(a) If an item is in or comes into the possession of a payor or collecting bank that
suspends payment and the item has not been finally paid, the item must be returned
by the receiver, trustee, or agent in charge of the closed bank to the presenting
bank or the closed bank's customer.
(b) If a payor bank finally pays an item and suspends payments without making a settlement
for the item with its customer or the presenting bank, which settlement is or becomes
final, the owner of the item has a preferred claim against the payor bank.
(c) If a payor bank gives or a collecting bank gives or receives a provisional settlement
for an item and thereafter suspends payments, the suspension does not prevent or interfere
with the settlement's becoming final if the finality occurs automatically upon the
lapse of certain time or the happening of certain events.
(d) If a collecting bank receives from subsequent parties settlement for an item,
which settlement is or becomes final, and the bank suspends payments without making
a settlement for the item with its customer, which settlement is or becomes final,
the owner of the item has a preferred claim against the collecting bank.
FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.
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