N.Y. Banking Law § 14-d: Power of the superintendent of financial services to prescribe a reasonable period of time permitting the drawing on items received for d...

§ 14-d. Power of the superintendent of financial services to prescribe

a reasonable period of time permitting the drawing on items received for

deposit in a customer's account. 1. It is the public policy of this

state to provide all banking customers with the ability to draw against

items deposited for collection with any banking institution located in

this state within a reasonable period of time.

2. The superintendent of financial services shall promulgate

regulations, which may be amended from time to time, establishing a

reasonable period of time within which a banking institution must permit

a banking customer to draw, as of right, on an item which has been

received for deposit in the customer's account.

3. The superintendent is authorized to gather from banking

institutions such information as may be required by the superintendent

of financial services for the promulgation of the regulations required

by this section.

4. (a) Except as otherwise provided in paragraph (b) of this

subdivision, a provision in any agreement between a banking institution

and its banking customer which provides for a period of time longer than

the period prescribed under regulations promulgated pursuant to this

section is unreasonable for purposes of article four of the uniform

commercial code and, in lieu thereof, the maximum period of time

permitted in the regulation shall be deemed controlling. For all other

purposes the provisions of this section shall not be deemed or construed

to alter or impair any right or obligation under the uniform commercial

code.

(b) This section does not prohibit a banking institution and a banking

customer from agreeing in writing to a greater period of time than that

otherwise prescribed by regulation pursuant to this section for the

drawing against items because of special circumstances, provided that,

such agreement is not contained in a pre-printed form and is not a

usual, regular business practice of the institution.

5. Such regulations shall require every banking institution to notify

each of its banking customers, in writing, of the applicable time

limitations on the right to draw on items received for deposit in the

customer's account and to keep posted in a conspicuous place at each

branch, a notice substantially setting forth the generally applicable

time limitations of the banking institution's customers' rights to draw

on items deposited to their accounts.

6. The superintendent of financial services is empowered, upon a

determination that the uniform application of a regulation adopted

pursuant to this section would result in unsafe or unsound banking

practices, to issue such further regulation or order with respect

thereto as it deems appropriate.

7. In this section "banking institution" has the same meaning ascribed

to it by section nine-f of this chapter and "item" has the same meaning

ascribed to it by the uniform commercial code.