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Can you summarize 12A OKST 4-404?
Relationship Between Payor Bank and Its Customer > Bank Not Obligated to Pay Check More Than Six Months Old
Short Summary
According to the Oklahoma Statutes, a bank is not obligated to pay a check presented more than six months after its date, except for certified checks. However, the bank may charge the customer’s account for a payment made in good faith after the six-month period. It is important to note that payment of a stale check over a stop payment order does not violate the bank’s duty of good faith. Dishonoring a stale check is also not considered wrongful dishonor. The document also mentions other relevant time periods and limitations related to indorser liability, breach of warranty, notice of dishonor, and cashier’s checks. Additionally, it states that checks with legends indicating void after a certain time period are still negotiable instruments, but the taker of such a check after the stated time period has notice of a defense and cannot be a holder in due course. The bank is not responsible for contractual language added to the face of a check unless there is an agreement stating otherwise. The issue of added information on a check is subject to resolution by the parties in the deposit contract. If the bank mistakenly pays such a check after the stated time period and the customer objects, the bank may be subrogated to the rights of the party who received the payment, allowing the bank to defend against liability by showing that the payment discharged a lawful debt of the customer.
Whom does it apply to?
Customers with checking accounts
What does it govern?
Bank Deposits and Collections
What are exemptions?
Certified checks and checks presented within six months of their date
What are the Penalties?
No specific penalties mentioned
Jurisdiction
Oklahoma