(a) A bank may charge against the account of a customer an item that is properly payable from the account even though the charge creates an overdraft. An item is properly payable if it is authorized by the customer and is in accordance with any agreement between the customer and bank.

(b) A customer is not liable for the amount of an overdraft if the customer neither signed the item nor benefited from the proceeds of the item.

Terms Used In South Carolina Code 36-4-401

  • Account: means any deposit or credit account with a bank, including a demand, time, savings, passbook, share draft, or like account, other than an account evidenced by a certificate of deposit;

    (2) "Afternoon" means the period of a day between noon and midnight;

    (3) "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;

    (4) "Clearing house" means an association of banks or other payors regularly clearing items;

    (5) "Customer" means a person having an account with a bank or for whom a bank has agreed to collect items, including a bank that maintains an account at another bank;

    (6) "Documentary draft" means a draft to be presented for acceptance or payment if specified documents, certificated securities (§ 36-8-102) or instructions for uncertificated securities (§ 36-8-102), or other certificates, statements, or the like are to be received by the drawee or other payor before acceptance or payment of the draft;

    (7) "Draft" means a draft as defined in § 36-3-104 or an item, other than an instrument, that is an order;

    (8) "Drawee" means a person ordered in a draft to make payment;

    (9) "Item" means an instrument or a promise or order to pay money handled by a bank for collection or payment. See South Carolina Code 36-4-104
  • Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.

(c) A bank may charge against the account of a customer a check that is otherwise properly payable from the account, even though payment was made before the date of the check, unless the customer has given notice to the bank of the postdating describing the check with reasonable certainty. The notice is effective for the period stated in § 36-4-403(b) for stop-payment orders, and must be received at such time and in such manner as to afford the bank a reasonable opportunity to act on it before the bank takes any action with respect to the check described in § 36-4-303. If a bank charges against the account of a customer a check before the date stated in the notice of postdating, the bank is liable for damages for the loss resulting from its act. The loss may include damages for dishonor of subsequent items under § 36-4-402. (d) A bank that in good faith makes payment to a holder may charge the indicated account of its customer according to:

(1) the original terms of the altered item; or

(2) the terms of the completed item, even though the bank knows the item has been completed unless the bank has notice that the completion was improper.

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