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Can you summarize IACO 554.12406?
UNIFORM COMMERCIAL CODE > Payment by originator to beneficiary discharge of underlying obligation.
Short Summary
This legal document, governed by the Iowa Code under the Uniform Commercial Code, pertains to the payment by an originator to a beneficiary in a funds transfer. According to the document, the originator is required to pay the beneficiary at the time the payment order is accepted by the beneficiary’s bank, in an amount equal to the order accepted by the bank. If the payment is made to satisfy an obligation, the obligation is discharged to the same extent as if the beneficiary had received the same amount in money. However, there are certain circumstances where the payment may not result in discharge, such as if the payment was made by a means prohibited by the contract or if the beneficiary refuses the payment. In such cases, the originator is subrogated to the rights of the beneficiary to receive payment from the beneficiary’s bank. The document also mentions that the rights of the originator or beneficiary can only be varied by their agreement. Overall, this document provides guidelines and provisions regarding the payment process in funds transfers and the discharge of underlying obligations.
Whom does it apply to?
Originators and beneficiaries of funds transfers
What does it govern?
Payment by originator to beneficiary discharge of underlying obligation
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Iowa