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Can you summarize IACO 554.12404?
UNIFORM COMMERCIAL CODE > Obligation of beneficiarys bank to pay and give notice to beneficiary.
Short Summary
This legal document, governed by the Iowa Code, specifically the Uniform Commercial Code, outlines the obligation of a beneficiary’s bank to pay and provide notice to the beneficiary. According to the document, if a beneficiary’s bank accepts a payment order, they are required to pay the amount of the order to the beneficiary on the payment date. If the beneficiary’s bank refuses to pay upon demand by the beneficiary and receipt of notice of consequential damages, the beneficiary may recover damages if the bank had notice of the damages, unless the bank proves a reasonable doubt concerning the right to payment. Additionally, the document states that if a payment order instructs payment to an account of the beneficiary, the bank must notify the beneficiary of receipt of the order by the next funds-transfer business day. Failure to provide the required notice results in the bank paying interest to the beneficiary. The right to receive payment and damages cannot be varied by agreement or funds-transfer system rule, while the right to be notified can be varied by agreement or rule if the beneficiary is notified beforehand.
Whom does it apply to?
Beneficiary's bank
What does it govern?
Obligation of beneficiarys bank to pay and give notice to beneficiary
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
Damages resulting from refusal to pay if beneficiary's bank had notice of the damages
Jurisdiction
Iowa