Court Opinion

ID: 5737587
Source: CourtListenerOpinion
Date Created: 2022-01-12 16:36:23.120009+00
Date Added: 2024-06-11T08:40:59.803007
License: Public Domain

Memorandum by the Court.
The key issue in this case is whether the plaintiff’s employee had authority to stamp the indorsement on the checks which were subsequently deposited in a bank other than that in which the plaintiff had an account. An absence of such authority would render the indorsement a forgery so that the defendant bank could be held liable for the *216diverted proceeds of the check (see McCabe Hanger Mfg. Co. v. Chelsea Exch. Bank, 183 App. Div. 441; Negotiable Instruments Law, § 42). After the plaintiff concluded his case and despiite the fact that the defendant had not yet put in any testimony or rested its case, the court made a finding that there had been authority for the indorsement and thereupon made its decision. The plaintiff, however, testified that no such authority had been given. That testimony put the question of authority in issue and provided the plaintiff with a prima facie case. It was therefore improper for the court to make a finding on the issue of authority at the end of the plaintiff’s case and, based upon such finding, to dismiss the complaint.