Rakestraw v. Rodrigues
California Supreme Court
500 P.2d 1401 (1972)
William Rakestraw (defendant), the then husband of Joyce Rakestraw (plaintiff), forged Joyce’s signatures on a promissory note and the deed of trust securing that note. A notary formalized the deed of trust on the false assurances of William’s business associate, Sherwood Rodrigues (defendant), that Rodrigues saw Joyce sign the deed. William used the forged documents to obtain a business loan. Joyce unwittingly endorsed the lender’s check for the loan amount. Joyce soon realized that William and Rodrigues had defrauded the lender. Joyce consulted her lawyer, who advised her to report the fraud to the deed of trust’s designated trustee and to rescind her signature on the lender’s check. Joyce ignored this advice and took no action. Three years later, the lender sued Joyce to collect payment on the promissory note. Joyce filed cross-complaints against William, to whom she was no longer married, and Rodrigues. Joyce settled the lender’s suit and obtained a jury verdict against her ex-husband and Rodrigues. The trial court denied Rodrigues’s motion for a judgment notwithstanding the verdict (JNOV). Rodrigues appealed to the California Supreme Court.
Rule of Law
Holding and Reasoning (Wright, C.J.)
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