PARRIS N. GLENDENING, Governor

Ch. 91

ENFORCED NOTWITHSTANDING ANY STATUTE OF FRAUDS AND WHETHER OR NOT
THE ACCOMMODATION PARTY RECEIVES CONSIDERATION FOR THE
ACCOMMODATION.

(C)     A PERSON SIGNING AN INSTRUMENT IS PRESUMED TO BE AN
ACCOMMODATION PARTY AND THERE IS NOTICE THAT THE INSTRUMENT IS SIGNED
FOR ACCOMMODATION IF THE SIGNATURE IS AN ANOMALOUS INDORSEMENT OR IS
ACCOMPANIED BY WORDS INDICATING THAT THE SIGNER IS ACTING AS SURETY OR
GUARANTOR WITH RESPECT TO THE OBLIGATION OF ANOTHER PARTY TO THE
INSTRUMENT. EXCEPT AS PROVIDED IN § 3-605, THE OBLIGATION OF AN
ACCOMMODATION PARTY TO PAY THE INSTRUMENT IS NOT AFFECTED BY THE FACT
THAT THE PERSON ENFORCING THE OBLIGATION HAD NOTICE WHEN THE
INSTRUMENT WAS TAKEN BY THAT PERSON THAT THE ACCOMMODATION PARTY
SIGNED THE INSTRUMENT FOR ACCOMMODATION.

(D)    IF THE SIGNATURE OF A PARTY TO AN INSTRUMENT IS ACCOMPANIED BY
WORDS INDICATING UNAMBIGUOUSLY THAT THE PARTY IS GUARANTEEING
COLLECTION RATHER THAN PAYMENT OF THE OBLIGATION OF ANOTHER PARTY TO
THE INSTRUMENT, THE SIGNER IS OBLIGED TO PAY THE AMOUNT DUE ON THE
INSTRUMENT TO A PERSON ENTITLED TO ENFORCE THE INSTRUMENT ONLY IF (I)
EXECUTION OF JUDGMENT AGAINST THE OTHER PARTY HAS BEEN RETURNED
UNSATISFIED, (II) THE OTHER PARTY IS INSOLVENT OR IN AN INSOLVENCY
PROCEEDING, (III) THE OTHER PARTY CANNOT BE SERVED WITH PROCESS, OR (IV)
IT IS OTHERWISE APPARENT THAT PAYMENT CANNOT BE OBTAINED FROM THE
OTHER PARTY.

(E)     AN ACCOMMODATION PARTY WHO PAYS THE INSTRUMENT IS ENTITLED
TO REIMBURSEMENT FROM THE ACCOMMODATED PARTY AND IS ENTITLED TO
ENFORCE THE INSTRUMENT AGAINST THE ACCOMMODATED PARTY. AN
ACCOMMODATED PARTY WHO PAYS THE INSTRUMENT HAS NO RIGHT OF
RECOURSE AGAINST, AND IS NOT ENTITLED TO CONTRIBUTION FROM, AN
ACCOMMODATION PARTY.

3-420.

(A)    THE LAW APPLICABLE TO CONVERSION OF PERSONAL PROPERTY APPLIES
TO INSTRUMENTS. AN INSTRUMENT IS ALSO CONVERTED IF IT IS TAKEN BY
TRANSFER, OTHER THAN A NEGOTIATION, FROM A PERSON NOT ENTITLED TO
ENFORCE THE INSTRUMENT OR A BANK MAKES OR OBTAINS PAYMENT WITH
RESPECT TO THE INSTRUMENT FOR A PERSON NOT ENTITLED TO ENFORCE THE
INSTRUMENT OR RECEIVE PAYMENT. AN ACTION FOR CONVERSION OF AN
INSTRUMENT MAY NOT BE BROUGHT BY (I) THE ISSUER OR ACCEPTOR OF THE
INSTRUMENT OR (II) A PAYEE OR INDORSEE WHO DID NOT RECEIVE DELIVERY OF
THE INSTRUMENT EITHER DIRECTLY OR THROUGH DELIVERY TO AN AGENT OR A
CO-PAYEE

(B)     IN AN ACTION UNDER SUBSECTION (A), THE MEASURE OF LIABILITY IS
PRESUMED TO BE THE AMOUNT PAYABLE ON THE INSTRUMENT, BUT RECOVERY
MAY NOT EXCEED THE AMOUNT OF THE PLAINTIFFS INTEREST IN THE
INSTRUMENT.

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