§ 41-04.1-22 — (4A-302) Obligations of receiving bank in execution of payment order

North Dakota § 41-04.1-22

• Jurisdiction: North Dakota
• Title 41: Uniform Commercial Code
• Ch. 41-04.1: Funds Transfers

Text

1. Except as provided in subsections 2 through 4, if the receiving bank accepts a
payment order under subsection 1 of section 41-04.1-17, the bank has the following
obligations in executing the order:
a. The receiving bank is obliged to issue, on the execution date, a payment order
complying with the sender's order and to follow the sender's instructions
concerning any intermediary bank or funds-transfer system to be used in carrying
out the funds transfer or the means by which payment orders are to be
transmitted in the funds transfer. If the originator's bank issues a payment order

to an intermediary bank, the originator's bank is obliged to instruct the
intermediary bank according to the instruction of the originator. An intermediary
bank in the funds transfer is similarly bound by an instruction given to it by the
sender of the payment order it accepts.
b. If the sender's instruction states that the funds transfer is to be carried out
telephonically or by wire transfer or otherwise indicates that the funds transfer is
to be carried out by the most expeditious means, the receiving bank is obliged to
transmit its payment order by the most expeditious available means and to
instruct any intermediary bank accordingly. If a sender's instruction states a
payment date, the receiving bank is obliged to transmit its payment order at a
time and by means reasonably necessary to allow payment to the beneficiary on
the payment date or as soon thereafter as is feasible.
2. Unless otherwise instructed, a receiving bank executing a payment order may use any
funds-transfer system if use of that system is reasonable in the circumstances and
issue a payment order to the beneficiary's bank or to an intermediary bank through
which a payment order conforming to the sender's order can expeditiously be issued to
the beneficiary's bank if the receiving bank exercises ordinary care in the selection of
the intermediary bank. A receiving bank is not required to follow an instruction of the
sender designating a funds-transfer system to be used in carrying out the funds
transfer if the receiving bank, in good faith, determines that it is not feasible to follow
the instruction or that following the instruction would unduly delay completion of the
funds transfer.
3. Unless subdivision b of subsection 1 applies or the receiving bank is otherwise
instructed, the bank may execute a payment order by transmitting its payment order by
first-class mail or by any means reasonable in the circumstances. If the receiving bank
is instructed to execute the sender's order by transmitting its payment order by a
particular means, the receiving bank may issue its payment order by the means stated
or by any means as expeditious as the means stated.
4. Unless instructed by the sender, the receiving bank may not obtain payment of its
charges for services and expenses in connection with the execution of the sender's
order by issuing a payment order in an amount equal to the amount of the sender's
order less the amount of the charges and may not instruct a subsequent receiving
bank to obtain payment of its charges in the same manner.