Baum v. COTTON STATES MUTUAL INSURANCE COMPANY

Bell, Chief Judge. This is a suit on a draft made payable on acceptance to the order of plaintiff, drawn by the defendant insurer on the drawee, First National Bank of Atlanta. The defendant in his answer raised several defenses. One defense was that the draft was conditional on acceptance and since it was not accepted when presented for payment defendant incurred no liability. The trial court granted defendant a summary judgment on the above described "defense.” Held: A draft is dishonored when acceptance is refused by the drawee and gives the holder on dishonor an immediate right of recourse against the drawer. Code § 109A-3 — 507 (1) (a) (2). The drawer "engages that upon dishonor of the draft and any necessary notice of dishonor or protest he will pay the amount of the draft to the holder or to any indorser who takes it up.” Code § 109A-3 — 413 (2). The defendant was the drawer and the lack of acceptance by the drawee bank is not a valid defense to this suit. It was error to grant a summary judgment on this ground. Judgment reversed. McMurray and Smith, JJ., concur.