Title 27, Uniform Commercial Code

§490:3-207 Reacquisition. Reacquisition of an instrument occurs if it is transferred to a former holder, by negotiation or otherwise. A former holder who reacquires the instrument may cancel indorsements made after the reacquirer first became a holder of the instrument. If the ca…

PART 3. ENFORCEMENT OF INSTRUMENTS §490:3-301 Person entitled to enforce instrument. "Person entitled to enforce" an instrument means (i) the holder of the instrument, (ii) a nonholder in possession of the instrument who has the rights of a holder, or (iii) a person not in posses…

§490:3-302 Holder in due course. (a) Subject to subsection (c) and section 490:3-106(d), "holder in due course" means the holder of an instrument if: (b) Notice of discharge of a party, other than discharge in an insolvency proceeding, is not notice of a defense under subsection …

§490:3-303 Value and consideration. (a) An instrument is issued or transferred for value if: (b) "Consideration" means any consideration sufficient to support a simple contract. The drawer or maker of an instrument has a defense if the instrument is issued without consideration. …

§490:3-304 Overdue instrument. (a) An instrument payable on demand becomes overdue at the earliest of the following times: (b) With respect to an instrument payable at a definite time the following rules apply: (c) Unless the due date of principal has been accelerated, an instrum…

§490:3-305 Defenses and claims in recoupment. (a) Except as stated in subsection (b), the right to enforce the obligation of a party to pay the instrument is subject to the following: (b) The right of a holder in due course to enforce the obligation of a party to pay the instrume…

§490:3-306 Claims to an instrument. A person taking an instrument, other than a person having rights of a holder in due course, is subject to a claim of a property or possessory right in the instrument or its proceeds, including a claim to rescind a negotiation and to recover the…

§490:3-307 Notice of breach of fiduciary duty. (a) In this section: (b) If (i) an instrument is taken from a fiduciary for payment or collection or for value, (ii) the taker has knowledge of the fiduciary status of the fiduciary, and (iii) the represented person makes a claim to …

§490:3-308 Proof of signatures and status as holder in due course. (a) In an action with respect to an instrument, the authenticity of, and authority to make, each signature on the instrument is admitted unless specifically denied in the pleadings. If the validity of a signature …

§490:3-309 Enforcement of lost, destroyed, or stolen instrument. (a) A person not in possession of an instrument is entitled to enforce the instrument if (i) the person was in rightful possession of the instrument and entitled to enforce it when loss of possession occurred, (ii) …

§490:3-310 Effect of instrument on obligation for which taken. (a) Unless otherwise agreed, if a certified check, cashier's check, or teller's check is taken for an obligation, the obligation is discharged to the same extent discharge would result if an amount of money equal to t…

§490:3-311 Accord and satisfaction by use of instrument. (a) If a person against whom a claim is asserted proves that (i) that person in good faith tendered an instrument to the claimant as full satisfaction of the claim, (ii) the amount of the claim was unliquidated or subject t…

§490:3-312 Lost, destroyed, or stolen cashier's check, teller's check, or certified check. (a) In this section: (b) A claimant may assert a claim to the amount of a check by a communication to the obligated bank describing the check with reasonable certainty and requesting paymen…

PART 4. LIABILITY OF PARTIES §490:3-401 Signature necessary for liability on instrument. A person shall not be liable on an instrument unless (i) the person signed the instrument, or (ii) the person is represented by an agent or representative who signed the instrument and the si…

§490:3-402 Signature by representative. (a) If a person acting, or purporting to act, as a representative signs an instrument by signing either the name of the represented person or the name of the signer, the represented person is bound by the signature to the same extent the re…

§490:3-403 Unauthorized signature. (a) Unless otherwise provided in this article or article 4, an unauthorized signature is ineffective except as the signature of the unauthorized signer in favor of a person who in good faith pays the instrument or takes it for value. An unauthor…

§490:3-404 Impostors; fictitious payees. (a) If an impostor, by use of the mails or otherwise, induces the issuer of an instrument to issue the instrument to the impostor, or to a person acting in concert with the impostor, by impersonating the payee of the instrument or a person…

§490:3-405 Employer responsibility for fraudulent indorsement by employee. (a) In this section: (b) For the purpose of determining the rights and liabilities of a person who, in good faith, pays an instrument or takes it for value or for collection, if an employer entrusted an em…

§490:3-406 Negligence contributing to forged signature or alteration of instrument. (a) A person whose failure to exercise ordinary care substantially contributes to an alteration of an instrument or to the making of a forged signature on an instrument is precluded from asserting…

§490:3-407 Alteration. (a) "Alteration" means (i) an unauthorized change in an instrument that purports to modify in any respect the obligation of a party, or (ii) an unauthorized addition of words or numbers or other change to an incomplete instrument relating to the obligation …

§490:3-408 Drawee not liable on unaccepted draft. A check or other draft does not of itself operate as an assignment of funds in the hands of the drawee available for its payment, and the drawee is not liable on the instrument until the drawee accepts it. [L 1991, c 118, pt of §1…

§490:3-409 Acceptance of draft; certified check. (a) "Acceptance" means the drawee's signed agreement to pay a draft as presented. It must be written on the draft and may consist of the drawee's signature alone. Acceptance may be made at any time and becomes effective when notifi…

§490:3-410 Acceptance varying draft. (a) If the terms of a drawee's acceptance vary from the terms of the draft as presented, the holder may refuse the acceptance and treat the draft as dishonored. In that case, the drawee may cancel the acceptance. (b) The terms of a draft are n…

§490:3-411 Refusal to pay cashier's checks, teller's checks, and certified checks. (a) In this section, "obligated bank" means the acceptor of a certified check or the issuer of a cashier's check or teller's check bought from the issuer. (b) If the obligated bank wrongfully (i) r…

§490:3-412 Obligation of issuer of note or cashier's check. The issuer of a note or cashier's check or other draft drawn on the drawer is obliged to pay the instrument (i) according to its terms at the time it was issued or, if not issued, at the time it first came into possessio…

§490:3-413 Obligation of acceptor. (a) The acceptor of a draft is obliged to pay the draft (i) according to its terms at the time it was accepted, even though the acceptance states that the draft is payable "as originally drawn" or equivalent terms, (ii) if the acceptance varies …

§490:3-414 Obligation of drawer. (a) This section does not apply to cashier's checks or other drafts drawn on the drawer. (b) If an unaccepted draft is dishonored, the drawer is obliged to pay the draft (i) according to its terms at the time it was issued or, if not issued, at th…

§490:3-415 Obligation of indorser. (a) Subject to subsections (b), (c), and (d) and to section 490:3-419(d), if an instrument is dishonored, an indorser is obliged to pay the amount due on the instrument (i) according to the terms of the instrument at the time it was indorsed, or…

§490:3-416 Transfer warranties. (a) A person who transfers an instrument for consideration warrants to the transferee and, if the transfer is by indorsement, to any subsequent transferee that: (b) A person to whom the warranties under subsection (a) are made and who took the inst…

§490:3-417 Presentment warranties. (a) If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft: (b) A drawee making payment may recover from any warrantor damages for breach of warranty equal to the amount paid by the d…

§490:3-418 Payment or acceptance by mistake. (a) Except as provided in subsection (c), if the drawee of a draft pays or accepts the draft and the drawee acted on the mistaken belief that (i) payment of the draft had not been stopped pursuant to section 490:4-403 or (ii) the signa…

§490:3-419 Instruments signed for accommodation. (a) If an instrument is issued for value given for the benefit of a party to the instrument ("accommodated party") and another party to the instrument ("accommodation party") signs the instrument for the purpose of incurring liabil…

§490:3-420 Conversion of instrument. (a) 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 obt…

PART 5. DISHONOR §490:3-501 Presentment. (a) "Presentment" means a demand made by or on behalf of a person entitled to enforce an instrument (i) to pay the instrument made to the drawee or a party obliged to pay the instrument or, in the case of a note or accepted draft payable a…

§490:3-502 Dishonor. (a) Dishonor of a note is governed by the following rules: (b) Dishonor of an unaccepted draft other than a documentary draft is governed by the following rules: (c) Dishonor of an unaccepted documentary draft occurs according to the rules stated in subsectio…

§490:3-503 Notice of dishonor. (a) The obligation of an indorser stated in section 490:3-415(a) and the obligation of a drawer stated in section 490:3-414(d) may not be enforced unless (i) the indorser or drawer is given notice of dishonor of the instrument complying with this se…

§490:3-504 Excused presentment and notice of dishonor. (a) Presentment for payment or acceptance of an instrument is excused if (i) the person entitled to present the instrument cannot with reasonable diligence make presentment, (ii) the maker or acceptor has repudiated an obliga…

§490:3-505 Evidence of dishonor. (a) The following are admissible as evidence and create a presumption of dishonor and of any notice of dishonor stated: (b) A protest is a certificate of dishonor made by a United States consul or vice consul, or a notary public or other person au…

§490:3-506 Dishonored check; action for treble damages; procedures. (a) In any action against a person who makes any check, draft, or order for the payment of money that has been dishonored for lack of funds or credit to pay the check, draft, or order or because the maker has no …

§490:3-506.5 Charges for dishonored checks. The payee or a holder in due course of any check, draft, or order for the payment of money that has been dishonored for lack of funds or credit to pay the check, draft, or order or because the maker has no account with the drawee shall …

PART 6. DISCHARGE AND PAYMENT §490:3-601 Discharge and effect of discharge. (a) The obligation of a party to pay the instrument is discharged as stated in this article or by an act or agreement with the party which would discharge an obligation to pay money under a simple contrac…

§490:3-602 Payment. (a) Subject to subsection (b), an instrument is paid to the extent payment is made (i) by or on behalf of a party obliged to pay the instrument, and (ii) to a person entitled to enforce the instrument. To the extent of the payment, the obligation of the party …

§490:3-603 Tender of payment. (a) If tender of payment of an obligation to pay an instrument is made to a person entitled to enforce the instrument, the effect of tender is governed by principles of law applicable to tender of payment under a simple contract. (b) If tender of pay…

§490:3-604 Discharge by cancellation or renunciation. (a) A person entitled to enforce an instrument, with or without consideration, may discharge the obligation of a party to pay the instrument (i) by an intentional voluntary act, including surrender of the instrument to the par…

§490:3-605 Discharge of indorsers and accommodation parties. (a) In this section, the term "indorser" includes a drawer having the obligation described in section 490:3-414(d). (b) Discharge, under section 490:3-604, of the obligation of a party to pay an instrument does not disc…

ARTICLE 4. BANK DEPOSITS AND COLLECTIONS PART 1. GENERAL PROVISIONS AND DEFINITIONS §490:4-101 Short title. This article may be cited as Uniform Commercial Code--Bank Deposits and Collections. [L 1965, c 208, §4-101; HRS §490:4-101; am L 1991, c 118, pt of §4]

§490:4-102 Applicability. (a) To the extent that items within this article are also within articles 3 and 8, they are subject to those articles. If there is conflict, this article governs article 3, but article 8 governs this article. (b) The liability of a bank for action or non…

§490:4-103 Variation by agreement; measure of damages; action constituting ordinary care. (a) The effect of the provisions of this article may be varied by agreement, but the parties to the agreement cannot disclaim a bank's responsibility for its lack of good faith or failure to…

§490:4-104 Definitions and index of definitions. (a) In this article, unless the context otherwise requires: (b) Other definitions applying to this article and the sections in which they appear are: "Agreement for electronic presentment". Section 490:4-110. "Bank". Section 490:4-…

§490:4-105 "Bank"; "depositary bank"; "payor bank"; "intermediary bank"; "collecting bank"; "presenting bank". In this article: