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Obligations of receiving bank in execution of payment order - 13 Pa. Cons. Stat. § 4A302

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     § 4A302.  Obligations of receiving bank in execution of payment
                order.
        (a)  General rule.--Except as provided in subsections (b),
     (c) and (d), if the receiving bank accepts a payment order
     pursuant to section 4A209(a) (relating to acceptance of payment
     order), the bank has the following obligations in executing the
     order:
            (1)  The receiving bank is obliged to issue, on the
        execution date, a payment order complying with the sender's
        order and to follow the sender's instructions concerning:
                (i)  any intermediary bank or funds-transfer system
            to be used in carrying out the funds transfer; or
                (ii)  the means by which payment orders are to be
            transmitted in the funds transfer.
        If the originator's bank issues a payment order to an
        intermediary bank, the originator's bank is obliged to
        instruct the intermediary bank according to the instruction
        of the originator. An intermediary bank in the funds transfer
        is similarly bound by an instruction given to it by the
        sender of the payment order it accepts.
            (2)  If the sender's instruction states that the funds
        transfer is to be carried out telephonically or by wire
        transfer or otherwise indicates that the funds transfer is to
        be carried out by the most expeditious means, the receiving
        bank is obliged to transmit its payment order by the most
        expeditious available means and to instruct any intermediary
        bank accordingly. If a sender's instruction states a payment
        date, the receiving bank is obliged to transmit its payment
        order at a time and by means reasonably necessary to allow
        payment to the beneficiary on the payment date or as soon
        thereafter as is feasible.
        (b)  Discretion of receiving bank.--Unless otherwise
     instructed, a receiving bank executing a payment order may:
            (1)  use any funds-transfer system if use of that system
        is reasonable in the circumstances; and
            (2)  issue a payment order to the beneficiary's bank or
        to an intermediary bank through which a payment order
        conforming to the sender's order can expeditiously be issued
        to the beneficiary's bank if the receiving bank exercises
        ordinary care in the selection of the intermediary bank.
     A receiving bank is not required to follow an instruction of the
     sender designating a funds-transfer system to be used in
     carrying out the funds transfer if the receiving bank, in good
     faith, determines that it is not feasible to follow the
     instruction or that following the instruction would unduly delay
     completion of the funds transfer.
        (c)  Manner by which receiving bank may execute payment order
     in certain circumstances.--Unless subsection (a)(2) applies or
     the receiving bank is otherwise instructed, the bank may execute
     a payment order by transmitting its payment order by first class
     mail or by any means reasonable in the circumstances. If the
     receiving bank is instructed to execute the sender's order by
     transmitting its payment order by a particular means, the
     receiving bank may issue its payment order by the means stated
     or by any means as expeditious as the means stated.
        (d)  Certain prohibited acts of receiving bank.--Unless
     instructed by the sender, the receiving bank:
            (1)  may not obtain payment of its charges for services
        and expenses in connection with the execution of the sender's
        order by issuing a payment order in an amount equal to the
        amount of the sender's order less the amount of the charges;
        and
            (2)  may not instruct a subsequent receiving bank to
        obtain payment of its charges in the same manner.

        Cross References.  Section 4A302 is referred to in sections
     4A208, 4A305, 4A402 of this title.

Last modified: November 27, 2007