12 U.S.C. § 5009: Measure of damages

Summary

Unless another part of the law says otherwise, a person who breaks a promise or breaks the rules about a substitute check must pay the person harmed. The payment is the smaller of the actual loss caused or the amount of the substitute check. The payer must also cover interest and related costs, like reasonable lawyer fees. Any payment is lowered by money the harmed person already got back for the same check. If the harmed person was partly at fault or acted in bad faith, the payment is reduced by their share of the fault. This does not cut into other legal rights under the Uniform Commercial Code or other laws.

Title 12, §5009

Banks and Banking, Source: USLM XML via OLRC

(a)Liability

(1)In general

Except as provided in section 5005 of this title, any person who, in connection with a substitute check, breaches any warranty under this chapter or fails to comply with any requirement imposed by, or regulation prescribed pursuant to, this chapter with respect to any other person shall be liable to such person in an amount equal to the sum of— (A)

(B)interest and expenses (including costs and reasonable attorney’s fees and other expenses of representation) related to the substitute check.

(2)Offset of recredits

The amount of damages any person receives under paragraph (1), if any, shall be reduced by the amount, if any, that the claimant receives and retains as a recredit under section 5006 or 5007 of this title.

(b)Comparative negligence

(1)In general

If a person incurs damages that resulted in whole or in part from the negligence or failure of that person to act in good faith, then the amount of any liability due to that person under subsection (a) shall be reduced in proportion to the amount of negligence or bad faith attributable to that person.

(2)Rule of construction

Nothing in this subsection reduces the rights of a consumer or any other person under the Uniform Commercial Code or other applicable provision of Federal or State law.

Notes & Related Subsidiaries

Editorial Notes

References in Text

This chapter, referred to in subsec. (a)(1), was in the original “this Act”, meaning Pub. L. 108–100, Oct. 28, 2003, 117 Stat. 1177, which is classified generally to this chapter. For complete classification of this Act to the Code, see

Short Title

note set out under section 5001 of this title and Tables.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title.

§5009 Measure of Damages