1. (1) “Alteration” means:

   1. (a) An unauthorized change in an instrument that purports to modify in any respect the obligation of a party; or
   2. (b) An unauthorized addition of words or numbers or other change to an incomplete instrument relating to the obligation of a party.
2. (2) Except as provided in subsection (3) of this section, an alteration fraudulently made discharges a party whose obligation is affected by the alteration unless that party assents or is precluded from asserting the alteration. No other alteration discharges a party, and the instrument may be enforced according to its original terms.

3. (3) A payor bank or drawee paying a fraudulently altered instrument or a person taking it for value or for collection, in good faith and without notice of the alteration, may enforce rights with respect to the instrument:

   1. (a) According to its original terms; or
   2. (b) In the case of an incomplete instrument altered by unauthorized completion, according to its terms as completed.

[1993 c.545 §48]