Liability of indorser
Full Text
Liability of indorser.—In the absence of a contract to the contrary, whoever indorses and delivers a negotiable instrument before maturity without, in such indorsement, expressly excluding or making conditional his own liability, is bound thereby to every subsequent holder, in case of dishonour by the drawee, acceptor or maker, to compensate such holder for any loss or damage caused to him by such dishonour, provided due notice of dishonour has been given to, or received by, such indorser as hereinafter provided.
Every indorser after dishonour is liable as upon an instrument payable on demand.
Plain English Summary
Makes an endorser liable to compensate subsequent holders if the instrument is dishonoured, provided they receive due notice of dishonour, unless they explicitly limit or exclude liability.
Key Legal Elements
- Endorsement and delivery before maturity binds the endorser to compensate subsequent holders
- Liability arises in case of dishonour by the drawee, acceptor, or maker
- Subject to due notice of dishonour being given to the endorser
- An endorser can exclude or limit liability in the endorsement text (e.g., sans recours)
Practical Note
Endorsers incur surety-like liability to all subsequent holders. An endorser can exclude liability by writing 'sans recours' (without recourse) next to their signature. After dishonour, they are liable immediately on demand without grace days.
हिंदी पाठ
पृष्ठांकक का दायित्व।—विपरीत अनुबंध के अभाव में, जो कोई भी परिपक्वता से पहले किसी परक्राम्य लिखत को पृष्ठांकित और परिदत्त (deliver) करता है, बिना अपने पृष्ठांकन में अपने स्वयं के दायित्व को स्पष्ट रूप से अलग किए या सशर्त बनाए, वह आहारी (drawee), स्वीकर्ता (acceptor) या निर्माता (maker) द्वारा लिखत के अनादृत (dishonour) होने की स्थिति में प्रत्येक पश्चात्वर्ती धारक (subsequent holder) को ऐसे अनादर से हुए किसी भी नुकसान या क्षति के लिए क्षतिपूर्ति करने के लिए बाध्य है; बशर्ते कि अनादर की उचित सूचना ऐसे पृष्ठांकक को दे दी गई हो या उसके द्वारा प्राप्त कर ली गई हो, जैसा कि इसके बाद प्रावधान किया गया है।
अनादर के पश्चात प्रत्येक पृष्ठांकक ऐसे उत्तरदायी होता है मानो लिखत मांग पर देय (payable on demand) हो।