Title XIII, COMMERCE (Ch. 505 - 554I)

1. In this section : a. “Fiduciary” means an agent, trustee, partner, corporate officer or director, or other representative owing a fiduciary duty with respect to an instrument. b. “Represented person” means the principal, beneficiary, partnership, corporation, or other person t…

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 is denied in the pleadings, the burden of establishing validity is o…

1. A person not in possession of an instrument is entitled to enforce the instrument if: a. the person seeking to enforce the instrument: (1) was entitled to enforce the instrument when loss of possession occurred, or (2) has directly or indirectly acquired ownership of the instr…

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 amount of the instrument were taken in payment of the obligat…

1. If a person against whom a claim is asserted proves that that person in good faith tendered an instrument to the claimant as full satisfaction of the claim, the amount of the claim was unliquidated or subject to a bona fide dispute, and the claimant obtained payment of the ins…

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, teller’s check, or certified check that was lost, destroyed, or stolen. c. “Declaration of lo…

A person is not liable on an instrument unless the person signed the instrument, or the person is represented by an agent or representative who signed the instrument and the signature is binding on the represented person under section 554.3402 . 94 Acts, ch 1167, §48, 121, 122 ; …

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 represented person would be bound if the si…

1. 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 unauthorized signature may be ratified for …

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 authorized to act for the payee, an endor…

1. In this section : a. “Employee” includes an independent contractor and employee of an independent contractor retained by the employer. b. “Fraudulent endorsement” means one of the following: (1) in the case of an instrument payable to the employer, a forged endorsement purport…

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 the alteration or the forgery against a person who, in good faith, pays the instrume…

1. “Alteration” means an unauthorized change in an instrument that purports to modify in any respect the obligation of a party, or an unauthorized addition of words or numbers or other change to an incomplete instrument relating to the obligation of a party. 2. Except as provided…

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. 94 Acts, ch 1167, §55, 121, 122

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 notification pursuant to instructions is given or the ac…

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 not varied by an acceptance to pay at a …

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 refuses to pay a cashier’s check or certified check, stops payment of a teller’s check, o…

The issuer of a note or cashier’s check or other draft drawn on the drawer is obliged to pay the instrument according to its terms at the time it was issued or, if not issued, at the time it first came into possession of a holder, or if the issuer signed an incomplete instrument,…

1. The acceptor of a draft is obliged to pay the draft 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, if the acceptance varies the terms of the draft, according to the term…

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 according to its terms at the time it was issued or, if not issued, at the time it first came into possession of…

1. Subject to subsections 2, 3, and 4 and to section 554.3419, subsection 4 , if an instrument is dishonored, an endorser is obliged to pay the amount due on the instrument according to the terms of the instrument at the time it was endorsed, or if the endorser endorsed an incomp…

1. A person who transfers an instrument for consideration warrants to the transferee and, if the transfer is by endorsement, to any subsequent transferee that: a. the warrantor is a person entitled to enforce the instrument; b. all signatures on the instrument are authentic and a…

1. If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, the person obtaining payment or acceptance, at the time of presentment, and a previous transferor of the draft, at the time of transfer, warrant to the drawee …

1. Except as provided in subsection 3 , if the drawee of a draft pays or accepts the draft and the drawee acted on the mistaken belief that payment of the draft had not been stopped pursuant to section 554.4403 or the signature of the drawer of the draft was authorized, the drawe…

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 liability on the instrument without being a direct benef…

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 obtains payment with respect to the instr…

1. “Presentment” means a demand made by or on behalf of a person entitled to enforce an instrument: a. 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 bank; or b. to accept a d…

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 payable at or through …

1. The obligation of an endorser stated in section 554.3415, subsection 1 , and the obligation of a drawer stated in section 554.3414, subsection 4 , may not be enforced unless the endorser or drawer is given notice of dishonor of the instrument complying with this section or not…

1. Presentment for payment or acceptance of an instrument is excused if the person entitled to present the instrument cannot with reasonable diligence make presentment; the maker or acceptor has repudiated an obligation to pay the instrument or is dead or in insolvency proceeding…

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 which purports to be a protest; b. a purported stamp or writing of the drawee, payor bank, or presentin…

1. The holder of a dishonored check, draft, or order may assess against the maker of that check, draft, or order a surcharge not to exceed thirty dollars. 2. The surcharge authorized by this section shall not be assessed unless the holder clearly and conspicuously posts a notice …

1. In a civil action against a person who makes a check, draft, or order, which has been dishonored for lack of funds or credit, after having been presented twice, or because the maker has no account with the drawee, the plaintiff shall recover from the defendant total damages eq…

1. 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 contract. 2. Discharge of the obligation of a party is not effective against a perso…

1. Subject to subsection 2 , an instrument is paid to the extent payment is made by or on behalf of a party obliged to pay the instrument, and to a person entitled to enforce the instrument. To the extent of the payment, the obligation of the party obliged to pay the instrument i…

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 payment of an obligation to pay an …

1. A person entitled to enforce an instrument, with or without consideration, may discharge the obligation of a party to pay the instrument by an intentional voluntary act, such as surrender of the instrument to the party, destruction, mutilation, or cancellation of the instrumen…

1. In this section , the term “endorser” includes a drawer having the obligation described in section 554.3414, subsection 4 . 2. Discharge, under section 554.3604 , of the obligation of a party to pay an instrument does not discharge the obligation of an endorser or accommodatio…

This Article may be cited as Uniform Commercial Code — Bank Deposits and Collections. [C66, 71, 73, 75, 77, 79, 81, §554.4101 ] 94 Acts, ch 1167, §78, 122

1. To the extent that items within this Article are also within Articles 3 and 8 , they are subject to the provisions of those Articles. If there is conflict, this Article governs Article 3 , but Article 8 governs this Article . 2. The liability of a bank for action or nonaction …

1. 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 exercise ordinary care or limit the measure of damages for the lack or failure. However, t…

1. In this Article , 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 a certificate of deposit. b. “Afternoon” means t…

In this Article : 1. “Bank” means a person engaged in the business of banking, including a savings bank, savings and loan association, credit union, or trust company. 2. “Depositary bank” means the first bank to take an item even though it is also the payor bank, unless the item …

1. If an item states that it is “payable through” a bank identified in the item, the item designates the bank as a collecting bank and does not by itself authorize the bank to pay the item, and the item may be presented for payment only by or through the bank. 2. If an item state…

A branch or separate office of a bank is a separate bank for the purpose of computing the time within which and determining the place at or to which action may be taken or notices or orders must be given under this Article and under Article 3 . [C66, 71, 73, 75, 77, 79, 81, §554.…

1. For the purpose of allowing time to process items, prove balances, and make the necessary entries on its books to determine its position for the day, a bank may fix an afternoon hour of 2:00 p.m. or later as a cutoff hour for the handling of money and items and the making of e…