Diaz V. Mfrs Hanover Case Summary

Words: 537
Pages: 3

In the case of Diaz v. Mfrs Hanover, the petitioner requires Manufacturers Hanover Trust Company to pay $37,000 or requires Al Newman to issue a new negotiable instrument to her for the same amount. In 1961 Manufacturers Trust Company merged with Central Hanover Bank & Trust Company (Hanover Trust) creating Manufacturers Hanover Trust Company. The bank became the main source of financing for check cashing stores. Al Newman is a licensed bail bondsman who was holding $37,000 on the behalf of a defendant in a criminal proceeding. On August 4, 1977, Newman delivered two certified checks to the petitioner, one for $12,000 and the other for $25,000 drawn to the respondents Manufacturers Hanover Trust Company. In the article in regards to this case, Rodell states that “the petitioner lost, misplaced, or was criminally relieved of the said certified checks and has to this date unable to locate them”. He also states that, “the petitioner notified the respondent, Newman, who in turn, requested that the respondent Manufacturers Hanover Trust Company stop payment. To this date, the checks …show more content…
The court stated in this case, that when a bank certifies a check, it accepts that check and has an obligation to pay the amount for which it is drawn. Therefore, when the defendant certified the original checks, the defendant assumed liability on the instruments. UCC Section: 3-804 states, “The court shall require security, in an amount fixed by the court not less than twice the amount allegedly unpaid on the instrument, indemnifying the defendant, his heirs, personal representatives, successors and assigns against loss..” Although it puts a burden on the petitioner to come up with the security, it appears that the court makes a reasonable request in order to secure their funds as long as the petitioner is allowed the funds once everything is cleared