Title 28, COMMERCIAL TRANSACTIONS

28-3-301. 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 possession of the instrument who is entitl…

28-3-302. Holder in due course. (1) Subject to subsection (3) of this section and section 28-3-106(4), "holder in due course" means the holder of an instrument if: (a) The instrument when issued or negotiated to the holder does not bear such apparent evidence of forgery or altera…

28-3-303. Value and consideration. (1) An instrument is issued or transferred for value if: (a) The instrument is issued or transferred for a promise of performance, to the extent the promise has been performed; (b) The transferee acquires a security interest or other lien in the…

28-3-304. Overdue instrument. (1) An instrument payable on demand becomes overdue at the earliest of the following times: (a) On the day after the day demand for payment is duly made; (b) If the instrument is a check, ninety (90) days after its date; or (c) If the instrument is n…

28-3-305. Defenses and claims in recoupment. (1) Except as stated in subsection (2) of this section, the right to enforce the obligation of a party to pay an instrument is subject to the following: (a) A defense of the obligor based on (i) infancy of the obligor to the extent it …

28-3-306. 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 …

28-3-307. Proof of signatures and status as holder in due course. (1) 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 i…

28-3-308. Enforcement of lost, destroyed, or stolen instrument. (1) A person not in possession of an instrument is entitled to enforce the instrument if (i) the person was in possession of the instrument and entitled to enforce it when loss of possession occurred, (ii) the loss o…

28-3-309. Effect of instrument on obligation for which taken. (1) 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 the…

28-3-310. Accord and satisfaction by use of instrument. (1) 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 to…

28-3-311. Lost, destroyed, or stolen cashier’s check, teller’s check or certified check. (1) In this section: (a) "Check" means a cashier’s check, teller’s check or certified check. (b) "Claimant" means a person who claims the right to receive the amount of a cashier’s check, tel…

28-3-401. Signature. (1) A person is not 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 signature is binding on the represented person under section 28-3-402. (…

28-3-402. Signature by representative. (1) 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 rep…

28-3-403. Unauthorized signature. (1) Unless otherwise provided in this chapter or chapter 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 unauthori…

28-3-404. Impostors — Fictitious payees. (1) 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…

28-3-405. Employer’s responsibility for fraudulent indorsement by employee. (1) In this section: (a) "Employee" includes an independent contractor and employee of an independent contractor retained by the employer. (b) "Fraudulent indorsement" means (i) in the case of an instrume…

28-3-406. Negligence contributing to forged signature or alteration of instrument. (1) 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 …

28-3-407. Alteration. (1) "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 o…

28-3-408. 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.

28-3-409. Acceptance of draft — Certified check. (1) "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…

28-3-410. Acceptance varying draft. (1) 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. (2) The terms of a draft are no…

28-3-411. Refusal to pay cashier’s checks, teller’s checks, and certified checks. (1) 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. (2) If the obligated bank wrongfully (i) re…

28-3-412. 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 possession…

28-3-413. Obligation of acceptor. (1) 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 t…

28-3-414. Obligation of drawer. (1) This section does not apply to cashier’s checks or other drafts drawn on the drawer. (2) 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 the…

28-3-415. Obligation of indorser. (1) Subject to subsections (2), (3) and (4) of this section and to section 28-3-419(4), 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…

28-3-416. Transfer warranties. (1) A person who transfers an instrument for consideration warrants to the transferee and, if the transfer is by indorsement, to any subsequent transferee that: (a) The warrantor is a person entitled to enforce the instrument; (b) All signatures on …

28-3-417. Presentment warranties. (1) If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, (i) the person obtaining payment or acceptance, at the time of presentment, and (ii) a previous transferor of the draft, at …

28-3-418. Payment or acceptance by mistake. (1) Except as provided in subsection (3) of this section, 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 28-4-403, or…

28-3-419. Instruments signed for accommodation. (1) 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 liabili…

28-3-420. Conversion of instrument. (1) 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 obta…

28-3-501. Presentment. (1) "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 at a bank, to the b…

28-3-502. Dishonor. (1) Dishonor of a note is governed by the following rules: (a) If the note is payable on demand, the note is dishonored if presentment is duly made to the maker and the note is not paid on the day of presentment. (b) If the note is not payable on demand and is…

28-3-503. Notice of dishonor. (1) The obligation of an indorser stated in section 28-3-415(1) and the obligation of a drawer stated in section 28-3-414(4) may not be enforced unless, (i) the indorser or drawer is given notice of dishonor of the instrument complying with this sect…

28-3-504. Excused presentment and notice of dishonor. (1) 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 obligat…

28-3-505. Evidence of dishonor. (1) The following are admissible as evidence and create a presumption of dishonor and of any notice of dishonor stated: (a) A document regular in form as provided in subsection (2) of this section which purports to be a protest; (b) A purported sta…

28-3-601. Discharge and effect of discharge. (1) The obligation of a party to pay the instrument is discharged as stated in this chapter or by an act or agreement with the party which would discharge an obligation to pay money under a simple contract. (2) Discharge of the obligat…

28-3-602. Payment. (1) Subject to subsection (2) of this section, 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 obligatio…

28-3-603. Tender of payment. (1) 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. (2) If tender of paym…

28-3-604. Discharge by cancellation or renunciation. (1) 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, such as surrender of the instrument to the party,…

28-3-605. Discharge of indorsers and accommodation parties. (1) In this section, the term "indorser" includes a drawer having the obligation described in section 28-3-414(4). (2) Discharge, under section 28-3-604 of the obligation of a party to pay an instrument does not discharg…

28-4-101. Short title. This chapter may be cited as Uniform Commercial Code — Bank Deposits and Collections.

28-4-102. Applicability. (1) To the extent that items within this chapter are also within chapters 3 and 8, they are subject to the provisions of those chapters. If there is conflict, the provisions of this chapter govern those of chapter 3, but the provisions of chapter 8 govern…

28-4-103. Variation by agreement — Measure of damages — Certain action constituting ordinary care. (1) The effect of the provisions of this chapter may be varied by agreement, but the parties to the agreement cannot disclaim a bank’s responsibility for its lack of good faith or f…

28-4-104. Definitions and index of definitions. (1) In this chapter, unless the context otherwise requires: (a) "Account" means any deposit or credit account with a bank, including a demand, time, savings, passbook, share draft, or like account, other than an account evidenced by…

28-4-105. "Bank" — "Depositary bank" — "Intermediary bank" — "Collecting bank" — "Payor bank" — "Presenting bank." In this chapter: (1) "Bank" means a person engaged in the business of banking, including a savings bank, savings and loan association, credit union or trust company;…