ROBERT J. TRIFFIN v. PNC BANK, N.A., et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-6589-04T26489-04T2

A-1949-05T2

ROBERT J. TRIFFIN,

Plaintiff-Appellant,

v.

PNC BANK, N.A. and

BANK OF AMERICA, successor in

interest to FLEET NATIONAL BANK,

Defendants-Respondents,

and

NADIR JESTER, FELIX DAVIS, CALVIN

DOUGLAS and DIANA ALOMAR,

Defendants.

_____________________________________

ROBERT J. TRIFFIN,

Plaintiff-Appellant,

v.

PNC BANK, N.A. and

BANK OF AMERICA, N.A.,

Defendants-Respondents,

and

BACK ON TRACK, P.C., KEVIN BIVINGS, JOY CREW,

STATE OF NEW JERSEY JUDICIARY, SHADEE

S. ISLAM, COSHEON BOWENS, a/k/a

COSHEONIA BOWENS, APRIL D. JACKSON

and DENISE G. PISTILLI,

Defendants.

______________________________________

 

Argued November 15, 2006 - Decided December 8, 2006

Before Judges Collester, Sabatino and Messano.

On appeal from the Superior Court of New Jersey, Law Division, Special Civil Part, DC-73-05, DC-246-05 (Camden County) and DC-5806-04, DC-6071-04 and DC-2125-05 (Gloucester County).

Robert J. Triffin, appellant, argued the cause pro se.

Gregg S. Sodini argued the cause for respondents (Sodini & Spina, attorneys; Mr. Sodini, on the brief).

PER CURIAM

These are back-to-back appeals, consolidated for the purpose of this opinion. Plaintiff, the assignee of numerous endorsed checks that were dishonored for payment by the defendant banks, seeks review of several orders entered for similar reasons by Special Civil Part judges in two counties. The orders in question dismissed plaintiff's claims against the banks for lack of standing. We reverse, and remand the cases for disposition on their merits.

Plaintiff Robert J. Triffin is in the business of purchasing at a discount, through assignment, large volumes of dishonored checks or other financial instruments that are cashed by various check-cashing companies. The checks typically are dishonored for payment after being presented to the drawee banks or to other institutions.

Upon obtaining the assignments, plaintiff routinely sues the drawee banks and other financial institutions on various legal theories. He regularly litigates those claims on a pro se basis in our courts, often raising issues that occasion appellate review.

In Docket No. A-6489-04T2, plaintiff appeals a June 28, 2005 order of the Special Civil Part in Camden County dismissing two consolidated actions filed by plaintiff in that court. In one case, DC-73-05, plaintiff sued PNC Bank, N.A. to recover on ten dishonored checks and on one check on which the defendant bank had issued a "stop payment" order. Concurrently, in DC-246-05, plaintiff sued Bank of America, N.A. on seven other dishonored checks. Defendants PNC Bank and Bank of America retained common counsel to defend these actions, who moved to dismiss them on a contention that plaintiff lacked standing to pursue recovery against the banks. The cases were then consolidated and, following oral argument, the Special Civil Part granted the motions to dismiss.

Similarly, in A-1949-05T2, plaintiff appeals from various orders issued by the Special Civil Part in Gloucester County rejecting his claims as the assignee of dishonored checks in several nearly-identical lawsuits. In particular, plaintiff brought suit against PNC Bank in DC-5806-04 and in DC-6071-04 to recover on numerous dishonored checks. He also filed a further claim against Bank of America in Gloucester County in DC-2125-05. On November 3, 2006, DC-2125-05 was consolidated with the other two Gloucester County cases and dismissed by the Special Civil Part on the same grounds. PNC Bank retained the same counsel that was defending its interests in the aforementioned litigation in Camden County. On July 14, 2005, the Special Civil Part granted summary judgment to PNC Bank in DC-5806-04 on the grounds that plaintiff lacked standing as an assignee to pursue claims he asserted against the bank. On that same date, the Special Civil Part also granted PNC Bank summary judgment in DC-6071-04, for the same reasons. Reconsideration of these orders was denied, and the present appeals ensued.

As a threshold matter, defendants argue that plaintiff's standing to litigate claims assigned to him by check-cashing enterprises licensed to do business in New Jersey is nullified by N.J.S.A. 17:15A-48(a)(5). That provision forbids a licensed check-cashing company to:

associat[e] with, or ha[ve] associated with, any person who has been convicted of an offense involving breach of trust, moral turpitude or fraudulent or dishonest dealing, or who has had a final judgment entered against him in a civil action upon grounds of fraud, misrepresentation or deceit[.]

[N.J.S.A. 17:15A-48(a)(5).]

There is no reported case law dealing with this statutory prohibition. Nor have we been supplied with any legislative history concerning its origins, purposes, or the intended meaning of the term "associate."

Defendants argue that plaintiff is barred, as a matter of public policy under N.J.S.A. 17:15A-34, from taking assignments of dishonored checks from licensed check-cashing enterprises because two judgments of civil fraud have been entered against him. In particular, in 1990 the Pennsylvania Court of Common Pleas entered such a civil fraud judgment against Robert J. Triffin, based upon checking transactions he had engaged in during the period of 1984-85. That Pennsylvania judgment was a primary reason why the Supreme Court of New Jersey has denied plaintiff, a law school graduate who has passed the bar examination, admission to the practice of law in our State on grounds of unsuitable character and fitness. See Application of Triffin, 151 N.J. 510, 514 (1997). Additionally, a civil judgment for fraud was separately entered in the Superior Court of New Jersey against plaintiff in Essex County in April 2004 after a jury trial in consolidated actions (ESX-L-1915-03 and ESX-L-10015-03) involving certain financial transactions. Although that New Jersey judgment is presently on appeal, defendant requests that we take judicial notice of the judgment pursuant to N.J.R.E. 201(b)(4) (allowing judicial notice to be taken of judicial records). Defendant argues that the Pennsylvania and New Jersey civil fraud judgments invalidate any attempt by New Jersey check-cashing licensees to "affiliate" with plaintiff by entering into assignment agreements with him. Although this argument, if it were decided in favor of defendants, would dispose not only of this appeal but presumably all other litigation in which plaintiff Triffin has obtained assignments from New Jersey check-cashing enterprises, we decline to rule upon that issue because it was not decided in either the Camden County or Gloucester County cases before us. See Dubois v. Delarm, 243 N.J. Super. 175, 180 (App. Div. 1990). We are aware that an unpublished decision of our court construed N.J.S.A. 17:15A-34 in a manner unfavorable to the defendant bank in that case, which plaintiff argues is now binding upon Bank of America because it is an alleged successor to that bank. See R. 1:36-3 (allowing unpublished opinions to be relied upon for purposes of collateral estoppel and res judicata). See also Eherenstorfer v. Div. of Public Welfare, 196 N.J. Super. 405, 411 (App. Div. 1984).

Nonetheless, we decline to enter this thicket because the issue of plaintiff's alleged ineligibility to sue under Title 17 simply was not decided by either of the trial judges in the matters before us, thus depriving us of the benefit of their considered reasoning and analysis. We do note in passing that there is considerable uncertainty about the breadth of the term "affiliate" in the cited statute, as well as uncertainty as to whether the Commissioner of Banking and Insurance should, as a matter of regulatory oversight, assess in the first instance the applicability and enforceability of the statute against its licensees and, derivatively, against plaintiff. The issue may be addressed by the trial courts on remand.

Turning to the merits, both appeals before us involve, as one of plaintiff's grounds for relief, the so called "midnight deadline" rule in Article 4 of the Uniform Commercial Code, codified in New Jersey at N.J.S.A. 12A-4-104 and N.J.S.A. 12A:4-301. Those provisions impose a statutory obligation upon payor banks to pay, return or dishonor a presented item by midnight of the banking day on which the item was received. The payor bank is presumptively accountable for the funds drawn on the check, "whether properly payable or not," if it fails to pay or return it before the midnight deadline. Ibid. With the exception of the one check in the Camden County case involving a "stop payment" order, the remainder of the dishonored checks in this matter raise claims of potential non-compliance with the midnight-deadline rule.

In dismissing plaintiff's complaints for lack of standing, both the Camden County judge and the Gloucester County judge relied upon Bridge View Bank, supra, 330 N.J.Super. 473 (App. Div. 2000). As in the cases before us, plaintiff in Bridge View Bank had been assigned a forged check that had been untimely dishonored by the defendant bank, allegedly in violation of the midnight deadline rule. Plaintiff took the assignment knowing that the check already had been paid in full to a customer by the assignor check-cashing company and thereafter had been dishonored approximately a month after it had been presented to the payor bank. Id. at 475. Relying principally upon a federal district court opinion in American Title Ins. Co. v. Burke & Hubert Bank & Trust Co., 813 F. Supp. 423 (E.D. Va. 1993), aff'd o.b. 25 F.3d 1038 (4th Cir. 1994), the two-judge panel in Bridge View Bank held that plaintiff, who had purchased the instrument with notice of its prior dishonor, had no basis to rely upon an expectation of payment and thus had "no vested interest in the timely payment or return of [the] check[.]" Id. at 478, citing American Title Ins. Co., supra, 813 F. Supp. at 428-29. Accordingly, Bridge View Bank affirmed the dismissal of plaintiff's claims under the midnight-deadline rule for lack of standing.

In a subsequent opinion, another panel of our court in Triffin v. Somerset Valley Bank, supra, 343 N.J. Super. 73 (App. Div. 2001), took note of Bridge View Bank in dicta. That case was not factually similar because it involved claims asserted by plaintiff against the drawer of a payroll check rather than against a payor bank. After summarizing the holding in Bridge View Bank, the panel held that it was inapplicable to the factual circumstances before it, because Bridge View Bank was "decided on narrow grounds; restricted to the issue of standing to sue a payor bank." Id. at 82.

More recently, the majority of another panel of our court has reached a different conclusion on plaintiff's standing as an assignee to bring claims under the midnight-deadline rule. In Triffin v. Mellon PSFS, supra, 372 N.J. Super. 3 (App. Div. 2004), the majority reasoned that the midnight-deadline rule was "designed to contribute to the goal of having checks act, as closely as feasible, like cash." Id. at 9. The rule "deters banks from simply holding a check and using a drawer's money as long as possible, by imposing liability for a delay in processing regardless of whether the check was properly payable[.]" Ibid. (citations omitted). Based upon that rationale, the Mellon PSFS majority held that "[t]he full assignability of such claims . . . is more likely to secure compliance with the deadline, since it would provide, for example, a single injured party, through the assignment to a person or entity in the business of suing on such checks, a remedy in instances, as here, where it might otherwise not be worthwhile to sue on a small check or checks." Id. at 9-10. The majority in Mellon PSFS thus expressly noted disagreement with the standing analysis of the panel in Bridge View Bank. Id. at 11. Nonetheless, the panel in Mellon PSFS affirmed the trial court's order dismissing plaintiff's claims on factual grounds, specifically because of "the notable absence of any evidence which demonstrates, or supports a legitimate inference, that [the defendant bank] did not comply with [the midnight-deadline rule]." Id. at 12. A third judge on the Mellon PSFS panel concurred with the result, observing that the majority's disagreement with Bridge View Bank was mere dictum. Id. at 12-13. That concurring judge had been a member of the per curiam panel that had decided Bridge View Bank.

Although the issue is surely one that is not free from doubt, we are more persuaded by the Mellon PSFS majority's interpretation of Article 4 of the Uniform Commercial Code than the analysis set forth in Bridge View Bank. We are particularly swayed by the notion that the free assignability of claims under the midnight-deadline rule advances the strict liability principles and policies underlying that rule, especially because of the modest sums that may be at stake in individual checks. It simply may not be worth the time and trouble for check-cashing enterprises to enforce their rights against payor banks on a check-by-check basis, and the assignment process enables those claims to be pursued more efficiently and in a manner that may discourage future violations.

We reach our own conclusion with due respect for our colleagues in Bridge View Bank, and also mindful that the Supreme Court has not to date granted certification to settle this question of law. Nor have Bridge View Bank or Mellon PSFS subsequently been relied upon by any courts outside of New Jersey. Hence, we register our own views on the matter, keenly aware that this panel does not retain the last word on the subject. See David v. Gov't Emples Ins. Co., 360 N.J. Super. 127, 141-42 (App. Div.), certif. denied, 178 N.J. 251 (2003) (a panel of the Appellate Division is not required to follow decisions of other panels with which it disagrees).

For these reasons, we must reverse the dismissal orders below entered in reliance upon Bridge View Bank, and remand for further proceedings addressing the merits of plaintiff's contentions under the midnight-deadline rule on a check-by-check basis. We do not retain jurisdiction.

 

See, e.g., Triffin v. Amer. Int'l Group, Inc., 372 N.J. Super. 517 (App. Div. 2004); Triffin v. Mellon PSFS, 372 N.J. Super. 3 (App. Div. 2004) ("Mellon I") reconsideration denied at 372 N.J. Super. 221 (App. Div. 2004) ("Mellon II"); Triffin v. Pomerantz Staffing Services, LLC, 370 N.J. Super. 301 (App. Div. 2004); Triffin v. Travelers Express Co., 370 N.J. Super. 399 (App. Div. 2004); Triffin v. Ameriplay, LLC, 368 N.J. Super. 587 (App. Div. 2004); Triffin v. Johnston, 359 N.J. Super. 543 (App. Div. 2003); Triffin v. Quality Urban Housing Partners, 352 N.J. Super. 538 (App. Div. 2002); Triffin v. Somerset Valley Bank, 343 N.J. Super. 73 (App. Div. 2001); Triffin v. Bridge View Bank, 330 N.J. Super. 473 (App. Div. 2000) ("Bridge View Bank"); Triffin v. First Union Bank, N.A., 319 N.J. Super. 72 (App. Div. 1999), certif. denied, 174 N.J. 42 (2003); Triffin v. Cigna Ins. Co., 297 N.J. Super. 199 (App. Div. 1997). Plaintiff's claims as an assignee are also the subject of numerous unreported decisions, none of which we discuss here. R. 1:36-3.

We were advised at oral argument that the potential applicability of the statute has been referred to the Commissioner, but no formal action has been taken by the Commissioner to date. We also note plaintiff's argument that he has a property-based constitutional right to pursue claims against the defendants as the assignee of the check-cashing companies. See note 3, infra. His assertions in that regard arguably call into question the validity of N.J.S.A. 17:15A-48(a)(5), if it were applied in the manner sought by defendants, thus requiring notice to the Attorney General. See R. 2:5-1(b); R. 4:28-4(a)(1). No such notice has been afforded to the Attorney General, and we have thus been deprived of his arguments as to the scope and enforceability of the statute. This supplies yet another reason for leaving this issue for a later day. We are providing this opinion to the Commissioner and the Attorney General for their information and for any action they may deem appropriate.

Our disposition makes it unnecessary for us to reach plaintiff's separate contention that he has standing under a federal regulation, 12 C.F.R. 229.34(d), to recover from the defendant banks, whether or not he has standing to do under the Uniform Commercial code. See Mellon PSFS, supra, 372 N.J. Super. at 9n.1 (likewise declining to resolve the assignability of claims under that regulation, which states that a payor bank implicitly warrants to "the transferee returning bank, to any subsequent returning bank, to the depository bank and to the owner of the check" that a check has met the midnight-deadline rule).

We also decline, for sound jurisprudential reasons, to reach plaintiff's argument that Article I, paragraph 1 of the New Jersey Constitution guarantees the assignability of claims by check cashers against the payor banks because such claims are in the nature of property rights. See N.J. Div. of Youth & Family Services v. S.S., 187 N.J. 556, 564 (2006) (courts should not reach constitutional questions that are not "imperative to the disposition of litigation"), citing Randolph Town Ctr., L.P. v. County of Morris, 186 N.J. 78, 80 (2006).

Lastly, we express no views about the viability of plaintiff's claims on the check (or checks) in the record involving "stop-payment" orders, as the record is not sufficiently developed on those incidental items, and our reversal of the lack-of-standing determinations by the Special Civil Part makes such analysis unnecessary.

(continued)

(continued)

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A-6489-04T2

December 8, 2006