N.Y. Banking Law § 680-f

§ 680-f. Payment to beneficiary by bank. 1. Unless the account\nagreement provides otherwise, the bank is obligated to pay a beneficiary\nif there are sufficient actually and finally collected funds in the\nbalance of the special deposit.\n 2. Except as provided in subdivision three of this section, the\nobligation to pay the beneficiary is excused if the funds available in\nthe special deposit are insufficient to cover such payment.\n 3. Unless the account agreement provides otherwise, if the funds\navailable in the special deposit are insufficient to cover an obligation\nto pay a beneficiary, a beneficiary may elect to be paid the funds that\nare available or, if there is more than one beneficiary, a pro rata\nshare of the funds available. Payment to the beneficiary making the\nelection under this subsection discharges the bank's obligation to pay a\nbeneficiary and does not constitute an accord and satisfaction with\nrespect to another person obligated to the beneficiary.\n 4. Unless the account agreement provides otherwise, the obligation of\nthe bank obligated to pay a beneficiary is immediately due and payable.\n 5. The bank may discharge its obligation under this section by:\n (a) crediting another transaction account of the beneficiary; or\n (b) taking other action that:\n (i) is permitted under the account agreement for the bank to obtain a\ndischarge; or\n (ii) otherwise would constitute a discharge under law.\n 6. If the bank obligated to pay a beneficiary has incurred an\nobligation to discharge the obligation of another person, the obligation\nof the other person is discharged if action by the bank under\nsubdivision five of this section would constitute a discharge of the\nobligation of the other person under law that determines whether an\nobligation is satisfied.\n