#### E. Moch Company, Respondent, *v.*The Security Bank of New York, Appellant.

First Department,

July 10, 1913.

Pleading — complaint — action by corporation against bank to recover proceeds of check payable to plaintiff, but deposited and withdrawn by its president without authority — notice—judgment on pleadings.

A complaint which alleges that a check payable to the order of the plaintiff was received by its president who indorsed thereon the name of the plaintiff and thereunder his own name, and thereafter deposited the check to his personal credit in a bank, of which the defendant is a successor, and that said bank accepted and collected said check and paid out the proceeds thereof for the personal benefit of the plaintiff’s president, with notice that it was the property of the plaintiff, and with notice putting it upon inquiry, which it failed to make, which would have disclosed that the check was placed to the personal account of plaintiff’s president, without authority, is sufficient to permit proof of notice to the defendant, and an order denying defendant’s motion for judgment on the pleadings should be affirmed.

Scott, J., dissented.

Appeal by the defendant, The Security Bank of New York, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 11th day of April, 1913, denying defendant’s motion for judgment on the pleadings.

*Herman B. Goodstein,*for the appellant.

*William Bondy,*for the respondent.

Clarke, J.:

The complaint sets forth that the plaintiff is a domestic corporation; that the defendant corporation is a bank organized under the laws of the State of New York; that through a change of name and merger it is the successor of the Fourteenth Street Bank, and liable for all its debts and obligations; that on or about November 13, 1908, Sears, Roebuck & Co., for valuable consideration, in due course of business, drew, signed and sent to the plaintiff its check on the Chase National Bank, payable to the order of E. Moch Company for $4,358.55; that *727on or about November 17, 1908, Eugene Moch, who, at said time, was the president of the said E, Moch Company, received said check and indorsed thereon “E. Moch Company,” and thereunder “Eugene Moch,” and thereafter deposited the check to his personal credit and account in the said Fourteenth Street Bank; that the said bank accepted said check and placed it to his personal credit and account; that it collected the check and placed the proceeds thereof to the personal credit of Eugene Moch; that since November 17, 1908, and prior to the commencement of this action, the said bank applied the proceeds thereof in payment of checks drawn against the proceeds thereof by the said Eugene Moch personally for his personal benefit, and thereby misappropriated the proceeds thereof to •the personal use of Eugene Moch; that the said check and the proceeds thereof were placed to the personal credit and account of Eugene Moch and the proceeds thereof withdrawn and paid for his personal benefit without authority; that the said bank accepted and collected said check with notice that the said check and the proceeds thereof were the property of the plaintiff and with notice putting it upon inquiry which it failed to make, which would have disclosed that the same was placed to the personal credit and account of Eugene Moch and collected, and the proceeds thereof withdrawn, paid and appropriated for the personal use of said Moch without authority; that there is now due and owing from the defendant to the plaintiff the said sum for which it demands judgment.

Although an answer was interposed, it is not here material, as this motion was made to test the sufficiency of the complaint. The Special Term held that the complaint stated a good and sufficient cause of action.

The determination of this case depends not upon a question of proof but of pleading. The appellant admits in its reply brief that the phrase “with notice that the said check and the proceeds thereof were the property of the plaintiff ” is sufficient to permit proof of the facts which in the opinion of the plaintiff constituted said notice. It seems to us that the allegation “and with notice putting it upon inquiry which it failed to make, which would have disclosed that the same was placed to the personal credit and account of Eugene Moch * * * *728without authority ” is likewise the allegation of the ultimate fact and sufficient to permit the detailed evidence thereof.

To state the proof tending to establish those facts would be to offend against the rule of pleading which requires the statement of ultimate facts and not intermediate and evidentiary facts. We think the complaint .is sufficient. Under it the plaintiff will be entitled to show, if it can, by any competent proof, such notice and knowledge on the defendant’s part as • would charge it with liability.

The order appealed from- should be affirmed, with ten dollars costs and disbursements to respondent.

Ingraham, P. J., McLaughlin and Laughlin, JJ., concurred; Scott, J., dissented. •

Order affirmed, with ten dollars costs and disbursements.