70A-4a-209 - Acceptance of payment order.
70A-4a-209. Acceptance of payment order.
(1) Subject to Subsection (4), a receiving bank other than the beneficiary's bank accepts apayment order when it executes the order.
(2) Subject to Subsections (3) and (4), a beneficiary's bank accepts a payment order at theearliest of the following times:
(a) when the bank:
(i) pays the beneficiary as stated in Subsection 70A-4a-405(1) or (2); or
(ii) notifies the beneficiary of receipt of the order or that the account of the beneficiaryhas been credited with respect to the order unless the notice indicates that the bank is rejectingthe order or that funds with respect to the order may not be withdrawn or used until receipt ofpayment from the sender of the order;
(b) when the bank receives payment of the entire amount of the sender's order pursuant toSubsection 70A-4a-403(1)(a) or (b); or
(c) the opening of the next funds transfer business day of the bank following the paymentdate of the order if, at that time, the amount of the sender's order is fully covered by awithdrawable credit balance in an authorized account of the sender or the bank has otherwisereceived full payment from the sender, unless the order was rejected before that time or isrejected within:
(i) one hour after that time; or
(ii) one hour after the opening of the next business day of the sender following thepayment date if that time is later.
(d) If notice of rejection is received by the sender after the payment date and theauthorized account of the sender does not bear interest, the bank is obliged to pay interest to thesender on the amount of the order for the number of days elapsing after the payment date to theday the sender receives notice or learns that the order was not accepted, counting that day as anelapsed day.
(e) If the withdrawable credit balance during that period falls below the amount of theorder, the amount of interest payable is reduced accordingly.
(3) Acceptance of a payment order cannot occur before the order is received by thereceiving bank. Acceptance does not occur under Subsection (2)(b) or (c) if the beneficiary ofthe payment order does not have an account with the receiving bank, the account has been closed,or the receiving bank is not permitted by law to receive credits for the beneficiary's account.
(4) (a) A payment order issued to the originator's bank cannot be accepted until:
(i) the payment date if the bank is the beneficiary's bank; or
(ii) the execution date if the bank is not the beneficiary's bank.
(b) If the originator's bank executes the originator's payment order before the executiondate or pays the beneficiary of the originator's payment order before the payment date and thepayment order is subsequently canceled pursuant to Subsection 70A-4a-211(2), the bank mayrecover from the beneficiary any payment received to the extent allowed by the law governingmistake and restitution.
Amended by Chapter 237, 1993 General Session