Dixon, Laukitis, and Downing, P.C. v. Busey Bank

Dixon, Laukitis, and Downing, P.C. (DLD) (plaintiff) was a law firm that maintained an account at Busey Bank (bank) (defendant). On May 25, 2011, DLD deposited into its Busey account a $350,000 check drawn on a Canadian bank that it received from a client. Busey made the $350,000 available to DLD on a provisional basis pending final collection. In early June, DLD transferred a total of $270,000 from its Busey account to the client who provided the $350,000 check. However, on June 10, the Canadian bank returned the check as an uncollectible counterfeit. That same day, Busey notified DLD and charged $350,000 back to DLD’s account. DLD then sued Busey for negligence, alleging that Busey failed to exercise ordinary care in processing the check. Specifically, DLD contended that Busey should have inquired about how DLD obtained the check, recognized the check as a counterfeit, and warned DLD not to spend the check proceeds until Busey received final payment. Busey moved to dismiss DLD’s complaint, citing its agreement with DLD, which provided that DLD would be responsible for any account shortages and that Busey would provide only provisional account credit for checks until Busey received final payment. Busey also submitted an affidavit from a Busey executive, who averred that there was nothing suspicious about the check and that the check complied with the Uniform Commercial Code (UCC). The trial court granted Busey’s motion to dismiss, ruling that (1) Busey did not owe a common-law duty of care to DLD because the UCC provided a comprehensive remedy for check processing, under which DLD bore the risk of loss until final collection, and (2) the doctrine enunciated in Moorman Manufacturing Co. v. National Tank Co. barred DLD from recovering under a tort negligence theory for purely economic loss. DLD appealed.