Pennymac tried to outwit the court system, succeeding at the trial level and then failing on appeal. The simple fact is that it is a rare instance where a party can lose a lawsuit based upon a forged instrument. The court will (and should) always find a way to deny such relief.
Simple case. Closing attorney still had copy of the note — 5 pages. Pennymac sued on a 6 page note. Defendants denied that the note was real and denied they signed the document upon which Pennymac was relying. Pennymac said that Florida statutes required Defendants to file a cause of action to get rid of a forged document. The trial court agreed. The appellate court said no, the authenticity of the document and the signature is put in play once it is apparent to all that this the gravamen of the defense.
Florida Statutes 673.308.1 reads in relevant part: [Note §673 is UCC Article 3]
In an action with respect to an instrument, the authenticity of, and authority to make, each signature on the instrument is admitted unless specifically denied in the pleadings. If the validity of a signature is denied in the pleadings, the burden of establishing validity is on the person claiming validity, but the signature is presumed to be authentic and authorized unless the action is to enforce the liability of the purported signer and the signer is dead or incompetent at the time of trial of the issue of validity of the signature.
Pennymac Trust likens the statute’s passing reference to “specifically” denying a signature’s authenticity to the specificity required to plead a cause of action for fraud under Florida Rule of Civil Procedure 1.120(b): “In all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with such particularity as the circumstances may permit.”
So as long as you don’t contest the signature specifically there is an iron clad presumption that you signed it. If the facts fit, then deny or set forth an answer or affirmative defense that specifically denies you signed it. But the word of caution here is that denying it doesn’t do you any good if you don’t have some pretty hard evidence, like this case, that shows that the document and/or the signature is not authentic. In this case the proof was straightforward.
BUT notice that the obvious nature of the forgery, fraud upon the court still somehow managed to escape the Plaintiff Pennymac and the attorneys for Pennymac. I wonder when someone important will look at that and say that is not the way to practice law.