(a) If a person acting, or purporting to act, as a representative signs an instrument by signing either the name of the represented person or the name of the signer, the represented person is bound by the signature to the same extent the represented person would be bound if the signature were on a simple contract. If the represented person is bound, the signature of the representative is the "authorized signature of the represented person" and the represented person is liable on the instrument, whether or not identified in the instrument.
(b) If a representative signs the name of the representative to an instrument and the signature is an authorized signature of the represented person, the following rules apply:
(1) If the form of the signature shows unambiguously that the signature is made on behalf of the represented person who is identified in the instrument, the representative is not liable on the instrument.
(2) Subject to subsection (c) of this section, if (i) the form of the signature does not show unambiguously that the signature is made in a representative capacity or (ii) the represented person is not identified in the instrument, the representative is liable on the instrument to a holder in due course that took the instrument without notice that the representative was not intended to be liable on the instrument. With respect to any other person, the representative is liable on the instrument unless the representative proves that the original parties did not intend the representative to be liable on the instrument.
(c) If a representative signs the name of the representative as drawer of a check without indication of the representative status and the check is payable from an account of the represented person who is identified on the check, the signer is not liable on the check if the signature is an authorized signature of the represented person.
Source: L. 94: Entire article R&RE, p. 862, § 1, effective January 1, 1995.
Editor's note: This section is similar to former § 4-3-103 as it existed prior to 1994.
Cross references: For unauthorized signatures, see § 4-3-403.
Notes of Decisions
Cited in
7
cases (
1 in the last 5 years), 1990–2024 · leading case:
Kunz v. Cycles West, Inc., 969 P.2d 781 (Colo. Ct. App. 1998).
Kunz v. Cycles West, Inc., 969 P.2d 781 (Colo. Ct. App. 1998).
· cites it 10× “Section 4-3-402(b), C.R.S.1998. Even when a person or business is not initially aware that it is dealing with a corporation, a course of dealing involving the consistent payment of corporate obligations with checks identifying the corporation by its name, including the…”
Genesis Capital Ventures, LLC v. Restore With Apex, Inc., 282 F. Supp. 3d 1225 (D. Colo. 2017).
· cites it 8× “" Colo. Rev. Stat. § 4-3-402 (b)(1). If the document does not demonstrate that a signature is made in a representative capacity, a signatory still may avoid liability if he "proves that the original parties did not intend the representative to be liable on the instrument.”
Georg v. Metro Fixtures Contractors, Inc., 178 P.3d 1209 (Colo. 2008).
· cites it 2× “1994) (holding that when an agent has actual authority to sign a negotiable instrument but acts with an improper purpose or without authorization in transferring an instrument to a third party, the principal is liable on the instrument to a holder in due course); see also §…”
Mountain States Com. Collections, Inc. v. 99¢ Liquidators, Inc., 940 P.2d 934 (Colo. Ct. App. 1996).
· cites it 2× “A literal interpretation is further undercut by the fact that the General Assembly has enacted another statute, effective January 1, 1995, dealing with insufficient checks, § 4-3-402(c), C.R.S. (1995 Cum.Supp.) of the Uniform Commercial Code (UCC).”
Mount. States Com. v. 99c Liquid, 940 P.2d 934 (Colo. Ct. App. 1996).
· cites it 2× “A literal interpretation is further undercut by the fact that the General Assembly has enacted another statute, effective January 1, 1995, dealing with insufficient checks, § 4-3-402(c), C.R.S. (1995 Cum.Supp.) of the Uniform Commercial Code (UCC).”
Dyles v. Cost Fund 1 (Colo. Ct. App. 2024).
“See § 4-3-402(b)(2), C.R.S. 2024; see also § 4-3-102(a), C.”
— Colo. Rev. Stat. § 4-3-402(b) — 1 case
Kunz v. Cycles West, Inc., 969 P.2d 781 (Colo. Ct. App. 1998).
“Section 4-3-402(b), C.R.S.1998. Even when a person or business is not initially aware that it is dealing with a corporation, a course of dealing involving the consistent payment of corporate obligations with checks identifying the corporation by its name, including the…”
— Colo. Rev. Stat. § 4-3-402(b)(2) — 1 case
Dyles v. Cost Fund 1 (Colo. Ct. App. 2024).
“See § 4-3-402(b)(2), C.R.S. 2024; see also § 4-3-102(a), C.”
— Colo. Rev. Stat. § 4-3-402(c) — 3 cases
Kunz v. Cycles West, Inc., 969 P.2d 781 (Colo. Ct. App. 1998).
“Section 4-3-402(b), C.R.S.1998. Even when a person or business is not initially aware that it is dealing with a corporation, a course of dealing involving the consistent payment of corporate obligations with checks identifying the corporation by its name, including the…”
Mountain States Com. Collections, Inc. v. 99¢ Liquidators, Inc., 940 P.2d 934 (Colo. Ct. App. 1996).
“A literal interpretation is further undercut by the fact that the General Assembly has enacted another statute, effective January 1, 1995, dealing with insufficient checks, § 4-3-402(c), C.R.S. (1995 Cum.Supp.) of the Uniform Commercial Code (UCC).”
Mount. States Com. v. 99c Liquid, 940 P.2d 934 (Colo. Ct. App. 1996).
“A literal interpretation is further undercut by the fact that the General Assembly has enacted another statute, effective January 1, 1995, dealing with insufficient checks, § 4-3-402(c), C.R.S. (1995 Cum.Supp.) of the Uniform Commercial Code (UCC).”
— Colo. Rev. Stat. § 4-3-402(e) — 1 case
Kunz v. Cycles West, Inc., 969 P.2d 781 (Colo. Ct. App. 1998).
“Section 4-3-402(b), C.R.S.1998. Even when a person or business is not initially aware that it is dealing with a corporation, a course of dealing involving the consistent payment of corporate obligations with checks identifying the corporation by its name, including the…”
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