N.Y. Uniform Commercial Code Law § 4-202: Responsibility for Collection; When Action Seasonable

Section 4--202. Responsibility for Collection; When Action Seasonable.

(1) A collecting bank must use ordinary care in

(a) presenting an item or sending it for presentment; and

(b) sending notice of dishonor or non-payment or returning an

item other than a documentary draft to the bank's transferor

or directly to the depositary bank under subsection (2) of

Section 4--212 after learning that the item has not been paid

or accepted, as the case may be; and

(c) settling for an item when the bank receives final settlement;

and

(d) making or providing for any necessary protest; and

(e) notifying its transferor of any loss or delay in transit

within a reasonable time after discovery thereof.

(2) A collecting bank taking proper action before its midnight

deadline following receipt of an item, notice or payment acts

seasonably; taking proper action within a reasonably longer time may be

seasonable but the bank has the burden of so establishing.

(3) Subject to subsection (1) (a), a bank is not liable for the

insolvency, neglect, misconduct, mistake or default of another bank or

person or for loss or destruction of an item in transit or in the

possession of others.