Opinion
Hearing Granted by Supreme Court March 8, 1928.
Appeal from Superior Court, Los Angeles County; Walton J. Wood, Judge.
Action by Emile J. Couture and another, copartners doing business under the firm name and style of the Slingluff-Couture Company, against the Ocean Park Bank. From a judgment for plaintiffs, defendant appeals. Affirmed.
COUNSEL
Tanner, Odell & Taft, of Los Angeles, for appellant.
Weber & Crawford, of Santa Monica, for respondents.
OPINION
STEPHENS, Justice pro tem.
This action concerns the payment of two bank checks which, with indorsements and marginal data, are herein set out in hæ c verba:
"Ocean Park Bank. 90-193
"Commercial.
Savings.
"Santa Monica Branch
"Santa Monica, Cal., Sept. 2, 1922. No. 103. Pay to the order of Manual Arts Hdw. Co. for J. B. Tailer $283.02 two hundred eighty-three and 02/100 dollars.
"The Slingluff-Couture Co.
"Emile J. Couture.
"Plumbing material."
Indorsement on back of above check as follows:
"James B. Tailer, Manual Art. Hard. Co."
"Ocean Park Bank. 90-193
"Commercial.
Savings.
"Santa Monica Branch.
"Santa Monica, Cal., Sept. 25, 1922. No. 177. Pay to the order of Manual Arts Plumbing Co., for J. B. Tailer $318.00 three hundred eighteen and xx/100 dollars.
"The Slingluff-Couture Co.
"Emile J. Couture."
Check indorsed:
"Manual Arts Plumbing Co. J. B. Tailer."
Tailer indorsed the checks without authority from any one, presented them to the bank for payment, received the money, and has not accounted therefor. Plaintiffs brought this action to recover the principal named in the checks and recovered judgment. Defendant appeals. The testimony in the main is without conflict, and will be stated in our consideration of the points urged by appellant as grounds for reversal of the judgment. In the interests of brevity and continuity, we shall treat points 1 to 4, inclusive, without separating them.
Point No. 1: "The beneficiary mentioned in the checks received the money."
Point No. 2: "One of two beneficiaries mentioned in the checks received the money."
Point No. 3: "Plaintiffs were guilty of negligence and the defendant was not."
Point No. 4: "The agent of the plaintiff perpetrated a fraud on defendant and plaintiff is bound thereby and cannot recover."
The testimony is clear and without conflict that Tailer, at the time the checks were drawn and paid, was a foreman plumber in the employ of plaintiffs, the respondents herein, and had been in such employ for six or seven weeks prior thereto. He had purchased certain plumbing and hardware supplies from Manual Arts Plumbing Company, a corporation, for the use and upon the credit of the plaintiff company, which had drawn the two checks in payment therefor and delivered them to Tailer for delivery to the plumbing company. Instead of delivering the checks as directed, however, he indorsed them himself and identified himself to the bank’s satisfaction by material slips and lodge cards. He was paid the money and absconded. He had no interest in the checks nor the money they directed to be paid. He was, then, not a beneficiary in fact.
The case of Ridgley National Bank v. Patton & Hamilton, 109 Ill. 483, relied upon by appellant, is not in point. In that case a check was drawn payable to "Patton & Hamilton for account of Lewis Coleman & Co. or order." Had the bank paid Coleman proof might have been in order as to whether the proper person received the money, although the insertion of the words "or order" after "Coleman & Co." would seem to indicate that the latter were the real payees named in the check; and Patton & Hamilton, having received the check as attorneys for Coleman, in the absence of other facts, no action could have been successful against the bank by Patton & Hamilton, the payees, or by the payor. In the instant case, however, the checks were payable "to the order of" the Manual Arts companies, and the proof showed that the party who received the money, not being the payee, had no title in the money. However, the Ridgley Case does not parallel the instant case at all. The bank in the Ridgley Case applied the money on deposit to another use, and, the court determined, wrongly so; and the equitable interest which it stated Coleman had in the check or money was because of the proof in that case, which proof in the instant case is not only entirely lacking, but affirmatively determines the fact that Tailer had no equitable or other interest in the checks.
Tailer had cashed one or possibly two of plaintiffs’ checks at this bank before, but neither of the tellers who paid the checks No. 103 and No. 177 has testified that he recognized him because of that fact, and both required identification. This identification was of course at the bank’s peril, and the trial court had ample evidence to determine that the identification given by Tailer to the bank tellers was not from any negligence or fraudulent act of plaintiffs.
The court asked one of plaintiffs’ firm, "What was your purpose in designating a certain J. B. Tailer in these checks?" and defendant holds this to be error. We agree with counsel for defendant that any undisclosed purpose would not be effective in any manner against defendant. The answer that was elicited could not have been prejudicial to defendant-"The purpose of designating J. B. Tailer on these checks was to show the job on which the amount was to be charged." No doubt the court desired to know whether or not as a fact Tailer had any interest in the check. The answer explained this point, and it was further cleared by cross-examination.
Point No. 5-"the forgery of the indorsement of check No. 103 for $283.02 was not proven." This point is based upon the fact that check No. 103 was drawn to Manual Arts Hardware Company instead of Manual Arts Plumbing Company, as was check No. 177. Without quoting the evidence, suffice it to say that it is apparent that the word "Hardware" was used inadvertently instead of "Plumbing" in this connection. The trial court was well within its rightful discretion in making such a deduction.
The contention of appellant that there is no testimony from which the trial court or this court could find that check No. 103 was not indorsed by the payee is untenable. The following testimony was given by the secretary-treasurer of the Manual Arts Plumbing Company:
"Mr. Crawford [for respondents]: I will show you checks 103 and 177-the first one is for $283.02, the second one $318.00-and ask you if the indorsement ‘Manual Arts Plumbing Company,’ is on that check. *** A. The indorsement is there, but it was not indorsed by Manual Arts Plumbing Company. Q. Was that indorsement made under your direction? A. No, sir. Q. Was it made with your consent? A. No. Q. Made with your knowledge? A. No."
This inquiry was apparently related to both checks No. 103 and No. 177, and the witness, in saying that the indorsement was not made by the Manual Arts Plumbing Company, could well have meant, and no doubt was understood by the trial court to mean, that either of the indorsements was placed there by the authority of the Manual Arts Plumbing Company. The whole trend of the testimony indicates that there was no identity such as Manual Arts Hardware Company as distinct from the Manual Arts Plumbing Company. It follows that it was not without competent evidence upon which the trial court found that the check never was indorsed by the payee. The money called for by the two checks was paid to an individual not named as the payee therein, and without the payee’s indorsement, and there is nothing in the case which acts as a legal release of the bank from responsibility for the error.
Judgment affirmed.
We concur: WORKS, P. J.; THOMPSON, J.