Florida Statutes & Case Law: FDLG's Response to Defendant's Motion to Dismiss

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Permalink Reply by L on December 18, 2009 at 7:20pm

Continued in next post.

Attachments:

• Booker v. Sarasota 707 So2d 886 (Fla.App. 1 Dist. 1998).pdf, 585 KB
• Munck v. Manatee River Bank & Trust Co. 165 S.C. Fla. 1935.pdf, 887 KB
• McClure v. American Nat. Bank S.C. Fla. 67 Fla. 22 (1914).pdf, 462 KB

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Permalink Reply by L on December 18, 2009 at 7:23pm

In Mason v. Rubin, there is a reference to Thompson v. First Union National Bank.

Attachments:

• Johns v. Gillian S.C. Fla 184 So. 140 (Fla. 1938).pdf, 207 KB
• WM Specialty Mortg. v. Salomon (874 So.2d 680 (Fla. App. 4 Dist. 2004).pdf, 583 KB

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Permalink Reply by L on December 18, 2009 at 11:12pm

The basics of Case Law Study:

NoLo Legal Research Help

How to Research Case Law

Georgetown Law Case Law Tutorial


Guide to Locating Florida Case Law

Georgetown Law Case Law Research Guide

How to Read a Judicial Opinion

Database for Case Law (none are exhaustive, most go back about 10 years)


MegaLaw

LexisOne

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Permalink Reply by L on December 19, 2009 at 8:45am

The UCC (Uniform Commercial Code) is federal law. Florida has similar (not exactly equivalent) state Statutes found here.

Here is the Florida U.C.C. Statute governing negotiable instruments, Chapter 673.

The following was posted on LivingLies (the Federal U.C.C. numbered references would have to be found in the Florida code to see if the same protections are available).

Foreclosure Fraud, on December 6th, 2009 at 6:29 pm Said:

Foreclosure Defense – Use the UCC

Something interesting I came across today… Thoughts???

“In light of the fact that virtually all promissory notes taken by banks, mortgage companies, etc., were sold at some time after the “closing” for the respective transactions — without the right in discovery to physically inspect, and photocopy the original wet-ink instrument, (production of the original instrument), meaning that the bank, mortgage company, etc., retained physical possession of the NOTE, standing in court to enforce the instrument in foreclosure is impossible pursuant to the Uniform Commercial Code. (UCC).

This is the law behind — “Show Me the Note!”

Statutory Requirements For Establishing The Right To Enforce An Instrument

1. Prove status of holder of the instrument. (UCC § 3-301(i)); or

2. Prove status of non-holder in possession of the instrument who has the rights of a holder. (UCC § 3-301(ii)); or

3. Prove status of being entitled to enforce the instrument as a person not in possession of the instrument pursuant to UCC § 3-309 or UCC § 3-418(d). (NOTE is lost, stolen, destroyed).

UCC § 3-309, requirements.

a. Prove possession of the instrument and entitled to enforce it when loss of possession occurred. (UCC § 3-309(a)(1)).

i. If illegality or fraud were involved in the original transaction, it cannot be proved that the person is entitled to enforce the instrument.(See UCC § 3-305. DEFENSES)

b. Prove non-possession of the NOTE is NOT the result of a transfer. (UCC § 3-309(a)(2)).

NOTE: If discovery shows that the instrument was sold by the person claiming the right to enforcement, a transfer occurred, and such person is NOT entitled to enforce the instrument. (See UCC § 3-309(a)(ii)).

c. Prove that the person seeking enforcement cannot reasonably obtain possession of the instrument because the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process. (UCC § 3-309(a)(3)).

NOTE: If discovery shows that the instrument was sold by the person claiming the right to enforcement, a transfer occurred, and such person is NOT entitled to enforce the instrument. (See UCC § 3-309(a)(ii)).

d. A person seeking enforcement of an instrument under subsection (a) must prove the terms of the instrument and the person’s right to enforce the instrument. (UCC § 3-309(b)).

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UCC § 3-309 Enforcement Of Lost, Destroyed, Or Stolen Instrument.

(a) A person not in possession of an instrument is entitled to enforce the instrument if

(1) the person seeking to enforce the instrument

(A) was entitled to enforce the instrument when loss of possession occurred, or

(B) has directly or indirectly acquired ownership of the instrument from a person who was entitled to enforce the instrument when loss of possession occurred;

(2) the loss of possession was NOT the result of a transfer by the person or a lawful seizure; and

(3) the person cannot reasonably obtain possession of the instrument because the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process.

(b) A person seeking enforcement of an instrument under subsection (a) must prove the terms of the instrument and the person’s right to enforce the instrument. If that proof is made, Section 3-308 applies to the case as if the person seeking enforcement had produced the instrument. The court may not enter judgment in favor of the person seeking enforcement unless it finds that the person required to pay the instrument is adequately protected against loss that might occur by reason of a claim by another person to enforce the instrument. Adequate protection may be provided by any reasonable means.

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An instrument is transferred when it is delivered by a person other than its issuer for the purpose of giving to the person receiving delivery the right to enforce the instrument. (UCC § 3-203(a)).

If a transferor purports to transfer less than the entire instrument, negotiation of the instrument does not occur. The transferee obtains no rights under this Article and has only the rights of a partial assignee. (UCC 3-203(d)).

****************

If the bank, mortgage company, etc., sold the NOTE, they have no right to enforce the NOTE, through foreclosure or court proceeding pursuant to the fact that the UCC bars such claimant from invoking the court’s subject matter jurisdiction of the case.

****************

Even if the claimant produces the original wet-ink NOTE, there is a defense to the action pursuant to UCC 3-305.

Illegality and false representation (fraud) perpetrated in the transaction. Did the bank disclose the SOURCE of the money for the transaction?

Did the bank inform the NOTE issuer that the money for the transaction was provided at no cost to the bank?

Did the bank disclose that the NOTE would be sold at the earliest possible convenience, and that such sale and receipt of money from a third party would actually pay off the NOTE? (Satisfaction of Mortgage).
Many discovery questions to be asked when a claimant initiates foreclosure proceedings.

***********

Many assume that the bank/broker/lender that begins the process is actually providing the money for making a “loan,” when in fact, the bank/broker/lender is only making an “exchange,“ of notes, at no cost, and then, coercing the issuer of the promissory note into the comprehension that he is receiving a “loan.”

The following was stated in A PRIMER ON MONEY, SUBCOMMITTEE ON DOMESTIC FINANCE, COMMITTEE ON BANKING AND CURRENCY, HOUSE OF REPRESENTATIVES, 88th Congress, 2d Session, AUGUST 5, 1964, CHAPTER VIII, HOW THE FEDERAL RESERVE GIVES AWAY PUBLIC FUNDS TO THE PRIVATE BANKS [44-985 O-65-7, p89]

“In the first place, one of the major functions of the private commercial banks is to create money. A large portion of bank profits come from the fact that the banks do create money. And, as we have pointed out, banks create money without cost to themselves, in the process of lending or investing in securities such as Government bonds.”

In this instance, the transaction was funded by using the prospective property (collateral) and the signer’s promissory note as if the property and the Note already belonged to the bank/broker/lender.

So, if the bank used the promissory NOTE, as money, to create the cash reserve which was then used to validate the bank check issued on the face amount of the promissory NOTE, at no cost to the bank, without NOTICE to the signer of the promissory NOTE, and without fully disclosing these facts and aspects of the transaction, the bank committed a DECEPTIVE PRACTICE, FRAUD.”

4closureFraud
http://4closurefraud.wordpress.com/

I am not an attorney and this is not legal advise…

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Permalink Reply by stopGOVTwaste on December 24, 2009 at 9:46am

Also UCC 3-501 is helpful... it allows the borrower to discontinue payment without dishonor.

UCC 3-501 requires a lender to “exhibit the note” when the lender makes demand for payment, and the borrower demands to see the note. Technically a demand for payment occurs every month, and it also occurs when a bank begins foreclosure proceedings.

UCC 3-501 also requires a servicer to show authority to make a demand for payment, if it does not own the note, but is merely servicing it. In the event a noteholder or servicer or will not exhibit the note or perform other legal requirements when requested to do so by the borrower, this UCC section allows the borrower to discontinue payments WITHOUT DISHONOR until such time as the noteholder or servicer complies with all laws or contract provisions.

Also helpful is UCC 3-309. UCC 3-309 requires the lender go through certain steps to prove up a note (make it enforceable) that is lost or destroyed. This is not easy for the lender to do, if one is willing to contest everything the lender does to try to prove up the note. This proof takes witnesses, who may not be able to say what the law requires, if the witnesses are thoroughly cross-examined. (Tip: Don’t let the lender get by with self-serving affidavits; take their witnesses’ depositions).

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Permalink Reply by L on December 19, 2009 at 11:19pm

Good info on Florida Statutes:

The Note, The Transferee, and the Wardrobe

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Permalink Reply by stopGOVTwaste on December 24, 2009 at 8:34am

My favorite part is 673.2031 - Transfer of instrument; rights acquired by transfer.--

(2) transferee cannot acquire rights of a holder in due course by a transfer, directly or indirectly, from a holder in due course if the transferee engaged in fraud or illegality affecting the instrument.

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Permalink Reply by L on January 5, 2010 at 12:32pm

This case was handed to me by a Florida Foreclosure Defense Attorney. I haven't read it yet but did not want to delay in posting it for others.

Attachments:

• Progressive Express v McGrath Community 913 So[1].2d 1281.pdf, 534 KB

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Permalink Reply by L on January 8, 2010 at 4:21pm

Great addition from Alina with a lot of FL (and also TX) Case Law: Mortgage Fraud White Paper: Have a Note Commercial / Residential Obligors? Attorneys Judges investors You need to read this.

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Permalink Reply by L on January 8, 2010 at 4:49pm

Let's see if the cited cases are available on Google Scholar and post links. If anyone has some time to check into that, it would be appreciated!

For those that aren't available, I'll find time to get copies at the library or the courthouse law library in the coming weeks.

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Permalink Reply by Matthew Gross on February 1, 2010 at 11:35am

This is no longer available. Is it anywhere else?

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Permalink Reply by L on February 1, 2010 at 8:09pm

That link is broken! Let's try this one: Mortgage Fraud White Paper: Have a Note Commercial / Residential Ob...

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