New Jersey Statutes 12A:3-414. Obligation of drawer
Terms Used In New Jersey Statutes 12A:3-414
- Acceptor: means a drawee who has accepted a draft. See New Jersey Statutes 12A:3-103
- Drawee: means a person ordered in a draft to make payment. See New Jersey Statutes 12A:3-103
- Drawer: means a person who signs or is identified in a draft as a person ordering payment. See New Jersey Statutes 12A:3-103
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- person: includes corporations, companies, associations, societies, firms, partnerships and joint stock companies as well as individuals, unless restricted by the context to an individual as distinguished from a corporate entity or specifically restricted to one or some of the above enumerated synonyms and, when used to designate the owner of property which may be the subject of an offense, includes this State, the United States, any other State of the United States as defined infra and any foreign country or government lawfully owning or possessing property within this State. See New Jersey Statutes 1:1-2
b. If an unaccepted draft is dishonored, the drawer is obliged to pay the draft according to its terms at the time it was issued or, if not issued, at the time it first came into possession of a holder, or if the drawer signed an incomplete instrument, according to its terms when completed, to the extent stated in 12A:3-115 and 12A:3-407. The obligation is owed to a person entitled to enforce the draft or to an indorser who paid the draft under 12A:3-415.
c. If a draft is accepted by a bank, the drawer is discharged, regardless of when or by whom acceptance was obtained.
d. If a draft is accepted and the acceptor is not a bank, the obligation of the drawer to pay the draft if the draft is dishonored by the acceptor is the same as the obligation of an indorser under subsections a. and c. of 12A:3-415.
e. If a draft states that it is drawn “without recourse” or otherwise disclaims liability of the drawer to pay the draft, the drawer is not liable under subsection b. of this section to pay the draft if the draft is not a check. A disclaimer of the liability stated in subsection b. of this section is not effective if the draft is a check.
f. If a check is not presented for payment or given to a depositary bank for collection within 30 days after its date, the drawee suspends payments after expiration of the 30-day period without paying the check, and because of the suspension of payments, the drawer is deprived of funds maintained with the drawee to cover payment of the check, the drawer to the extent deprived of funds may discharge its obligation to pay the check by assigning to the person entitled to enforce the check the rights of the drawer against the drawee with respect to the funds.
L.1995,c.28,s.1.