Sec. 3.407. ALTERATION. (a) "Alteration" means:
(1) an unauthorized change in an instrument that purports to modify in any respect the obligation of a party; or
(2) an unauthorized addition of words or numbers or other change to an incomplete instrument relating to the obligation of a party.
(b) Except as provided in Subsection (c), an alteration fraudulently made discharges a party whose obligation is affected by the alteration unless that party assents or is precluded from asserting the alteration. No other alteration discharges a party, and the instrument may be enforced according to its original terms.
(c) A payor bank or drawee paying a fraudulently altered instrument or a person taking it for value, in good faith and without notice of the alteration, may enforce rights with respect to the instrument:
(1) according to its original terms; or
(2) in the case of an incomplete instrument altered by unauthorized completion, according to its terms as completed.
Amended by Acts 1995, 74th Leg., ch. 921, Sec. 1, eff. Jan. 1, 1996.
Structure Texas Statutes
Title 1 - Uniform Commercial Code
Chapter 3 - Negotiable Instruments
Subchapter D. Liability of Parties
Section 3.402. Signature by Representative
Section 3.403. Unauthorized Signature
Section 3.404. Impostors; Fictitious Payees
Section 3.405. Employer's Responsibility for Fraudulent Indorsement by Employee
Section 3.406. Negligence Contributing to Forged Signature or Alteration of Instrument
Section 3.408. Drawee Not Liable on Unaccepted Draft
Section 3.409. Acceptance of Draft; Certified Check
Section 3.410. Acceptance Varying Draft
Section 3.411. Refusal to Pay Cashier's Checks, Teller's Checks, and Certified Checks
Section 3.412. Obligation of Issuer of Note or Cashier's Check
Section 3.413. Obligation of Acceptor
Section 3.414. Obligation of Drawer
Section 3.415. Obligation of Indorser
Section 3.416. Transfer Warranties
Section 3.417. Presentment Warranties
Section 3.418. Payment or Acceptance by Mistake