§ 6A-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 asserting the alteration or the forgery against a person who, in good faith, pays the instrument or takes it for value or for collection.
(b) Under subsection (a), 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.
(c) Under subsection (a), the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (b), the burden of proving failure to exercise ordinary care is on the person precluded.
History of Section.P.L. 2000, ch. 238, § 3; P.L. 2000, ch. 421, § 3.
Structure Rhode Island General Laws
Title 6A - Uniform Commercial Code
Chapter 6A-3 - Negotiable Instruments
Section 6A-3-401. - Signature.
Section 6A-3-402. - Signature by representative.
Section 6A-3-403. - Unauthorized signature.
Section 6A-3-404. - Impostors — Fictitious payees.
Section 6A-3-405. - Employer’s responsibility for fraudulent indorsement by employee.
Section 6A-3-406. - Negligence contributing to forged signature or alteration of instrument.
Section 6A-3-407. - Alteration.
Section 6A-3-408. - Drawee not liable on unaccepted draft.
Section 6A-3-409. - Acceptance of draft — Certified check.
Section 6A-3-410. - Acceptance varying draft.
Section 6A-3-411. - Refusal to pay cashier’s checks, teller’s checks, and certified checks.
Section 6A-3-412. - Obligation of issuer of note or cashier’s check.
Section 6A-3-413. - Obligation of acceptor.
Section 6A-3-414. - Obligation of drawer.
Section 6A-3-415. - Obligation of indorser.
Section 6A-3-416. - Transfer warranties.
Section 6A-3-417. - Presentment warranties.
Section 6A-3-418. - Payment or acceptance by mistake.