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Can you summarize MGL Chapter 106, Article 4, Section 4-303?
BANK DEPOSITS AND COLLECTIONS > When Items Subject to Notice, Stop-Payment Order, Legal Process, or Setoff; Order in Which Items may be Charged or Certified
Short Summary
This section of the Massachusetts General Law, specifically under the Uniform Commercial Code for Bank Deposits and Collections, governs the timing and order in which payor banks can process items subject to notice, stop-payment orders, legal processes, or setoffs. It states that any knowledge, notice, stop-payment order, or legal process received by the payor bank comes too late to terminate, suspend, or modify the bank’s right or duty to pay an item or charge the customer’s account if the bank has already accepted or certified the item, paid it in cash, settled for the item without the right to revoke the settlement, become accountable for the amount of the item, or if a cut-off hour has passed. The section also mentions that items may be accepted, paid, certified, or charged to the customer’s account in any order, as long as there are no conflicting provisions mentioned in subsection (a).
Whom does it apply to?
Payor banks and their customers
What does it govern?
Items subject to notice, stop-payment order, legal process, or setoff; order in which items may be charged or certified
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
Massachusetts