70A-4-401 - When bank may charge customer's account. - Utah Statutes

70A-4-401. When bank may charge customer's account.
(1) A bank may charge against the account of a customer an item that is properly payablefrom that account even though the charge creates an overdraft. An item is properly payable if it isauthorized by the customer and is in accordance with any agreement between the customer andbank.
(2) A customer is not liable for the amount of an overdraft if the customer neither signedthe item nor benefited from the proceeds of the item.
(3) A bank may charge against the account of a customer a check that is otherwiseproperly payable from the account, even though payment was made before the date of the check,unless the customer has given notice to the bank of the postdating describing the check withreasonable certainty. The notice is effective for the period stated in Section 70A-4-403 forstop-payment orders, and must be received at such time and in such manner as to afford the banka reasonable opportunity to act on it before the bank takes any action with respect to the checkdescribed in Section 70A-4-303. If a bank charges against the account of a customer a checkbefore the date stated in the notice of postdating, the bank is liable for damages for the lossresulting from its act. The loss may include damages for dishonor of subsequent items underSection 70A-4-402.
(4) A bank that in good faith makes payment to a holder may charge the indicatedaccount of its customer according to:
(a) the original terms of the altered item; or
(b) the terms of the completed item, even though the bank knows the item has beencompleted unless the bank has notice that the completion was improper.

Amended by Chapter 237, 1993 General Session