Some Suggestions for Nonurgent Reforms in the UCC’s Treatment of Accommodation Parties

Anyone who has studied those provisions of the Uniform Commercial Code (UCC or Code) that deal with accommodation parties-chiefly Sections 3-415, 3-416, and 3-606-knows a certain amount of despair at trying to decipher the meaning of these provisions. Fortunately, most of the problems raised are fairly narrow, and few of them have yet posed significant problems for the courts, either because they have not yet arisen or (more often) because the courts have cut through ambiguous language to reach desirable and justifiable results. Thus, most of the problems discussed below do not cry out for immediate legislative attention. The position of the Permanent Editorial Board for the Uniform Commercial Code with respect to amendments to the Code is a salutary one: “Amendments should be the result of experience rather than of theory.” To the extent that this rule is a reflection of the fact that the uniformity of the Code will not be preserved if amendments are suggested in a piecemeal fashion, the suggestions made below may be worthy of consideration-even if the underlying problems have not yet generated litigation-when and if a general revision of Article Three occurs (like the 1972 revision of Article Nine). Whether or not any of the suggestions discussed below ever deserve consideration, it is safe to assume that some will never get it. Some suggestions contained in studies far more illustrious than this one as well as suggestions in some less illustrious works have been ignored in the past.