Missouri Revised Statutes
Chapter 400
Uniform Commercial Code
←400.04-207
Section 400.4-208.1
400.04-209→
August 28, 2015
Presentment warranties.
400.4-208. (a) If an unaccepted draft is presented to the drawee for
payment or acceptance and the drawee pays or accepts the draft, (i) the
person obtaining payment or acceptance, at the time of presentment, and (ii)
a previous transferor of the draft, at the time of transfer, warrant to the
drawee that pays or accepts the draft in good faith that:
(1) the warrantor is, or was, at the time the warrantor transferred the
draft, a person entitled to enforce the draft or authorized to obtain payment
or acceptance of the draft on behalf of a person entitled to enforce the
draft;
(2) the draft has not been altered;
(3) the warrantor has no knowledge that the signature of the purported
drawer of the draft is unauthorized; and
(4) if the draft is a demand draft, creation of the demand draft
according to the terms on its face was authorized by the person identified as
drawer. Nothing in this section shall be construed to impair the rights of
the drawer against the drawee.
(b) A drawee making payment may recover from a warrantor damages for
breach of warranty equal to the amount paid by the drawee less the amount the
drawee received or is entitled to receive from the drawer because of the
payment. In addition, the drawee is entitled to compensation for expenses and
loss of interest resulting from the breach. The right of the drawee to
recover damages under this subsection is not affected by any failure of the
drawee to exercise ordinary care in making payment. If the drawee accepts
the draft, (i) breach of warranty is a defense to the obligation of the
acceptor, and (ii) if the acceptor makes payment with respect to the draft,
the acceptor is entitled to recover from a warrantor for breach of warranty
the amounts stated in this subsection.
(c) If a drawee asserts a claim for breach of warranty under subsection
(a) based on an unauthorized endorsement of the draft or an alteration of the
draft, the warrantor may defend by proving that the endorsement is effective
under Section 400.3-404 or 400.3-405 or the drawer is precluded under Section
400.3-406 or 400.4-406 from asserting against the drawee the unauthorized
endorsement or alteration.
(d) If (i) a dishonored draft is presented for payment to the drawer or
an endorser or (ii) any other item is presented for payment to a party
obliged to pay the item, and the item is paid, the person obtaining payment
and a prior transferor of the item warrant to the person making payment in
good faith that the warrantor is, or was, at the time the warrantor
transferred the item, a person entitled to enforce the item or authorized to
obtain payment on behalf of a person entitled to enforce the item. The
person making payment may recover from any warrantor for breach of warranty an
amount equal to the amount paid plus expenses and loss of interest resulting
from the breach.
(e) The warranties stated in subsections (a) and (d) cannot be
disclaimed with respect to checks. Unless notice of a claim for breach of
warranty is given to the warrantor within 30 days after the claimant has
reason to know of the breach and the identity of the warrantor, the warrantor
is discharged to the extent of any loss caused by the delay in giving notice
of the claim.
(f) A cause of action for breach of warranty under this section accrues
when the claimant has reason to know of the breach.
(g) A demand draft is a check, as provided in subsection (f) of section
400.3-104.
(h) If the warranty in paragraph (4) of subsection (a) is not given by a
transferor under applicable conflict of law rules, then the warranty is not
given to that transferor when the transferor is a transferee.
(L. 1992 S.B. 448, A.L. 2005 S.B. 279)
1992
1992
400.4-208. (a) If an unaccepted draft is presented to the
drawee for payment or acceptance and the drawee pays or accepts
the draft, (i) the person obtaining payment or acceptance, at the
time of presentment, and (ii) a previous transferor of the draft,
at the time of transfer, warrant to the drawee that pays or
accepts the draft in good faith that:
(1) the warrantor is, or was, at the time the warrantor
transferred the draft, a person entitled to enforce the draft or
authorized to obtain payment or acceptance of the draft on behalf
of a person entitled to enforce the draft;
(2) the draft has not been altered; and
(3) the warrantor has no knowledge that the signature of
the purported drawer of the draft is unauthorized.
(b) A drawee making payment may recover from a warrantor
damages for breach of warranty equal to the amount paid by the
drawee less the amount the drawee received or is entitled to
receive from the drawer because of the payment. In addition, the
drawee is entitled to compensation for expenses and loss of
interest resulting from the breach. The right of the drawee to
recover damages under this subsection is not affected by any
failure of the drawee to exercise ordinary care in making
payment. If the drawee accepts the draft, (i) breach of
warranty is a defense to the obligation of the acceptor, and (ii)
if the acceptor makes payment with respect to the draft, the
acceptor is entitled to recover from a warrantor for breach of
warranty the amounts stated in this subsection.
(c) If a drawee asserts a claim for breach of warranty
under subsection (a) based on an unauthorized endorsement of the
draft or an alteration of the draft, the warrantor may defend by
proving that the endorsement is effective under Section 400.3-404
or 400.3-405 or the drawer is precluded under Section 400.3-406
or 400.4-406 from asserting against the drawee the unauthorized
endorsement or alteration.
(d) If (i) a dishonored draft is presented for payment to
the drawer or an endorser or (ii) any other item is presented for
payment to a party obliged to pay the item, and the item is paid,
the person obtaining payment and a prior transferor of the item
warrant to the person making payment in good faith that the
warrantor is, or was, at the time the warrantor transferred the
item, a person entitled to enforce the item or authorized to
obtain payment on behalf of a person entitled to enforce the
item. The person making payment may recover from any warrantor
for breach of warranty an amount equal to the amount paid plus
expenses and loss of interest resulting from the breach.
(e) The warranties stated in subsections (a) and (d) cannot
be disclaimed with respect to checks. Unless notice of a claim
for breach of warranty is given to the warrantor within 30 days
after the claimant has reason to know of the breach and the
identity of the warrantor, the warrantor is discharged to the
extent of any loss caused by the delay in giving notice of the
claim.
(f) A cause of action for breach of warranty under this
section accrues when the claimant has reason to know of the
breach.
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