§ 6A-4-202 - Responsibility for collection or return – When action timely. - Rhode Island Statutes

SECTION 6A-4-202

   § 6A-4-202  Responsibility for collectionor return – When action timely. – (a) A collecting bank must exercise ordinary care in:

   (1) Presenting an item or sending it for presentment;

   (2) Sending notice of dishonor or nonpayment or returning anitem other than a documentary draft to the bank's transferor after learningthat the item has not been paid or accepted, as the case may be;

   (3) Settling for an item when the bank receives finalsettlement; and

   (4) Notifying its transferor of any loss or delay in transitwithin a reasonable time after discovery thereof.

   (b) A collecting bank exercises ordinary care undersubsection (a) by taking proper action before its midnight deadline followingreceipt of an item, notice, or settlement. Taking proper action within areasonably longer time may constitute the exercise of ordinary care, but thebank has the burden of establishing timeliness.

   (c) Subject to subsection (a)(1), a bank is not liable forthe insolvency, neglect, misconduct, mistake, or default of another bank orperson or for loss or destruction of an item in the possession of others or intransit.