400.4A-210. Rejection of payment order. - Missouri Statutes

Rejection of payment order.

400.4A-210. (a) A payment order is rejected by thereceiving bank by a notice of rejection transmitted to the senderorally, electronically, or in writing. A notice of rejectionneed not use any particular words and is sufficient if itindicates that the receiving bank is rejecting the order or willnot execute or pay the order. Rejection is effective when thenotice is given if transmission is by a means that is reasonablein the circumstances. If notice of rejection is given by a meansthat is not reasonable, rejection is effective when the notice isreceived. If an agreement of the sender and receiving bankestablishes the means to be used to reject a payment order, (i)any means complying with the agreement is reasonable and (ii) anymeans not complying is not reasonable unless no significant delayin receipt of the notice resulted from the use of thenoncomplying means.

(b) This subsection applies if a receiving bank other thanthe beneficiary's bank fails to execute a payment order despitethe existence on the execution date of a withdrawable creditbalance in an authorized account of the sender sufficient tocover the order. If the sender does not receive notice ofrejection of the order on the execution date and the authorizedaccount of the sender does not bear interest, the bank is obligedto pay interest to the sender on the amount of the order for thenumber of days elapsing after the execution date to the earlierof the day the order is canceled pursuant to section400.4A-211(d) or the day the sender receives notice or learnsthat the order was not executed, counting the final day of theperiod as an elapsed day. If the withdrawable credit balanceduring that period falls below the amount of the order, theamount of interest is reduced accordingly.

(c) If a receiving bank suspends payments, all unacceptedpayment orders issued to it are deemed rejected at the time thebank suspends payments.

(d) Acceptance of a payment order precludes a laterrejection of the order. Rejection of a payment order precludes alater acceptance of the order.

(L. 1992 S.B. 448)