Braunstein v Russo

[*1] Braunstein v Russo 2014 NY Slip Op 50362(U) Decided on February 28, 2014 Appellate Term, Second Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on February 28, 2014
SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS
PRESENT: : PESCE, P.J., ALIOTTA and SOLOMON, JJ
2012-2451 Q C.

Sandra Braunstein, Appellant,

against

Carol Russo, Respondent.

Appeal from a judgment of the Civil Court of the City of New York, Queens County (Barry A. Schwartz, J.), entered May 31, 2012. The judgment, after a nonjury trial, dismissed the action.

ORDERED that the judgment is reversed, without costs, and the matter is remitted to the Civil Court for the entry of judgment in favor of plaintiff in the principal sum of $5,000.

In this small claims action, plaintiff seeks to recover from defendant, her sister, the proceeds of a $5,000 check that had been drawn by their mother payable to defendant, which check was cashed after their mother's death in May 2008. The check had been drawn on a joint checking account which was in the name of plaintiff and her mother.

At a nonjury trial, defendant and her witness, a third sister, testified that their mother had drawn a separate $5,000 check to each of them, as gifts. Although the checks were written in March 2008, the third sister, who was initially in possession of both checks, had forgotten to give defendant's check to her until October 2008. Defendant testified that her check had been undated, and that she had asked the drawee bank if she could cash the check and was told that she could. She said that she had presented the check for payment in October 2008, received $5,000 in cash, and deposited that amount into her own bank account. Following the trial, the Civil Court dismissed the action.

The standard of review on an appeal of a small claims judgment is whether "substantial justice has . . . been done between the parties according to the rules and principles of substantive law" (CCA 1807). The decision of a fact-finding court should not be disturbed upon appeal unless it is obvious that the court's conclusions could not be reached under any fair interpretation of the evidence (see Claridge Gardens v Menotti, 160 AD2d 544 [1990]). This standard applies with greater force to judgments rendered in the Small Claims Part of the court (see Williams v Roper, 269 AD2d 125 [2000]).

"A check is a request of the customer to pay the whole or a portion of such indebtedness to the bearer, or to the order of the payee. Until presented and accepted, it is inchoate; it vests no title or interest, legal or equitable, in the payee to the fund" (Attorney-General of State of NY v Continental Life Ins. Co., 71 NY 325, 331 [1877]). A gift by check is complete only when the check has been paid during the lifetime of the maker. Where such a check is not paid prior to the drawer's death, "the gift is incomplete and no valid transfer of the fund is effectuated" (Matter of Grauds, 43 NYS2d 803, 817 [Sur Ct, NY County 1943]).

The check at issue here was drawn on a joint checking account which was in the name of [*2]plaintiff and her mother. Upon the death of one joint tenant, the surviving joint tenant is presumed to be entitled to any balance still on deposit in their joint names (see 9 NY Jur 2d, Banks and Financial Institutions § 249). Thus, in May 2008, when the parties' mother died, the money remaining in the checking account did not pass to the mother's estate but instead passed to plaintiff. While the record does not indicate whether the bank had knowledge of the mother's death (see UCC 4-405), the amount paid by the bank may be recovered from the holder of the check (see UCC 4-405, Comment 3). Since the money remaining in the checking account belonged to plaintiff after her mother's death, and since the check made payable to defendant was not paid by the bank during the lifetime of the mother, making the mother's gift to defendant incomplete, plaintiff was entitled to recover from defendant the sum of $5,000, which was the amount received by defendant upon cashing the check.

Accordingly, the judgment is reversed and the matter is remitted to the Civil Court for entry of judgment in favor of plaintiff in the principal sum of $5,000.

Pesce, P.J., Aliotta and Solomon, JJ., concur.
Decision Date: February 28, 2014