California Commercial Code

§ 3206

COM § 3206 Effective Jan 1, 1993Div. 3 · Ch. 2

Statute text

(a)An indorsement limiting payment to a particular person or otherwise prohibiting further transfer or negotiation of the instrument is not effective to prevent further transfer or negotiation of the instrument.

(b)An indorsement stating a condition to the right of the indorsee to receive payment does not affect the right of the indorsee to enforce the instrument. A person paying the instrument or taking it for value or collection may disregard the condition, and the rights and liabilities of that person are not affected by whether the condition has been fulfilled.

(c)If an instrument bears an indorsement (i) described in subdivision (b) of Section 4201, or (ii) in blank or to a particular bank using the words “for deposit,” “for collection,” or other words indicating a purpose of having the instrument collected by a bank for the indorser or for a particular account, the following rules apply:

…

Legislative history

Repealed and added by Stats. 1992, Ch. 914, Sec. 6. Effective January 1, 1993.