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Can you summarize MNST 336.3-605?
UNIFORM COMMERCIAL CODE > DISCHARGE OF SECONDARY OBLIGORS.
Short Summary
This legal document, under the Minnesota Statutes, specifically the Uniform Commercial Code (UCC), addresses the discharge of secondary obligors. It outlines the rules and consequences when a person entitled to enforce an instrument releases the obligation of a principal obligor, and another party to the instrument is a secondary obligor. The document explains that the obligations of the principal obligor to the secondary obligor with respect to previous payments are not affected, unless the terms of the release preserve the secondary obligor’s recourse. It also discusses the discharge of the secondary obligor to the same extent as the principal obligor from any unperformed portion of its obligation on the instrument, unless the release provides otherwise. The document further covers scenarios involving extensions of time for payment and modifications of the obligation of a principal obligor. It states that impairing the value of collateral can discharge the obligation of the secondary obligor to the extent of the impairment. The document also addresses the burden of persuasion and the preservation of a secondary obligor’s recourse. No specific penalties are mentioned in this document.
Whom does it apply to?
Persons entitled to enforce an instrument, principal obligors, and secondary obligors
What does it govern?
Discharge of secondary obligors under the Uniform Commercial Code (UCC)
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Minnesota