Twin City Bank v. Isaacs

Facts

On May 13, 1979, the Isaacs discovered their checkbook was missing and reported the loss to Twin City promptly the following day, Monday, May 14, 1979. The Isaacs later learned two forged checks totaling $2,050 had been written on their accounts and honored by the bank on May 11 and 12. Twin City froze the Isaacs’ checking account which had contained approximately $2,500 before the forgeries occurred. A few of the stolen checks cleared on Monday, May 14, before a hold order was issued which left the balance at approximately $2,000. The hold on the account was initially attributed to the fact that Mr. Isaacs had previously been convicted of burglary and Twin City’s suspicion that he was somehow connected to the check fraud. On May 30, the police informed Twin City that a suspect had been arrested and there was no connection to the Isaacs. Two weeks later, the police notified Twin City again that there was nothing to connect the Isaacs to the fraud. In mid-June 1979, the Isaacs filed suit against Twin City for wrongful dishonor of their checks and wrongful withholding of their funds. Twin City withheld $2,000 from the Isaacs for four years. The jury awarded the Isaacs $18,500 in compensatory damages for mental anguish, for loss of credit, and loss of the bargain on a house, as well as $45,000 in punitive damages.