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The Vermont Statutes Online



Title

09A

:
Uniform Commercial Code






Chapter

004

:
Bank Deposits and Collections











 

§

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 cash;

(2) settled for

the item without having a right to revoke the settlement under statute,

clearing-house rule, or agreement; or

(3) made a

provisional settlement for the item and failed to revoke the settlement in the

time and manner permitted by statute, clearing-house rule, or agreement.

(b) If

provisional settlement for an item does not become final, the item is not

finally paid.

(c) If

provisional settlement for an item between the presenting and payor banks is

made through a clearing house or by debits or credits in an account between

them, then to the extent that provisional debits or credits for the item are

entered in accounts between the presenting and payor banks or between the

presenting and successive prior collecting banks seriatim, they become final

upon final payment of the item by the payor bank.

(d) If a

collecting bank receives a settlement for an item which is or becomes final,

the bank is accountable to its customer for the amount of the item and any

provisional credit given for the item in an account with its customer becomes

final.

(e) Subject to

(i) applicable law stating a time for availability of funds and (ii) any right

of the bank to apply the credit to an obligation of the customer, credit given

by a bank for an item in a customer's account becomes available for withdrawal

as of right:

(1) if the bank

has received a provisional settlement for the item, when the settlement becomes

final and the bank has had a reasonable time to receive return of the item and

the item has not been received within that time;

(2) if the bank

is both the depositary bank and the payor bank, and the item is finally paid,

at the opening of the bank's second banking day following receipt of the item.

(f) Subject to

applicable law stating a time for availability of funds and any right of a bank

to apply a deposit to an obligation of the depositor, a deposit of money

becomes available for withdrawal as of right at the opening of the bank's next

banking day after receipt of the deposit. (Added 1993, No. 158 (Adj. Sess.), §

13, eff. Jan. 1, 1995.)