41-03-43. (3-406) Negligence contributing to forged signature or alteration of
150 words·~1 min read·
/nd/title-41/chapter-41-03-negotiable-instruments/41-03-43·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
instrument.
1. 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 that, in good
faith, pays the instrument or takes it for value or for collection.
2. 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.
3. Under subsection 1, the burden of proving failure to exercise ordinary care is on the
person asserting the preclusion. Under subsection 2, the burden of proving failure to
exercise ordinary care is on the person precluded.