§ 6A-4.1-210 - Rejection of payment order.
SECTION 6A-4.1-210
§ 6A-4.1-210 Rejection of payment order.– (a) A payment order is rejected by the receiving bank by a notice of rejectiontransmitted to the sender orally, electronically, or in writing. A notice ofrejection need not use any particular words and is sufficient if it indicatesthat the receiving bank is rejecting the order or will not execute or pay theorder. Rejection is effective when the notice is given if transmission is by ameans that is reasonable in the circumstances. If notice of rejection is givenby a means that is not reasonable, rejection is effective when the notice isreceived. If an agreement of the sender and receiving bank establishes themeans to be used to reject a payment order, (i) any means complying with theagreement is reasonable and (ii) any means not complying is not reasonableunless no significant delay in receipt of the notice resulted from the use ofthe noncomplying means.
(b) This subsection applies if a receiving bank other thanthe beneficiary's bank fails to execute a payment order despite the existenceon the execution date of a withdrawable credit balance in an authorized accountof the sender sufficient to cover the order. If the sender does not receivenotice of rejection of the order on the execution date and the authorizedaccount of the sender does not bear interest, the bank is obliged to payinterest to the sender on the amount of the order for the number of dayselapsing after the execution date to the earlier of the day the order iscanceled pursuant to § 6A-4.1-211(d) or the day the sender receives noticeor learns that the order was not executed, counting the final day of the periodas an elapsed day. If the withdrawable credit balance during that period fallsbelow the amount of the order, the amount of interest is reduced accordingly.
(c) If a receiving bank suspends payments, all unacceptedpayment orders issued to it are deemed rejected at the time the bank suspendspayments.
(d) Acceptance of a payment order precludes a later rejectionof the order. Rejection of a payment order precludes a later acceptance of theorder.