Court Opinion

ID: 3684832
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:29:38.634363+00
Date Added: 2024-06-11T15:30:53.893638
License: Public Domain

I respectfully dissent from the opinion and judgment entry rendered by the majority.
In its disposition of the second assignment of error, the majority states that the trial court properly held that the loss in question was not caused by any bank employee. The trial court took judicial notice of a prior case involving the same issue,O'Mara Enterprises, Inc. v. Heritage Bank (Aug. 13, 1992), Jefferson App. No. 91-J-6, unreported, 1992 WL 198078. In that case, the trial court found as follows:
"The Defendant Banks originally argued that they had express authority under Heritage Bank's exculpatory corporation resolution form to deposit these checks into the GSD (Gail Smith Develop[ment]) account. Under the principles set forth inMaster Chemical, supra, and under the undisputed facts in this case, the bank's reliance upon the exculpatory resolution, its failure to make any inquiry, and its treating the checks as bearer paper were commercially unjustifiable. As a matter of law no express authority existed for the Defendant to pay the checks to GSD."
That case was appealed to this court and was affirmed in part and reversed in part, and that conclusion of the trial judge was affirmed by this court.
It would seem to me that the bank could act commercially unjustifiably only through its employees. The bank's reliance upon the exculpatory resolution had to have been made by some employee. The bank's failure to make any inquiry and its treating the checks as bearer paper certainly had to be decided by some employee.
It is my conclusion that Exclusion Section 2(h) applies, precluding coverage because the loss in question was caused by appellee's employees. *Page 258