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Mumma v. Rainier National Bank

April 22, 1991; As Modified May 9, 1991.

JAN E. MUMMA, APPELLANT,
v.
RAINIER NATIONAL BANK, RESPONDENT



Baker, J. Pekelis and Agid, JJ., concur.

Author: Baker

Jan Mumma appeals the trial court's granting of summary judgment to respondent Rainier National Bank and denial of summary judgment to herself, alleging the trial court erred in failing to rule that respondent wrongfully accepted a check for deposit. We affirm.

Factual and Procedural Background

Appellant Jan Mumma received a cashier's check from Mutual of Enumclaw representing a partial annuity withdrawal of $13,904.48. She then met with James H. Liddell, an investment adviser doing business under the corporate name JHL & Associates, Inc. Liddell agreed to invest Mumma's funds in Fidelity, a nationally traded mutual fund management company. At Liddell's direction, Mumma endorsed the check to "Fidelity/JHL & Associates". She alleges that she intended and expected that Fidelity as well as JHL & Associates would have to endorse the check.

Liddell deposited the check into the account of JHL & Associates, Inc. (JHL) at Rainier National Bank (Rainier)*fn1 without any endorsement from Fidelity, but with JHL's endorsement in the form of a stamp. Rainier National Bank presented the check to the drawee bank and was paid on it. Mumma has been unable to recover her money from JHL, which is now insolvent, or from Liddell, who is serving a jail sentence for fraud stemming from this incident and others like it. Mumma brought suit against Rainier for conversion, breach of warranty and negligence in handling the check. The trial court dismissed Mumma's claims on Rainier's cross motion for summary judgment. This appeal followed.

Discussion

The resolution of this case depends upon whether the slash or "virgule" symbol ("") used by Mumma in endorsing her check is interpreted to mean "and" or "or". Mumma contends the slash is ambiguous and therefore, under RCW 62A.3-116, her check was not payable in the

alternative. Rainier contends that the common meaning of the slash is "or", and thus the check was payable in the alternative either to Fidelity or JHL. This is an issue of first impression in Washington.

RCW 62A.3-116 provides:

An instrument payable to the order of two or more persons

(a) if in the alternative is payable to any one of them and may be negotiated, discharged or enforced by any of them who has possession of it;

(b) if not in the alternative is payable to all of them and may be negotiated, discharged or ...


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