Union National Bank v. Farmers & Mechanics National Bank

Citations

• 271 Pa. 107
• 16 A.L.R. 1120
• 114 A. 506
• 1921 Pa. LEXIS 463

Syllabus

<p>Banks and banking — Checks—Signature—Forgery—Burden of proof — Evidence—Liability over — Estoppel—Act of April 6, 1849, P. L. 4%4-</p> <p>1. A bank is still bound to know the signature of its depositors, and where cheeks are presented to it for payment, must exercise care and diligence in discovering-forgeries of the signatures, and in giving notice to former innocent holders; if it fails in either of these respects, and injury results to the former innocent holders, it cannot recover back the amount of the checks, notwithstanding the provisions of section 10 of the Act of April 5, 1849, P. L. 424.</p> <p>2. An opportunity to promptly proceed against a forger is a valuable right, the deprivation of which, by a failure to give notice promptly, conclusively determines that loss has resulted, unless it is shown that there is a fund on hand belonging to the forger, out of which reimbursement may be had.</p> <p>3. Under such circumstances, the burden of proof is upon the depositor bank to show that loss will not result, and this it cannot do by simply proving that the party sued had money belonging to an immediately preceding innocent party, from which it received the cheek; it must be shown that the money on hand is money of the forger.</p> <p>4. The burden of proof is always on the party against whom the decision of the tribunal would be given if no further competent evidence were introduced.</p> <p>5. Where one of several parties connected with a transaction is liable over to the others, if recovery is had against them, a plaintiff, who can sue any of them on the contract or liability, cannot recover against the one he chooses to sue, unless he could recover also against the one ultimately liable.</p> <p>6. Where a bank pays a series of forged checks without objection, in cashing later checks forged by the same party the same holder has a right to consider the fact that the signatures had been at least tacitly recognized by the bank as genuine, this being an except