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 the alteration or the forgery against a person who, in good faith, pays the instrument or takes it for value or for collection.
(2) Under subsection (1) of this section, if the person asserting the preclusion fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss, the loss is allocated between the person precluded and the person asserting the preclusion according to the extent to which the failure of each to exercise ordinary care contributed to the loss.
(3) Under subsection (1) of this section, the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (2) of this section, the burden of proving failure to exercise ordinary care is on the person precluded.
History:
[28-3-406, added 1993, ch. 288, sec. 2, p. 1041.]
Structure Idaho Code
Title 28 - COMMERCIAL TRANSACTIONS
Chapter 3 - UNIFORM COMMERCIAL CODE — NEGOTIABLE INSTRUMENTS
Section 28-3-402 - SIGNATURE BY REPRESENTATIVE.
Section 28-3-403 - UNAUTHORIZED SIGNATURE.
Section 28-3-404 - IMPOSTORS — FICTITIOUS PAYEES.
Section 28-3-405 - EMPLOYER’S RESPONSIBILITY FOR FRAUDULENT INDORSEMENT BY EMPLOYEE.
Section 28-3-406 - NEGLIGENCE CONTRIBUTING TO FORGED SIGNATURE OR ALTERATION OF INSTRUMENT.
Section 28-3-407 - ALTERATION.
Section 28-3-408 - DRAWEE NOT LIABLE ON UNACCEPTED DRAFT.
Section 28-3-409 - ACCEPTANCE OF DRAFT — CERTIFIED CHECK.
Section 28-3-410 - ACCEPTANCE VARYING DRAFT.
Section 28-3-411 - REFUSAL TO PAY CASHIER’S CHECKS, TELLER’S CHECKS, AND CERTIFIED CHECKS.
Section 28-3-412 - OBLIGATION OF ISSUER OF NOTE OR CASHIER’S CHECK.
Section 28-3-413 - OBLIGATION OF ACCEPTOR.
Section 28-3-414 - OBLIGATION OF DRAWER.
Section 28-3-415 - OBLIGATION OF INDORSER.
Section 28-3-416 - TRANSFER WARRANTIES.
Section 28-3-417 - PRESENTMENT WARRANTIES.
Section 28-3-418 - PAYMENT OR ACCEPTANCE BY MISTAKE.