In respect of fraudulent charters, declarations and treaties, a clear maxim arises – that Fraus omnia vitiate: “fraud vitiates everything”. In other words, an act done in fraud and without authority has no effect, whatsoever; and
therefore, any reference to an example of historic fraud is not to legitimize it, nor agree with it, but to expose some of the most audacious examples of fraud, perfidy and falsity underpinning claimed western law; and
Simply put, no trust was created by such fraud, no matter how many times it may be stated to the contrary, as the very claim of authority to form such a trust was founded on fraud
§ 3-202. NEGOTIATION SUBJECT TO RESCISSION.
(a) Negotiation is effective even if obtained (i) from an infant, a corporation exceeding its powers, or a person without capacity, (ii) by fraud, duress, or mistake, or (iii) in breach of duty or as part of an illegal transaction.
(b) To the extent permitted by other law, negotiation may be rescinded or may be subject to other remedies, but those remedies may not be asserted against a subsequent holder in due course or a person paying the instrument in good faith and without knowledge of facts that are a basis for rescission or other remedy.
There is a trend nationwide where judges are ruling that broken chains of title are not relevant.
The UCC is one of the least favored courses in law school. Judges hate it because they didn’t pay attention during class. But it’s the law. So the courts are ruling by the seat of their pants instead of following the law. Banks like it for now but be careful what you wish for — these rulings are undermining the marketplace for negotiable instruments.
Eventually lenders and factoring companies are going to come face to face with the “law” they have created through the courts — the UCC doesn’t mean anything and there are no protections against a party with a broken chain pursing a competing claim. The end result is that they will start lending or trading in negotiable instruments or even non-negotiable instruments. That could stop the economy dead in its…
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