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North Carolina General Statutes 25-3-406 - Negligence contributing to forged signature or alteration of instrument

North Carolina General Statutes > Chapter 25 > Article 3 > § 25-3-406 - Negligence contributing to forged signature or alteration of instrument


Current as of: 2010

(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) 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.

(c) Under subsection (a) of this section, the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (b) of this section, the burden of proving failure to exercise ordinary care is on the person precluded.

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Questions & Answers: Negotiable Instruments (UCC Article 3)

does this apply to real estate foreclosure and the promissoty note?...
how do you over come a person that is in wrongful possession of the note and is trying to enforce it( foreclosure) ...
I have the same two questions above on foreclosure and note what if the mortgage note was never registered in the UCC court file by the original lender. Is this a fraud because th...
I have same concern ...
We wrote a check for a 50% deposit to a to a sub contractor to clear a building lot of vegetation, we made it out to his company a LLC. He took it to a check caching store and...
my personal asstent embezzled over 13 thousand dollers by forging my signature. she held back the normal checks that I signed to pay the bills from are small ranch rentals then ins...

See also:

North Carolina General Statutes Chapter 25 > Article 3 - Negotiable Instruments
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