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CITIZENS STATE BANK v. TRANSAMERICA INSURANCE COMPANY

No. 18969.

452 F.2d 199 (1971)

The CITIZENS STATE BANK, Hartford City, Indiana, Plaintiff-Appellee, v. TRANSAMERICA INSURANCE COMPANY, Defendant-Appellant.

United States Court of Appeals, Seventh Circuit.

November 29, 1971.

Attorney(s) appearing for the Case

Mark W. Gray, John T. Lorenz, Indianapolis, Ind., David B. Keller, Fort Wayne, Ind., Howard J. DeTrude, Jr., Indianapolis, Ind., for defendant-appellant; Kightlinger, Young, Gray & Hudson, Indianapolis Ind., of counsel.

George E. Fruechtenicht, Fort Wayne, Ind., Max C. Peterson, Hartford City, Ind., Rothberg, Gallmeyer, Fruechtenicht & Logan, Martin T. Fletcher, Fort Wayne, Ind., Peterson, Ervin & Barry, Hartford City, Ind., for plaintiff-appellee.

Before KILEY, CUMMINGS and SPRECHER, Circuit Judges.

SPRECHER, Circuit Judge.

The question posed by this diversity case1 is whether a bank employee's seemingly profitless and motiveless act assertedly causing a loss to the bank was "dishonest" under the terms of a blanket bond.

Transamerica Insurance Company (Transamerica), in consideration of an agreed premium, issued its Bankers' Blanket Bond, effective April 19, 1968, wherein it undertook to indemnify the Citizens State Bank,...

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