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Can you summarize Com Code CACL 4406?
Relationship Between Payor Bank and Its Customer [4401. - 4407.] >
Short Summary
This legal document, part of the California Commercial Code, specifically addresses the relationship between a payor bank and its customer. It outlines the obligations of the bank when providing a statement of account to the customer, including the requirement to either return the paid items or provide sufficient information for the customer to identify them. If the items are not returned, the bank must provide a telephone number for the customer to request the items or substitutes. The document also establishes the customer’s duty to promptly examine the statement or items and notify the bank of any unauthorized payments. Failure to comply with these duties may preclude the customer from asserting certain claims against the bank. Additionally, the document specifies the allocation of loss between the customer and the bank in cases of failure to comply or lack of good faith. Finally, it sets a time limit for discovering and reporting unauthorized signatures or alterations, after which the customer is precluded from asserting such claims against the bank. The document does not mention any specific exemptions or penalties.
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
California