Illinois General Assembly - Illinois Compiled Statutes

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810 ILCS 5/3-415

(810 ILCS 5/3-415) (from Ch. 26, par. 3-415)

Sec. 3-415.

Obligation of indorser.

(a) Subject to subsections (b), (c), and (d) and to Section 3-419(d), if
an instrument is dishonored, an indorser is obliged to pay the amount due
on the instrument (i) according to the terms of the instrument at the time
it was indorsed, or (ii) if the indorser indorsed an incomplete instrument,
according to its terms when completed to the extent stated in Sections 3-115
and 3-407.  The obligation of the indorser is owed to a person entitled to
enforce the instrument or to a subsequent indorser who paid the instrument
under this Section.

(b) If an indorsement states that it is made "without recourse" or
otherwise disclaims liability of the indorser, the indorser is not liable
under subsection (a) to pay the instrument.

(c) If notice of dishonor of an instrument is required by Section 3-503
and notice of dishonor complying with that Section is not given to an
indorser, the liability of the indorser under subsection (a) is discharged.

(d) If a draft is accepted by a bank after an indorsement is made, the
liability of the indorser under subsection (a) is discharged.

(e) If an indorser of a check is liable under subsection (a) and the
check is not presented for payment, or given to a depositary bank for
collection, within 30 days after the day the indorsement was made, the
liability of the indorser under subsection (a) is discharged.

(Source: P.A. 87-582; 87-1135.)