70A-3-106 - Unconditional promise or order. - Utah Statutes

70A-3-106. Unconditional promise or order.
(1) Except as provided in this section, for the purposes of Subsection 70A-3-104(1), apromise or order is unconditional unless it states an express condition to payment, that thepromise or order is subject to or governed by another writing, or that rights or obligations withrespect to the promise or order are stated in another writing. A reference to another writing doesnot of itself make the promise or order conditional.
(2) A promise or order is not made conditional by a reference to another writing for astatement of rights with respect to collateral, prepayment, or acceleration, or because payment islimited to resort to a particular fund or source.
(3) If a promise or order requires, as a condition to payment, a countersignature by aperson whose specimen signature appears on the promise or order, the condition does not makethe promise or order conditional for the purposes of Subsection 70A-3-104(1). If the personwhose specimen signature appears on an instrument fails to countersign the instrument, thefailure to countersign is a defense to the obligation of the issuer, but the failure does not prevent atransferee of the instrument from becoming a holder of the instrument.
(4) If a promise or order at the time it is issued or first comes into possession of a holdercontains a statement, required by applicable statutory or administrative law, to the effect that therights of a holder or transferee are subject to claims or defenses that the issuer could assertagainst the original payee, the promise or order is not thereby made conditional for the purposesof Subsection 70A-3-104(1). However, if the promise or order is an instrument, there cannot be aholder in due course of the instrument.

Repealed and Re-enacted by Chapter 237, 1993 General Session