§ 4-A-305 — Liability for Late or Improper Execution or Failure to Execute Payment Order

Section 4-A-305. Liability for Late or Improper Execution or Failure to\n Execute Payment Order.\n (1) If a funds transfer is completed but execution of a payment order\nby the receiving bank in breach of Section 4-A-302 results in delay in\npayment to the beneficiary, the bank is obliged to pay interest to\neither the originator or the beneficiary of the funds transfer for the\nperiod of delay caused by the improper execution. Except as provided in\nsubsection (3), additional damages are not recoverable.\n (2) If execution of a payment order by a receiving bank in breach of\nSection 4-A-302 results in (i) noncompletion of the funds transfer, (ii)\nfailure to use an intermediary bank designated by the originator, or\n(iii) issuance of a payment order that does not comply with the terms of\nthe payment order of the originator, the bank is liable to the\noriginator for its expenses in the funds transfer and for incidental\nexpenses and interest losses, to the extent not covered by subsection\n(1), resulting from the improper execution. Except as provided in\nsubsection (3), additional damages are not recoverable.\n * (3) In addition to the amounts payable under subsections (1) and\n(2), damages, including consequential damages, are recoverable to the\nextent provided in an express written agreement of the receiving bank.\n * NB Effective until June 3, 2026\n * (3) In addition to the amounts payable under subsections (1) and\n(2), damages, including consequential damages, are recoverable to the\nextent provided in an express agreement of the receiving bank, evidenced\nby a record.\n * NB Effective June 3, 2026\n * (4) If a receiving bank fails to execute a payment order it was\nobliged by express agreement to execute, the receiving bank is liable to\nthe sender for its expenses in the transaction and for incidental\nexpenses and interest losses resulting from the failure to execute.\nAdditional damages, including consequential damages, are recoverable to\nthe extent provided in an express written agreement of the receiving\nbank, but are not otherwise recoverable.\n * NB Effective until June 3, 2026\n * (4) If a receiving bank fails to execute a payment order it was\nobliged by express agreement to execute, the receiving bank is liable to\nthe sender for its expenses in the transaction and for incidental\nexpenses and interest losses resulting from the failure to execute.\nAdditional damages, including consequential damages, are recoverable to\nthe extent provided in an express agreement of the receiving bank,\nevidenced by a record, but are not otherwise recoverable.\n * NB Effective June 3, 2026\n (5) Reasonable attorney's fees are recoverable if demand for\ncompensation under subsection (1) or (2) is made and refused before an\naction is brought on the claim. If a claim is made for breach of an\nagreement under subsection (4) and the agreement does not provide for\ndamages, reasonable attorney's fees are recoverable if demand for\ncompensation under subsection (4) is made and refused before an action\nis brought on the claim.\n (6) Except as stated in this section, the liability of a receiving\nbank under subsections (1) and (2) may not be varied by agreement.\n