186 N.E. 800 | NY | 1933
In plaintiff's brief the sole issue is stated to be whether personally or through his agents, defendant had notice of the diversion of plaintiff's funds.
Plaintiff is a New York corporation. Oscar J. Wile, who was its treasurer, was personally indebted in a sum upwards of $33,000 to defendant from whom he had misappropriated *329 that amount and who resides in England. There is a finding that Wile was empowered to execute corporate checks for corporate purposes. In order to discharge this personal obligation, the day before defendant left New York Wile as treasurer drew plaintiff's corporate check in favor of defendant upon the National City Bank, caused it to be certified, wrote upon the back the words: "For deposit to the credit of A.E. Woodward," underneath these words inscribed "Aneless Corporation, Oscar J. Wile, Treas.," delivered the check to the Royal Bank of Canada and surrendered to defendant a duplicate deposit slip which did not indicate the form of the check. The bank collected it and paid the proceeds to defendant. It had no knowledge that the check was drawn in payment of a personal indebtedness and, until the institution of this action, defendant had no knowledge of the fact that plaintiff's funds had been used to pay Wile's indebtedness nor even any knowledge of plaintiff's existence.
As between Wile and defendant a valuable consideration subsisted. If Wile had abstracted $33,000 in cash from plaintiff's safe, deposited it to the credit of his own account and drawn a check against it to the order of defendant who, without knowledge or means of knowledge of the circumstances, took possession of the proceeds, defendant would not be liable. (Stephens v. Board of Education,
The judgment should be reversed and the complaint dismissed, with costs in all courts.
POUND, Ch. J., CRANE, LEHMAN and KELLOGG, JJ., concur; CROUCH, J., concurs in result only; HUBBS, J., not sitting.
Judgment reversed, etc. *332