Tennessee Code Annotated
Tenn. Code Ann. § 47-3-414 (2026)
Obligation of drawer
✓ current as of May 2026
- (a) This section does not apply to cashier's checks or other drafts drawn on the drawer.
- (b) If an unaccepted draft is dishonored, the drawer is obliged to pay the draft (i) according to its terms at the time it was issued or, if not issued, at the time it first came into possession of a holder, or (ii) if the drawer signed an incomplete instrument, according to its terms when completed, to the extent stated in §§ 47-3-115 and 47-3-407. The obligation is owed to a person entitled to enforce the draft or to an endorser who paid the draft under § 47-3-415.
- (c) If a draft is accepted by a bank, the drawer is discharged, regardless of when or by whom acceptance was obtained.
- (d) If a draft is accepted and the acceptor is not a bank, the obligation of the drawer to pay the draft if the draft is dishonored by the acceptor is the same as the obligation of an endorser under § 47-3-415(a) and (c).
- (e) If a draft states that it is drawn "without recourse" or otherwise disclaims liability of the drawer to pay the draft, the drawer is not liable under subsection (b) to pay the draft if the draft is not a check. A disclaimer of the liability stated in subsection (b) is not effective if the draft is a check.
- (f) If (i) a check is not presented for payment or given to a depositary bank for collection within thirty (30) days after its date, (ii) the drawee suspends payments after expiration of the 30-day period without paying the check, and (iii) because of the suspension of payments, the drawer is deprived of funds maintained with the drawee to cover payment of the check, the drawer to the extent deprived of funds may discharge its obligation to pay the check by assigning to the person entitled to enforce the check the rights of the drawer against the drawee with respect to the funds.
Acts 1995, ch. 397, § 2.
Notes of Decisions
Cited in 7
cases (1 in the last 5 years), 1976–2021 · leading case: Lake Hiwassee Dev. Co. v. Pioneer Bank, 535 S.W.2d 323 (Tenn. 1976).
Lake Hiwassee Dev. Co. v. Pioneer Bank, 535 S.W.2d 323 (Tenn. 1976). “T.C.A. § 47-3-414 provides: “Unless the indorsement otherwise specifies (as by such words as ‘without recourse’) every indorser engages that upon dishonor and any necessary notice of dishonor and protest he will pay the instrument according to its tenor at the time of his…”
McLemore v. Third Nat'l Bank (In Re Montgomery), 123 B.R. 801 (Bankr. M.D. Tenn. 1991). “§ 47-4-212 (bank’s right to revoke provisional credit, to charge back the amount of any credit given and to obtain refund from its customer); TENN.”
Smallman v. Home Fed. Sav. Bank of Tennessee, 786 S.W.2d 954 (Tenn. Ct. App. 1989). “This is not intended to say, and we are not called upon to determine whether a bank would be entitled to recover from a depositor under the statute authorizing recovery against endorsers, T.C.A. 47-3-414 [5] , but hold only that a bank which misses its midnight deadline is…”
Dobson & Johnson, Inc. v. Von Weiland, 644 S.W.2d 394 (Tenn. 1982). “T.C.A., § 47-3-414(1). “As a general rule the defense of want or failure of consideration relates only to consideration for the particular contract under which obligation is asserted.”
Tom Albert v. Pat Frye (Tenn. Ct. App. 2006). “In a post-trial motion to alter or amend, Plaintiffs contended they were entitled to relief pursuant to Tenn. Code Ann. § 47-3-414 (b) because Frye, the drawer, was obliged to pay the draft according to its terms without proof of fraud.”
Harpeth Fin. Servs., LLC v. Jim Clay Pinson, Jr. (Tenn. Ct. App. 2021). “Morris does not elaborate on this point. In the general sessions warrant, Harpeth only references the bad check statute, Tennessee Code Annotated § 47- 29-101, and not Tennessee Code Annotated § 47-3-414, the obligation of a drawer on an unaccepted draft.”
Car Connection, Inc. v. Auto Buyers, Inc. (Tenn. Ct. App. 1998). “T.C.A. § 47-3-414(b) provides: If an unaccepted draft is dishonored, the drawer is obligated to pay the draft in accordance with its terms at the time it was issued .”
— Tenn. Code Ann. § 47-3-414(1) — 1 case
Dobson & Johnson, Inc. v. Von Weiland, 644 S.W.2d 394 (Tenn. 1982). “T.C.A., § 47-3-414(1). “As a general rule the defense of want or failure of consideration relates only to consideration for the particular contract under which obligation is asserted.”
— Tenn. Code Ann. § 47-3-414(b) — 1 case
Car Connection, Inc. v. Auto Buyers, Inc. (Tenn. Ct. App. 1998). “T.C.A. § 47-3-414(b) provides: If an unaccepted draft is dishonored, the drawer is obligated to pay the draft in accordance with its terms at the time it was issued .”
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