Subject to Division 3 (commencing with Section 3101) concerning conversion of instruments (Section 3420) and restrictive indorsements (Section 3206), only a collecting bank‘s transferor can give instructions that affect the bank or constitute notice to it, and a collecting bank is not liable to prior parties for any action taken pursuant to the instructions or in accordance with any agreement with its transferor.

(Amended by Stats. 1992, Ch. 914, Sec. 20. Effective January 1, 1993.)

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Terms Used In California Commercial Code 4203

  • agreement: means the total legal obligation that results from the parties' agreement as determined by this code and as supplemented by any other applicable laws. See California Commercial Code 1201
  • Bank: means a person engaged in the business of banking, and includes a savings bank, savings and loan association, credit union, and trust company. See California Commercial Code 1201