the proceeds of $5,000 to reimburse him for the price of the Cessna which he bought for WTAE out of his personal funds.
7. On June 28, 1963, Steensen sent to the Bank an Aircraft Credit Statement (Bank Exh. A) in which the space entitled "Existing Lien on Aircraft" was left blank.
8. The Bank approved the loan and Steensen's credit. Steensen received from the Bank an Aircraft Check Sheet (WTAE Exh. B) and an aircraft chattel mortgage with promissory note attached in the sum of $6,124.80. (Bank Exh. B). Complying with instructions, Steensen executed and returned to the Bank the chattel mortgage and note, and the white copy of Form FAA-500, the bill of sale he had received from Aero which stated that there were no encumbrances. (T. pp. 93-94, 59-60). Also enclosed was a check payable to the Federal Aviation Agency for $8 (WTAE Exh. H) for recording the bill of sale and the mortgage, a check payable to the Bank for $6.50 for title search fee (WTAE Exh. I), an insurance policy with loss payable clause in favor of the Bank (Bank Exh. F), a financial statement, and the serial number of the Cessna.
9. Subsequently, the Aircraft Check Sheet was returned to Steensen with certain items checked off (WTAE Exh. C), being those items previously sent to the Bank. Accompanying the check sheet was a Letter of Authorization
on which Steensen was to state the name of the person to whom the proceeds of the loan were to be paid. On this Letter of Authorization Steensen filled in his own name and address as the person to whom the proceeds were to be paid and mailed it to the Bank, along with the Aircraft Check Sheet. The Bank received the check sheet but denies it received the Letter of Authorization.
10. On July 31, 1963, the Bank received a telefax (Bank Exh. D) from a title company notifying it that the Cessna was "titled to Aero Enterprises, Inc." and that a mortgage existed in favor of Appliance Buyers Credit Corporation (ABC) in the amount of $6,000. The title search (Bank Exh. C) revealed that Aero had purchased the Cessna from Kentucky Air Transport, Inc. on December 10, 1962 and that its bill of sale was recorded January 3, 1963; that ABC's $6,000 lien was dated December 8, 1962 and recorded January 3, 1963.
11. On July 31, 1963, the same day it received the telefax, the Bank sent $5,000, the proceeds of the loan, by check (Bank Exh. E) payable to "Aero Enterprised, Inc. and Buyers Credit Corporation " to satisfy the $6,000 lien. The check noted that it covers "Steensen, Robert D. 1961 Cessna Skyhawk." The release of lien was received by the Bank and filed with the Federal Aviation Agency.
12. Although McElhone swore that he sent the $5,000 check to Aero "at the specific instructions of the Defendant [Steensen] and with the full authority of the Defendant," (paragraph 9 of Answer to New Matter, In the Court of Common Pleas, Allegheny County, Pennsylvania, No. 2488 July Term, 1964, admitted into evidence, T. pp. 129-132) the check was actually mailed to ABC, and the payment was made without the knowledge of Steensen. (T. pp. 46-50). Neither did the Bank make any inquiry of Aero as to the amount owing on the $6,000 lien. (T. pp. 50-51).
13. The following letter to ABC accompanying the $5,000 check was admitted in evidence. (T. pp. 127-129).
"Appliance Buyers Credit Corp.