Case Title: Ward v. First Interstate Bank of Riverton

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1986-05-01T00:00:00Z

Document:
Ward v. First Interstate Bank of Riverton1986 WY 110718 P.2d 886Case Number: 85-266Decided: 05/01/1986Supreme Court of Wyoming
Al WARD, d/b/a Ward's 
Used Iron, Appellant (Plaintiff),

v.

FIRST INTERSTATE BANK OF 
RIVERTON, Appellee (Defendant).

Appeal from 
DistrictCourtofFremontCounty, Elizabeth A. Kail, 
J.

F.M. Andrews, 
Jr. of Andrews & Anderson, P.C., Riverton, for appellant.

James L. 
Hettinger and Jay E. Vincent (Student Intern) of Hettinger & Leedy, P.C., 
Riverton, for 
appellee.

Before THOMAS, C.J., and BROWN, CARDINE, URBIGKIT 
and MACY, JJ.

BROWN, 
Justice.

[¶1.]     This case involves the 
issue of whether a purchaser of a cashier's check can require the issuing bank 
to stop payment on the check. Appellant Al Ward dba Ward's Used Iron filed a 
complaint against appellee First Interstate Bank of Riverton praying that the 
bank be required to stop payment on a cashier's check purchased by appellant. 
The trial court granted summary judgment in favor of the bank and appellant 
brings this appeal.

[¶2.]     We will 
affirm.

[¶3.]     The facts show that 
appellant purchased a cashier's check from the bank on July 2, 1982, in the 
amount of $29,356.80. The check was delivered to the payee, Davis Oil Company; 
however, the check was never presented to the bank for payment. When appellant 
demanded that the bank stop payment on the check, the bank 
refused.

[¶4.]     Appellant then filed 
this action praying that the bank be required to stop payment on the cashier's 
check, contending a reasonable time for presentment had passed and the check was 
stale. Appellant later filed an amended complaint alleging that the bank was 
being unjustly enriched by the use of the money during the time the check was 
outstanding, so the bank should be required to pay appellant interest on the 
money held by the bank.

[¶5.]     Appellant claims 
summary judgment was improper inasmuch as there is a genuine issue of material 
fact regarding whether a reasonable time for presentment has passed. Appellant 
also asks whether his complaint states a claim for relief.

[¶6.]     We begin by stating our 
oft-cited standards of review. When reviewing a summary judgment on appeal, we 
review the judgment in the same light as the district court, using the same 
information. Toltec Watershed Improvement District v. Johnston, Wyo., 717 P.2d 808 (1986). A party moving for 
summary judgment has the burden of proving the nonexistence of a genuine issue 
of material fact. Dudley v. East Ridge Development Company, Wyo., 694 P.2d 113 
(1985). A material fact has been defined as one which, if proved, would have the 
effect of establishing or refuting an essential element of the cause of action 
or defense asserted. Samuel Mares Post No. 8, American Legion, Department of 
Wyoming v. Board of County Commissioners of the County of Converse, Wyo., 697 P.2d 1040 (1985). When examining a summary judgment, we view the record from the 
vantage point most favorable to the party opposing the motion, giving him all 
favorable inferences which may be drawn from the facts. Randolph v. Gilpatrick Construction Company, Inc., 
Wyo., 702 P.2d 142 (1985).

[¶7.]     As noted above, 
appellant claims there was an issue as to whether a reasonable time for 
presentment of the check has passed. An instrument must be presented for payment 
within a reasonable time after its issuance, such time being determined by the 
nature of the instrument and consideration of the facts of each case. § 
34-21-359, W.S. 1977. That general principle is correct, but we fail to see how 
it is applicable here. The check was delivered to the payee, Davis Oil Company, 
and is presumably still in the payee's possession. The issue of reasonable time 
for presentment of the check will come into play, if at all, when the check is 
presented for payment.

[¶8.]     A cashier's check 
differs from an ordinary check drawn on a customer's checking account. A 
cashier's check is a bill of exchange drawn by the bank as drawer upon itself as 
drawee.

"A cashier's check is a 
bill of exchange, drawn by the bank upon itself, and is accepted by the act of 
issuance. While the only apparent basic or factual difference between a 
cashier's check and the ordinary check is that the ordinary check is drawn on 
one other than the drawer, while in a cashier's check both the drawer and the 
drawee are the same, there are certain differences, some radical, in the 
incidents and consequences of the two types of checks. A cashier's check is a 
primary obligation of the bank, rather than the depositor, as in the case of an 
ordinary check, and a promise to pay which ordinarily cannot be countermanded. 
It is issued by the authorized officer of a bank, directed to another person, 
evidencing the fact that the payee is authorized to demand and receive from the 
bank, upon presentation, the amount of money represented by the check. Cashiers' 
checks, from their peculiar character and general use in the commercial world, 
are regarded substantially as the money which they represent, a rule that is not 
extended to ordinary checks of the depositor drawn on his bank." 10 Am.Jur.2d 
Banks § 544, pp. 518-519 (1963).

[¶9.]     Since a cashier's check 
is accepted by the very act of issuance, it is generally recognized that a 
cashier's check is not subject to stop payment or countermand in the absence of 
mistake or fraud.

"A cashier's check, since 
it is merely a bill of exchange drawn by a bank upon itself and is accepted in 
advance by the act of its issuance, is not subject to countermand like an 
ordinary check; the relations of the parties to such an instrument are analogous 
to those of the parties to a negotiable promissory note payable on demand. Thus, 
since a cashier's check is presumably purchased for a sufficient consideration, 
it is ordinarily beyond the power of the purchaser or the bank issuing it to 
stop payment thereon. Once the cashier's check is negotiated to a holder in due 
course, the credit and resources of the payee are no longer primarily involved; 
it is then a primary obligation of the bank and, upon presentment of the check 
for payment, the bank must honor the check. * * *" 10 Am.Jur.2d Banks § 643, pp. 
614-615 (1963).

[¶10.]  Such principles are in accord with 
Wyoming 
statutory law. Under Wyoming's Uniform Commercial Code (§§ 
34-21-101 to 34-21-1002, W.S. 1977), a cashier's check is a bill of exchange 
drawn by a bank upon itself, and is considered accepted when issued. § 
34-21-347, W.S. 1977. An item which has been accepted or certified by the bank 
may not be countermanded. § 34-21-452. See also Official Comment 5, UCC § 4-403 
(1977).

[¶11.]  In Dziurak v. Chase Manhattan Bank, 44 N.Y.2d 776, 406 N YS.2d 30, 377 N.E.2d 474 (1978), a customer requested the bank 
to issue a cashier's check payable to his order and, upon issuance, endorsed the 
check and delivered it to a third party. Thereafter, the customer sought to stop 
payment on the check which was refused. The New York appellate court held that a cashier's 
check was not an item payable for a customer's account and therefore the bank 
was under no legal obligation to honor the customer's order to stop 
payment.

[¶12.]  In Matter of Kimball, Bkrtcy., 16 B.R. 201, 203 (1981), it was stated:

"Considering the nature 
of a cashier's check, this Court is satisfied that there is no legally 
significant difference between currency and a cashier's check, therefore, it 
represents payment when delivered. While at first blush it may appear that the 
purchaser may stop payment by directing the issuing bank not to honor the 
cashier's check, just as the maker may stop payment on an ordinary check, this 
is not the case at all. On the contrary, it is established that under Fla. Stat. 
§§ 673.3-413, 673.3-410, 674.4-303 (UCC §§ 3-413, 4-303), a cashier's check is 
accepted by the very act of issuance. It becomes a primary obligation of the 
issuing bank rather than the purchaser, and represents an absolute, irrevocable 
promise of the bank to honor same when presented for collection. Neither the 
bank nor the purchaser have any authority to countermand the cashier's check 
after issuance. [Citations.]"

See also, Able 
& Associates, Inc. v. Orchard Hill Farms of Illinois, 77 Ill. App.3d 375, 32 
Ill.Dec. 757, 395 N.E.2d 1138 (1979); Bruno v. Collective Federal Savings and 
Loan Association, 147 N.J. Super. 115, 370 A.2d 874 (1977); Yukon National Bank 
v. Modern Builders Supply, Inc., Okla.App., 686 P.2d 307 
(1984).

[¶13.]  This case is distinguishable from that of 
Santos v. First 
National Bank, 186 N.J. Super. 52, 451 A.2d 401 (1982), upon which appellant 
relies. In that case, the purchaser was also the payee of the cashier's check. 
Consequently, although as the purchaser, he might well be foreclosed from 
stopping payment or attempting to recover the amount paid for the cashier's 
check, as the payee named in the check he did have an ownership interest which 
he endeavored to assert on the basis that the original instrument had been lost. 
Factually that case is quite different from this one. Even so, appellant relies 
upon that case as justification for asking this court to fashion an equitable 
remedy.

[¶14.]  Appellant also seeks equity in asking 
that "the bank not be unjustly enriched by the use of appellant's funds during 
the running of the statute of limitations." The basis of unjust enrichment is 
that one has funds belonging to another which equity and good conscience demand 
ought to be paid to the other. Restatement, Restitution § 1 (1937, 1962 
Reprint); Cohon v. Oscar L. Paris Company, 17 Ill. App.2d 21, 149 N.E.2d 472 
(1958).

[¶15.]  Again, we agree with this general 
principle, but fail to see its applicability here. As shown earlier, appellant 
has no superior interest to the money since appellee is now obligated to pay the 
money when the check is presented by the payee or a holder in due course. A 
somewhat similar argument was presented in First National Bank of Cody v. Fay, 
Wyo., 80 Wyo. 245, 341 P.2d 79 (1959). We rejected the argument and 
stated:

"The premise of 
appellant's claim that defendants will be unjustly enriched if permitted to 
retain the money assumes that whenever money has been received the recipient is 
not entitled to retain it unless he is able to affirmatively prove his right to 
do so. This is entirely unsound and its unwisdom becomes apparent if the same 
idea is expressed in a somewhat different fashion. For instance, it would mean 
that whenever a person receives money, he must thereafter be prepared to assume 
the burden of proving that he should not be legally or equitably called upon to 
repay it. Envisioning the impossible situations which would arise under such a 
rule, would cause us to discard any such rash philosophy. That is simply not the 
law. * *" Id., 
341 P.2d  at 83-84.

[¶16.]  Furthermore, although the bank may be 
technically enriched during the time it holds the money prior to presentment of 
the check, appellant has failed to show that such enrichment is unjust. It is 
the normal course of business for a bank to hold funds until a check is 
presented for payment.

[¶17.]  Having found no reversible error, the 
summary judgment granted by the trial court is affirmed in all 
respects.

[¶18.]  Affirmed.