CopyCited 2 times | Published | District Court, S.D. Florida | 2013 WL 3119057, 2013 U.S. Dist. LEXIS 87315
...Plaintiff has no cause for conversion against a third party Second, as the Court previously stated, Florida statutes specify that “[a]n action *1367 for conversion of an instrument may not be brought by ... [t]he issuer or acceptor of the instrument.” Fla. Stat. § 673.4201 (l)(a); 5 see Doc....
...An “issuer” is “a maker or drawer of an instrument.” Fla. Stat. §
673.1051 (3). Courts interpreting this statute hold that a drawer has no action in conversion against a bank other than its own drawee bank. See Groom v. Bank of America,
2012 WL 50250 , *7 (M.D.Fla.2012) (concluding that Fla. Stat. §
673.4201 (1) precludes the drawer of a checking account from a conversion action against the bank for checks the bank allegedly converted); Cheese & Grill Restaurant, Inc....
...Because a depositor loses title to funds when they are deposited into an account, the funds become the property of the bank and the depositor no longer has sufficient interest in that property to assert a claim of conversion. Id.; see UCC Comment to Fla. Stat. § 673.4201 (1) (“There is no reason why a drawer should have an action in conversion....
...1st DCA 1983). As discussed, courts interpret Florida statutes as precluding an action in conversion by the holder of an account against any bank other than its own. See Groom,
2012 WL 50250 , *7; Cheese,
970 So.2d at 375 ; see UCC Comment to Fla. Stat. §
673.4201 (1)....
...§
674.101-104 ; Corfan Banco Asuncion Paraguay v. Ocean Bank,
715 So.2d 967, 970-971 (Fla. 3d DCA 1998); see also Doc. 34, pp. 3-6. . The Court is not persuaded by Plaintiffs insistence that these transactions are not “instruments” as contemplated by Florida Statute §
673.4201(l)(a) because they are not written instructions signed by the person giving the instruction to pay....
CopyCited 2 times | Published | District Court, S.D. Florida | 62 U.C.C. Rep. Serv. 2d (West) 886, 2007 U.S. Dist. LEXIS 43358, 2007 WL 1628803
...ed pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim upon which relief may be granted. Defendant argues that Plaintiff lacks standing to bring a claim for conversion of a negotiable instrument pursuant to § 673.4201(1) because there was no constructive or actual delivery of the Check to the payees (the Chuvens) or their agent; therefore, as the Chuvens' assignee, Plaintiff cannot bring a claim for statutory conversion pursuant to § 673.4201(1)....
...Defendant further argues that as a result of the action to quiet title to their property, the Chuvens had no financial interest in the Check at the time they assigned their claims to Plaintiff; therefore, as the Chuvens' assignee, Plaintiff has no financial interest in the Check and has no right to recovery pursuant to § 673.4201(2). In response, Plaintiff argues that it has adequately alleged delivery-thus satisfying the pleading requirements of a claim for conversion of a negotiable instrument pursuant to § 673.4201(1)-by alleging that "the maker of the check intended that the check would be an enforceable obligation against her according to its terms," and that the maker "surrendered control of the check with that intention." (Resp....
...er the payee, a copayee, or the payee's agent. Then the Court must determine whether Plaintiff has adequately alleged delivery of the Check in satisfaction of the pleading requirements of a claim for conversion of a negotiable instrument pursuant to § 673.4201(1). If the Court determines that Plaintiff has adequately alleged delivery of the Check, then the Court must consider Defendant's argument that the facts alleged in the complaint preclude any recovery in this action as a matter of law pursuant § 673.4201(2). Florida Statutes section § 673.4201 provides in relevant part: (1) The law applicable to conversion of personal property applies to instruments....
...t or copayee. (2) In an action under subsection (1), the measure of liability is presumed to be the amount payable on the instrument, but recovery may not exceed the amount of the plaintiff's interest in the instrument. Defendant contends that under § 673.4201(1)(b), a payee may only sue for conversion of a check if there was delivery of the check to either the payee, a copayee, or an agent of the payee. (MTD at 7-8.) According to Defendant, "even if the drawer issues a check and attempts to deliver it, and thereby evinces an intent to make the check enforceable against the drawer, delivery under § 673.4201 does not occur unless there is delivery to a person who is the payee, a copayee, or the payee's agent." (MTD at 9.) Defendant argues that the complaint misguidedly focuses on the "state of mind of the drawer of the Check rather than on th...
...k was delivered to the imposter sellers or another person-not the Chuvens-who ultimately gave the Check to the imposter sellers. (MTD at 9.) According to Defendant, the only way Plaintiff can have standing to bring a claim for conversion pursuant to § 673.4201 is if the imposter sellers-having received delivery (actual or constructive) of the Check-were the Chuvens' agents for purposes of delivery....
...pursuant to Rule 12(b)(6). (MTD at 11.) Plaintiff argues in response that an allegation of constructive delivery to any third person is sufficient to satisfy the pleading requirements of a claim for conversion of a negotiable instrument pursuant to § 673.4201. According to Plaintiff, § 673.4201(1)(b) may be satisfied by an allegation that the maker or the drawer of the Check intended that the Check be an enforceable obligation and that he or she surrendered control of the check with that intention, placing it in the power of the payee or some third person. (Resp. at 4.) Florida Statutes section § 673.4201 was enacted by Laws 1992, c....
...Thus, under the former § 673.419, a check was converted if paid on an unauthorized or forged endorsement, but the former statutory provision did not expressly address whether a payee who never received delivery of the check could sue for conversion of it. See Fla. Stat. Ann. § 673.4201, cmt....
...rtgage and gave it to the purchasers who, having an outstanding obligation to the sellers, forged the sellers' signature and cashed the check). Defendant argues that with the Florida legislature's repeal of § 673.419 and its concurrent enactment of § 673.4201 (Florida's adoption of the statutory conversion provision within the revised Article 3 of the Uniform Commercial Code (UCC)), "the prior Florida cases on constructive delivery no longer represent the law in Florida on the delivery issue i...
...here, the third party receiving the check is not the agent of the payee." (MTD at 7.) Plaintiff argues in opposition that "constructive delivery of a negotiable instrument, even to a thief is still a valid basis to establish conversion" pursuant to § 673.4201, and that "the state of mind of the maker of the check is still a material issue." (Resp....
...at 3-4 (emphasis added).) The Florida Supreme Court has not directly addressed the question of whether constructive delivery of a negotiable instrument to the forger may be sufficient to constitute constructive delivery for the purposes of alleging a conversion claim pursuant to § 673.4201....
...must be resolved "in a manner consistent with established general precepts of policy construction in place in the State of Florida." [2] Guideone Elite Ins. Co. v. Old Cutler Presbyterian Church,
420 F.3d 1317, 1326 (11th Cir. 2005). The Comment to §
673.4201, which lends insight into the legislative intent in adopting §
673.4201, explains that under the former Article 3 of the UCC, there was a split of authority on the issue of "whether a payee who never received the instrument is a proper plaintiff in a conversion action." Fla. Stat. Ann. §
673.4201, cmt. 1. The Comment makes clear that pursuant to §
673.4201, the payee has no conversion action where the payee, a copayee, or the payee's agent never received delivery of the check. [3] Fla. Stat. Ann. §
673.4201, cmt. 1. It appears from the plain language of §
673.4201 and the commentary that constructive delivery of a negotiable instrument to the forger or a third party who is not a copayee or the payee's agent is not sufficient to constitute delivery for the purposes of alleging a conversion claim pursuant to §
673.4201. While no Florida court appears to have *1094 addressed this issue directly, the decisions construing §
673.4201 are consistent with this reading....
...nc. v. Community Bank of Homestead,
735 So.2d 519, (Fla. 3d DCA 1999), Ishii v. Welty,
1998 WL 1064846 (M.D.Fla.1998), and Harmony Homes, Inc. v. United States,
936 F.Supp. 907 (M.D.Fla.1996). The Racso and Ishii cases are consistent with construing §
673.4201 to require actual or constructive delivery to the payee, the copayee or the payee's agent before a claim for conversion may be brought. The Harmony Homes case does not involve a claim for conversion pursuant to §
673.4201 or the former § 673.419 and does not refer to or discuss delivery for the purposes of §
673.4201....
...Presumably, the assumption underlying the Racso decision was that there must have been constructive delivery to the payee (or the copayee or the payee's agent) in order for the payee to be a proper party plaintiff in a conversion action pursuant to § 673.4201....
...The Ishii court agreed that the individual who converted the check could have been acting as the payee's agent for purposes of delivery, and presumably, the assumption underlying the Ishii decision was the Ishii plaintiff could only have standing to bring a claim for conversion pursuant to § 673.4201 if the individuals who received delivery of the converted checks were the Ishii plaintiffs agents for purposes of delivery. Finally, the decisions of courts in other jurisdictions that have adopted the revised Article 3 provision identical to § 673.4201 *1095 support this reading....
...payee (a bank customer) had no knowledge of the fraudulent transactions, that the plaintiff/payee had no standing to bring a cause of action for statutory conversion (under Mississippi's adopted revised Article 3 UCC provision identical to Florida's § 673.4201) because the payee never received delivery of any of the instruments giving rise to the claim); Olympic Title Ins....
...rtgage loan, but a thief received delivery of the check from the closing agent-that the payee's assignee lacked standing to bring a cause of action for statutory conversion (under Ohio's adopted revised Article 3 UCC provision identical to Florida's § 673.4201) because the payee never received delivery of the check, and therefore retained its first mortgage position on the property)....
...allegations in the light most favorable to Plaintiff, the Court finds that Plaintiff has failed to adequately allege delivery of the Check in satisfaction of the pleading requirements of a claim for conversion of a negotiable instrument pursuant to § 673.4201(1)....
...NOTES [1] The Court notes that Plaintiff fails to identify in its single-count complaint a specific legal theory upon which it seeks recovery. In briefing the motion to dismiss, the parties treat the complaint as a claim for conversion of a negotiable instrument pursuant Florida Statutes section 673.4201....
...The drawer of the check has no conversion remedy, but the drawee is not entitled to charge the drawer's account when the drawee wrongfully honored the check. . . . The loss will fall on the person who gave value of the thief for the check." Fla. Stat. Ann. § 673.4201, cmt....
...Cadet,
862 So.2d 736, 742 (Fla. 5th DCA 2003)). [6] Because the Court finds that Plaintiff has failed to adequately allege delivery of the Check in satisfaction of the pleading requirements of a claim for conversion of a negotiable instrument pursuant to §
673.4201(1), the Court declines to address Defendant's additional argument that the facts alleged in the complaint preclude any recovery in this action as a matter of law pursuant §
673.4201(2).
