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The Vermont Statutes Online
Title
09A
:
Uniform Commercial Code
Chapter
004A
:
Funds Transfers
§
4A-303. Erroneous execution of payment order
(a) A receiving
bank that (i) executes the payment order of the sender by issuing a payment
order in an amount greater than the amount of the sender's order, or (ii)
issues a payment order in execution of the sender's order and then issues a
duplicate order, is entitled to payment of the amount of the sender's order
under section 4A-402(c) if that subsection is otherwise satisfied. The bank is
entitled to recover from the beneficiary of the erroneous order the excess
payment received to the extent allowed by the law governing mistake and
restitution.
(b) A receiving
bank that executes the payment order of the sender by issuing a payment order
in an amount less than the amount of the sender's order is entitled to payment
of the amount of the sender's order under section 4A-402(c) if (i) that
subsection is otherwise satisfied and (ii) the bank corrects its mistake by
issuing an additional payment order for the benefit of the beneficiary of the
sender's order. If the error is not corrected, the issuer of the erroneous
order is entitled to receive or retain payment from the sender of the order it
accepted only to the extent of the amount of the erroneous order. This
subsection does not apply if the receiving bank executes the sender's payment
order by issuing a payment order in an amount less than the amount of the
sender's order for the purpose of obtaining payment of its charges for services
and expenses pursuant to instruction of the sender.
(c) If a
receiving bank executes the payment order of the sender by issuing a payment
order to a beneficiary different from the beneficiary of the sender's order and
the funds transfer is completed on the basis of that error, the sender of the
payment order that was erroneously executed and all previous senders in the
funds transfer are not obliged to pay the payment orders they issued. The
issuer of the erroneous order is entitled to recover from the beneficiary of
the order the payment received to the extent allowed by the law governing
mistake and restitution. (Added 1993, No. 158 (Adj. Sess.), § 14, eff. Jan. 1,
1995.)