GA Code § 11-3-419 (2021)
2021 Georgia Code|Title 11 - Commercial Code|Article 3 - Negotiable Instruments|Part 4 - Liability of Parties|§ 11-3-419. Instruments Signed for Accommodation

  If an instrument is issued for value given for the benefit of a party to the instrument known as the "accommodated party," and another party to the instrument known as the "accommodation party" signs the instrument for the purpose of incurring liability on the instrument without being a direct beneficiary of the value given for the instrument, the instrument is signed by the accommodation party "for accommodation."   An accommodation party may sign the instrument as maker, drawer, acceptor, or indorser and, subject to subsection (d) of this Code section, is obliged to pay the instrument in the capacity in which the accommodation party signs. The obligation of an accommodation party may be enforced notwithstanding any statute of frauds and whether or not the accommodation party receives consideration for the accommodation.   A person signing an instrument is presumed to be an accommodation party and there is notice that the instrument is signed for accommodation if the signature is an anomalous indorsement or is accompanied by words indicating that the signer is acting as surety or guarantor with respect to the obligation of another party to the instrument. Except as provided in Code Section 11-3-605, the obligation of an accommodation party to pay the instrument is not affected by the fact that the person enforcing the obligation had notice when the instrument was taken by that person that the accommodation party signed the instrument for accommodation.   If the signature of a party to an instrument is accompanied by words indicating unambiguously that the party is guaranteeing collection rather than payment of the obligation of another party to the instrument, the signer is obliged to pay the amount due on the instrument to a person entitled to enforce the instrument only if (i) execution of judgment against the other party has been returned unsatisfied; (ii) the other party is insolvent or in an insolvency proceeding; (iii) the other party cannot be served with process; or (iv) it is otherwise apparent that payment cannot be obtained from the other party.   An accommodation party who pays the instrument is entitled to reimbursement from the accommodated party and is entitled to enforce the instrument against the accommodated party. An accommodated party who pays the instrument has no right of recourse against, and is not entitled to contribution from, an accommodation party.     (Code 1981, §11-3-419, enacted by Ga. L. 1996, p. 1306, § 3.)   Cross references.   - Proof of suretyship by parol, § 10-7-45.   Law reviews.   - For article discussing parol evidence in the law of commercial paper, see 13 Ga. L. Rev. 53 (1978).   JUDICIAL DECISIONS   ANALYSIS    General Consideration   Parol Evidence    RESEARCH REFERENCES   Am. Jur. 2d.   - 11 Am. Jur. 2d, Bills and Notes, §§ 84 et seq., 159 et seq., 234, 301, 418 et seq. 12 Am. Jur. 2d, Bills and Notes, §§ 474 et seq., 667, 671.   C.J.S.   - 10 C.J.S., Bills and Notes, §§ 24 et seq., 190, 191.   U.L.A.   - Uniform Commercial Code (U.L.A.) § 3-419.   ALR.    - Right of accommodation party to bill or note to revoke his signature, 22 A.L.R. 1348.    Rights and remedies of accommodation party to paper as against accommodated party after payment, 36 A.L.R. 553; 77 A.L.R. 668.    Rights of transferee after maturity of accommodation paper, 48 A.L.R. 1280.    Discharge of accommodation maker or surety by extension of time or release of collateral, under Negotiable Instruments Law, 65 A.L.R. 1425; 108 A.L.R. 1088; 2 A.L.R.2d 260.    Amount paid for paper by holder as limiting recovery against accommodation party, 69 A.L.R. 1313.    Admissibility of parol evidence that one signed negotiable paper for purpose other than assuming an obligation thereon, 75 A.L.R. 1519.   Discharge of accommodation maker or surety by release of mortgage or other security given for note, 2 A.L.R.2d 260.   Who is accommodation party under Uniform Commercial Code § 3-415, 90 A.L.R.3d 342.