Texas Business And Commerce Code Title 1, Chapter 4 - Bank Deposits And Collections

SUBCHAPTER A GENERAL PROVISIONS AND DEFINITIONS

• Texas Section 4.101 - Short Title
  This chapter may be cited as Uniform Commercial Code--Bank Deposits and Collections. Acts 1967, 60th Leg., p. 2343, ch. 785, Sec. 1, eff. Sept. 1,...
• Texas Section 4.102 - Applicability
  (a) To the extent that items within this chapter are also within Chapters 3 and 8, they are subject to those chapters. If there is...
• Texas Section 4.103 - Variation By Agreement; Measure Of Damages; Action Constituting Ordinary Care
  (a) The effect of the provisions of this chapter may be varied by agreement, but the parties to the agreement cannot disclaim a bank's responsibility...
• Texas Section 4.104 - Definitions And Index Of Definitions
  (a) In this chapter, unless the context otherwise requires: (1) "Account" means any deposit or credit account with a bank, including a demand, time, savings,...
• Texas Section 4.105 - "Bank"; "Depositary Bank"; "Intermediary Bank"; "Collecting Bank"; "Payor Bank"; "Presenting Bank"
  In this chapter: (1) "Bank" means a person engaged in the business of banking, including a savings bank, savings and loan association, credit union, or...
• Texas Section 4.106 - Payable Through Or Payable At Bank; Collecting Bank
  (a) If an item states that it is "payable through" a bank identified in the item, the item: (1) designates the bank as a collecting...
• Texas Section 4.107 - Separate Office Of A Bank
  A branch or separate office of a bank is a separate bank for the purpose of computing the time within which and determining the place...
• Texas Section 4.108 - Time Of Receipt Of Items
  (a) For the purpose of allowing time to process items, prove balances, and make the necessary entries on its books to determine its position for...
• Texas Section 4.109 - Delays
  (a) Unless otherwise instructed, a collecting bank in a good faith effort to secure payment of a specific item drawn on a payor other than...
• Texas Section 4.110 - Electronic Presentment
  (a) "Agreement for electronic presentment" means an agreement, clearing-house rule, or Federal Reserve regulation or operating circular providing that presentment of an item may be...
• Texas Section 4.111 - Statute Of Limitations
  An action to enforce an obligation, duty, or right arising under this chapter must be commenced within three years after the cause of action accrues....

SUBCHAPTER B COLLECTION OF ITEMS: DEPOSITARY AND COLLECTING BANKS

• Texas Section 4.112 - Payment Of Check At Par
  (a) Except as otherwise provided by Chapter 3 or this chapter, a payor bank shall pay a check drawn on it against an account with...
• Texas Section 4.201 - Status Of Collecting Bank As Agent And Provisional Status Of Credits; Applicability Of Chapter; Item Indorsed "Pay Any Bank"
  (a) Unless a contrary intent clearly appears and before the time that a settlement given by a collecting bank for an item is or becomes...
• Texas Section 4.202 - 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...
• Texas Section 4.203 - Effect Of Instructions
  Subject to Chapter 3 concerning conversion of instruments (Section 3.420) and restrictive indorsements (Section 3.206), only a collecting bank's transferor can give instructions that affect...
• Texas Section 4.204 - Methods Of Sending And Presenting; Sending Directly To Payor Bank
  (a) A collecting bank shall send items by a reasonably prompt method, taking into consideration relevant instructions, the nature of the item, the number of...
• Texas Section 4.205 - Depository Bank Holder Of Unindorsed Item
  If a customer delivers an item to a depositary bank for collection, the depositary bank: (1) becomes a holder of the item at the time...
• Texas Section 4.206 - Transfer Between Banks
  Any agreed method that identifies the transferor bank is sufficient for the item's further transfer to another bank. Acts 1967, 60th Leg., p. 2343, ch....
• Texas Section 4.207 - Transfer Warranties
  (a) A customer or collecting bank that transfers an item and receives a settlement or other consideration warrants to the transferee and to any subsequent...
• Texas Section 4.208 - Presentment Warranties
  (a) If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, (i) the person...
• Texas Section 4.209 - Encoding And Retention Warranties
  (a) A person who encodes information on or with respect to an item after issue warrants to any subsequent collecting bank and to the payor...
• Texas Section 4.210 - Security Interest Of Collecting Bank In Items, Accompanying Documents And Proceeds
  (a) A collecting bank has a security interest in an item and any accompanying documents or the proceeds of either: (1) in case of an...
• Texas Section 4.211 - When Bank Gives Value For Purposes Of Holder In Due Course
  For purposes of determining its status as a holder in due course, a bank has given value to the extent it has a security interest...
• Texas Section 4.212 - Presentment By Notice Of Item Not Payable By, Through Or At A Bank; Liability Of Drawer Or Indorser
  (a) Unless otherwise instructed, a collecting bank may present an item not payable by, through, or at a bank by sending to the party to...
• Texas Section 4.213 - Medium And Time Of Settlement By Bank
  (a) With respect to settlement by a bank, the medium and time of settlement may be prescribed by Federal Reserve regulations or circulars, clearing-house rules,...
• Texas Section 4.214 - Right Of Charge-back Or Refund; Liability Of Collecting Bank; Return Of Item
  (a) If a collecting bank has made provisional settlement with its customer for an item and fails by reason of dishonor, suspension of payments by...
• Texas Section 4.215 - Final Payment Of Item By Payor Bank; When Provisional Debits And Credits Become Final; When Certain Credits Become Available For Withdrawal
  (a) An item is finally paid by a payor bank when the bank has first done any of the following: (1) paid the item in...

SUBCHAPTER C COLLECTION OF ITEMS: PAYOR BANKS

• Texas Section 4.216 - Insolvency And Preference
  (a) If an item is in or comes into the possession of a payor or collecting bank that suspends payment and the item has not...
• Texas Section 4.301 - Deferred Posting; Recovery Of Payment By Return Of Items; Time Of Dishonor; Return Of Items By Payor Bank
  (a) If a payor bank settles for a demand item other than a documentary draft presented otherwise than for immediate payment over the counter before...
• Texas Section 4.302 - Payor Bank's Responsibility For Late Return Of Item
  (a) If an item is presented to and received by a payor bank, the bank is accountable for the amount of: (1) a demand item,...

SUBCHAPTER D RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER

• Texas Section 4.303 - When Items Subject To Notice, Stop-payment Order, Legal Process, Or Setoff; Order In Which Items May Be Charged Or Certified
  (a) Any knowledge, notice, or stop-payment order received by, legal process served upon, or setoff exercised by a payor bank comes too late to terminate,...
• Texas Section 4.401 - When Bank May Charge Customer's Account
  (a) A bank may charge against the account of a customer an item that is properly payable from that account even though the charge creates...
• Texas Section 4.402 - Bank's Liability To Customer For Wrongful Dishonor
  (a) Except as otherwise provided by this chapter, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable, but...
• Texas Section 4.403 - Customer's Right To Stop Payment; Burden Of Proof Of Loss
  (a) A customer or any person authorized to draw on the account if there is more than one person may stop payment of any item...
• Texas Section 4.404 - Bank Not Obligated To Pay Check More Than Six Months Old
  A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, that is presented...
• Texas Section 4.405 - Death Or Incompetence Of Customer
  (a) A payor or collecting bank's authority to accept, pay, or collect an item or to account for proceeds of its collection, if otherwise effective,...
• Texas Section 4.406 - Customer's Duty To Discover And Report Unauthorized Signature Or Alteration
  (a) A bank that sends or makes available to a customer a statement of account showing payment of items for the account shall either return...

SUBCHAPTER E COLLECTION OF DOCUMENTARY DRAFTS

• Texas Section 4.407 - Payor Bank's Right To Subrogation On Improper Payment
  If a payor bank has paid an item over the order of the drawer or maker to stop payment, or after an account has been...
• Texas Section 4.501 - Handling Of Documentary Drafts; Duty To Send For Presentment And To Notify Customer Of Dishonor
  A bank that takes a documentary draft for collection shall present or send the draft and accompanying documents for presentment and, upon learning that the...
• Texas Section 4.502 - Presentment Of "On Arrival" Drafts
  If a draft or the relevant instructions require presentment "on arrival", "when goods arrive", or the like, the collecting bank need not present until in...
• Texas Section 4.503 - Responsibility Of Presenting Bank For Documents And Goods; Report Of Reasons For Dishonor; Referee In Case Of Need
  Unless otherwise instructed and except as provided in Chapter 5, a bank presenting a documentary draft: (1) must deliver the documents to the drawee on...
• Texas Section 4.504 - Privilege Of Presenting Bank To Deal With Goods; Security Interest For Expenses
  (a) A presenting bank that, following the dishonor of a documentary draft, has seasonably requested instructions but does not receive them within a reasonable time...

Last modified: September 28, 2016