N.J.Super. 55, 66-67, 574 A.2d 468, 474).   Since plaintiff's principal is precluded from questioning the bank's honoring of the checks drawn by the employee, he cannot cause the corporation to sue the bank for so doing (see, Blake v. Blake, 225 A.D.2d 337, 638 N.Y.S.2d 632, citing Diamond v. Diamond, 307 N.Y. 263, 266, 120 N.E.2d 819).   The bank would not be precluded from relying on the ratification defense by any negligence on its part, since the defense arises from knowing and intentional conduct by plaintiff, not mere negligence (cf., Matter of Levy & Sons Fashions, 785 F.Supp. 1163, 1167 [citing Stella v. Dean Witter Reynolds, supra ], affd. 988 F.2d 311 [2d Cir.]).   Finally, we note that judgment in favor of the bank would in any event be required, since plaintiff failed to present any admissible evidence of the dates, amounts, and payees of the unauthorized checks allegedly drawn for improper purposes, thus failing to establish damages.

MEMORANDUM DECISION.