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Can you summarize CORS 4-4-404?
RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER > Bank not obligated to pay check more than six months old.
Short Summary
According to the Colorado Revised Statutes, specifically the Uniform Commercial Code, a bank is not obligated to pay a check presented by a customer more than six months after its date, unless it is a certified check. However, the bank may charge the customer’s account for a payment made in good faith after the six-month period. This provision is in line with banking and commercial practice, as checks outstanding for longer than six months are generally considered stale. The bank has the option to pay such checks, especially if it knows that the drawer wants payment made, as in the case of dividend checks. Certified checks are excluded from this provision since they are the primary obligation of the certifying bank, and the obligation runs directly to the holder of the check. It is important to note that the customer’s account was likely charged when the check was certified.
Whom does it apply to?
Customers having a checking account
What does it govern?
Relationship between payor bank and its customer
What are exemptions?
Certified checks
What are the Penalties?
No penalties mentioned.
Jurisdiction
Colorado