Crawford v. JP Morgan Chase Bank, NA

Summarized by J. Debbeler , Bricker Graydon LLP
14 years 9 months ago

Citation:

(6th Circuit, Dec 31,1969)

Tag(s):

6th Circuit

Ruling:

Sixth Circuit affirmed district court's dismissal of the plaintiff's complaint under FRCP 12(b)(6) which asserted claims for breach of contract and promissory estoppel relating to Bank One nka Chase's stop payment on a cashier's check due to an involuntary bankruptcy filing by the entity which owned the account against which the cashier's check was drawn and upon which an earlier check had been drawn.

Procedural context:

Action originally brought in Oakland County (Michigan) Circuit Court almost 6 years after incident occurred. Chase removed the case to federal court on diversity grounds. Plaintiff dismissed a claim under the Expedited Funds Availability Act (12 U.S.C. Sec. 4001) at oral argument in the district court due to statute of limitations issues.

Facts:

Entech Personal Systems, Inc. (Entech) issued a check to Betty Simspon nka Crawford for $200,000. Crawford took the check to Chase, upon whom it was drawn, and presented it for payment and received a cashier's check for $200,000. Between the time that Crawford received the cashier's check and the time she deposited the cashier's check in her bank Entch was subjected to an involuntary bankruptcy proceeding. Entch requested that Chase stop payment on the original check and the cashier's check. When Crawford's bank presented the cashier's check to Chase through the interbank system it was dishonored. Sixth Circuit affirmed district court which held that Crawford was not in possession of the original check, Chase had discharged its obligations on the original check, and claims on the cashier's check were barred on statuture of limitation grounds. On appeal,Crawford did not contest the district court's ruling on the cashier's check. The Sixth Circuit stated that Crawford exchanged the original check for the cashier's check which barred recovery and Crawford waited too long to challenge the dishonor of the cashier's check.

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