§490:4A-302  Obligations of receiving bank

in execution of payment order.  (a)  Except as provided in subsections (b)

through (d), if the receiving bank accepts a payment order pursuant to section

490:4A-209(a), the bank has the following obligations in executing the order:

     (1)  The receiving bank is obliged to issue, on the

execution date, a payment order complying with the sender's order and to follow

the sender's instructions concerning (i) any intermediary bank or

funds-transfer system to be used in carrying out the funds transfer, or (ii)

the means by which payment orders are to be transmitted in the funds transfer. 

If the originator's bank issues a payment order to an intermediary bank, the

originator's bank is obliged to instruct the intermediary bank according to the

instruction of the originator.  An intermediary bank in the funds transfer is

similarly bound by an instruction given to it by the sender of the payment

order it accepts.

     (2)  If the sender's instruction states that the funds

transfer is to be carried out telephonically or by wire transfer or otherwise

indicates that the funds transfer is to be carried out by the most expeditious

means, the receiving bank is obliged to transmit its payment order by the most

expeditious available means, and to instruct any intermediary bank

accordingly.  If a sender's instruction states a payment date, the receiving

bank is obliged to transmit its payment order at a time and by means reasonably

necessary to allow payment to the beneficiary on the payment date or as soon

thereafter as is feasible.

     (b)  Unless otherwise instructed, a receiving

bank executing a payment order may (i) use any funds-transfer system if use of

that system is reasonable in the circumstances, and (ii) issue a payment order

to the beneficiary's bank or to an intermediary bank through which a payment

order conforming to the sender's order can expeditiously be issued to the

beneficiary's bank if the receiving bank exercises ordinary care in the

selection of the intermediary bank.  A receiving bank is not required to follow

an instruction of the sender designating a funds-transfer system to be used in

carrying out the funds transfer if the receiving bank, in good faith,

determines that it is not feasible to follow the instruction or that following

the instruction would unduly delay completion of the funds transfer.

     (c)  Unless subsection (a)(2) applies or the

receiving bank is otherwise instructed, the bank may execute a payment order by

transmitting its payment order by first class mail or by any means reasonable

in the circumstances.  If the receiving bank is instructed to execute the

sender's order by transmitting its payment order by a particular means, the

receiving bank may issue its payment order by the means stated or by any means as

expeditious as the means stated.

     (d)  Unless instructed by the sender, (i) the

receiving bank may not obtain payment of its charges for services and expenses

in connection with the execution of the sender's order by issuing a payment

order in an amount equal to the amount of the sender's order less the amount of

the charges, and (ii) may not instruct a subsequent receiving bank to obtain

payment of its charges in the same manner. [L 1991, c 41, pt of §1]