(1) A person whose failure to exercise ordinary care substantially contributes to
an alteration of an instrument or to the making of a forged signature on an instrument
is precluded from asserting the alteration or the forgery against a person who, in
good faith, pays the instrument or takes it for value or for collection.
(2) Under subsection (1) of this section, if the person asserting the preclusion
fails to exercise ordinary care in paying or taking the instrument and that failure
substantially contributes to loss, the loss is allocated between the person precluded
and the person asserting the preclusion according to the extent to which the failure
of each to exercise ordinary care contributed to the loss.
(3) Under subsection (1) of this section, the burden of proving failure to exercise
ordinary care is on the person asserting the preclusion. Under subsection (2) of this section, the burden of proving failure to exercise
ordinary care is on the person precluded.
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