2010 Pennsylvania Code
Title 13 - COMMERCIAL CODE
Chapter 34 - Liability of Parties
3420 - Conversion of instrument.

     § 3420.  Conversion of instrument.
        (a)  General rule.--The law applicable to conversion of
     personal property applies to instruments. An instrument is also
     converted if it is taken by transfer, other than a negotiation,
     from a person not entitled to enforce the instrument or a bank
     makes or obtains payment with respect to the instrument for a
     person not entitled to enforce the instrument or receive
     payment. An action for conversion of an instrument may not be
     brought by the issuer or acceptor of the instrument or a payee
     or indorsee who did not receive delivery of the instrument
     either directly or through delivery to an agent or a copayee.
        (b)  Measure of damages.--In an action under subsection (a),
     the measure of liability is presumed to be the amount payable on
     the instrument, but recovery may not exceed the amount of the
     plaintiff's interest in the instrument.
        (c)  Limitation on liability.--A representative, other than a
     depositary bank, who has in good faith dealt with an instrument
     or its proceeds on behalf of one who was not the person entitled
     to enforce the instrument is not liable in conversion to that
     person beyond the amount of any proceeds that it has not paid
     out.

        Cross References.  Section 3420 is referred to in section
     4203 of this title.