| Greenberg, Trager & Herbst, LLP v HSBC Bank USA |
| 2010 NY Slip Op 04249 [73 AD3d 571] |
| May 20, 2010 |
| Appellate Division, First Department |
| Greenberg, Trager & Herbst, LLP, Appellant, v HSBCBank USA, Defendant, and Citibank, N.A., Respondent. (And a Third-Party Action.) Greenberg,Trager & Herbst, LLP, Appellant, v HSBC Bank USA, Respondent, et al., Defendant. (And aThird-Party Action.) |
—[*1] Zeichner Ellman & Krause LLP, New York (Barry J. Glickman of counsel), for Citibank,N.A., respondent. Michael R. Mendola, Buffalo for HSBC Bank USA, respondent.
Orders, Supreme Court, New York County (Charles E. Ramos, J.), entered April 24, 2009and April 28, 2009, which granted defendants' motions for summary judgment dismissing thecomplaint, unanimously affirmed, with costs.
The motion court correctly found that the administrative return of the misrouted check wasnot a dishonor triggering the running of HSBC's time to notify plaintiff depositor, so when thebank later learned the check was counterfeit, it properly revoked its provisional settlement andcharged the amount against plaintiff's account since the item had not been finally settled(see UCC 4-212 [1]). The court properly relied on HSBC's explanation, which wasresponsive to [*2]plaintiff's opposition papers (see Galdamez v Biordi Constr. Corp.,50 AD3d 357 [2008]), that the "insufficient funds" designation on the computer-generatedbacking affixed to the returned imaged check bearing a "sent wrong" notation was merely adefault setting that did not accurately reflect the reason for the return. Even if, arguendo, anHSBC employee misrepresented that the check had cleared, plaintiff's reliance on suchrepresentation in wiring funds to an offshore account, causing it to suffer damages when unableto recover such funds, does not give rise to a claim against the bank for negligentmisrepresentation absent a fiduciary relationship, which does not exist between a bank and itscustomer (see Dobroshi v Bank of Am.,N.A., 65 AD3d 882 [2009]). If, as plaintiff maintains, principles of estoppel shouldgovern the allocation of loss, then it was in the best position to guard against the risk of acounterfeit check by knowing its "client," its client's purported debtor and the recipient of thewire transfer. Instead, it expended scant effort at researching any of them, and engaged in thesubject transaction pursuant to the client's exhortation to act "ASAP" and that time was of theessence, despite never having received its requested confirmation that the transaction was indeedlegitimate.
The court also properly relied on the uncontroverted explanation by Citibank that itspersonnel who reviewed the routing were not in a position to discern whether the check wascounterfeit, so even though that same day they returned a number of checks with the same faceamount, there was at that time no reason for Citibank to notify HSBC.
We have considered plaintiff's other contentions and find them unavailing.Concur—Gonzalez, P.J., McGuire, DeGrasse and Manzanet-Daniels, JJ.