Triffin v. Dillabough

716 A.2d 605 (1998)

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Nature of the Case

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Facts

American Express (D) sells money orders through its authorized agents. An agent collects an amount of cash from the purchaser, also known as the sender, equal to the face value of the money order plus a small fee. The sender receives a partially completed money order embossed with the amount of the money order and blank spaces for the sender to fill in his or her own name and address, the name of the payee and the date. Three blank money orders were stolen from Chase Savings Bank. Another one hundred money orders disappeared while being shipped to I.W. Levin & Company. All contained the pre-printed signature of Louis Gerstner, then Chairman of American Express, but they were blank as to amount, sender, payee, and date.

Dillabough (D) presented two American Express money orders for payment at Chuckie Enterprises in Philadelphia. They were for $550.00 and $650.00 and listed D as the payee and a David W. (last name indecipherable) of 436 E. Allegheny Avenue as the sender. On February 25, 1991, Lynn (Lynn) presented one American Express money order at Chuckie's in the amount of $200.00, which listed himself as payee and Michael C. Pepe as the sender. Charles Giunta (Giunta), recognized D and Lynn from their previous visits to Chuckie's. Both provided photographic identification and properly endorsed their money orders. Giunta paid the face amounts less his standard 2 percent fee. The money orders traveled the regular bank collection routes and were presented for payment at the United Bank of Grand Junction, Colorado. They were returned to Chuckie's bearing the stamp 'REPORTED LOST OR STOLEN - DO NOT REDEPOSIT.' American Express refused to pay Chuckie's the face amounts of the money orders. Chuckie sold them to Triffin (P), a commercial discounter. P sued Ds (Dillabough, American Express, and Lynn) seeking payment. The trial court found that the money orders were not negotiable instruments and entered a verdict in favor of American Express. The Superior Court reversed the trial court and held that the money orders were negotiable instruments and P had the status of a holder in due course. American Express appealed.