57A-4A-204. Refund of payment and duty of customer to report with respect to unauthorized payment order.
(a) If a receiving bank accepts a payment order issued in the name of its customer as sender which is (i) not authorized and not effective as the order of the customer under §57A-4A-202, or (ii) not enforceable, in whole or in part, against the customer under §57A-4A-203, the bank shall refund any payment of the payment order received from the customer to the extent the bank is not entitled to enforce payment and shall pay interest on the refundable amount calculated from the date the bank received payment to the date of the refund. However, the customer is not entitled to interest from the bank on the amount to be refunded if the customer fails to exercise ordinary care to determine that the order was not authorized by the customer and to notify the bank of the relevant facts within a reasonable time not exceeding ninety days after the date the customer received notification from the bank that the order was accepted or that the customer's account was debited with respect to the order. The bank is not entitled to any recovery from the customer on account of a failure by the customer to give notification as stated in this section.
(b) Reasonable time under subsection (a) may be fixed by agreement as stated in §57A-1-302(b), but the obligation of a receiving bank to refund payment as stated in subsection (a) may not otherwise be varied by agreement.
Source: SL 1991, ch 397, §1; SL 2008, ch 259, §39.
Structure South Dakota Codified Laws
Title 57A - Uniform Commercial Code
Section 57A-4A-101 - Short title.
Section 57A-4A-102 - Subject matter.
Section 57A-4A-103 - Payment order--Definitions.
Section 57A-4A-104 - Funds transfer--Definitions.
Section 57A-4A-105 - Other definitions.
Section 57A-4A-106 - Time payment order is received.
Section 57A-4A-107 - Federal reserve regulations and operating circulars.
Section 57A-4A-108 - Exclusion of consumer transactions governed by federal law.
Section 57A-4A-201 - Security procedure.
Section 57A-4A-202 - Authorized and verified payment orders.
Section 57A-4A-203 - Unenforceability of certain verified payment orders.
Section 57A-4A-205 - Erroneous payment orders.
Section 57A-4A-207 - Misdescription of beneficiary.
Section 57A-4A-208 - Misdescription of intermediary bank or beneficiary's bank.
Section 57A-4A-209 - Acceptance of payment order.
Section 57A-4A-210 - Rejection of payment order.
Section 57A-4A-211 - Cancellation and amendment of payment order.
Section 57A-4A-212 - Liability and duty of receiving bank regarding unaccepted payment order.
Section 57A-4A-301 - Execution and execution date.
Section 57A-4A-302 - Obligation of receiving bank in execution of payment order.
Section 57A-4A-303 - Erroneous execution of payment order.
Section 57A-4A-305 - Liability for late or improper execution or failure to execute payment order.
Section 57A-4A-401 - Payment date.
Section 57A-4A-402 - Obligation of sender to pay receiving bank.
Section 57A-4A-403 - Payment by sender to receiving bank.
Section 57A-4A-404 - Obligation of beneficiary's bank to pay and give notice to beneficiary.
Section 57A-4A-405 - Payment by beneficiary's bank to beneficiary.
Section 57A-4A-406 - Payment by originator to beneficiary--Discharge of underlying obligation.
Section 57A-4A-501 - Variation by agreement and effect of funds-transfer system rule.
Section 57A-4A-502 - Creditor process served on receiving bank--Setoff by beneficiary's bank.
Section 57A-4A-503 - Injunction or restraining order with respect to funds transfer.
Section 57A-4A-505 - Preclusion of objection to debit of customer's account.