Print

The Vermont Statutes Online



Title

09A

:
Uniform Commercial Code






Chapter

004A

:
Funds Transfers











 

§

4A-305. Liability for late or improper execution or failure to execute payment

order

(a) If a funds

transfer is completed but execution of a payment order by the receiving bank in

breach of section 4A-302 results in delay in payment to the beneficiary, the

bank is obliged to pay interest to either the originator or the beneficiary of

the funds transfer for the period of delay caused by the improper execution.

Except as provided in subsection (c), additional damages are not recoverable.

(b) If execution

of a payment order by a receiving bank in breach of section 4A-302 results in

(i) noncompletion of the funds transfer, (ii) failure to use an intermediary

bank designated by the originator, or (iii) issuance of a payment order that

does not comply with the terms of the payment order of the originator, the bank

is liable to the originator for its expenses in the funds transfer and for

incidental expenses and interest losses, to the extent not covered by

subsection (a), resulting from the improper execution. Except as provided in

subsection (c), additional damages are not recoverable.

(c) In addition

to the amounts payable under subsections (a) and (b), damages, including

consequential damages, are recoverable to the extent provided in an express

written agreement of the receiving bank.

(d) If a

receiving bank fails to execute a payment order it was obliged by express

agreement to execute, the receiving bank is liable to the sender for its

expenses in the transaction and for incidental expenses and interest losses

resulting from the failure to execute. Additional damages, including

consequential damages, are recoverable to the extent provided in an express

written agreement of the receiving bank, but are not otherwise recoverable.

(e) Reasonable

attorney's fees are recoverable if demand for compensation under subsection (a)

or (b) is made and refused before an action is brought on the claim. If a claim

is made for breach of an agreement under subsection (d) and the agreement does

not provide for damages, reasonable attorney's fees are recoverable if demand

for compensation under subsection (d) is made and refused before an action is

brought on the claim.

(f) Except as

stated in this section, the liability of a receiving bank under subsections (a)

and (b) may not be varied by agreement. (Added 1993, No. 158 (Adj. Sess.), §

14, eff. Jan. 1, 1995.)