Presentment Warranty Law and Legal Definition
When used in relation to negotiable instruments, presentment warranty refers to an implied promise as to the title and credibility of an instrument made by a payer or acceptor upon the presentment of the instrument for payment. In the U.S., presentment warranty is expressly dealt under the Uniform Commercial Code. Pursuant to U.C.C. § 3-417 (a), if an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, (i) the person obtaining payment or acceptance, at the time of presentment, and (ii) a previous transferor of the draft, at the time of transfer, warrant to the drawee making payment or accepting the draft in good faith that:
(1) the warrantor is, or was, at the time the warrantor transferred the draft, a person entitled to enforce the draft or authorized to obtain payment or acceptance of the draft on behalf of a person entitled to enforce the draft;
(2) the draft has not been altered;
(3) the warrantor has no knowledge that the signature of the drawer of the draft is unauthorized; and
(4) with respect to any remotely-created consumer item, that the person on whose account the item is drawn authorized the issuance of the item in the amount for which the item is drawn.
