## Facts

- Defendants executed two promissory notes payable to Guardian Credit Corporation.
- The notes were assigned to Oxford Finance Companies, Inc. (Oxford).
- Defendants did not pay the full balances when the notes matured.
- Oxford later sold and assigned all rights in the notes to Bobby D. Associates (BDA).
- One note was lost while in Oxford’s possession.
- BDA purchased the lost note based on Oxford’s affidavit of lost note, whose contents defendants admitted as true and accurate.
- In a non-jury trial, the court entered a verdict for BDA on both notes; only the lost note was challenged on appeal.

## Issues

1. Whether an assignee who was not in possession of a promissory note when it was lost may enforce the note under 13 Pa.C.S. § 3309, when the assignor was in possession and entitled to enforce the note at the time of loss.

## Decision

- The Superior Court of Pennsylvania affirmed the judgment for BDA.
- Section 3309 does not bar assignment of the right to enforce a lost instrument.
- An assignee may enforce a lost note if the assignor satisfied § 3309’s conditions when the loss occurred and assigned its enforcement rights to the assignee.
- The trial court’s findings were supported by competent evidence, and no error of law occurred.

## Legal Principles

- Under 13 Pa.C.S. § 3309, a person not in possession may enforce a negotiable instrument if the statutory conditions are met, including that the instrument was lost while the enforcing right existed.
- The statutory requirement that the instrument was lost while a “person” was in possession and entitled to enforce establishes the origin of enforcement rights; it does not make those rights nontransferable.
- Assignment of “all rights, title, and interest” in a note transfers the assignor’s right to enforce, including enforcement rights arising under § 3309 for a lost instrument.
- Section 3309’s function includes protecting obligors from double liability through proof of terms and, when warranted, adequate protection; it is not a bar to ordinary assignment.

## Conclusion

The court held that an assignee can enforce a promissory note lost while in the assignor’s possession because § 3309 permits enforcement of lost instruments and does not prohibit transfer of the assignor’s enforcement rights to the assignee.


Bobby D. Assocs. v. DiMarcantonio, 751 A.2d 673 (Pa. Super. Ct. 2000)