Chapter 55 — Chapter 55
675 sections in this chapter.
NMSA 1978, § 55-4-206 Transfer between banks
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Any agreed method that identifies the transferor bank is sufficient for the item's further transfer to another bank. History: 1953 Comp., § 50A-4-206, enacted by Laws 1961, ch. 96, § 4-206; 1992, ch. 114, § 172. OFFICIAL COMMENTS UCC Official Comments © by ALI & the NCCUSL. Repro…
NMSA 1978, § 55-4-207 Transfer warranties
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(a) A customer or collecting bank that transfers an item and receives a settlement or other consideration warrants to the transferee and to any subsequent collecting bank that: (1) the warrantor is a person entitled to enforce the item; (2) all signatures on the item are authenti…
NMSA 1978, § 55-4-208 Presentment warranties
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(a) If an unaccepted draft is presented to the drawee for payment or acceptance and the drawee pays or accepts the draft, (i) the person obtaining payment or acceptance, at the time of presentment, and (ii) a previous transferor of the draft, at the time of transfer, warrant to t…
NMSA 1978, § 55-4-209 Encoding and retention warranties
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(a) A person who encodes information on or with respect to an item after issue warrants to any subsequent collecting bank and to the payor bank or other payor that the information is correctly encoded. If the customer of a depositary bank encodes, that bank also makes the warrant…
NMSA 1978, § 55-4-210 Security interest of collecting bank in items,
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accompanying documents and proceeds. (a) A collecting bank has a security interest in an item and any accompanying documents or the proceeds of either: (1) in the case of an item deposited in an account, to the extent to which credit given for the item has been withdrawn or appli…
NMSA 1978, § 55-4-211 When bank gives value for purposes of holder in due
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course. For purposes of determining its status as a holder in due course, a bank has given value to the extent it has a security interest in an item, if the bank otherwise complies with the requirements of Section 55-3-302 NMSA 1978 on what constitutes a holder in due course. His…
NMSA 1978, § 55-4-212 Presentment by notice of item not payable by, through or
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at a bank; liability of drawer or indorser. (a) Unless otherwise instructed, a collecting bank may present an item not payable by, through or at a bank by sending to the party to accept or pay a record providing notice that the bank holds the item for acceptance or payment. The n…
NMSA 1978, § 55-4-213 Medium and time of settlement by bank
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(a) With respect to settlement by a bank, the medium and time of settlement may be prescribed by federal reserve regulations or circulars, clearing-house rules, and the like, or agreement. In the absence of such prescription: (1) the medium of settlement is cash or credit to an a…
NMSA 1978, § 55-4-214 Right of charge-back or refund; liability of collecting
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bank; return of item. (a) If a collecting bank has made provisional settlement with its customer for an item and fails by reason of dishonor, suspension of payments by a bank or otherwise to receive a settlement for the item which is or becomes final, the bank may revoke the sett…
NMSA 1978, § 55-4-215 Final payment of item by payor bank; when provisional
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debits and credits become final; when certain credits become available for withdrawal. (a) An item is finally paid by a payor bank when the bank has first done any of the following: (1) paid the item in cash; (2) settled for the item without having a right to revoke the settlemen…
NMSA 1978, § 55-4-216 Insolvency and preference
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(a) If an item is in or comes into the possession of a payor or collecting bank that suspends payment and the item has not been finally paid, the item must be returned by the receiver, trustee or agent in charge of the closed bank to the presenting bank or the closed bank's custo…
NMSA 1978, § 55-4-301 Deferred posting; recovery of payment by return of items;
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time of dishonor; return of items by payor bank. (a) If a payor bank settles for a demand item other than a documentary draft presented otherwise than for immediate payment over the counter before midnight of the banking day of receipt, the payor bank may revoke the settlement an…
NMSA 1978, § 55-4-302 Payor bank's responsibility for late return of item
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(a) If an item is presented to and received by a payor bank, the bank is accountable for the amount of: (1) a demand item, other than a documentary draft, whether properly payable or not, if the bank, in any case in which it is not also the depositary bank, retains the item beyon…
NMSA 1978, § 55-4-303 When items subject to notice, stop-payment order, legal
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process or setoff; order in which items may be charged or certified. (a) Any knowledge, notice or stop-payment order received by, legal process served upon, or setoff exercised by a payor bank comes too late to terminate, suspend or modify the bank's right or duty to pay an item …
NMSA 1978, § 55-4-401 When bank may charge customer's account
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(a) A bank may charge against the account of a customer an item that is properly payable from that account even though the charge creates an overdraft. An item is properly payable if it is authorized by the customer and is in accordance with any agreement between the customer and…
NMSA 1978, § 55-4-402 Bank's liability to customer for wrongful dishonor; time of
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determining insufficiency of account. (a) Except as otherwise provided in this article, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overd…
NMSA 1978, § 55-4-403 Customer's right to stop payment; burden of proof of
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loss. (a) A customer or any person authorized to draw on an account if there is more than one person may stop payment of any item drawn on the customer's account or close the account by an order to the bank describing the item or account with reasonable certainty received at a ti…
NMSA 1978, § 55-4-404 Bank not obliged to pay check more than six months old
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A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, which is presented more than six months after its date, but it may charge its customer's account for a payment made thereafter in good faith. History: 1953 Comp., §…
NMSA 1978, § 55-4-405 Death or incompetence of customer
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(a) A payor or collecting bank's authority to accept, pay or collect an item or to account for proceeds of its collection, if otherwise effective, is not rendered ineffective by incompetence of a customer of either bank existing at the time the item is issued or its collection is…
NMSA 1978, § 55-4-406 Customer's duty to discover and report unauthorized
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signature or alteration. (a) A bank that sends or makes available to a customer a statement of account showing payment of items for the account shall either return or make available to the customer the items paid or provide information in the statement of account sufficient to al…
NMSA 1978, § 55-4-407 Payor bank's right to subrogation on improper payment
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If a payor bank has paid an item over the order of the drawer or maker to stop payment, or after an account has been closed or otherwise under circumstances giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to preve…
NMSA 1978, § 55-4-501 Handling of documentary drafts; duty to send for
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presentment and to notify customer of dishonor. A bank that takes a documentary draft for collection shall present or send the draft and accompanying documents for presentment and, upon learning that the draft has not been paid or accepted in due course, shall seasonably notify i…
NMSA 1978, § 55-4-502 Presentment of "on arrival" drafts
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If a draft or the relevant instructions require presentment "on arrival", "when goods arrive" or the like, the collecting bank need not present until in its judgment a reasonable time for arrival of the goods has expired. Refusal to pay or accept because the goods have not arrive…
NMSA 1978, § 55-4-503 Responsibility of presenting bank for documents and
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goods; report of reasons for dishonor; referee in case of need. Unless otherwise instructed and except as provided in Article 5 a bank presenting a documentary draft: (1) must deliver the documents to the drawee on acceptance of the draft if it is payable more than three days aft…
NMSA 1978, § 55-4-504 Privilege of presenting bank to deal with goods; security
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interest for expenses. (a) A presenting bank that, following the dishonor of a documentary draft, has seasonably requested instructions but does not receive them within a reasonable time may store, sell, or otherwise deal with the goods in any reasonable manner. (b) For its reaso…
NMSA 1978, § 55-4A-101 Short title
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This article may be cited as the Uniform Commerical [Commercial] Code - Funds Transfers. History: 1978 Comp., § 55-4A-101, enacted by Laws 1992, ch. 114, § 197.
NMSA 1978, § 55-4A-102 Subject matter
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Except as otherwise provided in Section 55-4A-108 NMSA 1978, this article applies to funds transfers defined in Section 55-4A-104 NMSA 1978. History: 1978 Comp., § 55-4A-102, enacted by Laws 1992, ch. 114, § 198. OFFICIAL COMMENTS UCC Official Comments © by ALI & the NCCUSL. Repr…
NMSA 1978, § 55-4A-103 Payment order; definitions
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(a) In this article: (1) "payment order" means an instruction of a sender to a receiving bank, transmitted orally or in a record, to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary if: (i) the instruction does not state a condition t…
NMSA 1978, § 55-4A-104 Funds transfer; definitions
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In this article: (a) "funds transfer" means the series of transactions, beginning with the originator's payment order, made for the purpose of making payment to the beneficiary of the order. The term includes any payment order issued by the originator's bank or an intermediary ba…
NMSA 1978, § 55-4A-105 Other definitions
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(a) In this article: (1) "authorized account" means a deposit account of a customer in a bank designated by the customer as a source of payment of payment orders issued by the customer to the bank; if a customer does not so designate an account, any account of the customer is an …
NMSA 1978, § 55-4A-106 Time payment order is received
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(a) The time of receipt of a payment order or communication canceling or amending a payment order is determined by the rules applicable to receipt of a notice stated in Section 55-1-202 NMSA 1978. A receiving bank may fix a cut-off time or times on a funds-transfer business day f…
NMSA 1978, § 55-4A-107 Federal reserve regulations and operating circulars
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Regulations of the board of governors of the federal reserve system and operating circulars of the federal reserve banks supersede any inconsistent provision of this article to the extent of the inconsistency. History: 1978 Comp., § 55-4A-107, enacted by Laws 1992, ch. 114, § 203…
NMSA 1978, § 55-4A-108 Relationship to electronic fund transfer act
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(a) Except as provided in Subsection (b) of this section, this article does not apply to a funds transfer any part of which is governed by the Electronic Fund Transfer Act of 1978 (Title XX, Public Law 95-630, 92 Stat. 3728, 15 U.S.C. Section 1693 et seq.) as amended from time to…
NMSA 1978, § 55-4A-201 Security procedure
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"Security procedure" means a procedure established by agreement of a customer and a receiving bank for the purpose of (i) verifying that a payment order or communication amending or canceling a payment order is that of the customer or (ii) detecting error in the transmission or t…
NMSA 1978, § 55-4A-202 Authorized and verified payment orders
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(a) A payment order received by the receiving bank is the authorized order of the person identified as sender if that person authorized the order or is otherwise bound by it under the law of agency. (b) If a bank and its customer have agreed that the authenticity of payment order…
NMSA 1978, § 55-4A-203 Unenforceability of certain verified payment orders
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(a) If an accepted payment order is not, under Subsection (a) of Section 55-4A-202 NMSA 1978, an authorized order of a customer identified as sender, but is effective as an order of the customer pursuant to Subsection (b) of Section 55-4A-202 NMSA 1978, the following rules apply:…
NMSA 1978, § 55-4A-204 Refund of payment and duty of customer to report with
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respect to unauthorized payment order. (a) If a receiving bank accepts a payment order issued in the name of its customer as sender that is: (i) not authorized and not effective as the order of the customer under Section 55-4A-202 NMSA 1978; or (ii) not enforceable, in whole or i…
NMSA 1978, § 55-4A-205 Erroneous payment orders
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(a) If an accepted payment order was transmitted pursuant to a security procedure for the detection of error and the payment order (i) erroneously instructed payment to a beneficiary not intended by the sender, (ii) erroneously instructed payment in an amount greater than the amo…
NMSA 1978, § 55-4A-206 Transmission of payment order through funds-transfer
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or other communication system. (a) If a payment order addressed to a receiving bank is transmitted to a funds- transfer system or other third-party communication system for transmittal to the bank, the system is deemed to be an agent of the sender for the purpose of transmitting …
NMSA 1978, § 55-4A-207 Misdescription of beneficiary
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(a) Subject to Subsection (b) of this section, if, in a payment order received by the beneficiary's bank, the name, bank account number or other identification of the beneficiary refers to a nonexistent or unidentifiable person or account, no person has rights as a beneficiary of…
NMSA 1978, § 55-4A-208 Misdescription of intermediary bank or beneficiary's
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bank. (a) This subsection applies to a payment order identifying an intermediary bank or the beneficiary's bank only by an identifying number. (1) The receiving bank may rely on the number as the proper identification of the intermediary or beneficiary's bank and need not determi…
NMSA 1978, § 55-4A-209 Acceptance of payment order
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(a) Subject to Subsection (d), a receiving bank other than the beneficiary's bank accepts a payment order when it executes the order. (b) Subject to Subsections (c) and (d), a beneficiary's bank accepts a payment order at the earliest of the following times: (1) when the bank (i)…
NMSA 1978, § 55-4A-210 Rejection of payment order
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(a) A payment order is rejected by the receiving bank by a notice of rejection transmitted to the sender orally or in a record. A notice of rejection need not use any particular words and is sufficient if it indicates that the receiving bank is rejecting the order or will not exe…
NMSA 1978, § 55-4A-211 Cancellation and amendment of payment order
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(a) A communication of the sender of a payment order canceling or amending the order may be transmitted to the receiving bank orally or in a record. If a security procedure is in effect between the sender and the receiving bank, the communication is not effective to cancel or ame…
NMSA 1978, § 55-4A-212 Liability and duty of receiving bank regarding
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unaccepted payment order. If a receiving bank fails to accept a payment order that it is obliged by express agreement to accept, the bank is liable for breach of the agreement to the extent provided in the agreement or in this article, but does not otherwise have any duty to acce…
NMSA 1978, § 55-4A-301 Execution and execution date
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(a) A payment order is "executed" by the receiving bank when it issues a payment order intended to carry out the payment order received by the bank. A payment order received by the beneficiary's bank can be accepted but cannot be executed. (b) "Execution date" of a payment order …
NMSA 1978, § 55-4A-302 Obligations of receiving bank in execution of payment
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order. (a) Except as provided in Subsections (b) through (d), if the receiving bank accepts a payment order pursuant to Section 55-4A-209(a) NMSA 1978, the bank has the following obligations in executing the order: (1) the receiving bank is obliged to issue, on the execution date…
NMSA 1978, § 55-4A-303 Erroneous execution of payment order
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(a) A receiving bank that (i) executes the payment order of the sender by issuing a payment order in an amount greater than the amount of the sender's order, or (ii) issues a payment order in execution of the sender's order and then issues a duplicate order, is entitled to paymen…
NMSA 1978, § 55-4A-304 Duty of sender to report erroneously executed payment
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order. If the sender of a payment order that is erroneously executed as stated in Section 55-4A-303 NMSA 1978 receives notification from the receiving bank that the order was executed or that the sender's account was debited with respect to the order, the sender has a duty to exe…
NMSA 1978, § 55-4A-305 Liability for late or improper execution or failure to
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execute payment order. (a) If a funds transfer is completed but the execution of a payment order by the receiving bank in breach of Section 55-4A-302 NMSA 1978 results in delay in payment to the beneficiary, the bank is obliged to pay interest to either the originator or the bene…