North Carolina National Bank v. United States Casualty Company

HAYNSWORTH, Circuit Judge.

Under its “Bankers Blanket Bond,” the Bank seeks to recover from the casualty company the amount of a large loss it suffered on a loan purportedly secured by accounts receivable, which, in fact, did not exist. It does so on the theory that copies of invoices deposited with and assigned to the Bank as evidence of the receivables were counterfeited within the meaning of the indemnity bond, because, though issued and assigned by authorized officials of the debtor, the invoices were intrinsically false in their representation that goods had been sold and delivered.

Relying…