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COMMONWEALTH TO USE NAHRGANG v. AMERICAN EMPLOYERS INSURANCE CO. (04/12/62)

April 12, 1962

COMMONWEALTH TO USE OF NAHRGANG
v.
AMERICAN EMPLOYERS INSURANCE CO., APPELLANT.



Appeals, Nos. 59 and 60, Oct. T., 1962, from judgments of County Court of Philadelphia, Nov. T., 1957, Nos. 2274 and 2275, in cases of Commonwealth to use of William L. Nahrgang v. American Employers Insurance Co., and Commonwealth to use of William L. Nahrgang, executor of estate of Jane Marie Nahrgang, deceased, v. Same. Orders reversed.

COUNSEL

Herbert A. Barton, with him Swartz, Campbell & Henry, for appellant.

James L. Price, with him Richman, Price & Jamieson, for appellee.

Before Rhodes, P.j., Ervin, Wright, Woodside, Watkins, Montgomery, and Flood, JJ.

Author: Flood

[ 198 Pa. Super. Page 21]

OPINION BY FLOOD, J.

John J. Nahrgang, Jr., a real estate dealer who was also a notary public, defrauded his brother, William L. Nahrgang, and William's wife, by obtaining from him and converting to his own use three checks totaling $7000. Each check was turned over to John in payment for a mortgage, which John told William he had available. In each case, John forged the mortgage, notarized the forged signatures and some time after he got the check delivered the mortgage to William. Suits were instituted to recover on a notarial bond issued by appellant as surety for John. The cases were tried by the court below, sitting without a jury, which found in favor of the plaintiff. The appellant filed motions for a new trial or for judgment n.o.v. and has appealed

[ 198 Pa. Super. Page 22]

    from orders of the court en banc overruling these motions and entering judgment for the plaintiff.

1. The first two transactions consisted of the delivery by William to John during December, 1952, of checks in the sums of $3500 and $2500, respectively, payable to the order of Commonwealth Title Company. John used each of these checks to pay certain obligations due the title company in other unrelated transactions. In each case after delivering the check to the title company he forged the mortgage which William expected to get and notarized the forged signatures of the purported mortgagors. He placed the two forged mortgages of record on February 9, 1953, and later delivered them to William. In each instance John concealed the fraud by making periodic payments of interest.

Since in each case the check was delivered to John before the time fixed for settlement and before the mortgage had been delivered to or seen by William, it cannot be said that the checks were delivered on the faith of the notarization of the signatures on the mortgages. Since William had not seen the mortgages at the time of the delivery of the checks it follows that he gave them to John in reliance upon John's honesty and in the belief at the time that John would deliver valid mortgages to him in return for the checks.

The contrary opinion of the court below, sitting en banc, is based, at least in part, upon the supposition "that two checks were drawn to the order of the Commonwealth Land Title Insurance Company only after the mortgage instruments were first produced and represented to be genuine and authentic". But this is not supported by the testimony. William's testimony is that he handed over the checks for each mortgage before he saw the mortgage, and before ...


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