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Can you summarize IACO 554.3417?
UNIFORM COMMERCIAL CODE > Presentment warranties.
Short Summary
This legal document, found in the Iowa Code under the Uniform Commercial Code, governs presentment warranties in commercial transactions. It outlines the obligations and warranties of the person obtaining payment or acceptance of an unaccepted draft, as well as previous transferors of the draft. The document specifies that the warrantor must warrant to the drawee that they are entitled to enforce the draft, the draft has not been altered, they have no knowledge of unauthorized signatures, and the creation of a demand draft was authorized by the drawer. The drawee has the right to recover damages for breach of warranty, including the amount paid by the drawee, expenses, and loss of interest. The document also addresses breach of warranty as a defense to the obligation of the acceptor and the right of the acceptor to recover damages. It further discusses the defense options for warrantors in case of unauthorized endorsement or alteration. Additionally, the document covers the warranties and rules applicable to dishonored drafts and other instruments presented for payment. It states that the warranties cannot be disclaimed with respect to checks and sets a time limit for notice of a claim for breach of warranty. The cause of action for breach of warranty accrues when the claimant has reason to know of the breach. The document concludes by mentioning the definition of a demand draft and the non-applicability of a warranty to a transferor under applicable conflict of laws rules.
Whom does it apply to?
Drawees, warrantors, and persons making payment
What does it govern?
Presentment warranties
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
Damages for breach of warranty equal to the amount paid by the drawee, plus compensation for expenses and loss of interest resulting from the breach
Jurisdiction
Iowa