§ 6A-4-407. Payor bank’s right to subrogation on improper payment.
If a payor bank has paid an item over the order of the drawer or maker to stop payment, or after an account has been closed, or otherwise under circumstances giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to prevent loss to the bank by reason of its payment of the item, the payor bank is subrogated to the rights:
(1) Of any holder in due course on the item against the drawer or maker;
(2) Of the payee or any other holder of the item against the drawer or maker either on the item or under the transaction out of which the item arose; and
(3) Of the drawer or maker against the payee or any other holder of the item with respect to the transaction out of which the item arose.
History of Section.P.L. 2000, ch. 238, § 4; P.L. 2000, ch. 421, § 4.
Structure Rhode Island General Laws
Title 6A - Uniform Commercial Code
Chapter 6A-4 - Bank Deposits and Collections
Part 4 - Relationship Between Payor Bank and It’s Customer
Section 6A-4-401. - When bank may charge customer’s account.
Section 6A-4-403. - Customer’s right to stop payment — Burden of proof of loss.
Section 6A-4-404. - Bank not obliged to pay check more than six months old.
Section 6A-4-405. - Death or incompetence of customer.
Section 6A-4-406. - Customer’s duty to discover and report unauthorized signature or alteration.
Section 6A-4-407. - Payor bank’s right to subrogation on improper payment.