Chapter 810 — COMMERCIAL CODE

(810 ILCS 5/3-104) (from Ch. 26, par. 3-104) Sec. 3-104. Negotiable instrument. (a) Except as provided in subsections (c) and (d), "negotiable instrument" means an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described i…

(810 ILCS 5/3-105) (from Ch. 26, par. 3-105) Sec. 3-105. Issue of instrument. (a) "Issue" means: (1) the first delivery of an instrument by the maker or drawer, whether to a holder or nonholder, for the purpose of giving rights on the instrument to any person; or (2) if agreed by…

(810 ILCS 5/3-106) (from Ch. 26, par. 3-106) Sec. 3-106. Unconditional promise or order. (a) Except as provided in this Section, for the purposes of Section 3-104(a), a promise or order is unconditional unless it states (i) an express condition to payment, (ii) that the promise o…

(810 ILCS 5/3-107) (from Ch. 26, par. 3-107) Sec. 3-107. Instrument payable in foreign money. Unless the instrument otherwise provides, an instrument that states the amount payable in foreign money may be paid in the foreign money or in an equivalent amount in dollars calculated …

(810 ILCS 5/3-108) (from Ch. 26, par. 3-108) Sec. 3-108. Payable on demand or at a definite time. (a) A promise or order is "payable on demand" if it (i) states that it is payable on demand or at sight, or otherwise indicates that it is payable at the will of the holder, or (ii) …

(810 ILCS 5/3-109) (from Ch. 26, par. 3-109) Sec. 3-109. Payable to bearer or to order. (a) A promise or order is payable to bearer if it: (1) states that it is payable to bearer or to the order of bearer or otherwise indicates that the person in possession of the promise or orde…

(810 ILCS 5/3-110) (from Ch. 26, par. 3-110) Sec. 3-110. Identification of person to whom instrument is payable. (a) The person to whom an instrument is initially payable is determined by the intent of the person, whether or not authorized, signing as, or in the name or behalf of…

(810 ILCS 5/3-111) (from Ch. 26, par. 3-111) Sec. 3-111. Place of payment. Except as otherwise provided for items in Article 4, an instrument is payable at the place of payment stated in the instrument. If no place of payment is stated, an instrument is payable at the address of …

(810 ILCS 5/3-112) (from Ch. 26, par. 3-112) Sec. 3-112. Interest. (a) Unless otherwise provided in the instrument, (i) an instrument is not payable with interest, and (ii) interest on an interest-bearing instrument is payable from the date of the instrument. (b) Interest may be …

(810 ILCS 5/3-113) (from Ch. 26, par. 3-113) Sec. 3-113. Date of instrument. (a) An instrument may be antedated or postdated. The date stated determines the time of payment if the instrument is payable at a fixed period after date. Except as provided in Section 4-401(c), an instr…

(810 ILCS 5/3-114) (from Ch. 26, par. 3-114) Sec. 3-114. Contradictory terms of instrument. If an instrument contains contradictory terms, typewritten terms prevail over printed terms, handwritten terms prevail over both, and words prevail over numbers. (Source: P.A. 87-582.)

(810 ILCS 5/3-115) (from Ch. 26, par. 3-115) Sec. 3-115. Incomplete instrument. (a) "Incomplete instrument" means a signed writing, whether or not issued by the signer, the contents of which show at the time of signing that it is incomplete but that the signer intended it to be c…

(810 ILCS 5/3-116) (from Ch. 26, par. 3-116) Sec. 3-116. Joint and several liability; contribution. (a) Except as otherwise provided in the instrument, 2 or more persons who have the same liability on an instrument as makers, drawers, acceptors, indorsers who are indorsing joint …

(810 ILCS 5/3-117) (from Ch. 26, par. 3-117) Sec. 3-117. Other agreements affecting an instrument. Subject to applicable law regarding exclusion of proof of contemporaneous or previous agreements, the obligation of a party to an instrument to pay the instrument may be modified, s…

(810 ILCS 5/3-118) (from Ch. 26, par. 3-118) Sec. 3-118. Statute of limitations. (a) (Blank). (b) (Blank). (c) Except as provided in subsection (d), an action to enforce the obligation of a party to an unaccepted draft to pay the draft must be commenced within 3 years after disho…

(810 ILCS 5/3-119) (from Ch. 26, par. 3-119) Sec. 3-119. Notice of right to defend action. In an action for breach of an obligation for which a third person is answerable over pursuant to this Article or Article 4, the defendant may give the third person written notice of the lit…

(810 ILCS 5/3-201) (from Ch. 26, par. 3-201) Sec. 3-201. Negotiation. (a) "Negotiation" means a transfer of possession, whether voluntary or involuntary, of an instrument by a person other than the issuer to a person who thereby becomes its holder. (b) Except for negotiation by a…

(810 ILCS 5/3-202) (from Ch. 26, par. 3-202) Sec. 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…

(810 ILCS 5/3-203) (from Ch. 26, par. 3-203) Sec. 3-203. Transfer of instrument; rights acquired by transfer. (a) An instrument is transferred when it is delivered by a person other than its issuer for the purpose of giving to the person receiving delivery the right to enforce th…

(810 ILCS 5/3-204) (from Ch. 26, par. 3-204) Sec. 3-204. Indorsement. (a) "Indorsement" means a signature, other than that of a signer as maker, drawer, or acceptor, that alone or accompanied by other words is made on an instrument for the purpose of (i) negotiating the instrumen…

(810 ILCS 5/3-205) (from Ch. 26, par. 3-205) Sec. 3-205. Special indorsement; blank indorsement; anomalous indorsement. (a) If an indorsement is made by the holder of an instrument, whether payable to an identified person or payable to bearer, and the indorsement identifies a per…

(810 ILCS 5/3-206) (from Ch. 26, par. 3-206) Sec. 3-206. Restrictive indorsement. (a) An indorsement limiting payment to a particular person or otherwise prohibiting further transfer or negotiation of the instrument is not effective to prevent further transfer or negotiation of t…

(810 ILCS 5/3-207) (from Ch. 26, par. 3-207) Sec. 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 firs…

(810 ILCS 5/3-301) (from Ch. 26, par. 3-301) Sec. 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 no…

(810 ILCS 5/3-302) (from Ch. 26, par. 3-302) Sec. 3-302. Holder in due course. (a) Subject to subsection (c) and Section 3-106(d), "holder in due course" means the holder of an instrument if: (1) the instrument when issued or negotiated to the holder does not bear such apparent e…

(810 ILCS 5/3-303) (from Ch. 26, par. 3-303) Sec. 3-303. Value and consideration. (a) An instrument is issued or transferred for value if: (1) the instrument is issued or transferred for a promise of performance, to the extent the promise has been performed; (2) the transferee ac…

(810 ILCS 5/3-304) (from Ch. 26, par. 3-304) Sec. 3-304. Overdue instrument. (a) An instrument payable on demand becomes overdue at the earliest of the following times: (1) on the day after the day demand for payment is duly made; (2) if the instrument is a check, 90 days after i…

(810 ILCS 5/3-305) (from Ch. 26, par. 3-305) Sec. 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 an instrument is subject to the following: (1) a defense of the obligor based on (i) infancy o…

(810 ILCS 5/3-306) (from Ch. 26, par. 3-306) Sec. 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 cla…

(810 ILCS 5/3-307) (from Ch. 26, par. 3-307) Sec. 3-307. Notice of breach of fiduciary duty. (a) In this Section: (1) "Fiduciary" means an agent, trustee, partner, corporate officer or director, or other representative owing a fiduciary duty with respect to an instrument. (2) "Re…

(810 ILCS 5/3-308) (from Ch. 26, par. 3-308) Sec. 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 …

(810 ILCS 5/3-309) (from Ch. 26, par. 3-309) Sec. 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 possession of the instrument and entitled to enforce it wh…

(810 ILCS 5/3-310) (from Ch. 26, par. 3-310) Sec. 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…

(810 ILCS 5/3-311) (from Ch. 26, par. 3-311) Sec. 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 amo…

(810 ILCS 5/3-312) (from Ch. 26, par. 3-312) Sec. 3-312. Lost, destroyed, or stolen cashier's check, teller's check, or certified check. (a) In this Section: (1) "Check" means a cashier's check, teller's check, or certified check. (2) "Claimant" means a person who claims the righ…

(810 ILCS 5/3-401) (from Ch. 26, par. 3-401) Sec. 3-401. Signature necessary for liability on instrument. 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…

(810 ILCS 5/3-402) (from Ch. 26, par. 3-402) Sec. 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 bo…

(810 ILCS 5/3-403) (from Ch. 26, par. 3-403) Sec. 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…

(810 ILCS 5/3-404) (from Ch. 26, par. 3-404) Sec. 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 imperso…

(810 ILCS 5/3-405) (from Ch. 26, par. 3-405) Sec. 3-405. Employer responsibility for fraudulent indorsement by employee. (a) In this Section: (1) "Employee" includes an independent contractor and employee of an independent contractor retained by the employer. (2) "Fraudulent indo…

(810 ILCS 5/3-406) (from Ch. 26, par. 3-406) Sec. 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 signatur…

(810 ILCS 5/3-407) (from Ch. 26, par. 3-407) Sec. 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 inc…

(810 ILCS 5/3-408) (from Ch. 26, par. 3-408) Sec. 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 t…

(810 ILCS 5/3-409) (from Ch. 26, par. 3-409) Sec. 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…

(810 ILCS 5/3-410) (from Ch. 26, par. 3-410) Sec. 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 …

(810 ILCS 5/3-411) (from Ch. 26, par. 3-411) Sec. 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 issu…

(810 ILCS 5/3-412) (from Ch. 26, par. 3-412) Sec. 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 is…

(810 ILCS 5/3-413) (from Ch. 26, par. 3-413) Sec. 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 eq…

(810 ILCS 5/3-414) (from Ch. 26, par. 3-414) Sec. 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 t…

(810 ILCS 5/3-415) (from Ch. 26, par. 3-415) Sec. 3-415. Obligation of indorser. (a) Subject to subsections (b), (c), and (d) and to Section 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 …