400.4A-507. Choice of law.

MISSOURI STATUTES AND CODES

Choice of law.

400.4A-507. (a) The following rules apply unless theaffected parties otherwise agree or subsection (c) applies:

(1) The rights and obligations between the sender of apayment order and the receiving bank are governed by the law ofthe jurisdiction in which the receiving bank is located.

(2) The rights and obligations between the beneficiary'sbank and the beneficiary are governed by the law of thejurisdiction in which the beneficiary's bank is located.

(3) The issue of when payment is made pursuant to a fundstransfer by the originator to the beneficiary is governed by thelaw of the jurisdiction in which the beneficiary's bank islocated.

(b) If the parties described in each paragraph ofsubsection (a) have made an agreement selecting the law of aparticular jurisdiction to govern rights and obligations betweeneach other, the law of that jurisdiction governs those rights andobligations, whether or not the payment order or the fundstransfer bears a reasonable relation to that jurisdiction.

(c) A funds-transfer system rule may select the law of aparticular jurisdiction to govern (i) rights and obligationsbetween participating banks with respect to payment orderstransmitted or processed through the system, or (ii) the rightsand obligations of some or all parties to a funds transfer anypart of which is carried out by means of the system. A choice oflaw made pursuant to rights and obligations between participatingbanks with respect to payment orders transmitted or processedthrough the system, is binding on participating banks. A choiceof law made pursuant to clause (i) is binding on participatingbanks. A choice of law made pursuant to clause (ii) is bindingon the originator, other sender, or a receiving bank havingnotice that the funds-transfer system might be used in the fundstransfer and of the choice of law by the system when theoriginator, other sender, or receiving bank issued or accepted apayment order. The beneficiary of a funds transfer is bound bythe choice of law if, when the funds transfer is initiated, thebeneficiary has notice that the funds-transfer system might beused in the funds transfer and of the choice of law by thesystem. The law of a jurisdiction selected pursuant to thissubsection may govern, whether or not that law bears a reasonablerelation to the matter in issue.

(d) In the event of inconsistency between an agreementunder subsection (b) and a choice-of-law rule under subsection(c), the agreement under subsection (b) prevails.

(e) If a funds transfer is made by use of more than onefunds-transfer system and there is inconsistency betweenchoice-of-law rules of the systems, the matter in issue isgoverned by the law of the selected jurisdiction that has themost significant relationship to the matter in issue.