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Can you summarize IACO 554.3402?
UNIFORM COMMERCIAL CODE > Signature by representative.
Short Summary
This legal document, governed by the Iowa Code under the Uniform Commercial Code, addresses the signature by a representative on an instrument. If a person acting as a representative signs an instrument using either the name of the represented person or their own name, the represented person is bound by the signature to the same extent as if it were a simple contract. The representative’s signature is considered the authorized signature of the represented person, making them liable on the instrument. However, if the representative signs their own name to an instrument and it is an authorized signature of the represented person, they may not be liable if the form of the signature unambiguously shows that it is made on behalf of the represented person and they are identified in the instrument. If the form of the signature does not clearly indicate the representative capacity or the represented person is not identified, the representative may be liable to a holder in due course who took the instrument without notice of the representative’s non-liability. However, the representative may not be liable to other parties if they can prove that the original parties did not intend for them to be liable. Additionally, if a representative signs the name of the representative as the drawer of a check without indication of their representative status, and the check is payable from the represented person’s identified account, the signer may not be liable if the signature is authorized by the represented person.
Whom does it apply to?
Persons acting as representatives and the represented person
What does it govern?
Signature by representative
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Iowa