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Can you summarize IDST 28-4-406?
RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER > CUSTOMERS DUTY TO DISCOVER AND REPORT UNAUTHORIZED SIGNATURE OR ALTERATION.
Short Summary
This legal document governs the relationship between a bank and its customer regarding the discovery and reporting of unauthorized signatures or alterations. It outlines the duties of the bank to provide the customer with statements of account showing payment of items and to either return the items paid or provide sufficient information for the customer to identify them. The document also specifies that the customer must exercise reasonable promptness in examining the statement or items and promptly notify the bank if any unauthorized payment is discovered. Failure to comply with these duties may preclude the customer from asserting unauthorized signatures or alterations against the bank. However, if the bank failed to exercise ordinary care in paying the item and the failure contributed to the loss, the loss may be allocated between the customer and the bank. Additionally, if the customer does not discover and report unauthorized signatures or alterations within one year, they may be precluded from asserting them against the bank. The document does not mention any specific exemptions.
Whom does it apply to?
Banks and their customers
What does it govern?
Relationship between a bank and its customer regarding the discovery and reporting of unauthorized signatures or alterations
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
The customer may be precluded from asserting unauthorized signatures or alterations if the bank proves that the customer failed to comply with their duties, and the bank suffered a loss as a result.
Jurisdiction
Idaho