California Court of Appeal

In this case, an employee of plaintiff-corporation stole checks made payable to plaintiff and cashed them in at three check cashing services, after which defendant-banks credited the accounts of the check cashing companies. Plaintiff sues to recover some of its losses due to the stolen checks. Judgment of dismissal entered on behalf of defendants is reversed, where: 1) check cashing companies are not banks, and should not be treated as banks for purposes of California's Uniform Commercial Code; and 2) defendants were thus the first banks to process the checks through the banking system, and as "first banks," they had a duty of care in the processing of those checks to make certain all endorsements are valid.

Appellate Information

• Decided 11/06/2014
• Published 11/06/2014

Judges

• Bedsworth

Court

• California Court of Appeal

Counsel