Boatsman v. Stockmen's National Bank

Citations

• 56 Colo. 495

Syllabus

<p>Forgery — Recovery of Money Paid Upon — The general rule is that the banker who pays money upon a forgery suffers the loss. He will not be permitted to charge the amount to the account of the depositor whose check the forgery purports to be. But where the depositor has negligently contributed to the deception a contrary rule applies.</p> <p>Murphy, a resident of Utah, owned certain lands situated near Morrill, Nebraska, the residence of Nichols, plaintiff’s intestate. Warren, assuming the name of Murphy, wrote Nichols offering the lands for sale, and after some correspondence by letter and telegram, bargained the same to him. Warren then wrote directing Nichols to send a deed to the defendant bank at Brush, Colorado, for execution, with a draft no pay for the land, requesting that the draft be made payable to bearer to avoid identification, and stating that the sale was a great sacrifice to him and must be consummated immediately. Nichols prepared a deed and sent it to Murphy at Brush, Colorado, which Warren received, executed it as Murphy, and presented it to the defendant bank for payment. The defendant bank communicated by telegram with the bank at Morrill, Nebraska, and received reply ordering payment for deed “if regular.” Upon this direction the defendant bank accepted the deed executed by Warren, in the name of Murphy, and paid the money to him. The forgery being discovered, Boatsman, as administrator of the estate of Nichols, brought action to charge the defendant bank with the amount paid upon the forgery. Held, that the negligence of Nichols in dealing in this manner with a stranger, arming him with letters and telegrams which might be exhibited as evidence of his identity, so increased the ordinary risk attending such transactions that the cause was taken out of the general rule; that the bank was justified, under the circumstances, in paying the money to the person presenting the deed duly acknowledged.</p> <p>Held further, that Nichols intended that