N.Y. Banking Law § 680-k: Duties and liability of bank

§ 680-k. Duties and liability of bank. 1. A bank does not have a

fiduciary duty to any person with respect to a special deposit.

2. When the bank holding a special deposit becomes obligated to pay a

beneficiary, a debtor-creditor relationship arises between the bank and

beneficiary.

3. The bank holding a special deposit has a duty to a beneficiary to

comply with the account agreement and this article.

4. If the bank holding a special deposit does not comply with the

account agreement or this article, the bank is liable to a depositor or

beneficiary only for damages proximately caused by the noncompliance.

Except as provided by other law of this state, the bank is not liable

for consequential, special, or punitive damages.

5. The bank holding a special deposit may rely on records presented in

compliance with the account agreement to determine whether the bank is

obligated to pay a beneficiary.

6. If the account agreement requires payment on presentation of a

record, the bank shall determine within a reasonable time whether the

record is sufficient to require payment. If the agreement requires

action by the bank on presentation of a record, the bank is not liable

for relying in good faith on the genuineness of the record if the record

appears on its face to be genuine.

7. Unless the account agreement provides otherwise, the bank is not

required to determine whether a permissible purpose stated in the

agreement continues to exist.