The herald. [microfilm reel] (Los Angeles [Calif.]) 1893-1900, 1898-09-17
BANKS ARE NOT LIABLE FOR
STAMP FoRGERIEs
CLEARING HOUSERESOLUTIONS
Funeral of F. G. Howes-Resolution
Of Sympathy-Statements of San
Francisco Banks Encouraging
OFFICE OF THE HERALD,

Justice williams Of the supreme court of
Pennsylvania held in case which was
tried a few days since, says the New York
Financier, that a bank cannot be held re-
sponsible for forgeries Of checks signed BY
rubber stamps. Thomas Robb was depos-
itor in the Pennsylvania Company for In
surance on Lives and the Granting of An
nu!ties. For his convenience he had made
rubber stamp bearing the fac smile of
his signature. A forger stole the stamp
and secured certain sums Of money from
the bank on checks bearing the imprint.
The banks contention was that Robb
should bear the loss, because OF his hav-
ing in use for his own purposes the stamp.
making detection of forgery impossible.
In the lower court II was held that the
procurement OF the stamp by Robb was not
an unlawful act, nor did his doing SO with
out notice TO the company relieve 1t from
the amount paid out on the forged checks.
Its procurement not being unlawful land it
having no relation to Robb's deposit with
the company, It did not impose upon him
the duty Of notifying the company. and
therefore, the loss did not necessarily fall
upon him.
But Justice Williams dissented earnestly
from this decision. He maintained that
the argument, If logical. placed an addi-
tional burden upon the defendant bank not
resulting from the commercial contracts
between it and its depositor. Justice VIII
lams cited the custom of opening deposits,
the leaving of a genuine signature, and
the banks liability In paying checks bear
ing this signature. and then went on to
say: '"The contract; which the commercial
law raises upon the deposit of money with
banker Is that the deposit shall be paid
out only to the depos,or or his order.
Payment upon forged check is, therefore,
no payment, and In no way affects the de-
pOsitor. But II the depositor executes a
check and for any reason leaves it on his
table where It Is found by another, who
fllls 1t up. presents 1t at the bank and re-
ceives payment upon 1t. this is good pay
ment by the bank, and the loss is that Of
the depositor, for the check was signed by
him. If. instead Of leaving his check upon
the table. the drawer had deposited 1t
within his safe, locked the safe and pu;
the key away in his office precisely as Mr.
Robb did with his stamp. and If clerk or
employe had taken the key, unlocked the
safe. distracted the check. and used it for
bis own benefit, its payment by the bank
would have bound the depositor."
That principle the court ruled, held good
In this case. The contention of Robb that
he intended the stamp for one particular
purpose. does not hold good. The making
OF 1t is evidence that he intended the sig
nature produced by the stamp should be
recognized as his AS with the signed check
90 with this stamped signature. When ne
put it in his safe and left the key where
1t was possible for any one to get 1t and
60 gain admittance to the safe, he exposed
himself to the loss that might follow. and
that loss is his.
In conclusion, the court held: IF the
bank is not protected by his signature
made by means of his own private stamp
II they are bound at their peril TO know
and discriminate between his signature
made with his pen and that made with
his private stamp, then he has by the use
of the stamp very greatly increased the
responsibility and peril of the banker with
out so much as giving him notice or afford
ing the slightest intimation of the neces-
eity for additional vigilance in scrutinizing
checks purporting to bear his signature.
Upon every rule of commercial law and
upon every consideration of equity and
good conscience. the judgment entered in
the court below in this case should be re-
versed and Judgment should be entered
here in favor of the defendant"