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The Vermont Statutes Online
Title
09A
:
Uniform Commercial Code
Chapter
004
:
Bank Deposits and Collections
§
4-202. Responsibility for collection or return; when action timely
(a) A collecting
bank must exercise ordinary care in:
(1) presenting
an item or sending it for presentment;
(2) sending
notice of dishonor or nonpayment or returning an item other than a documentary
draft to the bank's transferor after learning that the item has not been paid
or accepted, as the case may be;
(3) settling for
an item when the bank receives final settlement; and
(4) notifying
its transferor of any loss or delay in transit within a reasonable time after
discovery thereof.
(b) A collecting
bank exercises ordinary care under subsection (a) of this section by taking
proper action before its midnight deadline following receipt of an item,
notice, or settlement. Taking proper action within a reasonably longer time may
constitute the exercise of ordinary care, but the bank has the burden of
establishing timeliness.
(c) Subject to
subsection (a)(1)of this section, a bank is not liable for the insolvency,
neglect, misconduct, mistake, or default of another bank or person or for loss
or destruction of an item in the possession of others or in transit. (Added
1993, No. 158 (Adj. Sess.), § 13, eff. Jan. 1, 1995.)