Khosroabadi v. TD Canada Trust Branch 241, 2016 ONCA 733

ENDORSEMENT

1In this action, the appellant claims damages of $35,518.95, being the amount of a cheque she alleges was negligently negotiated by the respondent bank. The cheque was issued by the appellant’s insurer and was made payable jointly to the appellant and to Consilium Property Management Inc.

2The appellant testified that she endorsed the cheque and presented it to the bank but a teller advised her that both payees had to endorse it and present it together. She subsequently gave the cheque to Consilium’s owner, Mr. Yeretsian. The appellant later learned that Mr. Yeretsian had negotiated the cheque on his own and had deposited the money into Consilium’s account at the bank.

3The appellant had agreed that the cheque would be made payable jointly to her and Consilium so she could obtain payment of insurance proceeds. The trial judge found this agreement to be part of a scheme entered into between her and Mr. Yeretsian to mislead the insurer as to who had done repair work on her home.

4In furtherance of this scheme, when the appellant discovered that Mr. Yeretsian had negotiated the cheque, she asked him for her portion of the funds. When Mr. Yeretsian did not cooperate, the appellant turned to the bank.

5The trial judge accepted the bank’s evidence that a cheque made payable to joint payees can be negotiated as long as it is signed by both payees and the monies are deposited into the account of the presenting payee. That is precisely what happened.

6Against this background, the trial judge found that even if the teller did give the appellant the advice she claims – evidence that the trial judge rejected – the bank did nothing wrong. He further found the bank had no duty to take any steps, including verifying the standing of Consilium, to protect the appellant from an agreement she made with Mr. Yeretsian.

7In the result, the bank was not in breach of any duty to the appellant and could not be held responsible for any damages she claims to have suffered. Both parties were able to fully present their evidence at trial. Against that background, it was the role of the trial judge to make findings, including credibility findings, on the evidence he heard. The trial judge’s findings were supported by the record. We see no error in his application of the law to the facts, as found.

8The appeal is therefore dismissed. We would award costs of the appeal to the bank in the amount of $2,500, inclusive of disbursements and HST.