Tonelli v. Chase Manhattan Bank

This case concerns the duty and obligation of a drawee bank to disburse funds in its customer’s account only in accordance with the latter’s order, and requires us to determine whether a drawee bank is liable to its customer for the delivery of a cashier’s check to a thief in exchange for the customer’s certified check, lacking the payee’s indorsement. More precisely, the question presented may be posed as follows: Is the drawee bank absolved from liability because the cashier’s check is made payable to the same payee as the customer’s certified check for which it was exchanged?

Respondent…