N.Y. Uniform Commercial Code Law § 4-503: Responsibility of Presenting Bank for Documents and Goods; Report of Reasons for Dishonor; Referee in Case of Need

Section 4--503. Responsibility of Presenting Bank for Documents and

Goods; Report of Reasons for Dishonor; Referee in Case

of Need.

Unless otherwise instructed and except as provided in Article 5 a bank

presenting a documentary draft

(a) must deliver the documents to the drawee on acceptance of the

draft if it is payable more than three days after presentment;

otherwise, only on payment; and

(b) upon dishonor, either in the case of presentment for acceptance or

presentment for payment, may seek and follow instructions from any

referee in case of need designated in the draft or if the presenting

bank does not choose to utilize his services it must use diligence and

good faith to ascertain the reason for dishonor, must notify its

transferor of the dishonor and of the results of its effort to ascertain

the reasons therefor and must request instructions.

But the presenting bank is under no obligation with respect to goods

represented by the documents except to follow any reasonable

instructions seasonably received; it has a right to reimbursement for

any expense incurred in following instructions and to prepayment of or

indemnity for such expenses.