§ 25-4-407. Payor bank's right to subrogation on improper payment. - North Carolina Statutes

§25‑4‑407.  Payor bank's right to subrogation on improper payment.

If a payor bank has paid anitem over the order of the drawer or maker to stop payment, or after an accounthas been closed, or otherwise under circumstances giving a basis for objectionby the drawer or maker, to prevent unjust enrichment and only to the extentnecessary to prevent loss to the bank by reason of its payment of the item, thepayor bank is subrogated to the rights:

(1)        Of any holder in duecourse on the item against the drawer or maker;

(2)        Of the payee or anyother holder of the item against the drawer or maker either on the item orunder the transaction out of which the item arose; and

(3)        Of the drawer ormaker against the payee or any other holder of the item with respect to thetransaction out of which the item arose. (1965, c. 700, s. 1; 1995, c.232, s. 2.)