Sec. 42a-3-420. Conversion of instrument.
Sec. 42a-3-420. Conversion of instrument. (a) The law applicable to conversion
of personal property applies to instruments. An instrument is also converted if it is taken
by transfer, other than a negotiation, from a person not entitled to enforce the instrument
or a bank makes or obtains payment with respect to the instrument for a person not
entitled to enforce the instrument or receive payment. An action for conversion of an
instrument may not be brought by (i) the issuer or acceptor of the instrument or (ii) a
payee or endorsee who did not receive delivery of the instrument either directly or
through delivery to an agent or a copayee.
(b) In an action under subsection (a), 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.
(c) A representative, other than a depositary bank, who has in good faith dealt with
an instrument or its proceeds on behalf of one who was not the person entitled to enforce
the instrument is not liable in conversion to that person beyond the amount of any
proceeds that it has not paid out.
(P.A. 91-304, S. 57.)
Subsec. (b):
Evidence that plaintiff, the intended payee, had received restitution from the forger was relevant because the receipt
of the total amount of the plaintiff's interest in the settlement check constituted a defense available to the defendant-bank.
108 CA 799.