§ 25-4-301. Deferred posting; recovery of payment by return of items; time of dishonor; return of items by payor bank. - North Carolina Statutes

Part 3.

COLLECTION OF ITEMS:  PAYORBANKS.

§ 25‑4‑301. Deferred posting; recovery of payment by return of items; time of dishonor;return of items by payor bank.

(a)        If a payor banksettles for a demand item other than a documentary draft presented otherwisethan for immediate payment over the counter before midnight of the banking dayof receipt, the payor bank may revoke the settlement and recover the settlementif, before it has made final payment and before its midnight deadline, it:

(1)        Returns the item; or

(2)        Sends written noticeof dishonor or nonpayment if the item is unavailable for return.

(b)        If a demand item isreceived by a payor bank for credit on its books, it may return the item orsend notice of dishonor and may revoke any credit given or recover the amountthereof withdrawn by its customer, if it acts within the time limit and in themanner specified in subsection (a) of this section.

(c)        Unless previousnotice of dishonor has been sent, an item is dishonored at the time when forpurposes of dishonor it is returned or notice sent in accordance with thissection.

(d)        An item isreturned:

(1)        As to an itempresented through a clearing house, when it is delivered to the presenting orlast collecting bank or to the clearing house or is sent or delivered inaccordance with clearing‑house rules; or

(2)        In all other cases,when it is sent or delivered to the bank's customer or transferor or pursuantto instructions. (1899, c. 733, s. 137; Rev., s. 2287; C.S., s. 3119;1949, c. 954; 1965, c. 700, s. 1; 1995, c. 232, s. 2.)