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Can you summarize MICL 440.4406?
PART 4 RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER (440.4401...440.4407) > Statement of account; identification of items paid; retention of items or copies; customer's duty to discover and report unauthorized signature or alteration; failure to comply with subsection (3); failure of bank to exercise ordinary care in paying item; time limitation.
Short Summary
This legal document, part of the Uniform Commercial Code in Michigan, governs the relationship between a bank and its customer regarding the statement of account and payment of items. According to the document, a bank that provides a statement of account to a customer showing payment of items must either return the items paid, provide information in the statement to identify the items paid, or retain the items or copies of them. The customer has the right to request an item or a legible copy from the bank. The document also outlines the customer’s duty to promptly examine the statement or items for unauthorized payments and 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. If the bank fails to exercise ordinary care in paying an item and the customer can prove it, the loss is allocated between the customer and the bank. Additionally, the document sets a time limitation for the customer to discover and report unauthorized signatures or alterations. Failure to do so precludes the customer from asserting such unauthorized signatures or alterations against the bank.
Whom does it apply to?
Banks and their customers
What does it govern?
Relationship between a bank and its customer regarding the statement of account and payment of items
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No specific penalties are mentioned.
Jurisdiction
Michigan