Sec. 42a-4-302. Payor bank's responsibility for late return of item. - Connecticut Statutes

      Sec. 42a-4-302. Payor bank's responsibility for late return of item. (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 beyond midnight of the banking day of receipt without settling for it or, whether or not it is also the depositary bank, does not pay or return the item or send notice of dishonor until after its midnight deadline; or (2) any other properly payable item unless, within the time allowed for acceptance or payment of that item, the bank either accepts or pays the item or returns it and accompanying documents.

      (b) The liability of a payor bank to pay an item pursuant to subsection (a) is subject to defenses based on breach of a presentment warranty under section 42a-4-208 or proof that the person seeking enforcement of the liability presented or transferred the item for the purpose of defrauding the payor bank.

      (1959, P.A. 133, S. 4-302; P.A. 91-304, S. 96; May Sp. Sess. P.A. 92-11, S. 24, 70.)

      History: P.A. 91-304 deleted provision that conditioned the accountability of the bank on "the absence of a valid defense such as breach of a presentment warranty, settlement effected or the like," made minor changes in wording and added Subsec. (b) re limitations on the liability of a payor bank; May Sp. Sess. P.A. 92-11 made a technical change in Subsec. (b).

      See Sec. 42a-4-207 (1) re warranties of customer and collecting bank on transfer or presentment of items.

      Cited. 230 C. 486. Cited. 232 C. 167.