2005 Idaho Code - 28-3-419 — INSTRUMENTS SIGNED FOR ACCOMMODATION

                                  TITLE  28
                           COMMERCIAL TRANSACTIONS
                                  CHAPTER 3
                          UNIFORM COMMERCIAL CODE --
                            NEGOTIABLE INSTRUMENTS
                                   PART 4.
                             LIABILITY OF PARTIES
    28-3-419.  INSTRUMENTS SIGNED FOR ACCOMMODATION. (1) If an instrument is
issued for value given for the benefit of a party to the instrument
("accommodated party") and another party to the instrument ("accommodation
party") signs the instrument for the purpose of incurring liability on the
instrument without being a direct beneficiary of the value given for the
instrument, the instrument is signed by the accommodation party "for
accommodation."
    (2)  An accommodation party may sign the instrument as maker, drawer,
acceptor, or indorser and, subject to subsection (4) of this section, is
obliged to pay the instrument in the capacity in which the accommodation party
signs.  The obligation of an accommodation party may be enforced
notwithstanding any statute of frauds and whether or not the accommodation
party receives consideration for the accommodation.
    (3)  A person signing an instrument is presumed to be an accommodation
party and there is notice that the instrument is signed for accommodation if
the signature is an anomalous indorsement or is accompanied by words
indicating that the signer is acting as surety or guarantor with respect to
the obligation of another party to the instrument.  Except as provided in
section 28-3-605, the obligation of an accommodation party to pay the
instrument is not affected by the fact that the person enforcing the
obligation had notice when the instrument was taken by that person that the
accommodation party signed the instrument for accommodation.
    (4)  If the signature of a party to an instrument is accompanied by words
indicating unambiguously that the party is guaranteeing collection rather than
payment of the obligation of another party to the instrument, the signer is
obliged to pay the amount due on the instrument to a person entitled to
enforce the instrument only if (i) execution of judgment against the other
party has been returned unsatisfied, (ii) the other party is insolvent or in
an insolvency proceeding, (iii) the other party cannot be served with process,
or (iv) it is otherwise apparent that payment cannot be obtained from the
other party.
    (5)  An accommodation party who pays the instrument is entitled to
reimbursement from the accommodated party and is entitled to enforce the
instrument against the accommodated party. An accommodated party who pays the
instrument has no right of recourse against, and is not entitled to
contribution from, an accommodation party.