Moore v. First Nat. Bank

• Decision Date: 24 April 1924
• Docket Number: 6 Div. 103.
• Citation: 100 So. 349,211 Ala. 367
• Parties: MOORE ET AL. v. FIRST NAT. BANK OF BIRMINGHAM.
• Court: Alabama Supreme Court

100 So. 349

211 Ala. 367

MOORE ET AL. v. FIRST NAT. BANK OF BIRMINGHAM.

6 Div. 103.

Supreme Court of Alabama

April 24, 1924

Rehearing Denied May 29, 1924.

Appeal from Circuit Court, Jefferson County; Dan A. Green, Judge.

Action by Bessie Moore, as administratrix of the estate of T. L Moore, deceased, and another, against the First National Bank of Birmingham. Judgment for defendant, and plaintiffs appeal. Transferred from Court of Appeals under Acts 1911, p. 449, § 6. Affirmed.

Brenton K. Fisk, of Birmingham, for appellants.

Cabaniss Johnston, Cocke & Cabaniss, of Birmingham, for appellee.

GARDNER J.

This suit was originally instituted by T. L. Moore and his wife against the First National Bank, for the recovery of $480 due for money on deposit in said bank to their account. T. L Moore died before the trial of the cause, and it was revived in the name of Bessie Moore, as administratrix of his estate and proceeded to judgment with Bessie Moore, as administratrix, and Mrs. T. L. Moore, as parties plaintiff.

The litigation grew out of the indorsement by Mr. and Mrs. T. L. Moore of a certain draft drawn by one Olcott on the First National Bank of Richmond, Va., for the sum of $480. The Moores were depositors of the First National Bank of Birmingham, where Olcott presented the draft with their indorsements thereon, and received the full amount therefor.

The Moores insist there was a fraud practiced upon them by Olcott or a forgery committed in some manner, as they only indorsed the draft or intended to indorse the draft in the amount of $15. The bank insisted there was nothing upon the face of the instrument to arouse suspicion, and, as the signatures of the indorsers were genuine, it acted in good faith, and as a bona fide holder was entitled to protection.

The issues were submitted by the court to the jury for determination, resulting in a verdict in favor of the defendant, from which the plaintiff has prosecuted this appeal.

The salient facts are as follows: The Moores, residing in Birmingham, Ala., were keeping a rooming house, and during the early part of September, 1920, Olcott, a stranger, applied for and obtained room. He remained less than three weeks, stating to them that he was from New Orleans, and had merely stopped over and was on his way to Columbia, Tenn. Columbia, Tenn., was Mr. Moore's old home, and Olcott appeared to be acquainted with those Mr. Moore knew. Moore was 72 years of age and sick, and Olcott was near the same age. Olcott gained the confidence of the Moores, and some two or three days before the indorsement of the draft here in question he stated to the Moores that he wanted to send $10 through the mail to Richmond, but did not want to place a $10 bill in the letter for fear it might be stolen, and requested the Moores to give him a check for said amount in exchange for the $10; this they did.

Thereafter, on September 18th, Olcott applied to the Moores for the indorsement of the draft in question, stating it was just $15, and that he wished to go home in answer to a telegram. Speaking of this transaction, Mrs. Moore said:

"And Mr. Moore came in and asked me-I was busy, and they came in off the porch-to sign that check [indicating said draft], and I signed the check for $15, and so did Mr. Moore. I am speaking of this draft that I indorsed on the back. *** I wrote my name on the back of the $15 draft. He brought it in, and he just handed it to us and of course we indorsed it; that is all I know about it."

This witness further stated that she and her husband read the draft, and looking at the indorsements thereon, that they were, in her opinion, their indorsements. On cross-examination, further referring to this same transaction, the witness said:

"When our indorsement was placed on it Mr. Olcott just handed the paper over to us; we all had it in our hands and turned it over and wrote our indorsement on it. *** I think Mr. Olcott left our home the same day we gave him the draft. *** This draft we indorsed for the purpose of enabling him to get money to leave town."

The cashier of the bank testified that he handled the transaction resulting in the payment of this draft of $480, that at the time the holder of the draft presented it to the bank to be cashed he also presented the check for $10, bearing the signature of Mr. and Mrs. Moore, and that the Moores carried an account at this bank in the name of Mr. and Mrs. T. L. Moore. This account was offered in evidence to show that the Moores had frequently drawn sums in amounts equally as large and larger than the amount of this draft. The cashier stated he first took steps to ascertain whether the signatures on the back of the draft and on the check were genuine by comparing them with the signature card, and, having satisfied himself that they were genuine, and there were sufficient funds on hand to their account, he paid the draft. The draft being forwarded to Richmond, was dishonored by the bank at that place and returned to the First National Bank of Birmingham, and the amount thereof charged back to the account of Mr. and Mrs. Moore. The original draft is forwarded to this court for inspection.

It is not contended there is anything in the face of the instrument to arouse the slightest suspicion. Upon the upper left-hand corner a small portion of the paper fiber appears to have been removed, and a still smaller portion from the lower right-hand corner.

It is the theory of counsel for appellant that Olcott perpetrated the fraud upon the Moores by pasting over this draft which may have already been filled out or may at the time have been a blank, another draft for the $15, and thus having the two drafts pasted together obtained the indorsements of the Moores on the back of the draft here in question. This is doubtless a very plausible theory.

It is suggested by counsel for appellee, however, that this draft may have been substituted for the $15 one by clever manipulation, or a blank draft may have been substituted for the $15 draft in like manner. As to how the fraud was perpetrated, however, was for the jury's determination.

We may assume for the purposes of this case that the Moores were deceived as contended by counsel for appellant; that is, this draft was doubtless prepared and the $15 draft pasted over it by a small amount of mucilage at each corner, as above indicated. Accepting appellants' surmise we still think the cause was properly left for the jury's determination.

It is insisted that, if the face of the draft here in question were covered over by the attached $15 draft, and the indorsements upon this particular instrument in this manner secured, when the $15 draft was detached therefrom this was such a material alteration of the instrument here involved as to relieve the indorsers of all liability, citing section 124 of the Negotiable Instrument Law (Gen. Acts 1909, p. 146).

We are not inclined to accept the view that the detachment of the $15 draft fastened to the draft here in question, in the manner heretofore indicated, at the corners thereof, was such a material alteration of the instrument involved in this litigation within the meaning of the Negotiable Instrument Law and the authorities generally. The term "alteration" in this country is understood to signify a material change in the contract by a party thereto. 2 Daniel on Negotiable Instruments, § 1373a, and in section 1375 author points out in what alterations consists-none of which do we think the case here presented is embraced. In the case cited in the note to Bothell v. Schweitzer, 22 L. R. A. (N. S.) 263, the detached paper formed a material...