| (1) |
The effect of the provisions of this chapter may be varied by agreement but the parties to the agreement may not disclaim a bank’s responsibility for its lack of good faith or failure to exercise ordinary care, or limit the measure of damages for the lack or failure. However, the parties may determine by agreement the standards by which the bank’s responsibility is to be measured if those standards are not manifestly unreasonable. |
Terms Used In Utah Code 70A-4-103
- Clearinghouse: means an association of banks or other payors regularly clearing items. See Utah Code 70A-4-104
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Item: means an instrument or a promise or order to pay money handled by a bank for collection or payment. See Utah Code 70A-4-104
| (2) |
Federal Reserve regulations and operating circulars, clearinghouse rules, and the like, have the effect of agreements under Subsection (1), whether or not specifically assented to by all parties interested in items handled. |
| (3) |
Action or nonaction approved by this chapter or pursuant to Federal Reserve regulations or operating circulars is the exercise of ordinary care and, in the absence of special instructions, action or nonaction consistent with clearinghouse rules and the like or with a general banking usage not disapproved by this chapter, is prima facie exercise of ordinary care. |
| (4) |
The specification or approval of certain procedures by this chapter is not disapproval of other procedures that may be reasonable under the circumstances. |
| (5) |
The measure of damages for failure to exercise ordinary care in handling an item is the amount of the item reduced by an amount that could not have been realized by the exercise of ordinary care. If there is bad faith, it includes any other damages the party suffered as a proximate consequence. |
Amended by Chapter 237, 1993 General Session
