ON MOTION FOR REHEARING. In next to the last paragraph of the opinion filed we intended to answer the question: [4] Can plaintiff recover, not having pleaded nor shown any loss? by adopting what Judge TRIMBLE said on this question in his dissenting opinion, but, perhaps, we did not make ourselves clear. In addition to what we quoted, which we think is pertinent, Judge TRIMBLE, in his dissenting opinion (59 S.W.2d page 87) said: "It is urged that plaintiff cannot recover because it has `suffered no loss.' . . . The suit is not one for damages, but to recover money the defendant bank had and received, but to which it never had title and for which it gave plaintiff *Page 100 no consideration. The plaintiff, the moment it paid out the money on the forged indorsements had a cause of action against defendant, which arose immediately. The suit is to recover the money, and is not dependent upon whether a loss will eventually accrue to plaintiff, nor is the suit based upon the checks. [Clearfield Bank v. Madera National Bank, 87 Pa. Super. 564. See, also, Leather Manufacturers' National Bank v. Merchants' National Bank, 128 U.S. 26, 9 Sup. Ct. 3, 32 L. Ed. 342.]"
It is contended in the motion for rehearing that the result of our opinion runs counter to Section 2652, Revised Statutes 1929 (Mo. Stat. Ann., sec. 2652, p. 655), a part of our negotiable statute. This section provides that "where a signature is forged or made without the authority of the person whose signature it purports to be, it is wholly inoperative, and no right to retain the instrument, or to give a discharge therefor, or to enforce payment thereof against any party thereto, can be acquired through or under such signature, unless the party against whom it is sought to enforce such right is precluded from setting up the forgery or want of authority." There is nothing in the opinion that runs counter to this statute. Edgar is in no way involved. His name was used, but forged, and it was not intended that he would have anything to do with the cashier's checks, and there is no question here on Edgar "being precluded from setting up the forgery." And it is argued that we are in conflict with Clifford Banking Co. v. Donovan Commission Co., 195 Mo. 262, l.c. 289, 94 S.W. 527; Foege v. Merchants'-Laclede National Bank (Mo. App.), 208 S.W. 854; Stout v. Caruthersville Hdw. Co., 131 Mo. App. 520, 110 S.W. 619, l.c. 621; Wilson v. Torchon Lace Mercantile Co.,167 Mo. App. 305, 149 S.W. 1156. We do not agree that we are in conflict with the cases cited.
[5] It is argued that our ruling that the cashier's checks were not payable to bearer renders "nonnegotiable and nontransferable for want of a person having authority to endorse as payee allsuch cashier's checks;" and that such holding makes "the issuing bank unable to comply with the provisions" of Sections 2688 and 2689, Revised Statutes 1929 (Mo. Stat. Ann., secs. 2688, 2689, p. 684). So far as here pertinent, Sections 2688 and 2689 provide that the maker of a negotiable instrument "admits the existence of the payee and his then capacity to indorse." These sections have reference to negotiable instruments. Among the requirements of a negotiable instrument is that it "must be payable to order or to bearer." [Sec. 2630, R.S. 1929, Mo. Stat. Ann., sec. 2630, p. 644.] The cashier's checks were not, as we have ruled, under the facts, payable to order, legally speaking, or to bearer, therefore, they were not negotiable, and our holding in no way conflicts with Section 2630. It is contended vigorously in the motion for rehearing that we are wrong in holding that the *Page 101 cashier's checks were not payable to bearer, and it is again argued, as in the original briefs, that there is such distinction between the ordinary depositor's check and a cashier's check that the ruling in American Sash Door Co. v. Commerce Trust Co.,332 Mo. 98, 56 S.W.2d 1304, on the question as to "the person making it so payable" is not applicable. And we are asked to retract. That case, as appears in our opinion, concerned the ordinary depositor's check. We followed that case and applied the reasoning therein to the facts in the present case and have no doubt as to the correctness of our ruling. It is true that there is a difference in the application of some of the rules of law affecting ordinary checks and a cashier's check. Example, "a cashier's check, being merely a bill of exchange drawn by a bank on itself, and accepted in advance by the act of its issuance, is not subject to countermand by the payee after endorsement, as is an ordinary check by the drawer." [5 Michie, Banks and Banking, sec. 251, p. 454.] Our statute defines a bill of exchange as "an unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to order or to bearer." [Sec. 2754, R.S. 1929, Mo. Stat. Ann., sec. 2754, p. 708.] And the statute defines a check as "a bill of exchange drawn on a bank payable on demand." [Sec. 2813, R.S. 1929, Mo. Stat. Ann., sec. 2813, p. 721.] The only apparent difference, except the application of some rules of law, between the ordinary check and a cashier's check, is that the ordinary check is drawn on one, other than the drawer, while in a cashier's check, both the drawer and the drawee are the same. We are unable to appreciate how this difference could work a different construction and application of division 3 of Section 2638, Revised Statutes 1929, than was given in the American Sash Door Co. case, supra.
American Express Co. v. People's Savings Bank (Iowa), 181 N.W. 701, cited in our opinion, was an action to recover the proceeds of four drafts in which the plaintiff was both drawer and drawee, as in the present case. The payees were fictitious. One Crozer purchased the drafts and gave therefor his personal checks drawn on the defendant bank. After receiving the drafts Crozer endorsed them by writing thereon respectively the names of the payees and cashed them at the defendant bank. The drafts were then endorsed by the cashier of the defendant bank "to the order of the Continental Commercial National Bank of Chicago," and further, "prior endorsements guaranteed." The drafts were presented by the Chicago bank to the plaintiff express company, and were paid. The plaintiff express company, "not having realized" on Crozer's checks, brought suit against defendant bank. At the close of plaintiff's case, the trial court, on *Page 102 motion, directed a verdict for the defendant. The Supreme Court of Iowa reversed the judgment on such direction, saying that "if plaintiff's petition stated a cause of action, and its averments were sustained by plaintiff's evidence, then the court was in error in directing a verdict, regardless of the defense tendered by the answer, and regardless of the failure of plaintiff to allege and prove special damage." In ruling the question presented, the Iowa Supreme Court said: "Were the instruments in suit payable to bearer? The drafts in question are negotiable in form, and payable to fictitious or nonexisting persons. When a draft is payable to the order of a fictitious or nonexisting person, and such fact is known to the drawer, it is payable to bearer. [Section 3060a9.] When the name of the payee does not purport to be the name of any person, it is also payable to bearer. Id. `Person' includes a body of persons whether incorporated or not. [Section 3060a191.] The plaintiff company as drawer intended that these drafts should be paid to the named payees, and not to the purchaser, Crozer, and it was not known by the drawer that these drafts were payable to the order of fictitious or nonexisting payees. This being true, the drafts were not payable to bearer." Such is sound reason and we adopt it.
It is stated in the motion for rehearing that in the opinion filed we overlooked "the fact that this case (the Iowa case) was retried after remand and a decision rendered with the opposite result." The Iowa case was retried, American Express Co. v. People's Savings Bank (Iowa), 205 N.W. 1, but when the evidence of both sides was in, an entirely different picture was presented than appeared at the first trial. Of the evidence at the second trial the court said: "Although the clerk or cashier of the express company at Cedar Rapids testified that the drafts in question were intended to be paid to the named payees, and that he did not know that they were payable to the order of fictitious or nonexisting payees, it is shown that Mr. Moyer, the general agent of the company, had knowledge that Crozer was adopting a trade name or names in securing the drafts which were subsequently paid by the defendant bank through the Chicago office of the plaintiff. The trial court was clearly correct in its finding that the plaintiff company knew the method and manner of Crozer in handling these transactions and that the company as a matter of law had knowledge that when these numerous drafts were issued the payees thereof were names used by Crozer for the purpose of conducting the business, and for no other." In other words, under the facts of that case it was found that the express company, the drawer and drawee, of the drafts knew that the payees were fictitious. While a "different result" was reached in the second trial and in the second opinion, it was on entirely different state of facts as found, and in no manner affected the holding in the first opinion. *Page 103
[6] Complaint is made in the motion for rehearing that we did not mention the issue of delay in giving notice on the part of plaintiff "amounting to approximately two months," as defendant says in the motion, after discovery of the alleged forgeries before notifying defendant. This case is here on appeal by plaintiff from an order of the trial court refusing to set aside, on motion, an involuntary nonsuit. The defense of the alleged delay is an affirmative defense, the burden of which was on defendant. We did not, in the opinion filed, discuss that question, because we did not consider and do not now consider that, under the facts disclosed by plaintiff's case, there was reason to say that plaintiff could not recover because of the delay. Plaintiff's evidence tended to show that as soon as the facts relative to the situation were definitely discovered or ascertained, notice was given. Plaintiff's auditor testified that in June or July, 1930, plaintiff learned that the construction companies "suspected some irregularities, but what they were, they didn't know; they were having an audit made . . . to determine what the irregularities were." Plaintiff's auditor testified further: "Q. Well, did they (the construction companies) at least notify or did there come to your notice certain alleged forgeries in connection with some cashier's checks which you had issued? A. Yes. Q. I will ask you whether alleged forgery in connection with some checks which had cleared through the Produce Exchange Bank came to your notice? A. Yes, sir. Q. As soon as that definite notice came to you so that the checks could be identified what did you do? A. We made a demand upon the Produce Exchange Bank for the amount. Q. Was that in writing? A. Yes." Notice and demand were made by registered mail August 14, 1930. This notice or demand was not verified as contemplated by Article 18 of the clearing house association, and on December 16, 1930, verified notice or demand was made on defendant. Manifestly, so far as disclosed, there is no merit in defendant's contention on the question of delay.
The motion for rehearing should be overruled, and it is so ordered. Ferguson and Hyde, CC., concur.