Montana Code 30-4-301. Deferred posting — recovery of payment by return of items — time of dishonor — return of items by payor bank
30-4-301. Deferred posting — recovery of payment by return of items — time of dishonor — return of items by payor bank. (1) If a payor bank settles for a demand item other than a documentary draft presented otherwise than for immediate payment over the counter before midnight of the banking day of receipt, the payor bank may revoke the settlement and recover any settlement if before it has paid the item in cash (subsection (1)(a) of 30-4-213) and before its midnight deadline it:
Terms Used In Montana Code 30-4-301
- bank: means any person engaged in the business of banking, including a savings bank, savings and loan association, credit union, or trust company;
(2)"depositary bank" means the first bank to take an item even though it is also the payor bank, unless the item is presented for immediate payment over the counter;
(3)"payor bank" means a bank that is the drawee of a draft;
(4)"intermediary bank" means a bank to which an item is transferred in course of collection except the depositary or payor bank;
(5)"collecting bank" means a bank handling an item for collection except the payor bank;
(6)"presenting bank" means a bank presenting an item except a payor bank. See Montana Code 30-4-105
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
(a)returns the item; or
(b)sends written notice of dishonor or nonpayment if the item is unavailable for return.
(2)If a demand item is received by a payor bank for credit on its books it may return such item or send notice of dishonor and may revoke any credit given or recover the amount thereof withdrawn by its customer, if it acts within the time limit and in the manner specified in the preceding subsection.
(3)Unless previous notice of dishonor has been sent an item is dishonored at the time when for purposes of dishonor it is returned or notice sent in accordance with this section.
(4)An item is returned:
(a)as to an item presented through a clearinghouse, when it is delivered to the presenting or last collecting bank or to the clearinghouse or is sent or delivered in accordance with clearinghouse rules; or
(b)in all other cases, when it is sent or delivered to the bank’s customer or transferor or pursuant to instructions.