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DEFENDANTS MOTION TO DISMISS COMPLAINT Defendants, (hereinafter Defendants), by and through the undersigned counsel, and respectfully files

with this Court DEFENDANTS MOTION TO DISMISS COMPLAINT, pursuant to Fla. R. Civ. P. 1.120(a) and 1.140(b)(6), Fla. R. Civ. Pro., and precedent case law, and in support thereof states: FACTS 1. This is an action for foreclosure of residential real property owned by the Defendants. 2. The named Plaintiff in this case is AURORA LOAN SERVICES, LLC (hereinafter Plaintiff). The Plaintiff initiated this action when it filed its complaint on or about July 13, 2011. 3. There are, however, three fatal defects in the Plaintiffs Complaint which proves fatal to its cause. The facts surrounding each defect are explained in detail below.
Defect I Failure to Plead Capacity

4. To begin, while the name of the Plaintiff in the instant lawsuit is asserted in the caption of its Complaint, nowhere in the body of Plaintiffs Complaint does the Plaintiff set off or describe in any way its entity-status nor does the Plaintiff assert in what capacity does the Plaintiff contend it may avail itself to the jurisdiction of this Court. 5. Additionally, nowhere in the body of Plaintiffs Complaint does it assert the basis for its entity-existence or explain in any way the form of the entity that presents itself before the court. 6. Therefore, the Plaintiff has failed to plead its capacity to the extent necessary to show the jurisdiction of this Court. Dismissal of its Complaint is therefore warranted. Defect II Failure to State a Cause of Action

7. The Plaintiffs failure to plead a cause of action is bundled up in: (1) its failure to plead that it owns and holds the note and mortgage; or (2) adequately plead the requisite elements of agency relationship between itself and the true owner of the debt. 8. With respect to ownership of the note and mortgage, it is imperative that this Court note that the Plaintiffs cause of action is an in rem action in equity to foreclose a mortgage and not an in personam action at law for enforcement of the note for money damages. See SunTrust Mortgage v. Fullerton, 16 Fla. L. Weekly Supp. 1146b (6th Judicial Circuit, Pinellas County, October 2009). Due to the claim for relief, the Plaintiff must be both the owner and holder of the subject mortgage. See e.g. Verizzo v. Bank of N.Y., 28 So. 3d 976, 978 (Fla. 2d DCA 2010). 9. Here, Plaintiff has specifically pled that someone other than itself is the owner of the note and mortgage. 10. Moreover, Plaintiff has failed to plead: (1) who its principal is and therefore acknowledgment by the principal that Plaintiff will act for him or her, (2) Plaintiffs acceptance of the undertaking, and (3) control by the principal over the actions of Plaintiff. 11. There, because Plaintiff has failed to allege that it either owns the note or mortgage or plead all requisite elements to establish an agency relationship, it is has failed to state a cause of action and its Complaint should be dismissed. Defect III Note is non-negotiable 12. As an addition to, or in the alternative of, Defect II, the Complaint should be dismissed because the subject note is non-negotiable and therefore Plaintiff cannot seek recourse pursuant to Fla. Stat. 673.3011 as it appears to do so here. 13. Specifically, the subject note is not negotiable because it contains several instructions or undertakings other than the payment of money, to wit:

a. The instruction that the borrower pay a late charge if the lender has not received payment by the end of fifteen calendar days after the date payment is due in clause 7(A); b. The instruction that the lender will deliver or mail to the borrower any changes in the interest rate and monthly payments in clause 4(H); c. The obligation that the borrower to tell the lender, in writing, if borrower opts to may prepay in clause 5; d. The instruction that if applicable law is finally interpreted so that the interest charged under the note or other loan charges exceed legal limits, then: (1) any such charge shall be reduced by the amount necessary to reduce the charge to be permitted, and (2) the lender shall refund such charges to the borrower in clause 6; e. The instruction that the lender send any notices that must be given to the borrower pursuant to the terms of the subject note by either delivering it or mailing it by first class mail in clause 8; and f. The instruction that the borrower send any notices that must be given to the lender pursuant to the terms of the subject note by either delivering it or mailing it by first class mail in clause 8. 14. Because the subject note is non-negotiable, Plaintiff cannot avail itself to 673, et seq. Its Complaint should therefore be dismissed. STANDARD OF REVIEW 15. The purpose of a motion to dismiss is to ascertain if the plaintiff has alleged a good cause of action. Connolly v. Sebeco, Inc., 89 So. 2d 482 (Fla. 1956).

16. In ruling on a defendants motion to dismiss, a trial court is limited to the four corners of the Complaint, and it must accept all the allegations in the Complaint as true. See Lutz Lake Fern Rd. Neighborhood Groups, Inc. v. Hillsborough County, 779 So.2d 380, 383 (Fla. 2d DCA 2000). 17. However, exhibits attached to a Complaint are a part of the Complaint. See Bott v. City of Marathon, 949 So.2d 295 (Fla 3rd DCA 2007) (when considering a motion to dismiss, a trial court is required to consider any exhibit attached to, or incorporated in the pleading). See also Harry Pepper & Assoc., Inc. v. Lasseter, 247 So.2d 736 (Fla. 3rd DCA 1971) (stating [i]n considering a motion to dismiss the trial court was required to consider the exhibit . . . attached to and incorporated in the amended complaint and quoting Florida Rule of Civil Procedure 1.130(b), providing that [a]ny exhibit attached to a pleading shall be considered a part thereof for all purposes). 18. As such, an exhibit attached to a Complaint is a part of the Complaint and may be considered when ruling on a motion to dismiss and considering exhibits attached to a Complaint does not violate the four corners rule. 19. Further, exhibits attached to a Complaint must agree with the allegations of the Complaint, and where to two do not agree, the exhibits control. See also, Geico Gen. Ins. Co. V. Graci, 849 So.2d 1196 (Fla. 4th DCA 2003) and Ginsberg v. Lennar Fla. Holdings, Inc. 645 So.2d 490, 494 (Fla. 3d DCA 1994) (where exhibits contradict complaint allegations, plain meaning of exhibits control). Harry Pepper & Associates V. Lasseter, 247 So.2d 736 (Fla. 3d DCA 1971) and see Hlt Application Sys. V. Hartford Life, 381 So.2d 294 (Fla. 1st DCA 1980). MEMORANDUM OF LAW IN SUPPORT OF DEFENDANTS MOTION I. The Plaintiffs Complaint must be dismissed because of its failure to plead its capacity to sue 4

a. Legal Standards 20. Unlike the pleading requirements in the federal courts where notice pleading is the prevailing standard, the Florida Rules of Civil Procedure require fact pleading. Ranger Contru. v. Martin Cos., 881 So. 2d 677, 680 (Fla. 5th DCA 2004). 21. In order to state a cause of action, a complaint must allege sufficient ultimate facts to show that the pleader is entitled to relief. Med. & Benefits Plan v. Lago, 867 So. 2d 1184 (Fla. 5th DCA 2004). 22. At the outset of a suit, litigants must state their pleadings with sufficient particularity for a defense to be prepared. Horowitz v. Laske, 855 So. 2d 169, 173 (Fla. 5th DCA 2003) (citing Arky, Freed, Stearns, Watson, Greer Weaver & Harris, P.A. v. Bowmar Instrument Corp., 537 So. 2d 561 (Fla. 1988)). 23. Fla. R. Civ. Pro. 1.120(a) provides that [i]t is not necessary to aver the capacity of a party to sue or be sued, the authority of a party to sue or be sued in a representative capacity, or the legal existence of an organized association of persons that is made a party, except to the extent required to show the jurisdiction of the court. Bold emphasis added. The initial pleading served on behalf of a minor party shall specifically aver the age of the minor party. When a party desires to raise an issue as to the legal existence of any party, the capacity of any party to sue or be sued, or the authority of a party to sue or be sued in a representative capacity, that party shall do so by specific negative averment which shall include such supporting particulars as are peculiarly within the pleader's knowledge. Bold emphasis added. 24. Fla. R. Civ. Pro. 1.110(b) requires that a complaint include a short and plain statement of the grounds upon which the Courts jurisdiction depends. 25. Capacity to sue is an absence of legal disability which would deprive a party of the right to come into court. 59 Am.Jur.2d Parties 31 (1971). This is in contrast to standing which requires an entity have sufficient interest in the outcome of litigation to warrant the court's

consideration of its position. Keehn v. Joseph C. Mackey and Co., 420 So.2d 398 (Fla. 4th DCA 1982). 26. The Fourth District court said in Wittington Condominium Apts., Inc. v. Braemar Corp., 313 So.2d 463, 466 (Fla. 4th DCA 1975), cert. denied, 327 So.2d 31 (Fla. 1976): The specific negative averment referred to in Rule 1.120 may be reflected in a responsive pleading (answer) or presumably in what might be described as a "speaking motion" whether denominated as a motion to dismiss, a motion to drop improperly joined parties, or a motion to strike. Bold emphasis added. 27. Moreover a complaint's facial defect can be attacked appropriately for lack of capacity to sue pursuant to Federal Rule of Civil Procedure 9(a) (upon which Florida Rule 1.120(a) was patterned identically) by a motion to dismiss which can be justified under Federal Rule of Civil Procedure 12(b)(6), i.e., failure to state a claim upon which relief can be granted. Klebanow v. New York Produce Exchange, 344 F.2d 294 (2d Cir.1965). See also 2A J. Moore & J. Lucas, Moore's Federal Practice 12.07-.08 (2d ed. 1982), and 5 C. Wright & A. Miller, Federal Practice and Procedure 1292-1295, 1360 (1969 & Supp. 1981). 28. The failure to adequately plead capacity has been grounds for dismissals of lawsuits in Florida state courts. See e.g. Asociacion de Perjudiacados v. Citibank, 770 So. 2d 1267 (Fla. 3d DCA 2000) (dismissing case for lack of capacity as distinguished from lack of standing). 29. Furthermore, the Comment to the Rule (2004 Version), states that if a party involved in a suit in other than his individual capacity, the capacity in which he is a party should be indicated in the caption and the pleadings. Bold emphasis added. 30. The naming of an individual or entity in the caption is not a sufficient basis to warrant inclusion in the action if the party is not mentioned in the body of the complaint. Bold emphasis added. Altamonte Hitch & Trailer Serv. Inc. v. U-Haul Co. of Eastern Fla., 498 6

So. 2d 1346 (Fla. 5th DCA 1986). See also Trawicks Florida Practice and Procedure 6-2 (2004 ed.), pg. 83 (providing that the caption is not a part of the pleading for purposes of motions directed to the pleading. The caption is in the margin of the pleading. The margin encompasses all of the components, except the body and jurisdiction allegations). 31. Furthermore, the commencement, which names the party filing the pleading, is not part of the pleading for purposes of motions to dismiss as the commencement is in the margin of the pleading. Trawicks Florida Practice and Procedure 6-3 (2004 ed.), pg. 83. 32. Although the capacity issue is new, it is important to note that judges in circuit courts across this State have routinely recognized the legitimacy of the capacity argument and are routinely granting Defendants Motion to Dismiss based on these grounds, particularly in cases for mortgage foreclosures. See e.g. HSBC v. Montgomery, Pinellas Case 52-2009-CA-005696; Wachovia v. Matacchiero, Pinellas Case No. 52-2009-16936-CI-13; Bolin v. HSBC, Pinellas Case 08-005190-CI-19. 33. This Court should take heed of the words of the Honorable William P. Levens, Circuit Judge of the Thirteenth Judicial Circuit, who recently ruled when confronted with a capacity issue in a mortgage foreclosure case that [t]his is a very, very simple pleading matter than can be easily corrected, but must be correct because I am convinced that 1.120(a) the pleading of capacity and the identification in the body of the Complaint itself is a jurisdiction requisite to this matter going forwardI am simply granting the motion with leave to amend to more fully and appropriately comply with 1.120(a) with the explanation in the body of the Complaint that there be a basis. Because capacity is required to show the jurisdiction of the Court, and that needs to be specifically pled in my judgment. Deutsche Bank National Trust Company v. Steiner, Hillsborough County Case No. 08-13651-CI-15 (Hon. William P. Levens/October 28, 2010). b. Argument

34. Here, while Plaintiffs name is identified in the caption of its Complaint, nowhere else in Plaintiffs pleading is its entity status or capacity pled. As a threshold matter, then, it is unclear exactly who Plaintiff is and how it may avail itself to the jurisdiction of this Court. 35. By failing to allege the grounds upon which this Courts jurisdiction depends, and by failing to plead or specify in what capacity it brings the instant lawsuit, Plaintiff has not plead that it has the absence of legal disability to sue. 36. Rule 1.120(a) provides for the specific procedures defense counsel must use to challenge the issue of the Plaintiffs capacity, i.e. specific negative averment. Defendants therefore

specifically assert that Plaintiff has failed to plead any facts which identify its entity-status and therefore it cannot claim that it has properly invoked the jurisdiction of this Court within the four corners of the Complaint. 37. Plaintiffs failure to properly identify itself and thus plead its capacity (i.e. XYZ, Incorporated is a Delaware registered corporation properly registered as a foreign corporation with the Florida Secretary of State) prohibits Plaintiff from asserting that it has established its ability to invoke this Courts jurisdiction and it prevents Defendants from properly asserting defenses to this action which may prevent this Plaintiff from maintaining this instant suit from the outset. 38. As a result, Plaintiffs complaint must be dismissed. II. The Plaintiffs Complaint must be dismissed because of its failure to plead a cause of action a. Legal Standards 1. Standing, the Real Party in Interest, and Agency Law

39. Fla. R. Civ. Pro. 1.140(b)(6) provides, in pertinent part, that the following defenses may be made by motion at the option of the pleaderfailure to state a cause of actionA motion making any of these defenses shall be made before pleading if a further pleading is permitted. 40. Fla. R. Civ. Pro. 1.110(b) provides, in pertinent part, that [a] pleading which sets forth a claim for reliefmust state a cause of action and shall containa short and plain statement of the ultimate facts showing that the pleader is entitled to relief. 41. Standing requires an entity have sufficient interest in the outcome of litigation to warrant the court's consideration of its position. Keehn v. Joseph C. Mackey and Co., 420 So.2d 398 (Fla. 4th DCA 1982). 42. Moreover, standing is a threshold issue. Peace River/Manasota Regional Water Supply Authority v. IMC Phosphates, 18 So.3d 1079 (Fla. 2d DCA 2009); Hillsborough County v. Florida Restaurant Assn, Inc., 603 So.2d 587 (Fla. 2d DCA 1992); Miller v. Publicker Industries, Inc., 457 So.2d 1374 (Fla. 1984). 43. Standing, however, includes not just the notion that the party has a sufficient stake in the outcome of the litigation but also that the party is in fact the real party in interest. This is the at least equally-important requirement that the claim be brought by or on behalf of onein whom rests, by substantive law, the claim sought to be enforced. Kumar Corp. v. Nopal Lines, Ltd., 462 So. 2d 1178, 1183 (Fla. 3d DCA 1985) (citing Authors Comment to Fla. R. Civ. P. 1.210). 44. The authority of an agent to bind a principal may be real or it may be apparent only, and members of the public acting in good faith may rely on either, unless in the case of apparent authority the circumstances are such as to put a reasonable person on inquiry. Stiles v. Gordon Land Co., 44 So. 2d 417, 421 (Fla. 1950). Bold emphasis added.

45. The existence of an agency relationship is ordinarily a question to be determined by a jury in accordance with the evidence adduced at trial. Orlando Executive Park, Inc. v. Robbins, 433 So. 2d 491, 494 (Fla. 1983). 46. An agents real or actual authority arises out of expressed or implied manifestations of her principal. See Taco Bell of California v. Zappone, 324 So. 2d 123, 123 (Fla. 2d DCA 1975). 47. The essential elements of an actual agency relationship are: (1) acknowledgment by the principal that the agent will act for him or her, (2) the agent's acceptance of the undertaking, and (3) control by the principal over the actions of the agent. Robbins v. Hess, 659 So. 2d 424, 427 (Fla. 1st DCA 1995) (citing Goldschmidt v. Holman, 571 So. 2d 422, 424 n.5 (Fla. 1990)). 2. Standing in Foreclosure Actions 48. The party seeking foreclosure must present evidence that it owns and holds the note and mortgage in question in order to proceed with a foreclosure action. Lizio v. McCullom, 36 So. 3d 927, 929 (Fla. 4th DCA 2010). See also Verizzo v. Bank of New York, 28 So. 3d 976, 978 (Fla. 2d DCA 2010) (providing that there is a genuine issue of material fact as to whether the Bank of New York owns and holds the note and has standing to foreclose the mortgage.) 49. Indeed, where the defendant denies that the party seeking foreclosure has an ownership interest in the mortgage, the issue of ownership becomes an issue the plaintiff must prove. Carapezza v. Pate, 143 So.2d 346, 347 (Fla. 3d DCA 1962). 50. The standing requirement that the foreclosing party must both own and hold the mortgage is in accordance with Fla. R. Civ. Pro. Form 1.944. 51. This is because [t]o grant [a] judgment of foreclosure in favor of the [plaintiff], the trial court would have to find, among other things, that the [plaintiff] owned the mortgage

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and had performed all conditions precedent, if any to enforce the mortgage. Dykes v. Trustbank Sav., FSB, 567 So. 2d 958, 959 (Fla. 2d DCA 1990). Bold emphasis added. b. Argument 52. Here, while the Plaintiff has made an allegation that it is the holder and/or entitled to enforce the subject note and mortgage, it has failed to make any allegation that it is in fact the owner of same. 53. The failure of the Plaintiff to allege, in the body of its Complaint, that in addition to holding the subject note and mortgage it also owns these instruments prohibits it from asserting the proper chain of ownership of the instruments from their inception. 54. This distinction is important because, as noted in paragraph 8, supra, this is a cause of action in equity to foreclose a mortgage and not an action at law for enforcement of the note. Consequently, and pursuant to Form 1.944, Plaintiff must allege it is both the owner and holder of the note and mortgage. 55. As an alternative to such an allegation, Plaintiff may allege the requisite elements of an agency relationship between itself and the true owner in order to state a cause of action. This, however, Plaintiff has not done. 56. Indeed Plaintiff has failed to plead: (1) who its principal is and therefore acknowledgment by the principal that Plaintiff will act for him or her, (2) Plaintiffs acceptance of the undertaking, and (3) control by the principal over the actions of Plaintiff.1

Defendants acknowledge that paragraph 3 of the Complaint alleges that Plaintiff is the servicing agent for the owner of the note and mortgage. Nevertheless, such an allegation without allegations necessary to establish an agency relationship, is therefore a mere legal conclusion that this Court may not take as true for purposes of this motion. See Loan Co. v. Smith, 155 So. 2d 711 (Fla. 1st DCA 1963) (holding that mere legal conclusions are fatally defective unless substantiated by sufficient allegations of ultimate fact); Phelps v. Gilbreth, 68 So. 2d 360 (Fla. 1953) (holding that allegations of legal conclusions are of no legal effect or significance and are generally ignored in the construction and consideration of the pleadings of which they are a part).

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57. Consequently, Plaintiff has failed to state a cause of action for mortgage foreclosure. Its complaint should therefore be dismissed. III. In addition to, or as an alternative of, Argument II, Plaintiffs Complaint must be dismissed because the subject note is not negotiable a. Legal Standards i. Introduction

58. Issues regarding the negotiability of a mortgage promissory note appear to be rarely brought before trial courts attention. Therefore, both trial and appellate courts in this State generally have not had the opportunity to consider these issues on their merits. 59. Indeed, in a recent law review article published in the Pepperdine Law Review, Professor Dale Whitman identified only forty-two cases decided over the past twenty years in the entire United States in which a decision was reached on the merits regarding the negotiability of a mortgage note. See Dale A. Whitman, How Negotiability Has Fouled Up the Secondary

Mortgage Market, and What to Do About it, 37 Pepp. L. Rv. 737 (2010). 60. Even more shocking, Professor Whitman identified only two of those forty-two cases in which a the court provide[d] a thorough analysis of the negotiability of the note! See Id. at 754. 61. Tracing the case law backwards in Florida, it appears that an analysis of mortgage notes was first articulated by the Fifth District in American Bank of the South v. Rothenberg, 598 So. 2d 289 (Fla. 5th DCA 1992). 62. There, the Court stated that the rights of the parties must be determined by the character of the promissory note. In this case, the promissory note meets the requirements of section 673.104, Florida Statutes (1991) and is thus a negotiable instrument. Id. at 291. Bold emphasis added. 12

63. Thus, the Rothenberg Court articulated a crucial first step in the analysis of a mortgage promissory note: a decision of whether the character of the note at issue is that of a negotiable instrument. 64. Unfortunately, more recent appellate decisions have not mentioned this essential first step, most likely because the character of the promissory note was not questioned at the trial court level. See e.g. Taylor v. Deutsche Bank National Trust Company, 44 So. 3d 618, 622 (Fla. 5th DCA 2010) (merely providing that a promissory note is a negotiable instrument without any consideration as to how a promissory note is in fact negotiable); Riggs v. Aurora Loan Services, LLC, 36 So. 3d 932, 933 (Fla. 4th DCA 2010) (providing that [t]he note was a negotiable instrument subject to the provisions of Chapter 673, Florida Statutes (2008)); Perry v. Fairbanks, 888 So. 2d 725, 727 (Fla. 5th DCA 2004) (stating that [a] promissory note is clearly a negotiable instrument within the definition of section 673.1041(1) without providing an analysis of the statute). 65. The Second District has engaged in an examination of the negotiability statute and its application in the context of a retail installment sale contract (hereinafter RISC). See inter alia discussion regarding GMAC v. Honest Air. Because the nature of a RISC is similar to that of a mortgage promissory note in that both contracts require installment payments over a period of time, the analysis engaged by the Second District in Honest Air is applicable here. 66. In any event, when the character of the mortgage promissory note is questioned at the trial court level, the gratuitous assertion that the note is a negotiable instrument should not be accepted at face value. Rather, courts should first examine the note at issue to determine whether the note at meets the strict and technical definitions of negotiable instrument found in Floridas Uniform Commercial Code.

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ii.

Definition of Negotiable Instrument

67. Fla. Stat. 673.1041(1) provides the statutory definition of a negotiable instrument. 68. The statute begins by asserting that an instrument is negotiable if it is an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order. 69. In addition, the instrument must also meet the three following prerequisites: a. First, the instrument must be payable to bearer or to order at the time it is issued or first comes into possession of a holder. 673.1041(1)(a); b. Second, the instrument must be payable on demand or at a definite time. 673.1041(1)(b); and c. Third, the instrument must not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money. 673.1041(1)(c).2 Bold emphasis added. 70. For purposes of this motion, the third prong of the definition is of vital importance because, as Professor Whitman has stated, The standard note form approved by Fannie Mae and Freddie Mac for use in one-to-four-family residential loans is 1,455 words in length in three pages without signatures, and notes used in loans on commercial properties are commonly several times that size. Whitman at 743.

673.1041(1)(c) does provide three exceptions to the general rule that the promise or order must not contain any instruction or undertaking other than the payment of money. These exceptions are: (1) an undertaking or power to give, maintain, or protect collateral to secure payment; (2) an authorization or power to the holder to confess judgment or realize or dispose of collateral; and (3) a waiver of the benefit of any law intended for the advantage or protection of an obligor.

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71. Inextricably imbedded within those 1,455 words are a host of undertakings and instructions by the person promising or ordering payment to do some act in addition to the payment of money. 72. By the clear statutory definition once one promise or undertaking is found, the character of the note cannot said to be negotiable. 73. Finally, if the note is not a negotiable instrument, it is not subject to transfer or enforcement pursuant to Fla. Stat. 673, et seq. 74. Stated another way, the act of endorsing and transferring a mortgage promissory note is a nullity because endorsement and delivery only effectuates a transfer of a negotiable instrument. If an instrument is non-negotiable, it must be transferred pursuant to general contract law.

iii.

GMAC v. Honest 673.1041(1)(c)

Air

and

the

exclusionary

language

of

75. In GMAC v. Honest Air Conditioning & Heating, Inc., 933 So. 2d 34 (Fla. 2d DCA 2006), the Second District concluded that the trial court erred in finding that the [retail installment sales contract] was a negotiable instrument. Id. at 35. 76. There, the Court was confronted with a RISC entered into between GMAC and Honest Air for the purchase of an automobile. Id. 77. The Court noted that the RISC created certain instructions or undertakings in both the person promising to pay and the creditor ordering payment, including: (1) an instruction onto the debtor to not remove the vehicle from the United States; (2) an instruction onto the debtor to reimburse advances made by the creditor in payment of repair or storage bills; and (3) an instruction onto the creditor to dispose of the collateral in certain ways following repossession. Id. at 37. 15

78. Most notable to our purposes here, the Second District noted that the RISC required the debtor to pay fees for late payment or dishonored checks. Id. 79. Ultimately, the Second District held that these obligations bring the RISC within the exclusionary language of section 673.1041(1)(c), which provides that a negotiable instrument does not state any other undertakings in addition to the payment of money. Id. 80. The Court reasoned that this must be so because [a] negotiable instrument should be simple, certain, unconditional, and subject to no contingencies. As some writers have said, it must be a courier without luggage. Id. (citing Mason v. Flowers, 91 Fla. 224, 107 So. 334, 335 (Fla. 1926)).

b. Argument 81. In addition to, or in alternative of, argument II, supra, Plaintiffs Complaint must be dismissed because the subject note is not a negotiable instrument. As a result, Plaintiff may not invoke Fla. Stat. 673, et seq. in an attempt to enforce the note. 82. The note is not negotiable because it contains several instructions or undertakings other than the payment of money brining the note within the exclusionary language of 673.1041(1)(c). 83. To begin, the purported note provides for late charges. Such charges were considered obligations other than the payment of money which rendered the RISC in GMAC, supra, nonnegotiable. 84. Moreover, the note also contains the following additional obligations:

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1. The instruction that the borrower pay a late charge if the lender has not received payment by the end of fifteen calendar days after the date payment is due in clause 7(A); 2. The instruction that the lender will deliver or mail to the borrower any changes in the interest rate and monthly payments in clause 4(H); 3. The obligation that the borrower to tell the lender, in writing, if borrower opts to may prepay in clause 5; 4. The instruction that if applicable law is finally interpreted so that the interest charged under the note or other loan charges exceed legal limits, then: (1) any such charge shall be reduced by the amount necessary to reduce the charge to be permitted, and (2) the lender shall refund such charges to the borrower in clause 6; 5. The instruction that the lender send any notices that must be given to the borrower pursuant to the terms of the subject note by either delivering it or mailing it by first class mail in clause 8; and 6. The instruction that the borrower send any notices that must be given to the lender pursuant to the terms of the subject note by either delivering it or mailing it by first class mail in clause 8. 85. These obligations render the purported note non-negotiable. Because the note is nonnegotiable, the Plaintiff cannot claim that it is entitled to enforce it pursuant to Fla. Stat. 673.3011 as the holder of a negotiable instrument. 86. Therefore, Plaintiffs Complaint must be dismissed. CONCLUSION

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WHEREFORE, based upon the foregoing, the Defendants respectfully request this Court dismiss Plaintiffs complaint, award attorneys fees to the Defendants pursuant to Fla. Stat. 57.105(7) and the subject loan documents for such fees so wrongfully incurred by the necessity of this defense, and any other relief the Court deems just and proper. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished by U.S. Mail on this ____ day of March, 2012 to Eric Knopp, Esq., Attorney for Plaintiff, Kahane & Associates, P.A., 8201 Peters Rd Ste 3000, Plantation, Florida 33324-3292. By:__________________________ Michael P. Fuino, Esq. Matthew D. Weidner, P.A. Attorney for Defendant 1229 Central Avenue St. Petersburg, FL 33705 (727) 894-3159 FBN: 84191

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