In a recent Florida appellate case, the Court of Appeals for the Fourth District set aside a summary judgment where the trial court erred in finding for a plaintiff which pleaded an unindorsed promissory note. The case is:
Riggs v. Aurora Loan Servs., LLC, No. 4D08-4635, COURT OF APPEAL OF FLORIDA, FOURTH DISTRICT, 2010 Fla. App. LEXIS 5280; 35 Fla. L. Weekly D 879, April 21, 2010, Decided.
"In the instant case, the endorsement in blank is unsigned and unauthenticated, creating a genuine issue of material fact as to whether Aurora is the lawful owner and holder of the note and/or mortgage. As in BAC Funding Consortium, there are no supporting [*3] affidavits or deposition testimony in the record to establish that Aurora validly owns and holds the note and mortgage, no evidence of an assignment to Aurora, no proof of purchase of the debt nor any other evidence of an effective transfer. Thus, we reverse the summary judgment and remand for further proceedings. We find no merit in any of the other arguments raised on appeal."
Litigants are reminded that negotiation of a promissory note under the Uniform Commercial code is by indorsement and delivery. Unless the plaintiff is the named Lender shown on the face of the alleged instruments -- alleged promissory note and alleged mortgage, deed of trust or other mortgage scurity instrument -- only through indorsement and delivery can the plaintiff become the holder.
It is NOT at all unusual for careless foreclosure mills to plead an unindorsed copy of the promissory note. And plaintiffs rarely plead and prove delivery.
Instead, the plaintiff usually relies upon a conclusory affidavit of merit using an unqualified witness to allege that the plaintiff is the owner and the holder (these are legal conclusions, NOT facts).
In Riggs, it seems that the plaintiff neglected or was unable to find an indorsed copy of the the alleged promissory note and neglected to even seek the admission of the usual conclusory affidavit.
We are left with a nice concise opinion which reaffirms that the plaintiff cannot be entitled to summary judgment on a promissory note made out in favor of another entity when the note is unindorsed:
This should be a very nice case to cite in Florida when the plaintiff pleads another unindorsed instrument!