Nationwide Homes of Raleigh, N. C., Inc. v. First-Citizens Bank & Trust Co., FIRST-CITIZENS

• Decision Date: 16 June 1966
• Docket Number: FIRST-CITIZENS,No. 519,519
• Citation: 148 S.E.2d 693,267 N.C. 528
• Court: North Carolina Supreme Court
• Parties: NATIONWIDE HOMES OF RALEIGH, N.C., INC. v.BANK & TRUST COMPANY, and Eloise M. Currin, Administratrix ofthe Estate of S. T. Currin, Jr., Deceased.

Page 693

148 S.E.2d 693

267 N.C. 528

NATIONWIDE HOMES OF RALEIGH, N.C., INC. v. FIRST-CITIZENS BANK & TRUST COMPANY, and Eloise M. Currin Administratrix ofthe Estate of S. T. Currin, Jr., Deceased.

No. 519.

Supreme Court of North Carolina.

June 16, 1966.

Mordecai, Mills & Parker, Raleigh, for defendant appellant.

Yarborough, Blanchard, Tucker & Yarborough, Raleigh, for plaintiff appellee.

LAKE, Justice.

The principal contention of the Bank is that the plaintiff, on or about 28 December 1961, at which time its regional manager discovered the existence of the bank account and the checks paid prior to that time, did not notify the Bank that the checks were forgeries but merely notified the Bank that the account was unauthorized and the signature of Coleman upon the signature card was a forgery. It contends that, though the plaintiff received the bank statement for December on or before 10 January 1962, and, therefore, on that date had possession of all cancelled checks, the plaintiff did not make demand upon the Bank for re-crediting to his account the amount of such checks, less the credit above mentioned, until 29 March 1962, at which time the plaintiff delivered to the Bank an itemized list of the checks paid by the Bank and charged to the account, together with a statement of the credits acknowledged by the plaintiff to be due the Bank. For this reason the Bank contends that the plaintiff is barred from any right of recovery by G.S. § 53--52, which reads as follows:

'Forged check, payment of.--No bank shall be liable to a depositor for payment by it of a forged check or other order to pay money unless within sixty days after the receipt of such voucher by the depositor he shall notify the bank that such check or order so paid is forged.'

When funds were deposited in the defendant Bank for credit to an account opened, and later carried on its books, in the name of the plaintiff, a relation of debtor and creditor between the Bank and the plaintiff was thereby created. The Bank has the burden of proving that it paid the debt when it relies upon payment as a defense to an action for the collection of it. Nothing else appearing, it is not sufficient for the Bank to show simply that it made a debit entry upon the account. It must show that it had authority from the creditor to make such entry or that the creditor is estopped or otherwise barred from asserting the Bank's lack of authority for the making of such entry. Schwabenton v. Security National Bank of Greensboro, 251 N.C. 655, 111 S.E.2d 856.

Here, it is admitted in the answer that 'the sum of $13,956.45 was deposited in the defendant Bank in an account in the name of Nationwide Homes of Raleigh, N.C., Inc.' Upon the former appeal in this action, Nationwide Homes of Raleigh, N.C., Inc. v. First-Citizens Bank & Trust Co., 262 N.C. 79, 136 S.E.2d 202, Rodman, J., speaking for the Court, said:

'The admission that funds were deposited with defendant in plaintiff's name placed the burden on it to show payment of the debt so created. * * * Here the stipulation that Currin forged the checks negates express authority to draw on the bank account; * * * The mere fact that an agent makes deposits to the credit of his principal is not of itself sufficient to imply authority to draw checks on the account. * * * The burden was on defendant to show plaintiff's recognition of Currin's authority to write checks.'

The trial judge found as a fact that all disbursements charged to this account were 'by checks signed by Currin, which checks were unauthorized by and unknown to the plaintiff or to the parent corporation.' He also found as facts that throughout the existence of this account the Bank was not aware 'of any business of the said Currin or of the extent of Currin's practices, was unaware of any business of the plaintiff corporation, and made no effort to acquaint itself with either,' and 'that the defendant Bank had no notice of Currin's having described himself as general manager of plaintiff's local office.' These findings of fact are supportted by evidence in the record. Furthermore, the record does not disclose any exception by the defendant to any of them. For both of these reasons, the findings have the same effect as a verdict of a jury and are conclusive upon appeal. City of Goldsboro v. Atlantic Coast Line R.R., 246 N.C. 101, 97 S.E.2d 486; St. George v. Hanson, 239 N.C. 259, 78 S.E.2d 885; Town of Burnsville v. Boone, 231 N.C. 577, 58 S.E.2d 351; Buchanan v. Clark, 164 N.C. 56, 80 S.E. 424.

The parties stipulated 'that all checks drawn on the subject account are forgeries committed by S. T. Currin, Jr. and are not checks or drafts by the plaintiff.'

It being thus clearly established that the relation of debtor and creditor existed, and that the payments by the Bank were upon checks drawn by Currin with neither express, implied nor apparent authority, such payments are not a defense to the claim of the plaintiff unless they are made so by G.S. § 53--52.

In Moore v. Humphrey, 247 N.C. 423, 101 S.E.2d 460, Bobbitt, J., speaking for the Court, said:

'Where facts are stipulated, they are deemed established as fully as if determined by the verdict of a jury. * * * A stipulation is a judicial admission. As such, 'It is binding in every sense, preventing the party who makes it from introducing evidence to dispute it, and relieving the opponent from the necessity of producing evidence to establish the admitted fact.' Stansbury, North Carolina Evidence, sec. 166.'

We need not consider in the present case the interesting question of whether the court is bound by a conclusion of law incorporated into a stipulation of the parties, where the record contains findings of fact, supported by evidence, casting doubt upon the correctness of such conclusion. Nor do we need, in this instance, to determine whether a check signed in the name of the depositor by one who claims to be an agent, but who has no authority to draw such...