Court Opinion

ID: 9561086
Source: CourtListenerOpinion
Date Created: 2023-08-21 18:02:38.975753+00
Date Added: 2024-06-11T09:13:33.553185
License: Public Domain

EUBANK, Judge
(concurring).
While I concur with the majority opinion, I believe that additional emphasis on the specific arguments raised needs further discussion in light of the Uniform Commercial Code. The following is therefore presented.
In the appellants’ brief, they first point to the general rule that a bank is liable to its depositor if it pays out money on the forged name of the depositor, citing 10 Am.Jur.2d Banks § 603 (1963), and then cite Pacific Coast Cheese, Inc. v. Security First National Bank of Los Angeles, 45 Cal.2d 75, 286 P.2d 353 (1955), as determinative of the “election of remedies” question in their favor. In Cheese the facts were similar to the case at bar, except that the depositor’s signature was valid while the amount of the check was altered. The Cheese (depositor) manager, upon discovery of the defalcation, filed a criminal complaint and then a civil action against the bookkeeper, obtaining judgment for the full amount taken. The judgment was not satisfied, and Cheese (depositor) then brought an action against the bank on the basis that the bank had “improperly deducted” deposited funds from its account. The California Supreme Court reversed the trial court’s directed verdict in favor *289of the bank and in the process discounted the “election of remedies” defense stating:
The directed verdict cannot be justified, as contended by defendant, on the theory that plaintiff is barred under the doctrine of election of remedies by reason of the recovery of judgment against the bookkeeper for damages resulting from alteration of the checks. The doctrine is based on estoppel and, when applicable, operates only if the party asserting it has been injured. See Steiner v. Rowley, 35 Cal.2d 713, 720, 221 P.2d 9; Commercial Centre Realty Co. v. Superior Court, 7 Cal.2d 121, 129, 59 P.2d 978, 107 A.L.R. 714; Campanella v. Campanella, 204 Cal. 515, 521, 269 P. 433; Mansfield v. Pickwick Stages, 191 Cal. 129, 131, 215 P. 389; Hines v. Ward, 121 Cal. 115, 120-121, 53 P. 427; Perkins v. Benguet Consol. Min. Co., 55 Cal.App.2d 720, 758, 132 P.2d 70. Here the evidence does not show as a matter of law that defendant was in any way injured or prejudiced by plaintiffs action against the bookkeeper. (45 Cal.2d at 80, 286 P.2d at 356).
Cheese was cited as authority by our Supreme Court in Valley National Bank of Phoeniz v. Electrical District Number Four, 90 Ariz. 306, 318, 367 P.2d 655, 663 (1961), on the negligence-estoppel issue but without reference to the “election” question.
The appellee-bank counters this argument by stating that Cheese represents the minority view and Arizona represents the majority view, citing Dowdy v. Calvi, 14 Ariz. 148, 125 P. 873 (1912). The exact basis for this conclusion is not analyzed by the bank, except by reference to Annot., 6 A.L.R.2d 10 (1949), entitled “Conclusive Election of Remedies as Predicated of [sic] Commencement of Action, or its Prosecution Short of Judgment on the Merits.” The annotation states:
In Dowdy v. Calvi (1912) 14 Ariz. 148, 125 P. 873, it was stated that “another suit pending in the same or other court between the same parties involving the same subject of action, pursuing the same or a different remedy for relief, upon application made, cannot stand together”; that “the suit first commenced, in point of time, controls, and, when the remedies are inconsistent, such prior suit is an election of remedy and prevails”: and that “a subsequently commenced action between the same parties, for the same cause of action, seeking a different relief, will abate even though the prior action has been dismissed, because the plaintiff elected his remedy and cannot have two remedies for the same wrong.” (6 A.L.R.2d at 30-31).
The annotator reads a good deal into the Dowdy case that I do not find there. First, the court found that it was not an “election of remedies” case; second, all of the court’s discussion regarding “election of remedies” was dicta; third, the general statement of the law regarding “election of remedies” is correct if, as a precondition, all of the factors are the same, i. e., same parties, same subject matter, etc. Our Supreme Court did not hold that the mere filing was conclusive. This annotation merely points up the primary point at which analysis of the “election” must begin: Are the appellants pursuing the same or different remedies for relief in this action ?
Referring to the case at bar, my reading of the amended complaint against the bookkeeper in the first action, shows that it was framed as “money had and received,” while the action against the bank is based on A.R.S. §§ 44-2541 [U.C.C. § 3-404, Unauthorized signatures], 44-2543 [U.C.C. § 3-406, Negligence contributing to alteration or unauthorized signature], 44-2632 [U.C.C. § 4-406, Customer’s duty to discover and report unauthorized signature or alteration], and the deposit contract. See Comment, “Check Forgeries: Variations of Rules of Liability Based on Fault — U.C.C. Defense Sections 3-406 and 4-406,” 12 Ariz.L.Rev. 417 (1970); White *290& Summers, Uniform Commercial Code § 17-2 (1972). In my opinion these are different remedies against different parties making the “election of remedies” defense inapplicable to this action as a matter of law. See Van Waters & Rogers, Inc. v. Interchange Resources, Inc., 14 Ariz.App. 414, 484 P.2d 26 (1971). Further, I believe the Cheese solution to the election of remedies question is compatible with the Uniform Commercial Code remedies which are now the law in Arizona. See Comment, “Check Forgeries,”.supra.
Appellee, however, argues that what occurred was a form of “ratification” and cites A.R.S. § 44-25411 as authority. When A.R.S. § 44 — 2541 is read with A.R. S. § 44-25402 [U.C.C. § 3-403, Signature by authorized representative], the result raises a genuine issue as to a material fact, as do the appellee’s affirmative defenses based on negligence, referred to above, which together preclude the disposition of this matter by summary judgment.
I concur in the result that summary judgment was not proper under these circumstances and that this matter must be reversed and remanded to the trial court for further action not inconsistent with this opinion.

. Unauthorized signatures
A. Any unauthorized signature is wholly inoperative as that of the person whose name is signed unless he ratifies it or is precluded from denying it; but it operates as the signature of the unauthorized signer in favor of any person who in good faith pays the instrument or takes it for value.
B. Any unauthorized signature may be ratified for all purposes of this article. Such ratification does not of itself affect any rights of the person ratifying against the actual signer.

. Signature by authorized representative
A. A signature may be made by an agent or other representative, and his authority to make it may be established as in other cases of representation. No particular form of appointment is necessary to establish such authority.
B. An authorized representative who signs his own name to an instrument:
1. Is personally obligated if the instrument neither names the person represented nor shows that the representative signed in a representative capacity;
2. Except as otherwise established between the immediate parties, is personally obligated if the instrument names the person represented but does not show that the representative signed in a representative capacity, or if the instrument does not name the person represented but does show that the representative signed in a representative capacity.
C. Except as otherwise established the name of an organization preceded or followed by the name and office of an authorized individual is a signature made in a representative capacity.