Sec. 42a-4-503. Responsibility of presenting bank for documents and goods; report of reasons for dishonor; referee in case of need.
Sec. 42a-4-503. Responsibility of presenting bank for documents and goods;
report of reasons for dishonor; referee in case of need. Unless otherwise instructed
and except as provided in article 5, a bank presenting a documentary draft: (1) Must
deliver the documents to the drawee on acceptance of the draft if it is payable more than
three days after presentment; otherwise, only on payment; and (2) upon dishonor, either
in the case of presentment for acceptance or presentment for payment, may seek and
follow instructions from any referee in case of need designated in the draft or, if the
presenting bank does not choose to utilize the referee's services, it must use diligence
and good faith to ascertain the reason for dishonor, must notify its transferor of the
dishonor and of the results of its effort to ascertain the reasons therefor, and must request
instructions. However the presenting bank is under no obligation with respect to goods
represented by the documents except to follow any reasonable instructions seasonably
received; it has a right to reimbursement for any expense incurred in following instructions and to prepayment of or indemnity for those expenses.
(1959, P.A. 133, S. 4-503; P.A. 91-304, S. 106.)
History: P.A. 91-304 made minor changes in wording and punctuation and replaced alphabetic with numeric Subdiv.
indicators.