Bank of America National Trust & Savings Ass'n v. Figueroa

California Supreme Court Jun 1, 1933 No. Docket No. L.A. 13611.Published

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Holding. The court held that the Bank of America was not personally liable to Figueroa and Brittingham for the loss of their funds held by the insolvent California Savings & Commercial Bank, as the evidence supported the finding that the Bank of America lacked notice of the specific nature of the deposits and the appellants suffered no loss of preference rights due to the bank's remittance methods.

Issues

Whether the Bank of America is personally liable to Figueroa and Brittingham for the amount of their claims against an insolvent bank.
Whether the Bank of America had notice that certain deposits were subject to a specific tri-party contract.
Whether the Bank of America's method of remitting collection proceeds violated the parties' contractual agreements.

Disposition. affirmed

Quotations verified verbatim against the opinion

“The court below found both as to the $24,000 check and the drafts for the sale price of the cotton that the Bank of America was without notice that said items represented the deposit under the exhibit A contract”

“Furthermore, irrespective of whether the Bank of America had notice, it is not liable herein to Figueroa and Brittingham.”

“Figueroa and Brittingham have lost no rights of preference against the California Savings & Commercial Bank by reason of the fact that the Bank of America did not remit in cash or currency”

THE COURT.

This proceeding is a companion case on appeal to

Bank of America National Trust & Savings Association

California Savings & Commercial Bank et al.,

L. A. No. 13645,

ante,

p. 261 [22 Pac. (2d) 704], this day decided, which involves an appeal from a judgment of the Superior Court of the County of San Diego. The appeal in the case herein, L. A. No. 13611, is taken from a judgment of the Superior Court of Los Angeles County.

As indicated in our opinion in proceeding L. A. No. 13645,

ante,

p. 261, the action in the Superior Court of the County of San Diego was tried on the sole issue of whether the claim of Figueroa and Brittingham and the Bank of America for

[283]

$27,674.44 against the California Savings & Commercial Bank was a general claim, or a preferred claim to be paid in full from the cash in its vaults when it closed on July 23, 1930. It was stipulated in said case that any judgment against the insolvent bank should be a joint judgment in favor of Figueroa and Brittingham and the Bank of America, and that all issues between them

inter se

should be • dismissed without prejudice. To try said issues the Bank of America filed a separate suit in the county of Los Angeles against Figueroa and Brittingham. From the judgment in favor of the Bank of America in said action Figueroa and Brittingham prosecute this appeal.

By the complaint in the case herein the Bank of America sued to recover from Figueroa and Brittingham the balance of $9,226.73 due and unpaid on the last draft of '$20,000 accepted by it for accommodation of Figueroa and Brittingham. All other drafts drawn by Figueroa and Brittingham by virtue of the acceptance credit of $90,000 extended to them by the Bank of America, as more fully set forth in our opinion in case L. A. No. 13645, had been paid in full. Figueroa and Brittingham, by answer and cross-complaint herein, contended that the Bank of America, acting together with said California Savings & Commercial Bank, had committed certain acts in violation of the tri-party contract entered into by Figueroa and Brittingham, Bank of America and California Savings & Commercial Bank (which contract is more fully described in our opinion in case L. A. No. 13645,

Bank of America National Trust & Savings Ass'n v. Figueroa

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THE COURT.

L. A. No. 13645,

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