Ask Reggi Your Question Now
Can you summarize NCGS Chapter 25, Article 4?
Uniform Commercial Code > Bank Deposits and Collections.
Short Summary
This legal document, part of the North Carolina General Statutes under the Uniform Commercial Code, governs the general provisions and definitions related to bank deposits and collections. It provides definitions for various terms used in this context, such as ‘account’, ‘banking day’, ‘customer’, ‘draft’, ‘item’, and ‘settle’. The document also references other definitions from different sections of the Article, including ‘acceptance’, ‘cashier’s check’, ‘holder in due course’, ’notice of dishonor’, and more. Additionally, it mentions that Article 1 contains general definitions and principles of construction and interpretation applicable throughout this Article. The document covers various aspects related to the collection of items by depositary and collecting banks. It establishes that a collecting bank is considered an agent or subagent of the owner of the item, and any settlement given for the item is provisional. The ownership of an item and the rights to its proceeds are subject to the rights of a collecting bank, such as outstanding advances on the item and rights of recoupment or setoff. The document also specifies that after an item has been indorsed with the words ‘pay any bank’ or similar, only a bank may acquire the rights of a holder until the item is returned to the customer initiating collection or specially indorsed by a bank to a non-bank person. The responsibilities of collecting banks include exercising ordinary care in presenting items or sending them for presentment, sending notice of dishonor or nonpayment, settling for an item upon receiving final settlement, and notifying their transferor of any loss or delay in transit. The document also addresses transfer warranties, encoding and retention warranties, and the final payment of items by payor banks. Overall, the document provides guidelines and regulations for the collection of items by depositary and collecting banks, ensuring proper procedures and protections for all parties involved.
Whom does it apply to?
Banks, customers, drawees, payors, and other parties involved in the deposit and collection of funds
What does it govern?
Bank deposits and collections
What are exemptions?
The document does not specify any exemptions
What are the Penalties?
No specific penalties are mentioned in these documents
Jurisdiction
North Carolina