Kentucky Statutes 355.3-503 – Notice of dishonor
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(1) The obligation of an indorser stated in KRS § 355.3-415(1) and the obligation of a drawer stated in KRS § 355.3-414(4) may not be enforced unless:
(a) The indorser or drawer is given notice of dishonor of the instrument complying with this section; or
(b) Notice of dishonor is excused under KRS § 355.3-504(2).
(2) Notice of dishonor may be given by any person; may be given by any commercially reasonable means, including an oral, written, or electronic communication; and is sufficient if it reasonably identifies the instrument and indicates that the instrument has been dishonored or has not been paid or accepted. Return of an instrument given to a bank for collection is sufficient notice of dishonor.
(3) Subject to KRS § 355.3-504(3), with respect to an instrument taken for collection by a collecting bank, notice of dishonor must be given:
(a) By the bank before midnight of the next banking day following the banking day on which the bank receives notice of dishonor of the instrument; or
(b) By any other person within thirty (30) days following the day on which the person receives notice of dishonor.
With respect to any other instrument, notice of dishonor must be given within thirty
(30) days following the day on which dishonor occurs.
Effective: January 1, 1997
History: Repealed and reenacted 1996 Ky. Acts ch. 130, sec. 61, effective January 1,
1997. — Created 1958 Ky. Acts ch. 77, sec. 3-503, effective July 1, 1960.
(a) The indorser or drawer is given notice of dishonor of the instrument complying with this section; or
Terms Used In Kentucky Statutes 355.3-503
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
(b) Notice of dishonor is excused under KRS § 355.3-504(2).
(2) Notice of dishonor may be given by any person; may be given by any commercially reasonable means, including an oral, written, or electronic communication; and is sufficient if it reasonably identifies the instrument and indicates that the instrument has been dishonored or has not been paid or accepted. Return of an instrument given to a bank for collection is sufficient notice of dishonor.
(3) Subject to KRS § 355.3-504(3), with respect to an instrument taken for collection by a collecting bank, notice of dishonor must be given:
(a) By the bank before midnight of the next banking day following the banking day on which the bank receives notice of dishonor of the instrument; or
(b) By any other person within thirty (30) days following the day on which the person receives notice of dishonor.
With respect to any other instrument, notice of dishonor must be given within thirty
(30) days following the day on which dishonor occurs.
Effective: January 1, 1997
History: Repealed and reenacted 1996 Ky. Acts ch. 130, sec. 61, effective January 1,
1997. — Created 1958 Ky. Acts ch. 77, sec. 3-503, effective July 1, 1960.