§ 3406. Negligence contributing to forged signature or alteration of instrument.
190 words·~1 min read·
/pa/title-13/chapter-34/3406A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
§ 3406. Negligence contributing to forged signature or alteration of instrument.
(a)Failure to exercise ordinary care.-- 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)Allocation of loss.-- Under subsection (a), 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)Burden of proof.-- Under subsection (a), the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (b), the burden of proving failure to exercise ordinary care is on the person precluded.
13c3406v
Cross References. Section 3406 is referred to in sections 3417, 4208 of this title.
13c3407s