N.C. Supreme Ct.: In re Bass- Stamped Indorsement is Sufficient for Transfer

Summary:

The first indorsement in a chain of transfers of a mortgage note was simply a stamp, without an accompanying signature or initials. After falling behind on mortgage payments, Bass, relying on Econo-Travel Motor Hotel Corp. v. Taylor, 301 N.C. 200 (1980), challenged the standing of U.S. Bank as the holder of the note, arguing that it had not been properly indorsed.

The North Carolina Supreme Court rejected this argument relying on the broad definition of “signature” in the Uniform Commercial Code (UCC), at N.C.G.S. § 25-3-201(b)(37), as “any symbol executed or adopted with present intention to adopt or accept a writing.” As the official comment to the UCC includes that such symbol can be “printed, stamped or written; it may be by initials or by thumbprint”, the term “signature” is not limited to “a long-form writing of an individual person’s name.” Bass at 7. The Court distinguished Econ-Travel as a case where the note lacked any indicia of indorsement. Accordingly, the stamp was “an indorsement unless the accompanying words, terms of the instrument, place of the signature, or other circumstances unambiguously indicate that the signature was made for a purpose other than indorsement.” N.C.G.S. § 25-3-204(a) (emphasis added in the opinion.) Further, due to the presumption in the UCC in favor of the authenticity of signatures, N.C.G.S. § 25-3-308(a), Bass, and not U.S. Bank, bore the burden of making some sufficient showing that the stamp was valid.

For a copy of the opinion, please see:

Bass- Stamped Indorsement is Sufficient for Transfer.pdf

About

1. Bachelor of Arts degree in English Literature from Washington University, 1993. 2. Juris Doctor degree from George Washington University, 1996. Admissions to Practice of Law: North Carolina Bar, 1996. Federal District Courts for the Eastern and Middle Districts of North Carolina. Specialty Certification: North Carolina State Bar: Certified as a Specialist in Consumer Bankruptcy. Areas of Practice: Practice limited to consumer and business debtor bankruptcy law, 1998 to present. Memberships: National Association of Consumer Bankruptcy Attorneys (NACBA). North Carolina Academy of Trial Lawyers (NCATL). North Carolina Bar Association, Bankruptcy Section. Lectures prepared and presented: North Carolina Academy of Trial Lawyers seminar on bankruptcy; Topic: Counseling the Consumer Debtor Prior to Court - C.Y.A. Forms to Help 'Gird They Loins'; 2001. Middle District Bankruptcy Seminar; Topic: Preparing Chapter 13 Plans; 2002. NACBA National Convention; Topic: Efficient Office Practices; 2003. NACBA National Convention; Topic: Chapter 7 vs. Chapter 13 Debates; 2004. Middle District Bankruptcy Seminar; Topic: Chapter 7 & 13 Hot Issues; 2004. Positions held: NACBA National Convention; Convention Chair; 2008. NACBA National Convention; Panel Moderator: Topic: Basic Bankruptcy Issues; 2008. NACBA National Convention; Panel Moderator; Topic: Chapter 13-Disposable Income and Other Issues; 2007. NACBA National Convention; Panel Moderator; Topic: Representing Members of the Military and Their Families; 2007. NACBA, Member of National Board of Directors, 2006 to present. NCATL, Chair of the Bankruptcy Section, 2003 to 2007. NACBA, Chair of the North Carolina Section, 2003 to 2007. NC Bar Association, Bankruptcy Section, Bankruptcy Council Member, 2004 to present.

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