First National Bank v. Guardian Trust & Savings Bank

Citations

• 117 Wash. 231
• 200 P. 1095
• 1921 Wash. LEXIS 1024

Syllabus

<p>Bank? and Banking (14) — Validity of Loan — Authority of Office® — Notice of Fbaud. Where the president and executive officer of one bank pursued a policy of discounting commercial paper and opening a credit account thereon with another bank, on the representation that they were bona fide loans to solvent borrowers which his bank could not handle, the transaction was not on its face so out of the ordinary course of business as to put the discounting bank on inquiry as to any fraudulent intent of such officer to appropriate the money to his personal use; and hence the discounting bank cannot be held liable to the other bank for the defalcation of the money by the latter’s president.</p>