57A-4-202. Responsibility for collection or 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 an item other than a documentary draft to the bank's transferor after learning that the item has not been paid or accepted, as the case may be;
(3)Settling for an item when the bank receives final settlement; and
(4)Notifying its transferor of any loss or delay in transit within a reasonable time after discovery thereof.
(b) A collecting bank exercises ordinary care under subsection (a) by taking proper action before its midnight deadline following receipt of an item, notice, or settlement. Taking proper action within a reasonably longer time may constitute the exercise of ordinary care, but the bank has the burden of establishing timeliness.
(c) Subject to subsection (a)(1), a bank is not liable for the insolvency, neglect, misconduct, mistake, or default of another bank or person or for loss or destruction of an item in the possession of others or in transit.
Source: SL 1994, ch 368, ยง4-202.
Structure South Dakota Codified Laws
Title 57A - Uniform Commercial Code
Chapter 04 - Bank Deposits And Collections
Section 57A-4-101 - Short title.
Section 57A-4-102 - Applicability.
Section 57A-4-104 - Definitions and index of definitions.
Section 57A-4-106 - Payable through or payable at bank--Collecting bank.
Section 57A-4-107 - Separate office of a bank.
Section 57A-4-108 - Time of receipt of items.
Section 57A-4-110 - Electronic presentment.
Section 57A-4-111 - Statute of limitations.
Section 57A-4-202 - Responsibility for collection or return--When action timely.
Section 57A-4-203 - Effect of instructions.
Section 57A-4-204 - Methods of sending and presenting--Sending directly to payor bank.
Section 57A-4-205 - Depositary bank holder of unendorsed item.
Section 57A-4-206 - Transfer between banks.
Section 57A-4-207 - Transfer warranties.
Section 57A-4-208 - Presentment warranties.
Section 57A-4-209 - Encoding and retention warranties.
Section 57A-4-211 - When bank gives value for purposes of holder in due course.
Section 57A-4-213 - Medium and time of settlement by bank.
Section 57A-4-214 - Right of charge-back or refund; Liability of collecting bank; Return of item.
Section 57A-4-216 - Insolvency and preference.
Section 57A-4-302 - Payor bank's responsibility for late return of item.
Section 57A-4-401 - When bank may charge customer's account.
Section 57A-4-403 - Customer's right to stop payment--Burden of proof of loss.
Section 57A-4-404 - Bank not obligated to pay check more than six months old.
Section 57A-4-405 - Death or incompetence of customer.
Section 57A-4-406 - Customer's duty to discover and report unauthorized signature or alteration.
Section 57A-4-407 - Payor bank's right to subrogation on improper payment.
Section 57A-4-502 - Presentment of "on arrival" drafts.
Section 57A-4-504 - Privilege of presenting bank to deal with goods--Security interest for expenses.