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Mr. Frank W. Etheridge, for appellee: If, by by-laws or stipulations with depositors, an incorporated savings bank can 63, 54 Am. Dec. | discharge itself from the legal responsibility of its public employment and the duties it was created to perform, it is to be presumed that the by-laws and stipulations made by the bank were not designed thus to defeat the intention with which the legislature passed the act of incorporation, and such by-laws and stipulations do not relieve the bank from the duty of exercising reasonable care.
Kimball v. Norton, 59 N. H. 1, 47 Am. Rep. 173.
A payment to the wrong person upon presentment of a deposit book, if it is presented under such circumstances or in such a manner as would tend to excite suspicion, or put a man of ordinary prudence upon inquiry, will not exonerate the bank, even where there is a by-law of the bank ( assented to by the depositor, authorizing such payment.
Morse, Banks & Banking, § 620, p. 1030;
Sullivan v. Lewiston Inst. of Savings, 56 Me. 507, 96 Am. Dec. 502; Gifford v. Rutland Sav. Bank, 63 Vt. 108, 11 L. R. A. 794,
the bank and the signature to the forged with- | inquiry,-the question was considered to be drawal slip on which the payment was made; one for the jury. Ibid. and, also, there was no evidence that there had been any comparison made between them at the time of the payment, there was sufficient evidence to go to the jury on the question whether ordinary care had been used by the bank. Tobin v. Manhattan Sav. Inst. 6 Misc. 110, 26 N. Y. Supp. 14, Affirming 3 Misc. 628, 23 N. Y. Supp. 1165.
It is error to refuse to allow the jury to pass upon the question whether the bank was guilty of negligence in making a payment to one presenting a pass book, when an officer of the bank admitted, in his testimony, that, after making a comparison of the signature of the depositor in the signature book and the forged draft check upon which the payment was made, he could readily distinguish the forgery; and that, when the fraudulent claimant presented the book, he thinks ne did not ask him the questions set down opposite the name of the depositor in the signature book; and that, on account of a rush of business, if a signature presented was a tolerably good one the bank officers paid it without asking any questions; and this is error in spite of a by-iaw by which the "bank will not be responsible for frauds committed on the officers by producing the pass book and drawing money without the knowledge or consent of the owner." Saling v. German Sav. Bank, 15 Daly, 386, 7 N. Y. Supp. 642.
So the court refused to disturb a finding of negligence in a savings-bank officer making a payment to a person presenting the pass book with a forged check signed with the name of the depositor, when, being doubtful of the genuineness of the signature after comparing it with the signature upon the signature book, he required the person presenting it to indorse the depositor's name upon the check, and paid it without further inquiry; the bank should have taken steps to test the identity of the individual, in compelling him to produce some evidence or other person to identify him. Hager v. Buffalo Sav. Bank, 10 Misc. 455, 31 N. Y. Supp. 448.
A verdict for the plaintiff, in an action against a savings bank for the amount of a deposit paid to a stranger presenting the book, will not be disturbed where the depositor could
In Kummel v. Germania Sav. Bank, 127 N. Y. 488, 13 L. R. A. 786, 28 N. E. 398, the rule provided that the bank would not be responsible for any fraud committed on the officers in producing the pass book and drawing money without the knowledge or consent of the owner; and when a payment was made to one presenting the book and a receipt, and the applicant was asked by the cashier where he lived, and gave different answers, but was not asked any further questions, and was then paid the money,--it was held that the question of the bank's negligence was clearly for the jury, since it affirmatively appeared that the cashier did not avail himself of the means at hand to identify the person presenting the pass book and the forged receipt.
In a case, however, where the clerk making the payment "judged from the first that the signature to the receipt was not exactly right," asked the person presenting it if he could not write a more fluent hand, receiving from the applicant the explanation that he was not feeling well, and then put to him questions appearing upon the signature book, which were correctly answered, it was held that the question was involved in more doubt; but that, since the signature was such as to lead the clerk, an interested witness, to judge that it was not right; and since the two signatures were before the court and jury for comparison, upon which the variance might have been so great as, of itself, to put a prudent person on
Ladd v. Augusta Sav. Bank, 96 Me. 512, 58 L. R. A. 288, 52 Atl. 1012; Brown v. Merrimack River Sav. Bank, 67 N. H. 549,
68 Am. St. Rep. 700, 39 Atl. 336; Geitel sohn v. Citizens' Sav. Bank, 17 Misc. 574, 40 N. Y. Supp. 662; Ladd v. Androscoggin County Sav. Bank, 96 Me. 520, 52 Atl. 1016; People's Sav. Bank v. Cupps, 91 Pa. 315.
A party setting up an estoppel must show that he exercised good faith and diligence in endeavoring to ascertain the truth.
Morgan v. Farrel, 58 Conn. 427, 18 Am. St. Rep. 282, 20 Atl. 614; Bigelow, Estoppel, 480; Moore v. Bowman, 47 N. H. 499; Odlin v. Gove, 41 N. H. 465, 77 Am. Dec. 773.
Bankers are presumed to know the signatures of their depositors.
merely make his mark, and he person made a mark which was observed by the bank's officers to be different from the mark made by the depositor in the signature book, whereupon the stranger returned with another man who identified him as a depositor, but not as the depositor in question, and the bank made no further effort to ascertain the truth of the statements made, although the place of business of the depositor was around the corner from the bank. Rosen v. State Bank, 32 Misc. 231, 65 N. Y. Supp. 666.
And where there were circumstances calculated to raise suspicions of the identity of the applicant, the marked difference between the signature of the depositor and of the applicant arresting the attention of the bank's officials, who required him to identify himself, which he attempted to do, these facts were ample to sustain a finding of negligence in the bank's officers. Wegner v. Second Ward Sav. Bank, 76 Wis. 242, 44 N. W. 1096.
But it has been held, in so many words, that the proposition that a mere difference in the signatures requires a submission of the case to the jury on the question of the negligence of the bank's officers is not sound. Ferguson v. Harlem Sav. Bank, 43 Misc. 10, 86 N. Y. Supp. 825. Accordingly, under the usual by-law regulation that the bank would endeavor to prevent fraud, but that payments to persons producing the pass book should be valid payments to discharge the bank, where it was proved by an officer of the bank, and uncontradicted, that a few irregularities in the signature to the draft aroused his suspicion, that he then asked all the test questions required for identification, and that the fraudulent claimant correctly answered all of them, whereupon the payment was made, the bank had a right to rely upon the appearances thus presented; and hence a verdict should have been directed for the defendant bank. Ibid.
Weisser v. Denison, 10 N. Y. 68, 61 Am. Dec. 733; Hardy v. Chesapeake Bank, 51 Md. 562, 34 Am. Rep. 325; National Park Bank v. Ninth Nat. Bank, 46 N. Y. 77, 7 Am. Dec. 310; Allen v. Williamsburgh Sav. Bank, 69 N. Y. 314; Frank v. Chemical Nat. Bank, 84 N. Y. 209, 38 Am. Rep. 501.
The rights of the parties are founded upon contract, and the questions of contributory negligence and estoppel are not properly in the case.
Brown v. Merrimack River Sav. Bank, 67
N. H. 549, 68 Am. St. Rep. 700, 39 Atl. 336.
The measure of the bank's duty is good faith and reasonable care, and, failing in this, it still continues liable to the depositor, where it has made payment to the wrong person, notwithstanding such person presented the book at such time.
Sullivan v. Lewiston Inst. of Savings, 56 Me. 507, 96 Am. Dec. 500; Ladd v. Augusta Sav. Bank, 96 Me. 510, 58 L. R. A. 288, 52 Atl. 1012; Kimball v. Norton, 59 N. H. 1, 47 Am. Rep. 171; Brown v. Merrimack River Sav. Bank, 67 N. H. 549, 68 Am. St. Rep.
Where the applicant presented the book, and, pretending to be the depositor, wrote a check for the amount, which was carefully compared by the teller with the signature of the depositor in the book kept for that purpose, and the payment was then made, it was held in the leading New York case that a nonsuit after the refusal to allow the plaintiff to go to the jury on the question whether the alleged failure to discover any dischepancy between the genuine signature and the disputed one was negligence was not error. If, however, the two signatures were so dissimilar that when they were compared the discrepancy would be easily discovered by a person competent for the position of teller, then the failure to discover it would be evidence of negligence which should have been passed upon by the jury; but it would not be evidence of negligence if the difference was not marked and apparent, or if it would require a critical examination to detect it, and especially if the discrepancy was one as to which competent persons might easily differ in opinion. But, nevertheless, the bank will not be discharged by a payment upon the production of the pass book, irrespective of the exercise of ordinary care and diligence upon the part of the teller in discovering the dissimilarity in the signatures and instituting further inquiry. Appleby v. Erie County Sav. Bank, 62
N. Y. 12.
And where the defendant's officer testified that he compared the signature of the draft ticket presented with the pass book, and then asked the person presenting it his name, where he was born, in what ship he came to this country, and his mother's maiden name, all of which he answered correctly according to the signature book, and the officer then paid the amount demanded, upon the strength of the comparison and these answers, the majority of the court held that this evidence, not being rebutted or contradicted in any way, presented no
700, 39 Atl. 336; Appleby v. Erie County | L. R. A. 288, 52 Atl. 1012; Sullivan v. LewSav. Bank, 62 N. Y. 12; Allen v. Williams-iston Inst. of Savings, 56 Me. 507, 96 Am. burgh Sav. Bank, 69 N. Y. 314; Gearns v. Dec. 500; Allen v. Williamsburgh Sav. Bowery Sav. Bank, 135 N. Y. 557, 32 N. E. Bank, 69 N. Y. 314. 249; Tobin v. Manhattan Sav. Inst. 6 Misc. 110, 26 N. Y. Supp. 14.
A bank neglecting to obtain the signature of a customer is presumed to be familiar with his signature.
Whenever the depositor is able to write, no bank can claim to be in the exercise of reasonable care unless, before payment, it makes comparisons of signatures.
Weisser v. Denison, 10 N. Y. 68, 61 Am. Dec. 731.
Handwriting is, and has been for ages, the test of identity.
It makes unlawful payment at its peril. Tobin v. Manhattan Sav. Inst. 6 Misc. 110, 26 N. Y. Supp. 14.
Allen v. Williamsburg Sav. Bank, 69 N.
Rules do not dispense with the exercise of ordinary care on the part of the officers of the bank.
Appleby v. Erie County Sav. Bank, 62 N. Y. 17; Kummel v. Germania Sav. Bank, 127 N. Y. 491, 13 L. R. A. 786, 28 N. E. 398; Israel v. Bowery Sav. Bank, 9 Daly, 507; Ladd v. Augusta Sav. Bank, 96 Me. 510, 58
question of fact for the jury, but only one of law for the court, on the issue of the negligence of the bank in making the payment. Wall v. Emigrant Industrial Sav. Bank, 64 Hun, 249, 19 N. Y. Supp. 194.
And, going still further, it is held that there is no evidence on which to go to the jury on the question of negligence in the savings-bank officers, where the usual test questions are put to the person presenting the pass book and draft, and are all answered correctly, except that the occupation of the depositor is given as "stone mason" when it was originally given as "stone cutter" (but here there is no mention in the report of a physical comparison of the signature of the draft with that in the signature book), when it appears that the genuine depositor had made six separate deposits after the alleged fraudulent draft, which was shown in the pass book at all those times. Ferguson v. Harlem Sav. Bank, 92 N. Y. Supp. 261.
Where a deposit was made in the name of another person than the depositor, and the person presenting the book, after the death of the depositor, was questioned as to various matters apparently identifying him, answered the description of the depositor, and made a signature which was compared by the official representing the bank with the genuine signature of the depositor on file, and was thought by him to resemble it sufficiently; and the finding of a referee was that the official had used reasonable and ordinary care and diligence in making the payment,-the latter was entitled to the protection given to such a payment by the bank's by-laws. People v. Third Ave. Sav. Bank, 98 N. Y. 661.
It was also held that when the deposit was made with false descriptions of the depositor's name, occupation, and age, his administrators were properly defeated, where the bank official acted in good faith, and with ordinary care and diligence, in making the payment to one an
Hall, J., delivered the opinion of the
From April 1, 1887, to September 26, 1900, the plaintiff made in person 25 deposits in the defendant's savings bank, which, with dividends added at the rate declared by the bank, amounted at the time of the trial, in March, 1904, to $3,230. The plaintiff has neither herself withdrawn any part of said sum, nor has she given any order for any payment to others. Upon four occasions between December 31, 1901, and March 3, 1902, the plaintiff's daughter Mrs. Keith, who, with her husband, lived with
swering the description, and the questions were put to him satisfactorily, and his signature was thought by the bank's representative to correspond sufficiently to that of the depositor. Ibid.
In Gifford v. Rutland Sav. Bank, 63 Vt. 108, 11 L. R. A. 794, 25 Am. St. Rep. 744, 21 Atl. 340, the majority of the court held that, where a bank had not been notified of the loss of the book, and the depositor was not personally known to any officer of the bank, not having been present when the deposit was made, and the applicant was also unknown to them, but came with the book apparently lawfully in his possession, and on inquiry answered correctly that the money was originally sent for deposit by letter, that being a fact not likely to come to the knowledge of persons not having to do with and interested in the deposit, and although he wrote awkwardly the middle initial of the depositor's name, and comment was made upon it by the bank officer making the payment, the bank was not bound to require the thief to identify himself further than he did by producing the book, there being no circumstances which the court considered suspicious.
Where the evidence as to the diligence used by the bank teller to identify the person presenting the book was not very definite or positive, but he admitted that he testified rather from his usual way of transacting such business than from recollection of what inquiries he made, and there were proved the presentation of the book, the presence of the husband of the depositor, and his assent to the payment, no circumstances of suspicion being shown to be apparent, the signing of the initials of the depositor, and a memorandum made by the teller at the time showing that he "tested" the validity of the claim,-it was held that the evidence, on the whole, would sustain a finding of a referee that the teller made the
the plaintiff, obtained money from the bank,, bookkeeper, a forged letter of that date, purporting to have been signed by the plaintiff, addressed to the treasurer of the bank, representing that the plaintiff had accident ally destroyed her bank book, and requesting that a new one be issued in its place, and further stating that the plaintiff was an invalid, and had sent her daughter Mrs. Keith to get the new book, and had inclosed an order for money. Mr. Merriman informed Mrs. Keith that a new book could not be issued until a bond had been given to the bank, and prepared and gave to Mrs. Keith a form of a bond, with instructions to have it executed by the plaintiff and some responsible person as surety. On the following day Mrs. Keith presented the bond to Mr. Merriman at the bank, with the plaintiff's name as principal, and the name of another person as surety signed thereto. Both signatures were forgeries. In the absence of the treasurer of the bank, and without inquiring as to the responsibility or existence of the person whose name appeared as surety on the bond, and without submitting the matter to the "board of direction," or to "a committee appointed for that pur
amounting in all to $500, by presenting the plaintiff's bank book, of which she had iraudulently obtained the possession, and by presenting with the bank book forged orders purporting to have been signed by the plaintiff, directing payment to be made to Mrs. Keith of the sums named in the orders Early in April, 1902, Mrs. Keith confessed to her mother that she had drawn money upon the bank book, but claimed that she could obtain no more without an order from the plaintiff, and offered to write to the bank and secure a reply which would satisfy the plaintiff, and a few days later read to her mother what purported to be a letter from the bank to the effect that no further money could be drawn on the plaintiff's account without an order from the plaintiff, and that it would be all right. Thereafter the plaintiff kept her bank book locked up in a more secure place, but did not then notify the bank that her daughter had thus wrongfully obtained possession of the bank book and drawn the money. On the 16th of April, 1902, Mrs. Keith presented at the bank to Mr. Merriman, the defendant's
payment after "due inquiry." Hayden V. Brooklyn Sav. Bank, 15 Abb. Pr. N. S. 297.
For a case denying the responsibility of the bank for payment to an applicant who sent the book with a forged order through the mail, the decision being based upon a strong by-law, without special regard to the degree of care required of the bank, see supra, II.,-Burrill v. Dollar Sav. Bank, 92 Pa. 134, 37 Am. Rep. 669.
d. Payment upon forged orders alone.
In considering the question of what degree of care must be exercised by the bank in cases where the pass book is presented by one who does not pretend to be the depositor, with a forged order purporting to be executed by the latter, the inquirer is met by the difficulty presented by the construction of by-laws governing the transaction and intended to limit the liability of the bank for payment to fraudulent claimants, which by-laws frequently make no provision for irresponsibility in case of payment to a fraudulent claimant whose fraud consists simply in the production of a forged order purporting to be signed by the depositor, and not in pretending to be the depositor himself. Thus, where the bank had no by-law limiting its liability in case a depositor's bank book should be lost or stolen, and the bank, without notice of such loss, made a payment to a person who falsely impersonated the depositor and presented the book, and did pay out the account upon a forged order, no question of negligence either of the depositor or of the bank officials was involved, and the liability of the bank rested solely on the contract found in the bank's regulations providing that "money deposited may be withdrawn, in whole or in part, by the depositor, or by any other person duly authorized, at any time without notice." Ladd v. Androscoggin County Sav. Bank, 96 Me. 520, 52 Atl. 1016.
Where the bank's rule provided only for
payment to the depositor or his order, payment upon a forged order was not good payment, since a forged authority is no authority at all. Eaves v. People's Sav. Bank, 27 Conn. 229, 71 Am. Dec. 59.
Similarly, where the by-law involved was, "as the officers of this institution may be unable to identify every depositor transacting business at the bank, the institution will not be responsible for loss sustained where the depositors have not given notice that their books have been stolen or lost," it was held (following Kimins v. Boston Five Cents Sav. Bank, 141 Mass. 33, 55 Am. Rep. 441, 6 N. E. 242) that this exonerated the bank for payment to one who falsely impersonated the depositor, but not for payment to one who falsely claimed to act under authority from the depositor; and hence payment to one presenting the book with a forged order purporting to be signed by the depositor was not excused. Kingsley v. Whitman Sav. Bank, 182 Mass. 252, 94 Am. St. Rep. 650, 65 N. E. 161.
But where one of the rules of the bank was to the effect that, "as the officers of the institution may be unable to identify every depositor, the corporation will not be responsible for loss sustained, where a depositor has not given notice of his book being stolen or lost, if such book be paid in whole or in part on presentment;" and "in all cases a payment upon presentment of a deposit book shall be a discharge to the corporation for the amount so paid ;" and the fraudulent claimant presented not only the deposit book, but also a forged order purporting to be signed by the depositor it was held that the argument that the by-law was intended solely to protect the bank against the risk of mistake as to the personal identity of its depositors, and therefore that it did not apply to a case where there was no mistake as to identity, but the payment was made upon a forged order purporting to be signed by the
pose," Mr. Merriman issued and delivered | plaintiff were genuine; and the plaintiff to Mrs. Keith a new book, in the name of gave no notice to the defendant that Mrs. Keith had fraudulently obtained possession of the first book, and that said letter and orders were forgeries, until November 1, 1902.
the plaintiff, with the balance due upon the first book transferred thereto, and at the same time paid to Mrs. Keith $300 upon a forged order presented by her, dated April 16, 1902, purporting to have been signed by the plaintiff, and directing said sum to be paid to Mrs. Keith upon the amount due upon the first book. Six payments, amount-it or mislay it give immediate notice to the
The following statement was printed in the plaintiff's bank book:
"Take Care of This Book. If you lose
bank, as, if it gets into improper hands, you may be defrauded."
Among the by-laws printed in plaintiff's book were these:
ing to $1,700, were made by the bank to Mrs. Keith upon presentation of said second book with forged orders of the plaintiff; the last payment having been made on the 27th of October, 1902. The plaintiff had no knowledge of the existence of said second book, nor of the payment of any of the money drawn by her daughter thereon, until informed of these facts by the bank on the 1st of November, 1902, when she immediately obtained from her daughter the second book, and $20 of the money which she had fraudulently drawn. Said second book was issued and all the payments upon both bank books were made, by the bank in good faith, and upon the belief that the letter and orders purporting, to have been signed by the
"Art. 13. Dividends and money withdrawn shall be paid only to the depositor, or to the depositor's order, or legal representative; but neither the principal nor interest of any deposit shall be paid to any person, unless the depositor's book of entries made by an officer of the corporation or of the direction shall be presented that such payments may be entered therein, or unless the depositor shall prove to the satisfaction of the board of direction, or a committee appointed for that purpose, that such book has been lost or destroyed, in which case
depositor, would be, perhaps, conclusive in favor of the depositor if it were not for the last clause, providing that the presentment of the book should be a discharge of the bank "in all cases." In either case the purpose of the bylaw was to authorize the bank to rely upon the presentation of the book as its security against fraud; and if the bank, using reasonable care, and in good faith, paid the account upon presentation of the book, the bank was discharged. Levy v. Franklin Sav. Bank, 117 Mass. 448.
Where the rules and by-laws provided that "the secretary will use his best efforts to prevent frauds; but all payments to persons presenting the deposit book shall be deemed good and valid payments to depositors respectively," when a payment was made to a man presenting the book with an alleged forged order very much like the signature made at the time of the deposit, by the depositor, who was a woman, in the book kept for that purpose, it was held that, the rules allowing payment to anyone producing the pass book, no order for payment was required, and the question of the genuineness of the signature was wholly immaterial, and, this question being the only one given to the jury on the trial, a new trial was necessary. Schoenwald v. Metropolitan Sav. Bank, 57 N. Y. 418, Reversing 1 Jones & S. 440. This decision, however, has been practically overruled upon this point by Allen v. Williamsburgh Sav. Bank, 69 N. Y. 315, which, like the Schoenwald Case, is treated and distinguished in KELLEY v. BUFFALO SAY. BANK.
The by-law provided, in that case, that "the bank will use its best efforts to prevent fraud, but all payments made to persons producing the deposit books shall be deemed good and valid payments to depositors respectively." and the depositor's wife fraudulently applied to the bank for the money, presenting the pass book and a check with the forged signature of the depositor; and the jury were charged that
the only question for them to determine was whether the bank used its best efforts to secure the payment to the proper person. And, in affirming a judgment for the plaintiff, the court distinguished and limited Schoenwald v. Metropolitan Sav. Bank, 57 N. Y. 418, supra, in which, it was said, no special attention was given to the clause in the rules to the effect that the secretary would use his best efforts to prevent fraud. There the signature to the order used for the purpose of obtaining payment was very much like the signature of the deposi tor upon the signature book. From some statements in the Schoenwald Case, however, the court sharply dissented, for instance, that to the effect that "a bank had a right to make the payment on the simple production of the pass book," the fact being that the depositor was a woman and the book was produced by a man, which fact at once notified the bank that it was not the depositor who applied for the payment; and in such a case it could not be that the bank officers should not be called to the exercise of inquiry and care. The officers of savings banks, acting under rules like those under discussion, are bound to the exercise of care and diligence, up to the standard fixed for the bank by those rules, and, the book being produced by a person of the opposite sex from the depositor's, it was then necessary to rely upon an order from the depositor, and the bank could no longer depend upon the rule that the production of the pass book was enough to allow the payment. The case of Appleby v. Erie County Sav. Bank, 62 N. Y. 12, supra, was also distinguished upon the ground that the decision there, affirming the refusal of the trial court to give to the jury the question of the negligence of the bank, because the difference between the two signatures was not marked enough to the trial court to require it, was grounded upon the reason that the appellate court did not have the opportunity which the