Section 394-A. Proof of lost negotiable paper

1. Where, upon the trial of
  an action, it appears that a negotiable instrument within article  three
  of  the uniform commercial code, upon which the action or a counterclaim
  interposed in the action is founded, was lost while it belonged  to  the
  party  claiming  the  amount  due  thereupon,  he may prove the contents
  thereof by parol or other secondary evidence and may recover or set  off
  the amount due thereupon as if it was produced.
    2.  For  that  purpose,  he  must  give to the adverse party a written
  undertaking, in a sum fixed by the judge or the referee, not  less  than
  twice  the  amount  of  the  note  or  bill, with at least two sureties,
  approved by the judge or  the  referee,  to  the  effect  that  he  will
  indemnify  the  adverse  party,  his heirs and personal representatives,
  against any claim by any other person, on account of the note  or  bill,
  and against all costs and expenses, by reason of such a claim.
    3. But where an action is prosecuted or defended by the state, or by a
  public  officer in its behalf, the state or the public officer may prove
  the contents of a lost negotiable instrument within article three of the
  uniform commercial code, by parol or other secondary evidence,  and  may
  recover or set off the amount due thereupon, without giving any security
  to the adverse party notwithstanding section 3--804 of such code.