In 1958, William C. and Ula May Alden, and Mickey E. and Joyce E. Keffer signed a promissory note for $4,550, payable to August and Mabel Manke. The note was secured by a deed of trust for Nevada property held by Pioneer Title Insurance Company (Pioneer) (defendant). The note and the deed of trust were deposited with Pioneer, which was instructed to collect and pay the $4,550 to the payee named in the note and to re-convey the property covered by the deed of trust after full payment had been made. After August Manke died, Mabel assigned her interest in the note and deed of trust, which were lost, to Julio Giorgi (plaintiff). Giorgi notified the Aldens and the Keffers of the assignment, and Giorgi recorded the assignment. Giorgi did not notify Pioneer that an assignment had occurred. Trying to collect payment under the note, Giorgi learned that Pioneer had already made payment and re-conveyed the property to Mabel. Giorgi sued Mabel and Pioneer for the amount due under the note. The trial court ruled in favor of Giorgi against Mabel, but refused to hold Pioneer liable. Giorgi appealed.