673.4161
Transfer warranties.
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673.4161 Transfer warranties.—
(1) A person who transfers an instrument for consideration warrants to the transferee and, if the transfer is by indorsement, to any subsequent transferee that:
(a) The warrantor is a person entitled to enforce the instrument;
(b) All signatures on the instrument are authentic and authorized;
(c) The instrument has not been altered;
(d) The instrument is not subject to a defense or claim in recoupment of any party which can be asserted against the warrantor; and
(e) The warrantor has no knowledge of any insolvency proceeding commenced with respect to the maker or acceptor or, in the case of an unaccepted draft, the drawer.
(2) A person to whom the warranties under subsection (1) are made and who took the instrument in good faith may recover from the warrantor as damages for breach of warranty an amount equal to the loss suffered as a result of the breach, but not more than the amount of the instrument plus expenses and loss of interest incurred as a result of the breach.
(3) The warranties stated in subsection (1) cannot be disclaimed with respect to checks. Unless notice of a claim for breach of warranty is given to the warrantor within 30 days after the claimant has reason to know of the breach and the identity of the warrantor, the liability of the warrantor under subsection (2) is discharged to the extent of any loss caused by the delay in giving notice of the claim.
(4) A cause of action for breach of warranty under this section accrues when the claimant has reason to know of the breach.
History.—s. 2, ch. 92-82.
Notes of Decisions
Cited in 3
cases, 1995–2015 · leading case: HSBC Bank USA, N.A. v. Rolando Perez, Juan G. Guerra, Esperanza Medina, LaSalle, Bank, N.A., and U.S. Bank, N.A.
HSBC Bank USA, N.A. v. Rolando Perez, Juan G. Guerra, Esperanza Medina, LaSalle, Bank, N.A., and U.S. Bank, N.A. (2015)
“Under section 673.4161(1), Florida Statutes (2014), LaSalle has an action for breach of warranty against the transferor of the note, a remedy more theoretical than practical given the existence of the scheme to defraud.”
Sykes Corp. v. Eastern Metal Supply, Inc. (1995)
“We have *478 deliberately not considered the effect of section 673.4161(l)(b), Florida Statutes (1993), on Amelung’s endorsement on the checks alleged to have been converted because neither party has raised the same.”
Lucas v. Bankatlantic (2006)
“Section 673.4161, Florida Statutes (2004), also concerns transfer warranties, and is "virtually identical” to section 674.”
— 673.4161(1) — 2 cases
HSBC Bank USA, N.A. v. Rolando Perez, Juan G. Guerra, Esperanza Medina, LaSalle, Bank, N.A., and U.S. Bank, N.A. (2015)
“Under section 673.4161(1), Florida Statutes (2014), LaSalle has an action for breach of warranty against the transferor of the note, a remedy more theoretical than practical given the existence of the scheme to defraud.”
Lucas v. Bankatlantic (2006)
“Section 673.4161, Florida Statutes (2004), also concerns transfer warranties, and is "virtually identical” to section 674.”
— 673.4161(l)(b) — 1 case
Sykes Corp. v. Eastern Metal Supply, Inc. (1995)
“We have *478 deliberately not considered the effect of section 673.4161(l)(b), Florida Statutes (1993), on Amelung’s endorsement on the checks alleged to have been converted because neither party has raised the same.”
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