Valley National Bank v. Mooreman

LOCKWOOD, Chief Justice.

American Title and Trust Company had two checking accounts. One, in the Guaranty Bank, was designated its escrow account; the other, in the Valley National Bank, was called its trust account, and was used to deposit and disburse funds held in trust for various parties. The Valley Bank was fully aware of the nature of the trust account.

The Lomas and Nettleton Company, hereinafter called Lomas, also maintained a checking account in the Valley Bank. On August 18, 1966 it deposited in that account, two checks totaling nearly $23,000. The checks were drawn by American Title…