Triffin v. Ameripay, LLC

Nu Tribe Radio Networks, Inc. (NTRN) retained Ameripay, LLC (Ameripay) (defendant) to perform payroll services. Ameripay opened an account on NTRN’s behalf for all amounts required to be paid to NTRN’s employees. NTRN would wire all necessary funds to the account, and then Ameripay would issue the payroll checks from the account to NTRN’s employees. The only authorized signatories on the account were Ameripay’s two owners. On the bank’s signature card, the title of the account holder was designated as “Ameripay LLC Client Payroll N[T]RN.” The certificate of authority on file with the bank identified the account holder at the top of the document as “Ameripay LLC Client Payroll N[T]RN.” On the bottom of the document, the account holder was identified as “Ameripay, L.L.C.” On the face of the checks, NTRN’s name, address, and telephone number were listed on the top-left corner. The signature line on the checks did not contain any identifying information regarding the signatory’s status. Ameripay’s identity was not contained anywhere on the checks except in a faint watermark. Pursuant to this arrangement, Ameripay issued certain payroll checks on NTRN’s behalf, which were signed by one of Ameripay’s owners. However, NTRN did not wire the funds into the account to cover the check amounts, so Ameripay stopped payment. Consequently, the checks were dishonored when the employees went to cash them at A-1 Check Cashing Emporium, Inc. (A-1 Check Cashing). A-1 Check Cashing, a holder in due course, assigned the dishonored checks to Robert Triffin (plaintiff), and Triffin obtained holder-in-due-course status pursuant to Uniform Commercial Code (UCC) § 3-203(b). Triffin sued Ameripay for collection of the checks. The trial court found that the signature on the checks controlled and held Ameripay liable for the dishonored checks. Ameripay appealed and argued that it should not be held liable because Ameripay only signed the checks in a representative capacity for NTRN.