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01/05/2007 Response to Claim •r (" - �w BOARD Of COUNTY COMMISSIONERS + Mayor Mario Di Gennaro, District 4 �.�` 1., Mayor Pro Tem Dude M. Spehar, District 1 aU N TY r , ;„� i_ . Charles °Sonny' McCoy, District 3 Sylvia 3. Murphy, District 5 (305) 294-4641 y I `' ; +�1 L lite �� r FA 161,11 = Intl: . ' Suzanne A. Hutton, County Attorney** " i:D" Office of th e County Attorney er, Chief Assistant Coun Attorn ** Robert B. Shillin B ty ey PO Box 1026 Pedro J. Mercado, Assistant County Attorney Key West, FL 33041 -1026 Susan M. Crrimsley, Assistant County Attorney ** (305) 292 -3470 — Phone Natileene W. Cassel, Assistant County Attorney (305) 292 -3516 — Fax ** Board Certified in City, County & Local Govt. Law January 5, 2007 Judy Bobick d/b /a Ace Building Maintenance 1200 20 Terrace Key West, FL 33040 Gina Ramirez, d /b /a Commercial Building Maintenance 1205 20 Street Key West, FL 33040 By Hand Delivery & U.S. Mail Re: Claim for $35,546.01 by Group Financial Administrative Services, Inc. Dear Ms. Bobick & Ms. Ramirez: Be advised that this office represents the Board of County Commissioners of Monroe County in the above - referenced matter. If you are represented by counsel, please forward this letter to your lawyers immediately. Please direct all further communications to the County regarding this matter to this office. On December 28, 2006, the County received from Group Financial Administrative Services, Inc. (GFAS) the enclosed demand for payment in the amount of $35,546.01. From the information gathered to date, it appears that said sum represents funds which were released to either of both of you under the understanding that those funds would be forwarded to GFAS pursuant to your agreement with that firm. In short, it appears that either or both of you converted those funds for your own personal uses. Accordingly, the County therefore demands that you immediately refund $35,546.01 to the County or provide a satisfaction of that debt from GFAS. If you have evidence that you believe refutes the allegations set forth in the enclosed letter from GFAS, I would also welcome the opportunity to review those documents. However, because the County has now been threatened with litigation as a result of your actions, I have advised the Clerk of Court to hold all funds due on invoices submitted by both of you and your respective companies, to offset the claims that have been asserted by GFAS against the County because of your actions. Judy Bobrick Gina Ramirez January 5, 2007 Page 2 I want to avoid litigation on this matter and believe you can make arrangements to resolve the claims asserted by GFAS. However, you should know that should litigation ensue and the County prevail against you on a claim for civil theft, under Florida law, you could be required to pay treble damages, plus costs, and attomey's fees. Please save yourselves the time, expense, aggravation, and embarrassment that litigation would surely bring and resolve this matter immediately. Govem yourselves accordingly. Sincerely, z 7j Robert B. Shil in • er Chief Assistant County Attomey Enclosure Cc: Danny L. Kolhage, Clerk Peter Horton, Director, KWIA Dent Pierce, Public Works Director 4 GROUP FINANCIAL ADMINISTRATIVE SERVICES, INC. 11000 Metro Parkway Ft. Myers, FL 33966 (239)274 -7990 Board of County Commissioners Re: Ace Building Maintenance 3491 S. Roosevelt Blvd. 10 Day Demand for Payment Key West, Florida, 33040 $35,546.01 Accounts Payable Department: As you are aware, Group Financial Administrative Services, Inc. (G.F.A.S.), as factor, is the assignee of all accounts of Judy Bobic d/b /a Ace Building Maintenance (our client). As assignee, G.F.A.S. is entitled to all rights of payment upon those accounts. Notification of Assignment, and your legal obligations thereunder, are embodied in Article 9 of the UCC (Uniform Commercial Code). Whether received from a bank, factor, or other commercial lender, such notification is an important legal document that all A/P managers and accounts payable personnel should be completely familiar with. Please be advised that the enclosed statement of your account is accurate as to open balances legally owed to G.F.A.S. Any payment made post notification directly to Ace Building Maintenance and not reflected on this statement of account, has exposed you to multiple payment liability. It is our policy to always attempt settlement in these matters prior to litigation. Demand, therefore, is hereby made for complete and immediate payment on your account in the amount of $35,546.01. At your option, you may wish to consult with legal counsel or the County Attorney regarding this matter. As a complimentary service to you, we have included the following case law, definitions and renderings regarding post notification misdirected payments which will assist your counsel in advising you properly regarding your current obligations to G.F.A.S. 1.1.1 "As a general rule, a debtor will not be discharged from its obligations by performance rendered to the assignor after notice of assignment." Producers Cotton Oil Company v. Amstar Corporation, 197 Cal. App.3d 638, 656 (1988). (Emphasis added) "If an account debtor fails to follow the dictates of a valid assignment and improperly pays the assignor, the account debtor must answer to the assignee with a double payment in the amount of the improper payment. Haas b. Metro Goldwyn - Mayer, Inc F.2d 1136, 1139 (5th Cir. 1980) (applying California law). • 1.1.2 Aerofund Financial, Inc. v. Quality King Distributors, Inc., Trusted Care, Inc.; and Mark A. Paine, Index No. 98 -10163 Supreme Court of the State of New York, County of Suffolk, Trial Term, part 20- "However, it is well established law that the fact that defendant, Quality King, may have paid defendant, Trusted Care directly does not relieve Quality King of its obligation to pay Aerofund and its alleged payment to defendant, Trusted Care, is not a defense in this action." (See U.C.0 Sec. 9 318(3); General Motors Acceptance Corp v. Clifton -Fine Central School District, 85 N.Y. 2d 232, 623, N.Y.S. 2d 821 (1995); See also Abrams & Company, Inc. v. ITS Equipment & Leasing Corporation, 216 A.D. 2d 503, 628 N.Y.S. 2d 784 (2nd Dept, 1995); King and Madonna v. Tuxedo Enterprises, Inc., 975 F. Supp. 448, 35 U.C.C. Rep. Serv. 2d 1372 (S.D.N.Y. 1997). "The law in New York is well settled that, after a debtor receives notice of the assignment, the debtor must pay the assignee RECEI no i e protected if he pays the assignor." (Weniger v. Fourteenth St. Store, 191 . . • (1'.8). AIRPORTS - BEM 1.1.2 (cont'd) As stated by the Court of Appeals in General Motors Acceptance Corp. v. Clifton Fine Central School District, 85 N.Y. 2d. 232, 236, 623, N.Y.S. 2d 821 (1995): "Generally, after the account debtor receives notification that the right has been assigned and the assignee is to be paid, and continues to pay the assignor, the account debtor is liable to the assignee and the fact that the payment was made to the assignor is not a defense in an action brought by the assignee. The account debtor has a responsibility to make payment to the assignee after it receives notification that the contract has been assigned and that the payment is to be made to the assignee." (Hawkland, Lord & Lewis, UCC Series Sec. 9- 318:03) (emphasis supplied). Furthermore, in General Motors Acceptance Corp. v. Albany Water Board, 187 A.D. 2d 894, 590, N.Y.S 2d 312 (3rd Dept. 1992), the Appellate Division affirmed the trial court's award of summary judgment in favor of plaintiff concluding that defendant was liable for making payments directly to a car dealer, after defendant had been put on notice that payments should have been made to GMAC. As stated by the Appellate division, " After notice of the transfer, how ever, the debtor is put on his guard, and if he pays the assignor any moneys which, under the assignment belong to the assignee, or if he does anything prejudicial to the rights of the latter, he is liable for the resulting damages." (Citations omitted) 1.1.1.1. A notice that a secured party has a security interest in the account is sufficient as "notification of the assignment." Artoc Bank and Trust v. Apex Oil Company, 1992 WL 232304 1.1.1.2 Bay Area Factors v. Target Stores, Inc. 34 UCCRS 2d 585; In a similar case, Capital Factors, Inc. v. Caldor, Inc. 582 N.Y.S. 2d 1012, 1013, (18 UCC Rep Sery 2d 315) N.Y. App. Div. 1992), the court held that invoices stamped "payable" to the factoring company were sufficient to put the account debtor on notice that the account had been assigned. A letter stating that the factoring company was `working with" the assignor and that it would "appreciate you making all checks payable" to it was sufficient to notify the account debtor of the assignment. See Municipal Trust and Savings Bank v. Grant Park Community Dist., 525 N.E. 2d 255, 258 (6 UCC Rep Sery 2d 1621) (Ill Ct. App 1988). The court noticed that it knew of no authority requiring "magic words" for notices to be effective. 1.1.2.9- 318(3) First Bank of Marietta v. Roslovic & Partners, Inc. 40 UCC reporting service 2d 891, Ohio St 3d 116, 712, NE2d 703 —the law is clear. "Roslovic, as an account debtor, should have made the payments to First Bank of Marietta once it received proper notice of the assignment. Strict construction of this statute preserves the goals of commercial stability and reliability. Lenders are willing to enter riskier deals if a good assignment is in place that creates solid incentives for an account debtor to comply with its terms. The incentive for the account debtor to honor the assignment is the penalty that the account debtor will be assessed for payments made directly to the assignor. Equity and quantum meruit are not defenses to payments made in violation of the notice, nor is the difficulty of compliance or demands of the assignee a defense. While this may appear to place a heavy burden on Roslavic to pay twice, ( as Mascrete is presumably insolvent), it was Roslavic that decided to take the risk of direct payment to avoid a difficult situation despite the language of R.C. 130937© (UCC 9- 318(3)) and proper notice. The statute allows no exceptions. 1.1.2.1. A stamp on invoices stating that it is "PAYABLE TO: (ASSIGNEE)" and giving its address is sufficient. Capital Factors v. Caldor, Inc. 18 UCC Rep Sery 2d 315; 582 NYS 2d 1012 (App Div, 1st Dept, decided April 21, 1992). 1.1.2.2. A paid after notification action where the account creditor is in bankruptcy must be brought in the bankruptcy court (Dewhirst v. Citibank in reference to contractor's Equipment and Supply Co.) 861 F2d 241 (9th Cir 1988) 1.1.2.3 Indeed, the account debtor's failure to pay the secured party may result in The account debtor's having to pay again. See e.g. Valley National Bank v. Flagstaff Dairy, 570 P.2d 200 (Ariz. Ct. App 1977). See also Hall Bros. Construction Co. Inc. v. Mercantile National Bank of Indiana, 27 UCC Rep Sery 2d 1051. 1.1.2.4 National Trade Trust, Inc. v. Merrimac Construction, 25 UCC Rep. Serv. 2d 275—Once an account debtor receives notice that an amount owed has been assigned, the debtor loses the authority to pay the assignor. Tradex Inc. v. Modern Merchandising Inc., 386 N.W. 2d 800. An account debtor that erroneously pays the assignor after receiving notice of assignment waives any claim to a setoff against the assignor raised for the first time after the assigned debt was paid. As previously noticed, all payments due Ace Building Maintenance must be made directly G.F.A.S. without exception. Until further notice, all payments must be made to: G.F.A.S. Account of: Ace Building Maintenance. Box 919007 Orlando, FL 32891 -9007 Payments made in any other way will expose you to additional multiple liability. Any questions regarding this demand should be directed to our local office at 11000 Metro Parkway, Suite 22, Ft. Myers, FL 33966 ( ysincerely l � I c . on (239) 274 -7990 cc: Judy Bobic / Ace Building Maintenance Statement of Account As of December 27, 2006 Please Remit All Payments To: AEGIS FACTORS, INC. /G.F.A.S. Attention A/P Mgr. 11000 METRO PKWY g SUITE 22 Assigned Payment FTT M . YERS, FL 33912 g y Invoices Were Purchased From: BOARD OF COUNTY COMMISSIONERS ACE BUILDING MAINTENANCE 3491 S ROOSEVELT BLVD 1200 20TH TERRACE KEY WEST, FL 33040 KEY WEST, FL 33040 Invoice# Date Amount Age Balance 1056FAZ 9/15/2006 14,348.67 104 6,848.67 1063FAZ 10/2/2006 14,348.67 87 14,348.67 1103FAZ 10/16/2006 14,348.67 73 14,348.67 Total Due 35,546.01 AT'TENT'ION ACCOUNTS PAYABLE MGR; NOTIFICATION OF ASSIGNMENT ' 1 r rt :nn i h �-- ?' c ,� 1 i r l t d a t ere e been Ci:�2!' ��1_1 :r�13'��:�l�li�� � �_- ;� ��r� - _ ��.'1 7 - .- +.1� _]. t"] fie. � -. " + 3 (and payment thereon �'�'�� - ��.��j assigned l C ._ iL3i331 1 . =ri - ) pain that pav'm.ijt i lust be Iliad& ^'o : of , CE BUILDING MAINTENANCE