Brief Fact Summary. Brian P. McIntyre, (Appellant), filed a complaint against Twin Oaks Savings Bank and Robert E. Harris, (Appellees), after Appellees erroneously paid out a check over Appellant’s valid stop payment order. Appellant alleged that Appellees coerced him into signing a $2,000 personal note payable to Twin Oaks Savings Bank and Appellees counter-claimed demanding payment on the overdue note. Appellant appeals the trial court ruling in favor of Appellees.
Synopsis of Rule of Law. A payor is subrogated to the rights of the payee or any other holder against the drawer on the item or under the transaction out of which the item arose.
Issue. Whether Appellees can become subrogated to the rights of another party to prevent unjust enrichment.
Held. Yes. Appellant was unjustly enriched and Appellees were properly subrogated to Sandra Bennett’s interest as the holder of Appellant’s check.
Discussion. Appellant was unjustly enriched because he cashed Sandra Bennett’s check for work that was not performed. Appellees are subrogated to Sandra Bennett’s rights as a payee. Sandra Bennett, as a payee of the instrument, obtained the right to pursue Appellant. Appellees as payors are subrogated to the rights of the payee or any other holder against the drawer on the item or under the transaction out of which the item arose. The bank was properly subrogated to Sandra Bennett’s interest as the holder of Appellant’s check.