ALLEN v. WILLIAMSBURGH SAVINGS BANK

ALLEN v. WILLIAMSBURGH SAVINGS BANK. City Court of Brooklyn; General Term, April, 1876. Agent.—Husband and Wife.—Savings Bank’s Liability on Forged Order. A wife is not presumed to be her husband’s agent for the purpose of drawing his money from a savings bank. A by-law of a savings bank, requiring its “best efforts” to avoid mispayments, calls for more than ordinary care and diligence. If it did not, it would not be error to instruct the jury in the words of the by-law, and refuse to instruct them in the words of the legal equivalent. Appeal by defendants from an order denying a new trial and from a judgment. This action was brought by Isaac Allen against the Williamsburgh Savings Bank, to recover an alleged balance due the plaintiff as depositor of the defendants. Anna Allen, the former wife of the plaintiff, on June 12, 1862, opened an account with' the defendants, and subscribed her name to the signature book. In March, 1863, this account was made payable to the plaintiff, and he also subscribed his name to the signature book, and thereby agreed to be governed by the by-laws and regulations of the defendants. When Anna Allen opened her account she received from the defendants a bank book containing a credit for her deposit, and also extracts from the by-laws of the bank, regulating deposits and drafts, among which were the following, viz: “All deposits shall be regularly entered in the books of the bank, and also in a book to be furnished to the depositor, which shall be kept by him or her as a voucher for his or her deposits.” “ Drafts may be made personally or by the order in writing of the depositor (if the bank have the signature of the party on their signature book), but no person shall have the right to demand any part of his or her principal or interest without producing his or her bank book, that such payments may be entered therein.” ‘ ‘ The bank will use its best efforts to prevent frauds, but all payments made to persons producing the deposit book shall be deemed good and valid payments to depositors respectively.” Anna Allen died in 1869 and the plaintiff married Martha Allen about a year afterwards. Since that time the latter had been in the habit of taking the book to the bank and making deposits for the plaintiff. On October 14, 1874, without plaintiff’s knowledge, she obtained the deposit book from the trunk in which it was locked, and took it to the bank for the purpose of drawing $2,850. The signature clerk, who had charge of all applications for drafts, filled out for her a draft for that amount and gave it to her for the purpose of getting plaintiff’s signature. She returned the next day, and presented the draft with plaintiff’s name signed thereto, and with the book for payment. The signature clerk compared the signature with that of plaintiff on the signature book ; found it to resemble that thereon; and certified the correctness thereof to the paying teller, who paid her the money and entered the payment on the bank book. The plaintiff testified that he did not sign the check, but that the signature resembled his name “but not exactly as I write it.” The dispute between the parties was in reference to this payment to plaintiff’s wife, which he claimed was made on a forged draft. When the evidence was closed the defendant’s counsel made several requests to the judge to charge, which were refused, and which sufficiently appear in the opinion. • The jury found a verdict for the plaintiff for the full amount. The defendants appealed. S. M. & D. E. Meeker, for appellants. I. The bylaws and regulations, assented to by plaintiff, formed part of the contract between the parties (Schoenwald v. Metropolitan Savings Bank, 57 N. Y. 418 ; Appleby v. Erie County Savings Bank, 62 N. Y. 12). II. Defendants having paid the amount in dispute according to the by-laws and regulations, the payment should be binding upon the plaintiff. III. The judge should have directed the jury to credit the defendants with that payment, if they exercised ordinary care and diligence to ascertain whether the order was signed by the plaintiff and paid the same in good faith to the person presenting the order and bank book. IV. The verdict is against the weight of evidence. D. P. Barnard (A. & J. Z. Lott, attorneys), for respondent. [MAJORITY — Neibsoe", Ch. J.] Neibsoe", Ch. J. At the close of the case at the trial three exceptions were taken on behalf of the defendants. First. The defendant’s counsel requested the court to charge, that the payment of the sum for which the action was brought, to the plaintiff’s wife, was a valid payment to him. We think that was properly refused. There was no evidence tending to show that the plaintiff’s wife was his agent in the matter of drawing the money, or had authority to thus act for him; such authority could not arise or be inferred from the mere marital relation. Secondly. The learned judge stated to the jury that the only question for them was, whether the defendants had used “their best efforts” to secure the payment to the proper personthat if they did so they should be credited with the amount. That if they did not thus use “ their best efforts,” the jury should find for the plaintiff. As this direction was in the very terms of a portion of the by-law framed for the protection of the bank, and as notice to the customer, the force of the objection is not apparent. If the learned counsel thought that some reference should have been made in that connection to the residue of the by-law, a request to that effect might have been made. But under the last clause of the by-law the defendant would not have been discharged by a payment to the holder of the book, if negligently made. It must have been made in good faith, the best efforts used to prevent fraud. That clause applies to an instance where the customer may be falsely personated by another ; a payment to the holder of the book under the belief that he was in fact the owner of the money. In this case it was known that the person producing the book was not the depositor, and an order from him was required ; the error was in treating the written order produced as if it were genuine. Thirdly. The court declined to charge that if the defendant exercised ordinary care and diligence to ascertain that the order was signed by the plaintiff, and paid the same in good faith, said payment should be credited. That the payment should have been made in good faith, appears to have been assumed on the trial. If by the term “ ordinary care and diligence ” was intended more or less than the use of their best efforts, it was properly rejected. In either view, a charge in conformity with that request would have been a modification of or departure from the contract. The learned judge may have thought that it was not well to burden the minds of the jury with technical distinctions between the different degrees of care or of negligence. The jury might have been misled by the use of qualifying words, and it was prudent to refrain from testing their intelligence in that manner, as the parties had fixed upon a term well adapted to the common apprehension; it would have been speculative and adventurous to have substituted another term, even though it might be one in legal use. If the instructions requested had been given, the jury would have regarded the ordinary care and diligence suggested as merely equivalent to the defendant’s best efforts. It would seem, therefore, that no prejudice was sufferred from the refusal to charge as requested. The mere fact that plaintiff did not sign the order on which the money was drawn, was not determinate, nor was it so regarded on the trial. The question remained, whether the signature to the order was in appearance and character so like that of the plaintiff’s that by the use of the best efforts that could reasonably have been made—a term implying care, skill,- and good faith,— the difference could not have been detected. We are quite sensible that each of the numerous customers of the bank may not write a uniform hand, and that, by a skillful imitation of the signature of a depositor, especially where that signature is not very characteristic, the teller or cashier may be misled. Could we perceive in this instance any fraud, management or indirection on the part of this plaintiff, we should seek to avoid the verdict. But the testimony was properly given to the jury, and on the question of fact we can not say that they have erred. We may well regret that institutions so useful to frugal persons of moderate means, should be liable to such losses. But cases of the kind have arisen, and under the present practice will arise. The cashier of the bank, however expert, may not always be able to detect a spurious signature. A further precaution might be adopted. The bank could refuse to pay money on any written order or transfer not duly proved or acknowledged before a notary. If mistakes should occur, even after that precaution, the bank would have little reason to apprehend an adverse verdict from a jury. The judgment and order appealed from, should be affirmed with costs.