Cengage Advantage Books: Business Law Today, The Essentials 10th Edition by Roger LeRoy Miller

تمرين 16

Cumis Mutual Insurance Society, Inc. v. Rosol
FACTS Mizek Rosol received an e-mail message from someone he did not know, offering a fee if he would receive checks, deposit them, and transfer the funds to others. He agreed and opened an account at Polish Slavic Federal Credit Union (PSFCU). He received and deposited a cashier's check for $9,800 issued by a credit union in Florida. Three days later, he deposited a check for $45,000 drawn on a Canadian bank. Within a week, PSFCU told him that payment on the first check had been stopped, but it did not disclose that the check was fraudulent. PSFCU issued a provisional credit for the amount of the Canadian check. After Rosol had transferred $36,240 to a party in Japan and $4,500 to a party in Great Britain, the Canadian check was dishonored. PSFCU demanded that Rosol repay the transferred funds. He refused. PSFCU filed a claim with its insurer, Cumis Mutual Insurance Society, Inc. Cumis paid the claim and filed a suit against Rosol to recover the amount. The court issued a summary judgment in Cumis's favor. Rosol appealed.
ISSUE Were the funds that Rosol deposited from the Canadian check provisional at the time he transferred them to the parties in Japan and Great Britain?
DECISION Yes. A state intermediate appellate court reversed the lower court's judgment and remanded the case because "there were genuine issues of material fact precluding summary judgment." If PSFCU reasonably led Rosol to believe that the Canadian check had been finally credited to his account, the credit union could not rely on UCC 4-201(a) to recover the transferred funds.
REASON The appellate court explained that UCC 4-201(a) governed the relationship between PSFCU and Rosol. Under that provision, a credit to the account of "the owner" of a check is provisional until the final settlement of the check. The credit to Rosol's account for the checks was thus provisional between the time of their deposit and the time of their dishonor. During that period, PSFCU had a "right of recoupment" for the funds that Rosol had transferred. But Rosol contended that he would not have transferred those funds if PSFCU had told him that the first check was fraudulent-not just that it had been stopped. The court reasoned that "the state of his knowledge" about the first check could bear on the question of whether Rosol had acted reasonably in relying on what he was told about the second check.
CRITICAL THINKING-Ethical Consideration In what ways was Rosol's apparent motive similar to the most common reason that ethical problems occur in business?