New Jersey § 12a:3-419

§ 12a:3-419.

a. If an instrument is issued for value given for the benefit of a party to the instrument

(“accommodated party”) and another party to the instrument (“accommodation party”)

signs the instrument for the purpose of incurring liability on the instrument without

being a direct beneficiary of the value given for the instrument, the instrument is

signed by the accommodation party “for accommodation.” b. An accommodation party may sign the instrument as maker, drawer, acceptor, or indorser

and, subject to subsection d. of this section, is obliged to pay the instrument in

the capacity in which the accommodation party signs. The obligation of an accommodation party may be enforced notwithstanding any statute

of frauds and whether or not the accommodation party receives consideration for the

accommodation. c. A person signing an instrument is presumed to be an accommodation party and there

is notice that the instrument is signed for accommodation if the signature is an anomalous

indorsement or is accompanied by words indicating that the signer is acting as surety

or guarantor with respect to the obligation of another party to the instrument. Except as provided in 12A:3-605, the obligation of an accommodation party to pay

the instrument is not affected by the fact that the person enforcing the obligation

had notice when the instrument was taken by that person that the accommodation party

signed the instrument for accommodation. d. If the signature of a party to an instrument is accompanied by words indicating

unambiguously that the party is guaranteeing collection rather than payment of the

obligation of another party to the instrument, the signer is obliged to pay the amount

due on the instrument to a person entitled to enforce the instrument only if execution

of judgment against the other party has been returned unsatisfied, the other party

is insolvent or in an insolvency proceeding, the other party cannot be served with

process, or it is otherwise apparent that payment cannot be obtained from the other

party. e. An accommodation party who pays the instrument is entitled to reimbursement from

the accommodated party and is entitled to enforce the instrument against the accommodated

party. An accommodated party who pays the instrument has no right of recourse against,

and is not entitled to contribution from, an accommodation party.