2018 New Mexico Statutes
Chapter 55 - Uniform Commercial Code
Article 3 - Negotiable Instruments
Section 55-3-115 - Incomplete instrument.

(a) "Incomplete instrument" means a signed writing, whether or not issued by the signer, the contents of which show at the time of signing that it is incomplete but that the signer intended it to be completed by the addition of words or numbers.

(b) Subject to Subsection (c), if an incomplete instrument is an instrument under Section 55-3-104 NMSA 1978, it may be enforced according to its terms if it is not completed, or according to its terms as augmented by completion. If an incomplete instrument is not an instrument under Section 55-3-104 NMSA 1978, but, after completion, the requirements of Section 55-3-104 NMSA 1978 are met, the instrument may be enforced according to its terms as augmented by completion.

(c) If words or numbers are added to an incomplete instrument without authority of the signer, there is an alteration of the incomplete instrument under Section 55-3-407 NMSA 1978.

(d) The burden of establishing that words or numbers were added to an incomplete instrument without authority of the signer is on the person asserting the lack of authority.

History: 1978 Comp., § 55-3-115, enacted by Laws 1992, ch. 114, § 102.

OFFICIAL COMMENTS

UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.

1. This section generally carries forward the rules set out in former Section 3-115. The term "incomplete instrument" applies both to an "instrument," i.e. a writing meeting all the requirements of Section 3-104 [55-3-104 NMSA 1978] , and to a writing intended to be an instrument that is signed but lacks some element of an instrument. The test in both cases is whether the contents show that it is incomplete and that the signer intended that additional words or numbers be added.

2. If an incomplete instrument meets the requirements of Section 3-104 [55-3-104 NMSA 1978] and is not completed it may be enforced in accordance with its terms. Suppose, in the following two cases, that a note delivered to the payee is incomplete soley because a space on the pre-printed note form for the due date is not filled in:

Case #1. If the incomplete instrument is never completed, the note is payable on demand. Section 3-108(a)(ii) [55-3-108 NMSA 1978] . However, if the payee and the maker agreed to a due date, the maker may have a defense under Section 3-117 [55-3-117 NMSA 1978] if the demand for payment is made before the due date agreed to by the parties.

Case #2. If the payee completes the note by filling in the due date agreed to by the parties, the note is payable on the due date stated. However, if the due date filled in was not the date agreed to by the parties there is an alteration of the note. Section 3-407 [55-3-407 NMSA 1978] governs the case.

Suppose Debtor pays Creditor by giving Creditor a check on which the space for the name of the payee is left blank. The check is an instrument but it is incomplete. The check is enforceable in its incomplete form and it is payable to the bearer because it does not state a payee. Section 3-109(a)(2) [55-3-109 NMSA 1978]. Thus, Creditor is a holder of the check. Normally in this kind of case Creditor would simply fill in the space with Creditor's name. When that occurs the check becomes payable to the Creditor.

3. In some cases the incomplete instrument does not meet the requirements of Section 3-104 [55-3-104 NMSA 1978]. An example is a check with the amount not filled in. The check cannot be enforced until the amount is filled in. If the payee fills in an amount authorized by the drawer the check meets the requirements of Section 3-104 and is enforceable as completed. If the payee fills in an unauthorized amount there is an alteration of the check and Section 3-407 [55-3-407 NMSA 1978] applies.

4. Section 3-302(a)(1) [55-3-302 NMSA 1978] also bears on the problem of incomplete instruments. Under that section a person cannot be a holder in due course of the instrument if it is so incomplete as to call into question its validity. Subsection (d) of Section 3-115 [55-3-115 NMSA 1978] is based on the last clause of Subsection (2) of the former Section 3-115.

Repeals. — Laws 1992, ch. 114, § 237 repealed former 55-3-115 NMSA 1978, as enacted by Laws 1961, ch. 96, § 3-115, relating to incomplete instruments, effective July 1, 1992. Laws 1992, ch. 114, § 102, enacted a new section, effective July 1, 1992. For provisions of former section, see the 1991 NMSA 1978 on NMOneSource.com.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 11 Am. Jur. 2d Bills and Notes §§ 73 to 79, 81, 87, 88, 666; 12 Am. Jur. 2d Bills and Notes §§ 1160, 1297.

Liability of one who signs commercial paper in blank to be used for his own benefit where it is wrongfully used by an agent or employee, 43 A.L.R. 198.

Effect of payee of bill or note, executed in blank as to amount, filling it in for an amount in excess of that authorized, 75 A.L.R. 1389.

Bank's liability for payment or withdrawal on less than required number of signatures, 7 A.L.R.4th 655.

10 C.J.S. Bills and Notes § 32.