Connecticut General Statutes 42a-4-302 – Payor bank’s responsibility for late return of item
(a) If an item is presented to and received by a payor bank, the bank is accountable for the amount of: (1) A demand item, other than a documentary draft, whether properly payable or not, if the bank, in any case in which it is not also the depositary bank, retains the item beyond midnight of the banking day of receipt without settling for it or, whether or not it is also the depositary bank, does not pay or return the item or send notice of dishonor until after its midnight deadline; or (2) any other properly payable item unless, within the time allowed for acceptance or payment of that item, the bank either accepts or pays the item or returns it and accompanying documents.
Terms Used In Connecticut General Statutes 42a-4-302
- banking day: means the part of a day on which a bank is open to the public for carrying on substantially all of its banking functions, but for the purpose of determining a bank's midnight deadline, as defined in subdivision (10) of this subsection, shall not include Saturday. See Connecticut General Statutes 42a-4-104
- documentary draft: means a draft to be presented for acceptance or payment if specified documents, certificated securities, as defined in section 42a-8-102, or instructions for uncertificated securities, as defined in section 42a-8-102, or other certificates, statements, or the like are to be received by the drawee or other payor before acceptance or payment of the draft. See Connecticut General Statutes 42a-4-104
- item: means an instrument or a promise or order to pay money handled by a bank for collection or payment. See Connecticut General Statutes 42a-4-104
(b) The liability of a payor bank to pay an item pursuant to subsection (a) is subject to defenses based on breach of a presentment warranty under section 42a-4-208 or proof that the person seeking enforcement of the liability presented or transferred the item for the purpose of defrauding the payor bank.