Fireman's Fund Insurance v. Security Pacific National Bank

This appeal is taken from an order of dismissal entered after Security Pacific National Bank’s (hereinafter Security) general demurrer to Fireman’s Fund Insurance Company’s (hereinafter Fireman’s) second amended complaint was sustained without leave to amend. Plaintiff-appellant Fireman’s instituted these proceedings against defendant-respondent Security, among others, to recover damages in the amount of a $25,000 check deposited by one of the latter’s customers, Jason A. Keyes (hereinafter Keyes), into his account having earlier forged one of the drawer’s signatures on a check drawn from the account of Daniel Reeves & Company (hereinafter Reeves) at Banco Popular De Puerto Rico (hereinafter Banco).

Fireman’s contends that it has pleaded sufficient facts to allege a cause of action for common law negligence, as well as breach of certain warranties found within divisions 3 and 4 of the California Uniform Commercial Code (hereinafter Commercial or Com. Code).

The problem confronting us arose when Keyes absconded with $25,000. The check involved was prepared by Keyes, whose signature was one of two required on checks drawn on the Reeves account at Banco. After signing his…