Michigan Laws 440.4703 – Payment order effective pursuant to MCL 440.4702; application of rules; applicability of section to amendments of payment orders
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(1) If an accepted payment order is not, under section 4A202(1), an authorized order of a customer identified as sender, but is effective as an order of the customer pursuant to section 4A202(2), the following rules apply:
(a) By express written agreement, the receiving bank may limit the extent to which it is entitled to enforce or retain payment of the payment order.
Terms Used In Michigan Laws 440.4703
- Bank: means a person engaged in the business of banking and includes a savings bank, savings and loan association, credit union, and trust company. See Michigan Laws 440.4605
- Customer: means a person, including a bank, having an account with a bank or from whom a bank has agreed to receive payment orders. See Michigan Laws 440.4605
- Fault: means a default, breach, or wrongful act or omission. See Michigan Laws 440.1201
- Payment order: means an instruction of a sender to a receiving bank, transmitted orally, electronically, or in writing, to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary if the following apply:
(i) The instruction does not state a condition to payment to the beneficiary other than time of payment. See Michigan Laws 440.4603Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, or instrumentality, public corporation, or any other legal or commercial entity. See Michigan Laws 440.1201 Receiving bank: means the bank to which the sender's instruction is addressed. See Michigan Laws 440.4603 Sender: means the person giving the instruction to the receiving bank. See Michigan Laws 440.4603
(b) The receiving bank is not entitled to enforce or retain payment of the payment order if the customer proves that the order was not caused, directly or indirectly, by a person (i) entrusted at anytime with duties to act for the customer with respect to payment orders or the security procedure, or (ii) who obtained access to transmitting facilities of the customer or who obtained, from a source controlled by the customer and without authority of the receiving bank, information facilitating breach of the security procedure, regardless of how the information was obtained or whether the customer was at fault. Information includes any access device, computer software, or the like.
(2) This section applies to amendments of payment orders to the same extent it applies to payment orders.