Title 41 — Uniform Commercial Code

This chapter may be cited as Uniform Commercial Code - Funds Transfers.

Except as otherwise provided in section 41-04.1-08, this chapter applies to funds transfers defined in section 41-04.1-04.

1. In this chapter: a. "Beneficiary" means the person to be paid by the beneficiary's bank. b. "Beneficiary's bank" means the bank identified in a payment order in which an account of the beneficiary is to be credited pursuant to the order or which otherwise is to make payment to…

In this chapter: 1. "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 ban…

1. In this chapter: a. "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 au…

1. 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 under section 41-01-10. A receiving bank may fix a cutoff time or times on a funds-transfer business day for the re…

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 chapter to the extent of the inconsistency.

1. Except as provided in subsection 2, this chapter does not apply to a funds transfer any part of which is governed by the Electronic Fund Transfer Act of 1978 [Title XX, Pub. L. 95-630; 92 Stat. 3728; 15 U.S.C. 1693 et seq.]. 2. This chapter applies to a funds transfer that is …

"Security procedure" means a procedure established by agreement of a customer and a receiving bank for the purpose of verifying that a payment order or communication amending or canceling a payment order is that of the customer or detecting error in the transmission or the conten…

1. 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. 2. If a bank and its customer have agreed that the authenticity of payment orders …

1. If an accepted payment order is not, under subsection 1 of section 41-04.1-10, an authorized order of a customer identified as sender, but is effective as an order of the customer under subsection 2 of section 41-04.1-10, the following rules apply: a. By express agreement evid…

1. If an accepted payment order was transmitted pursuant to a security procedure for the detection of error and the payment order erroneously instructed payment to a beneficiary not intended by the sender, erroneously instructed payment in an amount greater than the amount intend…

1. Subject to subsection 2, 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 the order and acc…

1. This subsection applies to a payment order identifying an intermediary bank or the beneficiary's bank only by an identifying number. a. The receiving bank may rely on the number as the proper identification of the intermediary or beneficiary's bank and need not determine wheth…

1. Subject to subsection 4, a receiving bank other than the beneficiary's bank accepts a payment order when it executes the order. 2. Subject to subsections 3 and 4, a beneficiary's bank accepts a payment order at the earliest of the following times: a. When the bank pays the ben…

1. 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 exec…

1. 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 amen…

1. 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 may be accepted but may not be executed. 2. "Execution date" of a payment order m…

1. Except as provided in subsections 2 through 4, if the receiving bank accepts a payment order under subsection 1 of section 41-04.1-17, the bank has the following obligations in executing the order: a. The receiving bank is obliged to issue, on the execution date, a payment ord…

1. A receiving bank that 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 issues a payment order in execution of the sender's order and then issues a duplicate order is entitled to payment of the amo…

If the sender of a payment order that is erroneously executed as stated in section 41-04.1-23 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 exercise ordinary c…

"Payment date" of a payment order means the day on which the amount of the order is payable to the beneficiary by the beneficiary's bank. The payment date may be determined by instruction of the sender but cannot be earlier than the day the order is received by the beneficiary's …

1. This section is subject to sections 41-04.1-13 and 41-04.1-15. 2. With respect to a payment order issued to the beneficiary's bank, acceptance of the order by the bank obliges the sender to pay the bank the amount of the order, but payment is not due until the payment date of …

1. Payment of the sender's obligation under section 41-04.1-27 to pay the receiving bank occurs as follows: a. If the sender is a bank, payment occurs when the receiving bank receives final settlement of the obligation through a federal reserve bank or through a funds-transfer sy…

1. If the beneficiary's bank credits an account of the beneficiary of a payment order, payment of the bank's obligation under subsection 1 of section 41-04.1-29 occurs when and to the extent the beneficiary is notified of the right to withdraw the credit, the bank lawfully applie…

1. Except as otherwise provided in this chapter, the rights and obligations of a party to a funds transfer may be varied by agreement of the affected party. 2. "Funds-transfer system rule" means a rule of an association of banks: a. Which governs transmission of payment orders by…

For proper cause and under applicable law, a court may restrain a person from issuing a payment order to initiate a funds transfer, an originator's bank from executing the payment order of the originator, the beneficiary's bank from releasing funds to the beneficiary, or the bene…

If a receiving bank has received payment from its customer with respect to a payment order issued in the name of the customer as sender and accepted by the bank, and the customer received notification reasonably identifying the order, the customer is precluded from asserting that…

1. If, under this chapter, a receiving bank is obliged to pay interest with respect to a payment order issued to the bank, the amount payable may be determined by agreement of the sender and receiving bank or by a funds-transfer system rule if the payment order is transmitted thr…

1. The following rules apply unless the affected parties otherwise agree or subsection 3 applies: a. The rights and obligations between the sender of a payment order and the receiving bank are governed by the law of the jurisdiction in which the receiving bank is located. b. The …