47-4202. Responsibility for collection or return; when action timely
A. A collecting bank must exercise ordinary care in:
1. Presenting an item or sending it for presentment;
2. Sending notice of dishonor or non-payment or returning an item other than a documentary draft to the bank's transferor after learning that the item has not been paid or accepted, as the case may be;
3. Settling for an item when the bank receives final settlement; and
4. Notifying its transferor of any loss or delay in transit within a reasonable time after discovery thereof.
B. A collecting bank exercises ordinary care under subsection A by taking proper action before its midnight deadline following receipt of an item, notice or settlement. Taking proper action within a reasonably longer time may constitute the exercise of ordinary care, but the bank has the burden of establishing timeliness.
C. Subject to paragraph 1 of subsection A, a bank is not liable for the insolvency, neglect, misconduct, mistake or default of another bank or person or for loss or destruction of an item in the possession of others or in transit.
Section: Previous 47-4106 47-4107 47-4108 47-4109 47-4110 47-4111 47-4201 47-4202 47-4203 47-4204 47-4205 47-4206 47-4207 47-4208 47-4209 NextLast modified: October 13, 2016