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 an overdraft. Any item is properly payable if it is authorized by the customer and is in accordance with any agreement between the customer and bank.     (b)    A customer is not liable […]

Section 4-402 – Bank’s Liability to Customer for Wrongful Dishonor; Time of Determining Insufficiency of Account

    (a)    Except as otherwise provided in this title, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft.     (b)    A payor bank is liable to its customer for damages proximately caused […]

Section 4-403 – Customer’s Right to Stop Payment; Burden of Proof of Loss

    (a)    Any person authorized to draw on the account, if there is more than one person, may stop payment of any item drawn on the customer’s account or close the account by an order to the bank describing the item or account with reasonable certainty received at a time and in a manner that affords the […]

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, which is presented more than six months after its date, but it may charge its customer’s account for a payment made thereafter in good faith.

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, is not rendered ineffective by incompetence of a customer of either bank existing at the time the item is issued or its collection is undertaken if the bank does not know […]

Section 4-406 – Customer’s Duty to Discover and Report Unauthorized Signature or Alteration; Comparative Fault

    (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 or make available to the customer the items paid or provide information in the statement of account sufficient to allow the customer reasonably to identify the items paid. The statement of […]

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 closed, or otherwise under circumstances giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to prevent loss to the […]