§ 554.3602 — Payment

Iowa § 554.3602

• Jurisdiction: Iowa
• Title XIII: COMMERCE
• Ch. 554: UNIFORM COMMERCIAL CODE

Text

1. Subject to subsection 2, an instrument is paid to the extent payment is made by or
on behalf of a party obliged to pay the instrument, and to a person entitled to enforce the
instrument. To the extent of the payment, the obligation of the party obliged to pay the

instrument is discharged even though payment is made with knowledge of a claim to the
instrument under section 554.3306 by another person.
2. The obligation of a party to pay the instrument is not discharged under subsection 1 if:
a. a claim to the instrument under section 554.3306 is enforceable against the party
receiving payment and payment is made with knowledge by the payor that payment is
prohibited by injunction or similar process of a court of competent jurisdiction, or in the case
of an instrument other than a cashier’s check, teller’s check, or certified check, the party
making payment accepted, from the person having a claim to the instrument, indemnity
against loss resulting from refusal to pay the person entitled to enforce the instrument; or
b. the person making payment knows that the instrument is a stolen instrument and pays
a person it knows is in wrongful possession of the instrument.