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Can you summarize SDCL 57A-4-403?
RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER. > Customer's right to stop payment--Burden of proof of loss.
Short Summary
This legal provision, found in the South Dakota Codified Laws under the Uniform Commercial Code, pertains to the relationship between a payor bank and its customer regarding bank deposits and collections. It grants the customer or any authorized person the right to stop payment of any item drawn on the customer’s account or close the account by providing an order to the bank. The order must describe the item or account with reasonable certainty and be received by the bank in a timely manner. If multiple signatures are required to draw on the account, any of the authorized persons may stop payment or close the account. A stop-payment order remains effective for six months, but if the original order was oral and not confirmed in writing within fourteen calendar days, it lapses. The customer bears the burden of proving any loss resulting from the payment of an item contrary to a stop-payment order or order to close an account. The loss may include damages for dishonor of subsequent items. No specific penalties are mentioned in this provision.
Whom does it apply to?
Customers or persons authorized to draw on the account
What does it govern?
Stop payment of items drawn on a customer's account or closing the account
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No penalties are mentioned.
Jurisdiction
South Dakota