ORS 74.4020
Bank’s liability to customer for wrongful dishonor

  • time of determining insufficiency of account

(1)

Except as otherwise provided in this chapter, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable. However, a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft.

(2)

A payor bank is liable to its customer for damages proximately caused by the wrongful dishonor of an item. Liability is limited to actual damages proved and may include damages for an arrest or prosecution of the customer or other consequential damages. Whether any consequential damages are proximately caused by the wrongful dishonor is a question of fact to be determined in each case.

(3)

A payor bank’s determination of the customer’s account balance on which a decision to dishonor for insufficiency of available funds is based may be made at a time between the time the item is received by the payor bank and the time that the payor bank returns the item or gives notice in lieu of return, and no more than one determination need be made. If, at the election of the payor bank, a subsequent balance determination is made for the purpose of reevaluating the bank’s decision to dishonor the item, the account balance at that time is determinative of whether a dishonor for insufficiency of availability funds is wrongful. [1961 c.726 §74.4020 (Bank’s liability to customer for wrongful dishonor); 1993 c.545 §105]

Source: Section 74.4020 — Bank’s liability to customer for wrongful dishonor; time of determining insufficiency of account, https://www.­oregonlegislature.­gov/bills_laws/ors/ors074.­html.

Notes of Decisions

Since plaintiff was without (overdrawn) rather than within its approved line of credit, defendant bank was entitled, as to plaintiff, to dishonor drafts in excess thereof. Modoc Meat & Cattle Co. v. First State Bank of Oregon, 271 Or 276, 532 P2d 21 (1975)

74.1010
Short title 74.1020
Applicability 74.1030
Variation by agreement 74.1040
Definitions and index of definitions 74.1050
“Bank” 74.1060
Payable through or payable at bank 74.1070
Separate office of bank for computing time for actions, notices and orders 74.1080
Time of receipt of items 74.1090
Waiver of time limits 74.1110
Statute of limitations 74.1120
Electronic presentment 74.2010
Status of collecting bank as agent and provisional status of credits 74.2020
Responsibility for collection 74.2030
Effect of instructions 74.2040
Methods of sending and presenting 74.2050
Depositary bank as holder of unindorsed item 74.2060
Transfer between banks 74.2070
Warranties of customer and collecting bank on transfer of item 74.2080
Presentment warranties 74.2090
Encoding and retention warranties 74.2100
Security interest of collecting bank in items 74.2110
Bank as holder in due course 74.2120
Presentment by notice of item not payable by, through or at bank 74.2130
Medium and time of settlement by bank 74.2140
Right of charge-back or refund 74.2150
Final payment of item by payor bank 74.2160
Insolvency and preference 74.3010
Deferred posting 74.3020
Payor bank’s responsibility for late return of item 74.3030
When items subject to notice, stop payment order, legal process or setoff 74.4010
When bank may charge customer’s account 74.4020
Bank’s liability to customer for wrongful dishonor 74.4030
Customer’s right to stop payment 74.4040
Bank not obligated to pay check more than six months old 74.4050
Death or incompetence of customer 74.4060
Statements to customer 74.4070
Payor bank’s right to subrogation on improper payment 74.5010
Handling of documentary drafts 74.5020
Presentment of “on arrival” drafts 74.5030
Responsibility of presenting bank for documents and goods 74.5040
Privilege of presenting bank to deal with goods
Green check means up to date. Up to date

Current through early 2024

§ 74.4020’s source at oregon​.gov