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Terms Used In New Jersey Statutes 12A:3-415

  • 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
a. Subject to subsections b., c., d. and e. of this section and to subsection d. of 12A:3-419, if an instrument is dishonored, an indorser is obliged to pay the amount due on the instrument according to the terms of the instrument at the time it was indorsed, or if the indorser indorsed an incomplete instrument, according to its terms when completed, to the extent stated in 12A:3-115 and 12A:3-407. The obligation of the indorser is owed to a person entitled to enforce the instrument or to a subsequent indorser who paid the instrument under this section.

b. If an indorsement states that it is made “without recourse” or otherwise disclaims liability of the indorser, the indorser is not liable under subsection a. of this section to pay the instrument.

c. If notice of dishonor of an instrument is required by 12A:3-503 and notice of dishonor complying with that section is not given to an indorser, the liability of the indorser under subsection a. of this section is discharged.

d. If a draft is accepted by a bank after an indorsement is made, the liability of the indorser under subsection a. of this section is discharged.

e. If an indorser of a check is liable under subsection a. of this section and the check is not presented for payment, or given to a depositary bank for collection, within 30 days after the day the indorsement was made, the liability of the indorser under subsection a. of this section is discharged.

L.1995,c.28,s.1.

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