§ 4-3-604 — Discharge by cancellation or renunciation

(a) A person entitled to
enforce an instrument, with or without consideration, may discharge the obligation
of a party to pay the instrument (i) by an intentional voluntary act, such as surrender
of the instrument to the party, destruction, mutilation, or cancellation of the
instrument, cancellation or striking out of the party's signature, or the addition of
words to the instrument indicating discharge or (ii) by agreeing not to sue or
otherwise renouncing rights against the party by a signed record. The obligation of
a party to pay a check is not discharged solely by destruction of the check in
connection with a process in which information is extracted from the check and an
image of the check is made and, subsequently, the information and image are
transmitted for payment.

(b) Cancellation or striking out of an indorsement pursuant to subsection (a)
of this section does not affect the status and rights of a party derived from the
indorsement.

Legislative History

Source: L. 94: Entire article R&RE, p. 877, � 1, effective January 1, 1995. L. 2023: (a) amended, (SB 23-090), ch. 136, p. 531, � 23, effective August 7.