Delaware Code Title 6 Sec. 4-302 – Payor bank’s responsibility for late return of item
(a) If an item is presented to and received by a payor bank, the bank is accountable for the amount of:
(1) A demand item, other than a documentary draft, whether properly payable or not, if the bank, in any case in which it is not also the depositary bank, retains the item beyond midnight of the banking day of receipt without settling for it or, whether or not it is also the depositary bank, does not pay or return the item or send notice of dishonor until after its midnight deadline; or
(2) Any other properly payable item unless, within the time allowed for acceptance or payment of that item, the bank either accepts or pays the item or returns it and accompanying documents.
Terms Used In Delaware Code Title 6 Sec. 4-302
- Banking day: means the part of a day on which a bank is open to the public for carrying on substantially all of its banking functions. See Delaware Code Title 6 Sec. 4-104
- Documentary draft: means a draft to be presented for acceptance or payment if specified documents, certificated securities (Section 8-102) or instructions for uncertificated securities (Section 8-102), or other certificates, statements, or the like are to be received by the drawee or other payor before acceptance or payment of the draft. See Delaware Code Title 6 Sec. 4-104
- Item: means an instrument or a promise or order to pay money handled by a bank for collection or payment. See Delaware Code Title 6 Sec. 4-104
- Person: means a natural person, partnership (whether general or limited), limited liability company, trust (including a common law trust, business trust, statutory trust, voting trust or any other form of trust), estate, association (including any group, organization, co-tenancy, plan, board, council or committee), corporation, government (including a country, state, county or any other governmental subdivision, agency or instrumentality), custodian, nominee or any other individual or entity (or series thereof) in its own or any representative capacity, in each case, whether domestic or foreign. See Delaware Code Title 6 Sec. 17-101
(b) The liability of a payor bank to pay an item pursuant to subsection (a) is subject to defenses based on breach of a presentment warranty (Section 4-208) or proof that the person seeking enforcement of the liability presented or transferred the item for the purpose of defrauding the payor bank.
5A Del. C. 1953, §§ ?4-302; 55 Del. Laws, c. 349; 70 Del. Laws, c. 86, § ?4;