§ 6A-3-406 - Negligence contributing to forged signature or alteration of instrument. - Rhode Island Statutes

SECTION 6A-3-406

   § 6A-3-406  Negligence contributing toforged signature or alteration of instrument. – (a) A person whose failure to exercise ordinary care substantially contributesto an alteration of an instrument or to the making of a forged signature on aninstrument is precluded from asserting the alteration or the forgery against aperson who, in good faith, pays the instrument or takes it for value or forcollection.

   (b) Under subsection (a), if the person asserting thepreclusion fails to exercise ordinary care in paying or taking the instrumentand that failure substantially contributes to loss, the loss is allocatedbetween the person precluded and the person asserting the preclusion accordingto the extent to which the failure of each to exercise ordinary carecontributed to the loss.

   (c) Under subsection (a), the burden of proving failure toexercise ordinary care is on the person asserting the preclusion. Undersubsection (b), the burden of proving failure to exercise ordinary care is onthe person precluded.