O.C.G.A. § 11-3-401 (2019)

Annotations

Law reviews. For article discussing parol evidence in

the law of commercial paper, see 13 Ga. L. Rev. 53 (1978).

JUDICIAL DECISIONS Editor’s notes. - In light of the similarity of the statutory provisions, decisions under former Code 1933, § 14-604 and former Code Sections 11-3-401, 11-3402, are included in the annotations for this Code section. An account in a fictitious name is recognized in Georgia. National Factor & Inv. Corp. v. State Bank, 224 Ga. 535, 163

S.E.2d 817, 1968 Ga. LEXIS 846 (1968) (decided under former Code 1933, § 132042). Trade name. - Under Georgia law, a person operating a business under a trade name may endorse personally checks drawn to that person under the trade name. Perini Corp. v. First Nat’l Bank, 553 F.2d 398, 1977 U.S. App. LEXIS 13115

(5th Cir. 1977) (decided under former Code 1933, § 11-3-401). General endorsers. - All who sign their names without qualification, and in absence of any contrary agreement, are placed in same category, as to presentment and notice of dishonor, as technical or general endorsers; that is, those who endorse for the purpose of transferring title. Massell v. Prudential Ins. Co. of Am., 57 Ga. App. 460, 196 S.E. 115, 1938 Ga. App. LEXIS 313 (1938) (decided under former Code 1933, § 14-604). Signing back of instrument. - One signing back of negotiable instrument other than as maker, drawer, or acceptor is an endorser and not a surety. Pitman v. Pitman, 215 Ga. 585, 111 S.E.2d 721, 1959 Ga. LEXIS 548 (1959) (decided under former Code 1933, § 14-604). One who places signature on back of instrument without indicating intention to be bound in capacity other than endorser is deemed to be an endorser in legal sense of the word, and is entitled to have note presented to the one primarily liable, and, if it is not paid, to notice of dishonor. McCarroll v. First Inv. Co., 109 Ga. App. 748, 137 S.E.2d 319, 1964 Ga. App. LEXIS 981 (1964) (decided under former Code 1933, § 14-604). One signing, without more, for accommodation of maker. - One who places name on back of promissory note, without more, for purpose of lending credit to the instrument for accommodation of maker, is nevertheless an endorser in the legal sense of the word, and is not a surety, unless as between the original parties one is shown to be a surety by agreement of the parties thereto. Massell v. Prudential Ins. Co. of Am., 57 Ga. App. 460, 196 S.E. 115, 1938 Ga. App. LEXIS 313 (1938) (decided under former Code 1933, § 14-604).

Where evidence showed only that defendant signed name on back of a promissory note for sole purpose of lending credit to maker, the fact of suretyship was not established, and statute of limitations applicable to such endorser was same as that applicable to parties on the face of the instrument. Cantrell v. Byars, 66 Ga. App. 672, 19 S.E.2d 44, 1942 Ga. App. LEXIS 273 (1942) (decided under former Code 1933, § 14-604). One may prove, as between immediate parties, intention to be other than endorser. - Section does not prevent endorser from alleging and proving as between immediate parties to note, endorser’s intention to be bound in a capacity other than endorser. Hopkins Auto. Equip. Co. v. Lyon, 59 Ga. App. 468, 1 S.E.2d 460, 1939 Ga. App. LEXIS 327 (1939) (decided under former Code 1933, § 14-604). To establish prima facie that one is not an endorser one must clearly indicate by appropriate words an intention to be bound in some other capacity. Hopkins Auto. Equip. Co. v. Lyon, 59 Ga. App. 468, 1 S.E.2d 460, 1939 Ga. App. LEXIS 327 (1939) (decided under former Code 1933, § 14-604). Admissibility of parol evidence. - Where a person places signature on back of note without indicating by appropriate words one’s intention to be bound in capacity other than endorser, it may be alleged and shown by parol evidence in this state, as between immediate persons, or those taking with notice of dishonor, or actual facts of such endorsement, that the one so placing name on the back of the instrument was to be bound in some other capacity. Massell v. Prudential Ins. Co. of Am., 57 Ga. App. 460, 196 S.E. 115, 1938 Ga. App. LEXIS 313 (1938) (decided under former Code 1933, § 14-604).

RESEARCH REFERENCES Am. Jur. 2d. 11 Am. Jur. 2d, Bills and Notes, § 60 et seq. 12 Am. Jur. 2d, Bills and Notes, § 497 et seq. C.J.S. 10 C.J.S., Bills and Notes, §§ 27 et seq., 80. 80 C.J.S., Signatures, § 1 et seq.

U.L.A. Uniform Commercial Code (U.L.A.) § 3401. ALR. Place of maker’s signature on bill or note, 20 A.L.R. 394. Necessity of endorsement by all payees

before maturity to make a transferee a bona fide holder, 25 A.L.R. 163. Sufficiency of signing or endorsing bill or note by printing or stamping, 46 A.L.R. 1498. Necessity that checks be signed by all persons in whose name the deposit stands, 61 A.L.R. 967.

Addition of word indicating representative or fiduciary capacity after name of payee, endorser, or endorsee on commercial paper as charging transferee with notice of trust in favor of third parties or of defenses in maker, 61 A.L.R. 1389.