Indiana § 26-1-4-301 Deferred posting; recovery of payment by return of items; time of
dishonor; return of items by payor bank

Indiana Statutes

§ 26-1-4-301 — Deferred posting; recovery of payment by return of items; time of dishonor; return of items by payor bank

Indiana § 26-1-4-301

Title 26COMMERCIAL LAW

Art. 1UNIFORM COMMERCIAL CODE

Ch. 4Bank Deposits and Collections

This text of Indiana § 26-1-4-301 (Deferred posting; recovery of payment by return of items; time of dishonor; return of items by payor bank) is published on Counsel Stack Legal Research, covering Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Ind. Code § 26-1-4-301 (2026).

Text

(a)If a payor bank settles for a demand item other than a documentary draft presented otherwise than for immediate payment over the counter before midnight of the banking day of receipt, the payor bank may revoke the settlement and recover the settlement if, before it has made final payment and before its midnight deadline, it:

(1)returns the item;

(2)returns an image of the item, if the party to which the return is made has entered into an agreement to accept an image as a return of the item and the image is returned in accordance with that agreement; or

(3)sends a record providing notice of dishonor or nonpayment if the item is unavailable for return.

(b)If a demand item is received by a payor bank for credit on its books, it may return the item or send notice of dishonor and may re

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(a) If a payor bank settles for a demand
item other than a documentary draft presented otherwise than for
immediate payment over the counter before midnight of the banking
day of receipt, the payor bank may revoke the settlement and recover
the settlement if, before it has made final payment and before its
midnight deadline, it:
(1) returns the item;
(2) returns an image of the item, if the party to which the return
is made has entered into an agreement to accept an image as a
return of the item and the image is returned in accordance with
that agreement; or
(3) sends a record providing notice of dishonor or nonpayment if
the item is unavailable for return.
(b) If a demand item is received by a payor bank for credit on its
books, it may return the item or send notice of dishonor and may
revoke any credit given or recover the amount thereof withdrawn by its
customer, if it acts within the time limit and in the manner specified in
subsection (a).
(c) Unless previous notice of dishonor has been sent, an item is
dishonored at the time when for purposes of dishonor it is returned or
notice sent in accordance with this section.
(d) An item is returned:
(1) as to an item received through a clearing-house, when it is
delivered to the presenting or last collecting bank or to the
clearing-house or is sent or delivered in accordance with its rules;
or
(2) in all other cases, when it is sent or delivered to the bank's
customer or transferor or pursuant to instructions.
Formerly: Acts 1963, c.317, s.4-301. As amended by
P.L.152-1986, SEC.222; P.L.222-1993, SEC.33; P.L.135-2009,
SEC.19.