Colorado § 4-3-409 - Acceptance of draft; certified check.

§ 4-3-409. Acceptance of draft; certified check.

(a) "Acceptance" means the drawee's signed agreement to pay a draft as presented. It must be written on the draft and may consist of the drawee's signature alone. Acceptance may be made at any time and becomes effective when notification pursuant to instructions is given or the accepted draft is delivered for the purpose of giving rights on the acceptance to any person.

(b) A draft may be accepted although it has not been signed by the drawer, is otherwise incomplete, is overdue, or has been dishonored.

(c) If a draft is payable at a fixed period after sight and the acceptor fails to date the acceptance, the holder may complete the acceptance by supplying a date in good faith.

(d) "Certified check" means a check accepted by the bank on which it is drawn. Acceptance may be made as stated in subsection (a) of this section or by a writing on the check which indicates that the check is certified. The drawee of a check has no obligation to certify the check, and refusal to certify is not dishonor of the check.

Source: L. 94: Entire article R&RE, p. 866, § 1, effective January 1, 1995.

Editor's note: This section is similar to former §§ 4-3-409, 4-3-410, and 4-3-411 as they existed prior to 1994.

ANNOTATION

Annotator's note. The following annotations include cases decided under former provisions similar to this section.

Acceptance of a bill at common law and under this section is merely the signification by the drawee of his assent to the order of the drawer. The legal meaning of an acceptance is that the acceptor engages to pay the instrument according to the tenor of his acceptance; in other words, it is a promise to pay. Van Buskirk v. State Bank, 35 Colo. 142, 83 P. 778 (1905).

An agreement in writing to honor a draft is sufficient to create liability to a bank which in reliance thereon is the assignee for value of the draft. Posey v. Denver Nat'l Bank, 24 Colo. 199, 49 P. 282 (1897).

A drawer may recover of an acceptor upon a verbal acceptance, whether the drawer's funds are in the acceptor's hands upon acceptance or later. Durkee v. Conklin, 13 Colo. App. 313, 57 P. 486 (1899).

Such acceptance is outside the statute of frauds because it is only a promise to pay another's funds on his order. Durkee v. Conklin, 13 Colo. App. 313, 57 P. 486 (1899).

Drawee may be estopped by conduct to assert that acceptance was not in writing. Mumm v. Taylor, 121 Colo. 157, 213 P.2d 836 (1950).

Section applies to checks. Though a check need not be presented for acceptance in order to render the parties thereto liable, still the check itself does not operate as an assignment of any part of the fund to the credit of the drawer with the bank and the drawee bank is not liable to the holder, unless and until it accepts or certifies the check, and, except as otherwise provided all provisions applicable to a bill of exchange payable on demand apply to a check. Consequently, as no contrary provision for the acceptance of or promise to pay a check has been made, the provision applicable to a bill of exchange (i.e., draft) that acceptance or certification when made must be in writing applies also to a check. Van Buskirk v. State Bank, 35 Colo. 142, 83 P. 778 (1905).

Where upon inquiry by correspondent bank as agent of the drawer, the bank agrees to honor check, such assent constitutes an acceptance; and upon dishonor, drawer can maintain an action for breach of the agreement. Sigel-Campion Live Stock Co. v. Davis, 69 Colo. 511, 194 P. 468 (1921). See Gambrill v. Brown Hotel Co., 11 Colo. App. 529, 54 P. 1025 (1898).

Drawer discharged by acceptance. Where the payee of a bank check procures acceptance by the bank upon which it is drawn, upon which acceptance he obtains judgment against the latter, he cannot pursue a further remedy against the drawer of the check in the same matter, there being as to such drawer a positive statutory discharge. Roberts v. Sch. Dist. No. 1, 99 Colo. 484, 63 P.2d 1232 (1936) (decided under repealed CSA, C. 112, § 188, negotiable instruments law).