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Can you summarize 11 MERS Section 4-401?
RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER > When bank may charge customer's account
Short Summary
This legal document, part of the Maine Revised Statutes, specifically addresses the relationship between a payor bank and its customer regarding bank deposits and collections. According to this document, a bank has the authority to charge a customer’s account for an item that is properly payable from that account, even if it creates an overdraft. An item is considered properly payable if it is authorized by the customer and complies with any agreement between the customer and the bank. Additionally, the document states that a customer is not liable for an overdraft if they neither signed the item nor benefited from its proceeds. The document also allows a bank to charge a customer’s account for a check that is otherwise properly payable, even if payment was made before the date of the check, unless the customer has given notice of postdating to the bank. If a bank charges against the account before the stated date, it may be liable for damages. Furthermore, the document outlines the circumstances under which a bank can make payment to a holder and charge the customer’s account accordingly. Overall, this document provides guidelines and regulations for banks and their customers regarding account charges and payment transactions.
Whom does it apply to?
Banks and their customers
What does it govern?
Relationship between payor bank and its customer
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Maine