§ 6A-3-420 - Conversion of instrument.
SECTION 6A-3-420
§ 6A-3-420 Conversion of instrument.– (a) The law applicable to conversion of personal property applies toinstruments. An instrument is also converted if it is taken by transfer, otherthan a negotiation, from a person not entitled to enforce the instrument or abank makes or obtains payment with respect to the instrument for a person notentitled to enforce the instrument or receive payment. An action for conversionof an instrument may not be brought by (i) the issuer or acceptor of theinstrument or (ii) a payee or indorsee who did not receive delivery of theinstrument either directly or through delivery to an agent or a co-payee.
(b) In an action under subsection (a), the measure ofliability is presumed to be the amount payable on the instrument, but recoverymay not exceed the amount of the plaintiff's interest in the instrument.
(c) A representative, other than a depositary bank, who hasin good faith dealt with an instrument or its proceeds on behalf of one who wasnot the person entitled to enforce the instrument is not liable in conversionto that person beyond the amount of any proceeds that it has not paid out.