70A-3-406 - Negligence contributing to forged signature or alteration of instrument. - Utah Statutes

70A-3-406. Negligence contributing to forged signature or alteration of instrument.
(1) A person whose failure to exercise ordinary care substantially contributes to analteration of an instrument or to the making of a forged signature on an instrument is precludedfrom asserting the alteration or the forgery against a person who, in good faith, pays theinstrument or takes it for value or for collection.
(2) Under Subsection (1), if the person asserting the preclusion fails to exercise ordinarycare in paying or taking the instrument and that failure substantially contributes to loss, the loss isallocated between the person precluded and the person asserting the preclusion according to theextent to which the failure of each to exercise ordinary care contributed to the loss.
(3) Under Subsection (1), the burden of proving failure to exercise ordinary care is on theperson asserting the preclusion. Under Subsection (2), the burden of proving failure to exerciseordinary care is on the person precluded.

Repealed and Re-enacted by Chapter 237, 1993 General Session