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A state appeals court has reinstated a customer’s lawsuit against Chase Manhattan Bank for cashing forged checks that emptied his account while he was abroad. The customer, Abdul Matin, had saved $70,905 while working as a waiter in lower Manhattan, according to his attorneys. In March 1998, he returned to his native Bangladesh to help care for his ailing father, and he stayed longer than expected, nearly two years. On his return home to Brooklyn in December 1999, Matin said, he discovered that someone had forged his name on checks and been paid the entire amount of his account. Moreover, he said, the forger gave the bank a phony change of address form bearing his name, and his monthly statements were rerouted to an address in Queens. The claim about the misdirected statements were the basis of his successful appeal to the Appellate Division, 2nd Department, since the mixup would have made it impossible for him to meet a deadline for reporting the problem. When Matin asked for reimbursement, the bank refused on the ground that his request was too late under the law. He sued for breach of contract. A trial court judge granted a Chase motion for summary judgment based on its statement that it had sent the statements to Matin or made them available to him, and that he did not inform the bank of the forgery signatures until more than one year afterward. Under the Uniform Commercial Code (UCC), a bank is strictly liable for any item that it wrongly charges against a customer’s account, the appellate court noted, citing UCC 4-401. But a customer who does not discover and report a forged signature within one year is precluded from asserting any claims against the bank based on the forgery (UCC 4-406[4]). If the bank had mailed the statements to Matin or a person designated by him, it would have fulfilled its responsibility under the Commercial Code, the appeals court said in an unsigned opinion. “However, the plaintiff alleged that the statements were not mailed to him or to a person to whom he directed because the bank sent the statements to the address on a forged change of address card,” the appellate court said. “The bank did not contest that the statements were sent to the address on the forged change of address card rather than his actual address.” The court found that these allegations raised a triable issue of fact. Therefore, it said, the motion for summary judgment should have been denied. The plaintiff’s appellate attorney, Ronald Cohen, said he had never handled a case like this before. “This situation occurred in a period prior to Sept. 11, when banks’ practice and regulations as to opening and closing accounts were less stringent than they are today,” he said. “I do not believe that a situation such as this, under the current measures that banks have taken, could occur again.” Banks now typically require a photo identification with proof of address to change a mailing address, he added. A corporate spokeswoman for Chase Manhattan said the bank declined to comment on the case or the bank’s policies. The 2nd Department panel consisted of Presiding Justice Nancy E. Smith and Justices Gabriel M. Krausman, Stephen G. Crane and Robert A. Spolzino. Joseph Cohen, of the Law Office of Howard B. Weber, represented the plaintiff in the trial court. Nicole C. Johnson, of JPMorgan Chase & Co.’s legal department, represented the bank.

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