Title 11, Chapter 3, Section 419
Instruments signed for accommodation.
(a) 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
(b) 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
(c) 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.
(d) 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.
(e) 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.