Page:United States Statutes at Large Volume 77.djvu/717

 77 STAT. ]

PUBLIC LAW 88-243-DEC. 30, 1963

(2) Wlien the instrument lias been taken for value before it is due the acconnnodation party is liable in the capacity in which he has signed even thoug-h the taker knows of the accommodation. (3) As against a holder in due course and without notice of the accommodation oral proof of the accommodation is not admissible to gh-e the accommodation party the benefit of discharges dependent on his character as such. In other cases the accommodation character may be shown by oral proof. (4) An indorsement which shows that it is not in the chain of title is notice of its accommodation character. (5) An accommodation party is not liable to the party accommodated, and if he pays the instrument has a right of recourse on the instrument against such party. § 28:3—416. Contract of guarantor (1) "Payment guaranteed" or equivalent words added to a signature mean that the signer engages that if the instrument is not paid M-lien due he will pay it according to its tenor without resort by the holder to any other party. (2) "Collection guaranteed" or equivalent words added to a signature mean that the signer engages that if the instrument is not paid when due he will pay it according to its tenor, but only after the liolder has reduced his claim against the maker or acceptor to judgment and execution has been returned unsatisfied, or after the maker or acceptor has become insolvent or it is otherwise apparent that it is useless to proceed against him. (3) Words of guaranty which do not otherwise specify guarantee payment. (4) No words of guaranty added to the signature of a sole maker or acceptor affect his liability on the instrument. Such words added to the signature of one of two or more makers or acceptors create a presumption that the signature is for the accommodation of the others. (5) When words of guaranty are used presentment, notice of dishonor and protest are not necessary to charge the user. (6) Any guaranty written on the instrument is enforcible notwithstanding any statute of frauds. § 28:3—417. Warranties on presentment and transfer (1) Any person who obtains payment or acceptance and any prior transferor warrants to a person who in good faith pays or accepts that (a) he has a good title to the instrument or is authorized to obtain payment or acceptance on behalf of one who has a good title; and (b) he has no knowledge that the signature of the maker or drawer is unauthorized, except that this warranty is not given by a holder in due course acting in good faith (i) to a maker with respect to the maker's own signature; or (ii) to a drawer with respect to the drawer's own signature, whether or not the drawer is also the drawee; or (iii) to an acceptor of a draft if the holder in due course took the draft after the acceptance or dbtained the acceptance without knowledge that the drawer's signature was unauthorized; and (c) the instrument has not been materially altered, except that this warranty is not given by a holder in due course acting in good faith

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