In this article 111:
(1) Account agreement means an agreement that:
(a) Is in a record between a bank and one or more depositors;
(b) May have one or more beneficiaries as additional parties; and
(c) States the intention of the parties to establish a special deposit governed
by this article 111.
(2) Bank means a person engaged in the business of banking and includes
a savings bank, savings and loan association, credit union, trust company, and a
bank as defined in section 11-101-401 (5). Each branch or separate office of a bank is
a separate bank for the purpose of this article 111.
(3) Beneficiary means a person that:
(a) Is identified as a beneficiary in an account agreement; or
(b) If not identified as a beneficiary in an account agreement, may be entitled
to payment from a special deposit:
(I) Under the account agreement; or
(II) On termination of the special deposit.
(4) Contingency means an event or circumstance stated in an account
agreement that is not certain to occur but must occur before the bank is obligated
to pay a beneficiary.
(5) Creditor process means attachment, garnishment, levy, notice of lien,
sequestration, or similar process issued by or on behalf of a creditor or other
claimant.
(6) Depositor means a person that establishes or funds a special deposit.
(7) Good faith means honesty in fact and observance of reasonable
commercial standards of fair dealing.
(8) Knowledge of a fact means:
(a) With respect to a beneficiary, actual knowledge of the fact; or
(b) With respect to a bank holding a special deposit:
(I) If the bank:
(A) Has established a reasonable routine for communicating material
information to an individual to whom the bank has assigned responsibility for the
special deposit; and
(B) Maintains reasonable compliance with the routine, actual knowledge of
the fact by that individual; or
(II) If the bank has not established and maintained reasonable compliance
with a routine described in subsection (8)(b)(I) of this section or otherwise exercised
due diligence, implied knowledge of the fact that would have come to the attention
of an individual to whom the bank has assigned responsibility for the special
deposit.
(9) (a) Obligated to pay a beneficiary means a beneficiary is entitled under
the account agreement to receive from the bank a payment when:
(I) A contingency has occurred; and
(II) The bank has knowledge the contingency has occurred.
(b) Obligation to pay a beneficiary has a corresponding meaning.
(10) Permissible purpose means a governmental, regulatory, commercial,
charitable, or testamentary objective of the parties stated in an account agreement.
The term includes an objective to:
(a) Hold funds:
(I) In escrow, including for a purchase and sale, lease, buyback, or other
transaction;
(II) As a security deposit of a tenant;
(III) That may be distributed to a person as remuneration, retirement or other
benefit, or compensation under a judgment, consent decree, court order, or other
decision of a tribunal; or
(IV) For distribution to a defined class of persons after identification of the
class members and their interest in the funds;
(b) Provide assurance with respect to an obligation created by contract, such
as earnest money to ensure a transaction closes;
(c) Settle an obligation that arises in the operation of a payment system,
securities settlement system, or other financial market infrastructure;
(d) Provide assurance with respect to an obligation that arises in the
operation of a payment system, securities settlement system, or other financial
market infrastructure; or
(e) Hold margin, other cash collateral, or funds that support the orderly
functioning of financial market infrastructure or the performance of an obligation
with respect to the infrastructure.
(11) Person means an individual, estate, business or nonprofit entity,
government or governmental subdivision, agency, or instrumentality or other legal
entity. The term includes a protected series, however denominated, of an entity if
the protected series is established under law that limits, or limits if conditions
specified under law are satisfied, the ability of a creditor of the entity or of any
other protected series of the entity to satisfy a claim from assets of the protected
series.
(12) Record means information:
(a) Inscribed on a tangible medium; or
(b) Stored in an electronic or other medium and retrievable in perceivable
form.
(13) Special deposit means a deposit that satisfies section 11-111-105.
(14) State means a state of the United States, the District of Columbia,
Puerto Rico, the United States Virgin Islands, or any other territory or possession
subject to the jurisdiction of the United States. The term includes an agency or
instrumentality of the state.