Land Title & Trust Co. v. Northwestern National Bank

Citations

• 196 Pa. 230
• 46 A. 420
• 1900 Pa. LEXIS 508

Syllabus

<p>Banks and banking — Checks—Indorsement—Forgery.</p> <p>A bank is not liable for the payment of a check on a forged indorsement where the person who committed the forgery and received the money was in fact the person to whom the drawer delivered the check, and whom he believed to be the payee named.</p> <p>A person calling himself A. called on B.,a property owner, under the pretense of desiring to purchase real estate and secured from him his title-papers. A. took the papers to a responsible conveyancer to whom he applied for a loan on mortgage, representing himself as B. The conveyancer believing the man to beB. negotiated the loan and a settlement was made through a trust company to which the conveyancer introduced A. as B. A. signed the mortgage as B., and received the trust company’s check drawn on itself to the order of B. This check indorsed with B.5s name was deposited in a bank by a person who had opened an account with it as R., and was collected by the bank of the trust company in the usual course of business. It did not appear that A. and R. were the same person. The fraud was discovered six months later when B. was called upon to pay the interest on the mortgage. The money was drawn out of the bank by R. four weeks after it was deposited. A. andR. disappeared, and were not heard of afterwards. Held, that the trust company could not recover from the bank the amount of the cheek.</p> <p>Green, C. J., and Dean, J., dissented.</p>