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No. 128689
| Carson Fischer, PLC, |
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Timothy O. McMahon |
Plaintiff-Appellee, |
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vs (Appeal from Ct of Appeals)
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(Oakland - Nichols, R.) |
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Craig L. John |
| Michigan National Bank |
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| and Michigan National Corporation, |
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| Defendants-Appellants. |
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| ______________________________________ |
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Plaintiff-Appellee's Brief on Appeal>>
Plaintiff-Appellee's Supplemental Brief>>
Defendants-Appellants' Brief on Appeal>>
Background
Over a 10-year span, Chip Rasor, the office manager of Bloomfield Hills law firm Carson Fischer, PLC, embezzled approximately $5 million from the firm. This case concerns the proper allocation of that loss between Carson Fischer and its bank, defendant Michigan National Bank. As office manager, Rasor was entrusted with checks that were made payable to the bank; the checks were intended to pay Carson Fischer’s withholding tax liability. Rasor added his personal bank loan numbers to the checks before he presented them to the bank, which then credited Rasor’s personal loan accounts instead of Carson Fischer’s account. After the fraud came to light, Carson Fischer sued Rasor and obtained a $20 million judgment against him; he was also convicted of bank fraud and sent to prison. Carson Fischer also sued Michigan National, demanding that the bank credit Carson Fischer’s account in the amount of the embezzled funds. The bank argued that MCL 440.4406 and the parties’ account agreement required Carson Fischer to give the bank notice of any unauthorized signature on, or alteration of, its checks. At most, the bank argued, it was liable only for those losses suffered by Carson Fischer after it received notice of Rasor’s fraud. The trial court agreed and granted the bank’s motion for partial summary disposition. The trial court limited Michigan National’s liability to the funds that were embezzled on or after September 1, 2000. Carson Fischer appealed. The Court of Appeals reversed in an unpublished per curiam opinion, reasoning that there was no unauthorized signature or alteration in the case, and that the limitation on recovery under MCL 440.4406 did not apply to Carson Fischer’s claim against Michigan National. Michigan National appeals.
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