Court Opinion

ID: 9583067
Source: CourtListenerOpinion
Date Created: 2023-08-21 22:34:34.382503+00
Date Added: 2024-06-11T13:37:09.918586
License: Public Domain

White, J.,
concurring.
Nebraska Security Bank, like all banks in this state, maintains a debtor-creditor relationship with its depositors. A bank’s contract with its depositor drawer is to pay all items that are “properly payable.” Neb. U.C.C. § 4-401 (Reissue 1980). Upon breach of this obligation a bank’s liability runs to its customer. Neb. U.C.C. § 4-402 (Reissue 1980).
A bank has no obligation to a payee or other holder unless the bank “signs” the check, either by acceptance or certification. Neb. U.C.C. § 3-401(1) (Reissue 1980) (“No person is liable on an instrument unless his signature appears thereon”). Absent special circumstances not present in this case, a check is not an assignment to the payee of the debt owed by the bank. Neb. U.C.C. § 3-409 (Reissue 1980). Atlantic Cement Co. v. South Shore Bank, 730 F.2d 831 (1st Cir. 1984). This is so even if the depositor and payee arrange by contract to have the check operate as an assignment, if the bank has no *599knowledge of the agreement. Even with such knowledge, a bank’s duties to a third party are derived only from its duties to the depositor, and any claim a third party might have against the bank is subject to the bank’s claims against the depositor. People’s Nat. Bank v. Swift, 134 Tenn. 175, 183 S.W. 725 (1915).
In this case Nebraska Security Bank never accepted or certified the check held by Stauffer Seeds. After Heinrichs deposited $29,766.65 in his account on January 7, 1983, Nebraska Security properly exercised its right of setoff. At no point in the transactions did a duty on the bank’s part arise to Stauffer Seeds, the payee of the dishonored check. Nothing in the Uniform Commercial Code prevented the bank from then transferring its funds to the third-party lienholder.
Shanahan, J., joins in this concurrence.