The Florida Bar-
Contemporary negotiable instruments law developed hundreds of years ago, before every important institution of the modern financial world: incorporated banks, business corporations, developed capital markets, global monetary systems, electronic transfers, and even paper currency.1 It is counterintuitive that this ancient law of negotiable instruments would have any relevance to one of the world’s most sophisticated, cutting-edge tools of high finance — the pooling and securitization of mortgage loans. Yet, the courts routinely look to such law to resolve a foreclosure crisis spawned by the collapse of mortgage-backed securitization, a process which is as strained as trying to decide First Amendment issues using cases pre-dating the Constitution. It is all the more extraordinary that, just as the nation begins to awaken to “robo-signing” and other such pervasive and methodical abuses of the court systems, judges should find themselves slavishly compelled to apply a body of law shaped (and then abandoned) by the very authors of such scandals: the financial institutions.
This article explores the historical underpinnings of negotiability and whether the evidentiary shortcut that negotiability appears to offer as a means of proving a plaintiff’s standing to sue can or should be applied in the context of the foreclosure cases facing the courts today. Examination of the original purposes of negotiability, as well as recent changes to the Uniform Commercial Code, leads to the conclusion that mere possession of a negotiable instrument (the promissory note) is insufficient to enforce a mortgage. The possessor or “holder” must prove ownership of the instrument — a complete chain of title from the original creditor — to invoke the equitable remedy of foreclosure.
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When an original wet ink check is not cashed for over six months it beoomes uncashable and non negotiable. When notes are intended to go into a trust and not entered within the 90 day window under PSA law, does this not void that note which is like a check. And once void no matter who has it in hand is it not void and non negotiable due to contract law? If the note is in fact void how can anyone holding it cash it in for the house? And when they have decieving cashed a a void or non negotiable check the note has not returned to the foreclosed on family. shouldnt the familie be notified and the banksters responsible to return the notes. They can eat their cake and keep it to.