§ 6A-4.1-211 - Cancellation and amendment of payment order.
SECTION 6A-4.1-211
§ 6A-4.1-211 Cancellation and amendment ofpayment order. – (a) A communication of the sender of a payment order cancelling or amending theorder may be transmitted to the receiving bank orally, electronically, or inwriting. If a security procedure is in effect between the sender and thereceiving bank, the communication is not effective to cancel or amend the orderunless the communication is verified pursuant to the security procedure or thebank agrees to the cancellation or amendment.
(b) Subject to subsection (a), a communication by the sendercancelling or amending a payment order is effective to cancel or amend theorder if notice of the communication is received at a time and in a manneraffording the receiving bank a reasonable opportunity to act on thecommunication before the bank accepts the payment order.
(c) After a payment order has been accepted, cancellation oramendment of the order is not effective unless the receiving bank agrees or afunds transfer system rule allows cancellation or amendment without agreementof the bank.
(1) With respect to a payment order accepted by a receivingbank other than the beneficiary's bank, cancellation or amendment is noteffective unless a conforming cancellation or amendment of the payment orderissued by the receiving bank is also made.
(2) With respect to a payment order accepted by thebeneficiary's bank, cancellation or amendment is not effective unless the orderwas issued in execution of an unauthorized payment order, or because of amistake by a sender in the funds transfer which resulted in the issuance of apayment order (i) that is a duplicate of a payment order previously issued bythe sender, (ii) that orders payment to a beneficiary not entitled to receivepayment from the originator, or (iii) that orders payment in an amount greaterthan the amount the beneficiary was entitled to receive from the originator. Ifthe payment order is canceled or amended, the beneficiary's bank is entitled torecover from the beneficiary any amount paid to the beneficiary to the extentallowed by the law governing mistake and restitution.
(d) An unaccepted payment order is canceled by operation oflaw at the close of the fifth funds transfer business day of the receiving bankafter the execution date or payment date of the order.
(e) A canceled payment order cannot be accepted. If anaccepted payment order is canceled, the acceptance is nullified and no personhas any right or obligation based on the acceptance. Amendment of the paymentorder is deemed to be cancellation of the original order at the time ofamendment and issue of a new payment order in the amended form at the same time.
(f) Unless otherwise provided in an agreement of the partiesor in a funds transfer system rule, if the receiving bank, after accepting apayment order, agrees to cancellation or amendment of the order by the senderor is bound by a funds transfer system rule allowing cancellation or amendmentwithout the bank's agreement, the sender, whether or not cancellation oramendment is effective, is liable to the bank for any loss and expenses,including reasonable attorney's fees, incurred by the bank as a result of thecancellation or amendment or attempted cancellation or amendment.
(g) A payment order is not revoked by the death or legalincapacity of the sender unless the receiving bank knows of the death or of anadjudication of incapacity by a court of competent jurisdiction and hasreasonable opportunity to act before acceptance of the order.
(h) A funds transfer system rule is not effective to theextent it conflicts with subsection (c)(2).