Feldman Construction Co. v. Union Bank

Plaintiff Feldman Construction Company sued its depository bank, Union Bank, for the wrongful payment of a check. Union cross-complained for indemnity against Trans-World Bank. Trans-World in turn cross-complained against the plaintiff and Union Bank for money owed and for negligence.

Judgment was entered in the court below for the plaintiff against Union Bank. Judgment also went against Trans-World on its cross-complaint. Union was awarded indemnity against Trans-World. Union does not appeal; Trans-World is the sole appellant herein.

The facts giving rise to this controversy are: On March 20, 1968, William Feldman, a partner of plaintiff, drew a check on behalf of the partnership directing its drawee bank, Union, to pay $15,000 to the order of:

The check was delivered to Mr. Sullivan, president of Interstate Steel, a subcontractor of the Feldman' Construction Company. On the back of the check was written the following: “Endorsement of this check acknowledges payment as of this date all material and labor at A.I.C. Bldg. 8060 Florence Ave. Downey, Calif.” On March 21, 1968, the check was deposited by Interstate Steel in its account at Trans-World Bank. It bore the…