N.D. Cent. Code § 41-04-38
(4-407) Payor bank's right to subrogation on improper payment
Redline — December 1, 2021 → current.View current text →
Current — January 1, 2022
As of December 1, 2021
If a payor bank has paid an item over the stop payment order of the drawer or maker, 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 shall be subrogated to the rights of:
If a payor bank has paid an item over the stop payment order of the drawer or maker, 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 shall be subrogated to the rights of:
(1) Any holder in due course on the item against the drawer or maker.
(1) Any holder in due course on the item against the drawer or maker.
(2) 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.
(2) 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.
(3) 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.
(3) 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.
(4) The limitations of the preamble prevent the bank itself from getting any double recovery or benefits out of its subrogation rights conferred by the section.
(5) The spelling out of the affirmative rights of the bank in this section does not destroy other existing rights (Section 1-103). Among others these may include the defense of a payor bank that by conduct in recognizing the payment a customer has ratified the bank’s action in paying in disregard of a stop-payment order or right to recover money paid under a mistake.
Official source: North Dakota Legislative Branch. Reproduced from public-domain North Dakota statutes; confirm against the official source for the current text. Not legal advice.