Title XXVI, TRADE AND COMMERCE

400.3-401. Signature. — (a) 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 400.3-40…

400.3-402. 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 …

400.3-403. 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 unauth…

400.3-404. 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 per…

400.3-405. Employer's responsibility for fraudulent endorsement by employee. — (a) In this section: (1) "Employee" includes an independent contractor and employee of an independent contractor retained by the employer. (2) "Fraudulent endorsement" means (i) in the case of an instr…

400.3-406. 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 asserti…

400.3-407. 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 obligatio…

400.3-408. 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. 1992 S.…

400.3-409. 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 not…

400.3-410. 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…

400.3-411. 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)…

400.3-412. 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 possess…

400.3-413. 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 varie…

400.3-414. 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 …

400.3-415. Obligation of endorser. — (a) Subject to subsections (b), (c), and (d) and to Section 400.3-419(d), if an instrument is dishonored, an endorser is obliged to pay the amount due on the instrument (i) according to the terms of the instrument at the time it was endorsed, …

400.3-416. Transfer warranties. — (a) A person who transfers an instrument for consideration warrants to the transferee and, if the transfer is by endorsement, to any subsequent transferee that: (1) the warrantor is a person entitled to enforce the instrument; (2) all signatures …

400.3-417. Presentment warranties. — (a) If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, (i) the person obtaining payment or acceptance, at the time of presentment, and (ii) a previous transferor of the draft, …

400.3-418. 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 400.4-403 or (ii) the sig…

400.3-419. Instrument 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 lia…

400.3-420. 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 o…

400.3-501. 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 at a bank, to th…

400.3-502. Dishonor. — (a) Dishonor of a note is governed by the following rules: (1) 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. (2) If the note is not payable on demand and…

400.3-503. Notice of dishonor. — (a) The obligation of an endorser stated in Section 400.3-415(a) and the obligation of a drawer stated in Section 400.3-414(d) may not be enforced unless (i) the endorser or drawer is given notice of dishonor of the instrument complying with this …

400.3-504. 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 obli…

400.3-505. Evidence of dishonor. — (a) The following are admissible as evidence and create a presumption of dishonor and of any notice of dishonor stated: (1) a document regular in form as provided in subsection (b) which purports to be a protest; (2) a purported stamp or writing…

400.3-601. 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 contract. (b) Discharge of the obli…

400.3-602. 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 part…

400.3-603. 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 p…

400.3-604. 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, such as surrender of the instrument to the par…

400.3-605. Discharge of endorsers and accommodation parties. — (a) In this section, the term "endorser" includes a drawer having the obligation described in Section 400.3-414(d). (b) Discharge, under Section 400.3-604, of the obligation of a party to pay an instrument does not di…

400.4-101. Short title. — This article may be cited as "Uniform Commercial Code Bank Deposits and Collections". ­­-------- (L. 1963 p. 503 § 4-101, A.L. 1992 S.B. 448)

400.4-102. 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 n…

400.4-103. 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 failur…

400.4-104. Definitions and index of definitions. — (a) In this article unless the context otherwise requires: (1) "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 …

400.4-105. Bank — depositary bank — payor bank — intermediary bank — collecting bank — presenting bank. — 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) "De…

400.4-106. Payable through or payable at bank — collecting bank. — (a) If an item states that it is "payable through" a bank identified in the item, (i) the item designates the bank as a collecting bank and does not by itself authorize the bank to pay the item, and (ii) the item …

400.4-107. Separate office of bank. — 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…

400.4-108. Time of receipt of items. — (a) 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…

400.4-109. Delays. — (a) Unless otherwise instructed, a collecting bank in a good faith effort to secure payment of a specific item drawn on a payor other than a bank, and with or without the approval of any person involved, may waive, modify or extend time limits imposed or perm…

400.4-110. Electronic presentment. — (a) "Agreement for electronic presentment" means an agreement, clearing-house rule, or Federal Reserve regulation or operating circular, providing that presentment of an item may be made by transmission of an image of an item or information de…

400.4-111. Statute of limitations. — An action to enforce an obligation, duty, or right arising under this Article must be commenced within three years after the cause of action accrues, and the statutes of limitation in chapter 516 shall not apply. ­­-------- (L. 1992 S.B. 448, …

400.4-201. Status of collecting bank as agent and provisional status of credits — applicability of article — item endorsed "pay any bank". — (a) Unless a contrary intent clearly appears and before the time that a settlement given by a collecting bank for an item is or becomes fin…

400.4-202. Responsibility for collection or return — when action timely. — (a) A collecting bank must exercise ordinary care in: (1) presenting an item or sending it for presentment; (2) sending notice of dishonor or nonpayment or returning an item other than a documentary draft …

400.4-203. Effect of instructions. — Subject to article 3 concerning conversion of instruments (Section 400.3-420) and restrictive endorsements (Section 400.3-206), only a collecting bank's transferor can give instructions that affect the bank or constitute notice to it, and a co…

400.4-204. Methods of sending and presenting — sending directly to payor bank. — (a) A collecting bank shall send items by a reasonably prompt method, taking into consideration relevant instructions, the nature of the item, the number of those items on hand, the cost of collectio…

400.4-205. Depositary bank holder of unendorsed item. — If a customer delivers an item to a depositary bank for collection: (1) the depositary bank becomes a holder of the item at the time it receives the item for collection if the customer at the time of delivery was a holder of…