Opinion
October 22, 1924.
November 17, 1924.
Negotiable instruments — Checks — Negotiation by treasurer — Authority of.
In an action of assumpsit against a drawee bank for the alleged improper payment of a check, judgment should be entered in favor of the defendant, where the check was cashed in due course, in the absence of notice that the treasurer of the company, who negotiated the same, had exceeded his authority.
Appeals, Nos. 181 and 182, Oct. T., 1924, by defendant, from judgment of the Municipal Court of Philadelphia, Oct. T., 1922, Nos. 803 and 804, on verdict for plaintiff in the case of Substantial Building and Loan Association v. Real Estate Title Insurance and Trust Company of Philadelphia.
Before ORLADY, P.J., PORTER, HENDERSON, TREXLER, KELLER, LINN and GAWTHROP, JJ. Reversed.
Assumpsit for check improperly paid. Before CASSIDY, J., without a jury.
The facts are stated in the opinion of the Superior Court, and in the report of the former appeal, in 82 Pa. Super. 211.
The court entered judgment in favor of the plaintiff in the sum of $1,156.06. Defendant appealed.
Error assigned was, among others, refusal of defendant's motion for judgment n.o.v.
Maurice W. Sloan, and with him Stanley B. Rice, for appellant.
Albert L. Moise, for appellee.
Argued October 22, 1924.
When this case was here before on appeal from judgment entered on the pleadings pursuant to section 20 of the Practice Act, we decided that plaintiff should have an opportunity, if the facts justified it, of amending the statement of claim, which the court below had held defective in not stating a cause of action; we accordingly reversed: see 82 Pa. Super. 211, where the facts are stated. In the opinion we said that the statement of claim contained "no averment that defendant had notice before payment to such holder that plaintiff's treasurer after making the authorized endorsement exceeded his authority then to deal with the check." Apparently to meet that omission, plaintiff amended by adding an averment stating its by-law specifying the duties of its treasurer, with an allegation that defendant had constructive notice of it. There was no averment that defendant had actual notice of any breach of duty by the treasurer. The by-law provides: "The duties of the treasurer shall be to receive and take charge of all moneys paid into the association, to deposit the same in a bank to be designated by the board of directors, to pay all orders drawn on him by order of the board of directors, if signed by the president and attested by the secretary; he shall receive and hold in trust for the association, all mortgages, bonds, policies of insurance, securities, etc., upon all properties upon which money has been loaned by the association; he shall give a corporate bond in a sum to be fixed by the board of directors for the faithful performance of his duties before entering thereon, and shall renew the same whenever required to do so by the board of directors, and at the expiration of his term of office he shall deliver to his successor in office, all moneys, books and papers in his possession belonging to the association." Issue was joined, jury trial waived, and the court found for plaintiff.
Plaintiff's receipt of the check and the genuineness of the treasurer's endorsement being conceded, its negotiation might be completed by delivery, pursuant to the statute, as we said in our former opinion. There is nothing to the contrary in the by-law prescribing the treasurer's duties. Actual notice to defendant of alleged abuse of authority by plaintiff's treasurer was neither averred in the statement of claim nor shown in the evidence. It was suggested at the argument that some significance be attached to the word "cashed," which was stamped on the check; there is nothing in the record to show how that could constitute notice of alleged abuse of the treasurer's authority. As the case is destitute of evidence to support the judgment, we cannot sustain it.
Judgment reversed and here entered for defendant.