§4A-402. Obligation of sender to pay receiving bank

Link to law: http://legislature.vermont.gov/statutes/section/09A/004A/00402
Published: 2015

Print

The Vermont Statutes Online



Title

09A

:
Uniform Commercial Code






Chapter

004A

:
Funds Transfers











 

§

4A-402. Obligation of sender to pay receiving bank

(a) This section

is subject to sections 4A-205 and 4A-207.

(b) With respect

to a payment order issued to the beneficiary's bank, acceptance of the order by

the bank obliges the sender to pay the bank the amount of the order, but

payment is not due until the payment date of the order.

(c) This

subsection is subject to subsection (e) and to section 4A-303. With respect to

a payment order issued to a receiving bank other than the beneficiary's bank,

acceptance of the order by the receiving bank obliges the sender to pay the

bank the amount of the sender's order. Payment by the sender is not due until

the execution date of the sender's order. The obligation of that sender to pay

its payment order is excused if the funds transfer is not completed by

acceptance by the beneficiary's bank of a payment order instructing payment to

the beneficiary of that sender's payment order.

(d) If the

sender of a payment order pays the order and was not obliged to pay all or part

of the amount paid, the bank receiving payment is obliged to refund payment to

the extent the sender was not obliged to pay. Except as provided in sections

4A-204 and 4A-304, interest is payable on the refundable amount from the date

of payment.

(e) If a funds

transfer is not completed as stated in subsection (c) and an intermediary bank

is obliged to refund payment as stated in subsection (d) but is unable to do so

because not permitted by applicable law or because the bank suspends payments,

a sender in the funds transfer that executed a payment order in compliance with

an instruction, as stated in section 4A-302(a)(1), to route the funds transfer

through that intermediary bank is entitled to receive or retain payment from

the sender of the payment order that it accepted. The first sender in the funds

transfer that issued an instruction requiring routing through that intermediary

bank is subrogated to the right of the bank that paid the intermediary bank to

refund as stated in subsection (d).

(f) The right of

the sender of a payment order to be excused from the obligation to pay the

order as stated in subsection (c) or to receive refund under subsection (d) may

not be varied by agreement. (Added 1993, No. 158 (Adj. Sess.), § 14, eff. Jan.

1, 1995.)
Read Entire Law on legislature.vermont.gov