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Ark. Code Ann. § 4-4-202

Responsibility for collection or return — When action timely

Known as the Uniform Commercial Code

The act spans §§ 4–4 (597 sections).

Applied in 1 court decision — leading case Douglas Companies, Inc. v. Commercial National Bank of Texarkana (2005)

Most recently applied in Douglas Companies, Inc. v. Commercial National Bank of Texarkana (August 2005)

Acts 1961, No. 185, § 4-202; 1967, No. 303, § 13; A.S.A. 1947, § 85-4-202; Acts 1991, No. 572, § 6.

(1) A collecting bank must exercise ordinary care in: 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.

(5) 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.

(6) 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.

Current official text: Arkansas General Assembly. Digitized from the UniCourt Code Improvement Commission public-domain capture. Reproduced from public-domain Arkansas statutes; confirm against the official source for the current text. Not legal advice.