On The Effect Of Instrument Alteration

Instrument alteration is the behavior in which the person without right has a purpose of exercising the instrument right, and alterates the important recorded items except signiture on the valid instrument. It doesn't affect the instrument's form validity. The effect of instrument alteration is the influence on the instrument liability and the legal consequents to the litigants when the instrument is altered. It mainly includes three aspects: instrument liability, non-instrument liability and the burden of risks.The effect of instrument liability manifests in which instrument liability to undertake on the altered instrument. The premise of instrument liability is the signiture. Everyone merely pays resposibility for the contents when he signitures on the instruments. The parties who signed before the alteration usually is limited to the original terms of instrument. The ones who signed after the alteration must pay responsibility for the altered terms. If failing to destinguish whether the signiture is before or after, it should be suppose the latter. If the alteror signed on the instrument, he should undertake the heavier liability on the instrument.The effect of non-instrument liability manifests in the illegal liability of instrument alteration. The litigants must bear a negative legal result bacause of violating the law. It includes three liabilities: civil liability, criminal liability and administrative liability.The effect of burden of risks on instrument alteration is that the parties have to undertake the risks when the instrument is altered, and the alteror flees away or cannot afford it. The payer, drawer, holder and signer whose signiture after the alteration may undertake the risks. If the litigants have mistakes to the alteration, he should share the loss according to The Loss Distribution Rule. If all the litigants have no mistakes, they should share the loss accoding to Kildor-Hicks Theory or Equal Resposibility Rule. In addition, the payer or the bank agent can aviod the risk by exemption clauses, or transfer the risk by insurrance contract.Our Instruments Law examines the defects in the effect of instrument alteration: Put the sum change out of the instrument alteration; The payer take essential responsibility for the instrument alteration, and it increases the payer's duty; The 14 th provision of Chinese Instrunents Law confuses the forgery and alteration, which seriously deters the negotiation of the instrument. Therefore, the Instruments Law should carry on the legislation consummation for these problens.