§ 26-9. Effect of failure of creditor to take action. - North Carolina Statutes

§26‑9.  Effect of failure of creditor to take action.

(a)        If the holder orowner of the obligation refuses or fails, within 30 days from the service orreceipt of such notice, to take appropriate action pursuant thereto, thefollowing persons shall be discharged on any such note, bond, bill or otherobligation to the extent that they are prejudiced thereby:

(1)        The surety, indorseror guarantor giving such notice, and

(2)        All co‑sureties,co‑indorsers or co‑guarantors joining therein or adopting suchnotice as provided by G.S. 26‑7, and

(3)        All the co‑sureties,co‑indorsers, or co‑guarantors whose names or addresses such holderor owner of the obligation failed to disclose on demand as required bysubsection (c) of G.S. 26‑7.

(b)        The fact that aninstrument contains a provision waiving any  defense of any surety, indorser orguarantor by reason of the extension of the time for payment does not preventthe operation of this section. Any such notice to the holder or owner of theobligation as is authorized by G.S. 26‑7 may be given at or subsequent tothe time such obligation is due or at or subsequent to the termination of aperiod of extension.

(c)        The failure of anyco‑surety, co‑indorser or co‑guarantor to join in or adopt anotice to the holder or owner of the obligation as authorized by subsection (b)of G.S. 26‑7 does not prevent such co‑surety, co‑indorser orco‑guarantor from giving a separate notice as authorized by subsection(a) of G.S. 26‑7. (1868‑9, c. 232, s. 2; Code, s. 2098; Rev., s.2847; C.S., s. 3969; 1951, c. 763, s. 3.)