KANSAS OFFICE of
  REVISOR of STATUTES

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84-3-103. Definitions. (a) In this article:

(1) "Acceptor" means a drawee who has accepted a draft.

(2) "Drawee" means a person ordered in a draft to make payment.

(3) "Drawer" means a person who signs or is identified in a draft as a person ordering payment.

(4) Reserved.

(5) "Maker" means a person who signs or is identified in a note as a person undertaking to pay.

(6) "Order" means a written instruction to pay money signed by the person giving the instruction. The instruction may be addressed to any person, including the person giving the instruction, or to one or more persons jointly or in the alternative but not in succession. An authorization to pay is not an order unless the person authorized to pay is also instructed to pay.

(7) "Ordinary care" in the case of a person engaged in business means observance of reasonable commercial standards, prevailing in the area in which the person is located, with respect to the business in which the person is engaged. In the case of a bank that takes an instrument for processing for collection or payment by automated means, reasonable commercial standards do not require the bank to examine the instrument if the failure to examine does not violate the bank's prescribed procedures and the bank's procedures do not vary unreasonably from general banking usage not disapproved by this article or article 4.

(8) "Party" means a party to an instrument.

(9) "Promise" means a written undertaking to pay money signed by the person undertaking to pay. An acknowledgment of an obligation by the obligor is not a promise unless the obligor also undertakes to pay the obligation.

(10) "Prove" with respect to a fact means to meet the burden of establishing the fact (K.S.A. 84-1-201(b)(8), and amendments thereto).

(11) "Remitter" means a person who purchases an instrument from its issuer if the instrument is payable to an identified person other than the purchaser.

(b) Other definitions applying to this article and the sections in which they appear are:

"Acceptance"

84-3-409, and amendments thereto

"Accommodated party"

84-3-419, and amendments thereto

"Accommodation party"

84-3-419, and amendments thereto

"Alteration"

84-3-407, and amendments thereto

"Anomalous endorsement"

84-3-205, and amendments thereto

"Blank endorsement"

84-3-205, and amendments thereto

"Cashier's check"

84-3-104, and amendments thereto

"Certificate of deposit"

84-3-104, and amendments thereto

"Certified check"

84-3-409, and amendments thereto

"Check"

84-3-104, and amendments thereto

"Consideration"

84-3-303, and amendments thereto

"Draft"

84-3-104, and amendments thereto

"Endorsement"

84-3-204, and amendments thereto

"Endorser"

84-3-204, and amendments thereto

"Holder in due course"

84-3-302, and amendments thereto

"Incomplete instrument"

84-3-115, and amendments thereto

"Instrument"

84-3-104, and amendments thereto

"Issue"

84-3-105, and amendments thereto

"Issuer"

84-3-105, and amendments thereto

"Negotiable instrument"

84-3-104, and amendments thereto

"Negotiation"

84-3-201, and amendments thereto

"Note"

84-3-104, and amendments thereto

"Payable at a definite time"

84-3-108, and amendments thereto

"Payable on demand"

84-3-108, and amendments thereto

"Payable to bearer"

84-3-109, and amendments thereto

"Payable to order"

84-3-109, and amendments thereto

"Payment"

84-3-602, and amendments thereto

"Person entitled to enforce"

84-3-301, and amendments thereto

"Presentment"

84-3-501, and amendments thereto

"Reacquisition"

84-3-207, and amendments thereto

"Special endorsement"

84-3-205, and amendments thereto

"Teller's check"

84-3-104, and amendments thereto

"Transfer of instrument"

84-3-203, and amendments thereto

"Traveler's check"

84-3-104, and amendments thereto

"Value"

84-3-303, and amendments thereto

(c) The following definitions in other articles apply to this article:

"Bank"

84-4-105, and amendments thereto

"Banking day"

84-4-104, and amendments thereto

"Clearing house"

84-4-104, and amendments thereto

"Collecting bank"

84-4-105, and amendments thereto

"Depository bank"

84-4-105, and amendments thereto

"Documentary draft"

84-4-104, and amendments thereto

"Intermediary bank"

84-4-105, and amendments thereto

"Item"

84-4-104, and amendments thereto

"Payor bank"

84-4-105, and amendments thereto

"Suspends payments"

84-4-104, and amendments thereto

(d) In addition, article 1 of chapter 84 of the Kansas Statutes Annotated, and amendments thereto, contains general definitions and principles of construction and interpretation applicable throughout this article.

History: L. 1991, ch. 296, § 3; L. 2005, ch. 58, § 1; L. 2007, ch. 89, § 41; July 1, 2008.

KANSAS COMMENT, 1996

In addition to the definitions set forth in subsection (a), the more extensive list of cross references listed in subsection (b), concerning other Article 3 definitions, (c), definitions in other articles of the code, and (d), Article 1 definitions, must also be consulted. For example, the key definition of "negotiable instrument" is found in 84-3-104, and that of "negotiation" in 84-3-201. The present section is derived from the former 84-3-102 and 84-3-118.

Subsection a. The initial distinctions are between (a)(2) "drawer" and (a)(5) "maker," the former referring to one who orders payment of a draft, while the latter is the person that promises to pay a note. If the "drawee," the person ordered to pay the draft, promises to honor that order, it is an "acceptance," as defined in 84-3-409, and the drawee also becomes the "acceptor" as defined in (a)(1).

Paragraphs (a)(6), "order" for drafts, and (a)(9), "promise" for notes, also deal with the distinctions between drafts and notes. Both must be definite and not create doubt as to the intention of the drawer to order, rather than request or authorize, or the enforcibility of the promise of the maker to pay, rather than merely acknowledge an indebtedness.

Paragraphs (a)(4), "good faith," and (7), "ordinary care," should be read together, and each requires the observance of reasonable commercial standards. The reasonableness of the "good faith" is in the entire transaction, while the reasonableness in "ordinary care" will usually refer to individual events.

Paragraph (a)(8), "party," refers to "a party to an instrument," a phrase not here defined. It generally includes those named in an instrument, although 84-3-401 makes it clear a party is not liable on an instrument unless that person or an agent has it. The basic liabilities of the traditional parties, the makers, acceptors, drawers, indorsers and transferors, are spelled out in 84-3-412 through 84-3-417.

Revisor's Note:

Former section 84-3-103 was repealed by L. 1991, ch. 296, § 111 and the number reassigned to the current text.

CASE ANNOTATIONS

1. Insurance companies were maker/drawers and drawees where attorney forged client's endorsement; conversion action against nonbank drawees not prohibited. King v. White, 265 Kan. 627, 631, 962 P.2d 475 (1998).


 



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