19 Cal.2d 807, 18057, Bernhard v. Bank of America

Docket Nº18057
Citation19 Cal.2d 807, 122 P.2d 892
Opinion Judge[9] Traynor
Party NameBernhard v. Bank of America
Attorney[7] Joseph Brenner for Appellant. [8] Louis Ferrari, Edmund Nelson and G. L. Berrey for Respondent.
Case DateMarch 06, 1942
CourtUnited States State Supreme Court (California)

Page 807

19 Cal.2d 807

122 P.2d 892

HELEN BERNHARD, as Administratrix, etc., Appellant,

v.

BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION (a National Banking Association), Respondent.

L. A. No. 18057.

Supreme Court of California

March 6, 1942

In Bank.

Page 808

COUNSEL

Joseph Brenner for Appellant. Louis Ferrari, Edmund Nelson and G. L. Berrey for Respondent

OPINION

[122 P.2d 893] TRAYNOR, J.

In June, 1933, Mrs. Clara Sather, an elderly woman, made her home with Mr. and Mrs. Charles

Page 809

O. Cook in San Dimas, California. Because of her failing health, she authorized Mr. Cook and Dr. Joseph Zeiler to make drafts jointly against her commercial account in the Security First National Bank of Los Angeles. On August 24, 1933, Mr. Cook opened a commercial account at the First National Bank of San Dimas in the name of "Clara Sather by Charles O. Cook." No authorization for this account was ever given to the bank by Mrs. Sather. Thereafter, a number of checks drawn by Cook and Zeiler on Mrs. Sather's commercial account in Los Angeles were deposited in the San Dimas account and checks were drawn upon that account signed "Clara Sather by Charles O. Cook" to meet various expenses of Mrs. Sather.

On October 26, 1933, a teller from the Los Angeles Bank called on Mrs. Sather at her request to assist in transferring her money from the Los Angeles Bank to the San Dimas Bank. In the presence of this teller, the cashier of the San Dimas Bank, Mr. Cook, and her physician, Mrs. Sather signed by mark an authorization directing the Security First National Bank of Los Angeles to transfer the balance of her savings account in the amount of $4,155.68 to the First National Bank of San Dimas. She also signed an order for this amount on the Security First National Bank of San Dimas "for credit to the account of Mrs. Clara Sather." The order was credited by the San Dimas Bank to the account of "Clara Sather by Charles O. Cook." Cook withdrew the entire balance from that account and opened a new account in the same bank in the name of himself and his wife. He subsequently withdrew the funds from this last mentioned account and deposited them in a Los Angeles Bank in the names of himself and his wife.

Mrs. Sather died in November, 1933. Cook qualified as executor of the estate and proceeded with its administration. After a lapse of several years he filed an account at the instance of the probate court accompanied by his resignation. The account made no mention of the money transferred by Mrs. Sather to the San Dimas Bank; and Helen Bernhard, Beaulah Bernhard, Hester Burton, and Iva LeDoux, beneficiaries under Mrs. Sather's will, filed objections to the account for this reason. After a hearing on the objections the court settled the account, and as part of its order declared that

Page 810

the decedent during her lifetime had made a gift to Charles O. Cook of the amount of the deposit in question.

After Cook's discharge, Helen Bernhard was appointed administratrix with the will annexed. She instituted this action against defendant, the Bank of America, successor to the San Dimas Bank, seeking to recover the deposit on the ground that the bank was indebted to the estate for this amount because Mrs. Sather never authorized its withdrawal. In addition to a general denial, defendant pleaded two affirmative defenses: (1) that the money on deposit was paid out to Charles O. Cook with the consent of Mrs. Sather and (2) that this fact is res judicata by virtue of the finding of the probate court [122 P.2d 894] in the proceeding to settle Cook's account that Mrs. Sather made a gift of the money in question to Charles O. Cook and "owned no sums of money whatsoever" at the time of her death. Plaintiff demurred to both these defenses, and objected to the introduction in evidence of the record of the earlier proceeding to support the plea of res judicata. She also contended that the probate court had no jurisdiction to pass upon. Cook's ownership of the money because the executor resigned before the filing of the objections. This last contention was answered before judgment was entered, by the decision of this court in Waterland v. Superior Court, 15 Cal.2d 34 [98 P.2d 211], holding that the probate court has jurisdiction in such a situation. The trial court overruled the demurrers and objection to the evidence, and gave judgment for defendant on the ground that Cook's ownership of the money was conclusively established by the finding of the probate court. Plaintiff has appealed, denying that the doctrine of res judicata is applicable to the instant case or that there was a valid gift of the money to Cook by Mrs. Sather.

Plaintiff contends that the doctrine of res judicata does not apply because the defendant who is asserting the plea was not a party to the previous action nor in privity with a party to that action and because there is no mutuality of estoppel.

The doctrine of res judicata precludes parties or their privies from relitigating a cause of action that has been finally determined by a court of competent jurisdiction. Any issue necessarily decided in such litigation is conclusively determined as to the parties or their privies if it is involved in a subsequent lawsuit on a different cause of action. (See cases cited in 2 Freeman, Judgments (5th ed.) sec. 627; 2 Black,

Page 811

Judgments (2d ed.), sec. 504; 34 C.J. 742 et seq.; 15 Cal.Jur. 97.) The rule is based upon the sound public policy of limiting litigation by preventing a party who has had one fair trial on an issue from again drawing it into controversy. (See cases cited in 38 Yale L. J. 299; 2 Freeman, Judgments (5th ed.), sec. 626; 15 Cal.Jur. 98.) The doctrine also serves to protect persons from being twice vexed for the same cause. (Ibid) It must, however, conform to the mandate of due process of law that no person be...

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827 practice notes
  • 205 B.R. 939 (Bkrtcy.S.D.Cal. 1997), 96-01433, In re Simonis
    • United States
    • Federal Cases United States Bankruptcy Courts Ninth Circuit
    • March 19, 1997
    ...known as issue preclusion, but of California's rules for application of res judicata, or claims preclusion. Bernhard v. Bank of America, 19 Cal.2d 807, 813, 122 P.2d 892, 895 (Cal.1942) Page 944 ("In determining the validity of a plea of res judicata three questions are pertinent: Was ......
  • 267 F.Supp. 298 (D.Md. 1967), Civ. A. 11385, State of Maryland for Use of Gliedman v. Capital Airlines, Inc.
    • United States
    • Federal Cases United States District Courts 4th Circuit District of Maryland
    • April 3, 1967
    ...J. Traynor-- Civil Procedure: The Tempest Brews,' 53 Calif.L.Rev. 25 (1965); Bernhard v. Bank of America Nat'l Trust & Sav. Ass'n, 19 Cal.2d 807, 122 P.2d 892 (1942); United States v. United Air Lines, 216 F.Supp. 709, 725-729 (E.D.Wash., D.Nev.1962), aff'd as to the issue of mutuality ......
  • 411 F.2d 88 (3rd Cir. 1969), 14589, Provident Tradesmens Bank & Trust Co. v. Lumbermens Mut. Cas. Co.
    • United States
    • Federal Cases United States Courts of Appeals Court of Appeals for the Third Circuit
    • April 2, 1969
    ...seemingly remained intact. Justice Traynor, in the pioneer case of Bernhard v. Bank of America National Trust and Savings Association, 19 Cal.2d 807, 122 P.2d 892 (1942), opened the door to a frontal reconsideration of the requirement of mutuality. In a well-known passage 12 he pointed to t......
  • 481 F.2d 501 (D.C. Cir. 1973), 24658, Stebbins v. Keystone Ins. Co.
    • United States
    • Federal Cases United States Courts of Appeals Court of Appeals for the District of Columbia Circuit
    • June 5, 1973
    ...of Judgments supra § 68, comment o. [16] E. g., Lober v. Moore supra; Bernhard v. Bank of America Nat'l Trust & Sav. Ass'n, 19 Cal.2d 807, 122 P.2d 892 (1942) (per Traynor, J.); B. R. DeWitt, Inc. v. Hall, 19 N.Y.2d 141, 278 N.Y.S.2d 596, 225 N.E.2d 195 [17] Stebbins' additional claim t......
  • Request a trial to view additional results
823 cases
  • 205 B.R. 939 (Bkrtcy.S.D.Cal. 1997), 96-01433, In re Simonis
    • United States
    • Federal Cases United States Bankruptcy Courts Ninth Circuit
    • March 19, 1997
    ...known as issue preclusion, but of California's rules for application of res judicata, or claims preclusion. Bernhard v. Bank of America, 19 Cal.2d 807, 813, 122 P.2d 892, 895 (Cal.1942) Page 944 ("In determining the validity of a plea of res judicata three questions are pertinent: Was ......
  • 267 F.Supp. 298 (D.Md. 1967), Civ. A. 11385, State of Maryland for Use of Gliedman v. Capital Airlines, Inc.
    • United States
    • Federal Cases United States District Courts 4th Circuit District of Maryland
    • April 3, 1967
    ...J. Traynor-- Civil Procedure: The Tempest Brews,' 53 Calif.L.Rev. 25 (1965); Bernhard v. Bank of America Nat'l Trust & Sav. Ass'n, 19 Cal.2d 807, 122 P.2d 892 (1942); United States v. United Air Lines, 216 F.Supp. 709, 725-729 (E.D.Wash., D.Nev.1962), aff'd as to the issue of mutuality ......
  • 411 F.2d 88 (3rd Cir. 1969), 14589, Provident Tradesmens Bank & Trust Co. v. Lumbermens Mut. Cas. Co.
    • United States
    • Federal Cases United States Courts of Appeals Court of Appeals for the Third Circuit
    • April 2, 1969
    ...seemingly remained intact. Justice Traynor, in the pioneer case of Bernhard v. Bank of America National Trust and Savings Association, 19 Cal.2d 807, 122 P.2d 892 (1942), opened the door to a frontal reconsideration of the requirement of mutuality. In a well-known passage 12 he pointed to t......
  • 481 F.2d 501 (D.C. Cir. 1973), 24658, Stebbins v. Keystone Ins. Co.
    • United States
    • Federal Cases United States Courts of Appeals Court of Appeals for the District of Columbia Circuit
    • June 5, 1973
    ...of Judgments supra § 68, comment o. [16] E. g., Lober v. Moore supra; Bernhard v. Bank of America Nat'l Trust & Sav. Ass'n, 19 Cal.2d 807, 122 P.2d 892 (1942) (per Traynor, J.); B. R. DeWitt, Inc. v. Hall, 19 N.Y.2d 141, 278 N.Y.S.2d 596, 225 N.E.2d 195 [17] Stebbins' additional claim t......
  • Request a trial to view additional results
4 books & journal articles
  • Invalidating issue preclusion: rethinking preclusion in the patent context.
    • United States
    • University of Pennsylvania Law Review Vol. 165 Nbr. 3, February - February 2017
    • February 1, 2017
    ...and apply issue preclusion in cases where there is non-mutuality). (29) See, e.g., Bernhard v. Bank of Am. Nat'l Tr. & Sav. Ass'n, 122 P.2d 892, 895 (Cal. 1942) (Traynor, J.) (expressing bewilderment over the continued application of the mutuality or privity requirement for application ......
  • Collateral estoppel in attorney disciplinary proceedings: a Hobson's choice.
    • United States
    • Defense Counsel Journal Vol. 81 Nbr. 1, January - January 2014
    • January 1, 2014
    ...a plaintiff from relitigating the same issue by switching parties. Id. (citing Bernhard v. Bank of Am. Nat'l Trust & Sav. Ass'n, 122 P.2d 892, 895 (Cal. 1942)). (27) In re Owens, 532 N.E.2d at 251. (28) Taylor v. Sturgell, 553 U.S. 880, 892-893 (2008) (citing Richards v. Jefferson Cnty.......
  • Gazing into the crystal ball: reflections on the standards state judges should use to ascertain federal law.
    • United States
    • William and Mary Law Review Vol. 40 Nbr. 4, April 1999
    • April 1, 1999
    ...(citing and accepting Justice Roger Traynor's opinion for a unanimous court in Bernhard v. Bank of Am. Nat'l Trust & Say. Ass'n, 122 P.2d 892 (Cal. 1942), rejecting the doctrine of mutuality of estoppel); International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (citing Judge Learn......
  • NATIONAL INJUNCTIONS AND PRECLUSION.
    • United States
    • Michigan Law Review Nbr. 2019, October 2019
    • October 1, 2019
    ...standing, and injunctions, though they are beyond the scope of this project. (70.) Bernhard v. Bank of Am. Nat'l Tr. & Sav. Ass'n, 122 P.2d 892 (Cal. (71.) Id. at 895-96. In Bernhard, the California Supreme Court permitted Bank of America to use issue preclusion against an administrator......