First Nat. Bank v. First Nat. Bank

• Decision Date: 01 April 1931
• Docket Number: No. 3583.,3583.
• Parties: FIRST NAT. BANK OF WICHITA FALLS v. FIRST NAT. BANK OF BORGER et al.
• Court: Texas Court of Appeals

37 S.W.2d 802

FIRST NAT. BANK OF WICHITA FALLS v. FIRST NAT. BANK OF BORGER et al.

No. 3583.

Court of Civil Appeals of Texas. Amarillo.

April 1, 1931.

Rehearing Denied April 15, 1931.

Appeal from District Court, Wichita County; P. A. Martin, Judge.

Action by the First National Bank of Wichita Falls against the First National Bank of Borger and others. Judgment for defendants, and plaintiff appeals.

Affirmed.

J. T. Montgomery and Kilgore & Rogers, all of Wichita Falls, for appellant.

Aynesworth & Aynesworth, of Stinnett, for appellees.

RANDOLPH, J.

The plaintiff, the First National Bank of Wichita Falls, instituted this suit in the district court of Wichita county, against the defendants First National Bank of Borger and the City National Bank of Wichita Falls, to recover of the said defendants money paid out by plaintiff upon a forged check, which payment was alleged to have been caused by the negligence of the defendants banks.

The case was tried by the court without a jury, and judgment was rendered that plaintiff take nothing by its suit.

The trial court filed its findings of fact and conclusions of law.

The pleadings and the evidence disclose substantially that all the parties are national banking corporations; that one W. P. Collins was a depositor in the plaintiff bank, having money on deposit subject to his check; that on the 15th of October, 1929, there was presented to the Borger bank, by a person giving the name of J. B. Schulz, a check purporting to be signed by said Collins, but which was, in fact, a forgery, for the sum of $2,250, said check being payable to H. L. Haynes or order and with the names "H. L. Haynes" and "J. B. Schulz" indorsed thereon. The Borger bank accepted the check for collection without requiring identification of said Schulz of any kind, and, without actually indorsing same in any manner, sent said check to the City National Bank of Wichita Falls as a cash item.

E. W. Wasson, assistant cashier and teller of the First National Bank of Borger, testified that he handled and accepted the check in controversy and took it for collection; that he gave J. B. Schulz credit for it with the understanding that he was not to get any money until the check was paid; that he had quite a conversation with Schulz as to his occupation and address; Schulz said he did not need any money then and would not want any until the check was paid; that he (Wasson) accepted the check himself on the 14th of October, 1929; that he had never known any person by the name of H. L. Haynes or J. B. Schulz; that the person presenting the check was not known to him or to any one else in the bank so far as he knew. That he did not know W. P. Collins, and neither did any one in the bank so far as he knew. Schulz was not introduced or identified before acceptance of the check, and no identification was required of him. The witness does not know whether the names J. B. Schulz and H. L. Haynes were assumed or not.

Wasson further testified that it was an oversight that the check was not indorsed by the First National Bank of Borger; that it is the custom for banks to indorse items of that kind sent to their corresponding banks for collection.

It appears that the Borger bank received the check on the 14th of October 1929; that one of the tellers paid to Schulz the sum of $500 on the 16th of October, 1929, and $1,750 on October 17, 1929, about 11 o'clock, a. m. Wasson gave Schulz credit on the books and he gave the bank two checks for the money. The two checks as named above were introduced in evidence. No investigation was made before the money was paid. No introduction or identification was required at that time. There was nothing in Schulz's actions to create suspicion. The check was deposited by Schulz for collection, because, as Wasson says, he did not know the maker of the check and did not know whether it was good or not. He testified: "I did not know the genuine signature of the purported maker of the check and I desired to have the First National Bank of Wichita Falls pass upon it before advancing any money. Yes, this is the custom of all banks to send the checks to the bank drawn upon either directly or indirectly for the purpose of having the genuineness of the signature of the maker passed upon."

There is no question before us but that the check purporting to be signed by W. P. Collins and drawn on the First National Bank of Wichita Falls was a forgery.

The forged check was sent by the Borger bank to its correspondent, the City National Bank of Wichita Falls, as a cash item, and was apparently received as such, but the officials of the Borger bank testified that the check was only accepted for collection, and that the sending of same as a cash item was an error.

It appears that, according to the custom of banks, when the City National Bank, as correspondent, received the check from the Borger bank, it supplied the indorsement of the Borger bank and turned the check in to the clearing house, where the First National Bank of Wichita Falls received it, and on the same day paid it off by charging it to the account of its customer, W. P. Collins. When the check reached the plaintiff, First National Bank, the officer receiving it called another official of that bank, and, on inspection of the check, the two, comparing it with the genuine signature of Collins which was on file in bank, decided it was the genuine signature of Collins, charged it to him, and remitted the money to the Borger bank.

The fact that the check was received by the Borger bank as a collection...