N.Y. Uniform Commercial Code Law § 4-303: When Items Subject to Notice, Stop-Order, Legal Process or Setoff; Order in Which Items May Be Charged or Certified

Section 4--303. When Items Subject to Notice, Stop-Order, Legal Process

or Setoff; Order in Which Items May Be Charged or

Certified.

(1) Any knowledge, notice or stop-order received by, legal process

served upon or setoff exercised by a payor bank, whether or not

effective under other rules of law to terminate, suspend or modify the

bank's right or duty to pay an item or to charge its customer's account

for the item, comes too late to so terminate, suspend or modify such

right or duty if the knowledge, notice, stop-order or legal process is

received or served and a reasonable time for the bank to act thereon

expires or the setoff is exercised after the bank has done any of the

following:

(a) accepted or certified the item;

(b) paid the item in cash;

(c) settled for the item without reserving a right to revoke the

settlement and without having such right under statute,

clearing house rule or agreement;

(d) completed the process of posting the item to the indicated

account of the drawer, maker or other person to be charged

therewith or otherwise has evidenced by examination of such

indicated account and by action its decision to pay the item;

or

(e) become accountable for the amount of the item under

subsection (1) (d) of Section 4--213 and Section 4--302

dealing with the payor bank's responsibility for late return

of items.

(2) Subject to the provisions of subsection (1) items may be accepted,

paid, certified or charged to the indicated account of its customer in

any order convenient to the bank.