Security Trust & Savings Bank v. Matson

JENNINGS, J.

Plaintiff appeals from a judgment denying recovery in an action instituted by it to recover damages from a notary public and the surety on her official bond. The record discloses the following pertinent facts:

For approximately two and one-half years prior to December 27, 1928, one Lewis H. Homer was an attorney-in-fact for respondent Indemnity Insurance Company of North America in the city of San Diego. During the month of December, 1928, the said Lewis H. Homer sought to procure from appellant the loan of $15,000 and offered to secure repayment of the loan by depositing with appellant a bond executed by the Indemnity Insurance Company of North America guaranteeing repayment of the loan. The deal was consummated and the loan made. The bond which was thus given purported to have been executed by Gordon L. Eby, also an authorized agent and attorney-in-fact of the respondent Insurance Company. The bond was not in fact executed by Gordon L. Eby and his signature appearing thereon was forged. Attached to the bond was a notarial certificate in the usual form reciting that Gordon L. Eby, known to the notary to be the person whose name is subscribed to the within instrument as attorney-in-fact of the Indemnity Insurance Company of North America, had personally appeared before the notary and acknowledged that he had subscribed the name of the company as principal and his own name as attorney-in-fact. The certificate bore the seal of a notary public. The signature of the notary is a genuine signature. The evidence discloses that the notary who had been employed as a stenographer in the office of Gordon L. Eby in San Diego, was not so employed

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at the time the bond was made. It also appears that it was the custom of the notary, during the time she was employed in Eby’s office, to keep in her desk, available for use by anyone who had access thereto, a number of blank acknowledgments signed by her as notary. The evidence discloses that the notary did not possess a seal of her own, but used a blank notarial seal which was the property of the office. This seal remained in the office when she terminated her employment with Gordon L. Eby during the month of November, 1928. It is undisputed that although the signature of the notary appearing on the certificate attached to the bond is a genuine signature, the recital contained therein that Gordon L. Eby had appeared before her on December 27, 1928, and acknowledged that he had subscribed the name of the Indemnity Insurance Company of North America to the bond as principal and his own name as attorney-in-fact is untrue and that Gordon L. Eby did not subscribe the company’s name as principal or his own name as attorney-in-fact, nor did he acknowledge that he did. The conclusion is obvious that Lewis H. Homer, who was employed in the office of Gordon L. Eby forged Eby’s signature to the bond, secured possession of one of the blank notarial certificates bearing the signature of the notary, impressed it with the notarial seal which was in the office, and attached the certificate to the spurious bond, which he deposited with appellant to secure repayment of the loan made by appellant to him. The complaint alleges that the notary had been duly appointed and was acting as such on December 27, 1928; that her official bond had been duly approved by a judge of the superior court; that appellant made the loan to Lewis H. Homer in reliance upon the bond deposited as security; that it believed the bond was valid and genuine for the reason that the purported signature of Gordon L. Eby as attorney-in-fact appeared to have been acknowledged before the notary; that her certificate was genuine and by reason thereof appellant believed the bond to which it was attached and the signature of Gordon L. Eby as attorney-in-fact were authentic and genuine and that it had good security for the loan; that Lewis H. Homer is insolvent and the loan obtained by him has not been paid and by reason of the genuine certificate of acknowledgment of the notary attesting the forged signature of Gordon L. Eby as attorney-