Michigan § 440.3406 - Failure to exercise ordinary care contributing to alteration or forged instrument; allocation of loss; burden of proof.
Full text of Michigan Michigan Compiled Laws § 440.3406 — Failure to exercise ordinary care contributing to alteration or forged instrument; allocation of loss; burden of proof., with citation guidance and answers to common questions.
§ 440.3406. Failure to exercise ordinary care contributing to alteration or forged instrument; allocation of loss; burden of proof.
A person whose failure to exercise ordinary care substantially contributes to an alteration of an instrument or to the making of a forged signature on an instrument is precluded from asserting the alteration or the forgery against a person who, in good faith, pays the instrument or takes it for value or for collection.
Under subsection (1), if the person asserting the preclusion fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss, the loss is allocated between the person precluded and the person asserting the preclusion according to the extent to which the failure of each to exercise ordinary care contributed to the loss.
Under subsection (1), the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (2), the burden of proving failure to exercise ordinary care is on the person precluded.
Source: official Michigan text · Last verified 2026-08-27
Frequently Asked Questions About Michigan § 440.3406
What does Michigan Compiled Laws § 440.3406 cover?
Section 440.3406 ("Failure to exercise ordinary care contributing to alteration or forged instrument; allocation of loss; burden of proof.") is part of the Michigan Compiled Laws, the codified statutory law of Michigan. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Michigan § 440.3406?
A common citation format is "Michigan Compiled Laws § 440.3406" (Michigan). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Michigan law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Michigan official source linked on this page or consult a licensed Michigan attorney.
How does Michigan § 440.3406 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Michigan can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Michigan.