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<h1>Discharge from liability by cancellation, release or payment discharges makers, acceptors and indorsers under negotiable instruments.</h1> The maker, acceptor or indorser is discharged from liability by cancellation when a holder cancels the acceptor's or indorser's name with intent to discharge him and to parties claiming under that holder; by release when a holder otherwise discharges the party and to those deriving title after notice of such discharge; and by payment to all parties where the instrument is payable to bearer or indorsed in blank and payment is made in due course.