300 Broadway Healthcare Ctr., L.L.C. v. Wachovia Bank, N.A.
425 N.J. Super. 33, 39 A.3d 248 (N.J. App. Div. 2012)
ZEK successfully persuaded the New Jersey Appellate Division to reverse the lower court’s ruling and grant summary judgment to its bank client. Plaintiff’s bookkeeper allegedly forged the name of an authorized signer on checks drawn on its account and deposited some of these checks to his own account with ZEK’s client. ZEK relied on the Uniform Commercial Code’s rule § 3-420(a) in that the drawer of checks may not bring a conversion action against the bank that accepts the forged checks for deposit. Plaintiff argued that it was not the drawer of the forged checks because the purported signature of the authorized signer was forged. In a case of first impression in New Jersey, ZEK convinced the Appellate Division to reject plaintiff’s argument, reverse the lower court and adopt the view of courts outside the state holding that the UCC precludes the maker of a check from bringing a conversion claim based on checks with a forged drawer’s signatures.