Bank of Texas v. VR Electric, Inc.

An outside contractor's employee stole an unsigned company check from VR Electric's (plaintiff's) office, forged the company president's signature, and cashed it through a car dealer, Frank Mata (defendant), who deposited it into his own account; the Bank of Texas (defendant) processed and paid the check through an automated Federal Reserve system without manually verifying the signature. Bank employees gave conflicting testimony about the bank's verbal, unwritten policy on when signatures required manual verification. A jury found the Bank acted in good faith but that its negligence, along with that of the other parties, contributed to the loss; the trial court disregarded the good-faith finding but let the negligence finding stand, awarding VR damages, and the Bank appealed.