§ 41-04-32 — (4-401) When bank may charge customer's account

1. A bank may charge against the account of a customer an item which is properly
payable from that account even though the charge creates an overdraft. An item is
properly payable if it is authorized by the customer and complies with any agreement
between the customer and bank.
2. A customer is not liable for the amount of an overdraft if the customer neither signed
the item nor benefited from the proceeds of the item.
3. A bank may charge against the account of a customer a check that is otherwise
properly payable from the account, even though payment was made before the date of
the check, unless the customer has given notice to the bank of the postdating
describing the check with reasonable certainty. The notice will be effective for the
period stated in subsection 1 of section 41-04-34 for stop orders, and must be
received at a time and in a manner as to afford the bank a reasonable opportunity to
act on it before any action by the bank with respect to the check described in section
41-04-31. If a bank charges against the account of a customer a check before the date
stated in the notice of postdating, the bank is liable for damages for the loss resulting
from its act. The loss may include damages for dishonor of subsequent items pursuant
to section 41-04-33.
4. A bank that in good faith makes payment to a holder may charge the indicated account
of its customer according to:
a. The original terms of the altered item; or
b. The terms of the completed item, even though the bank knows the item has been
completed unless the bank has notice that the completion was improper.