N.Y. Uniform Commercial Code Law § 4-a-211: Cancellation and Amendment of Payment Order

Section 4-A-211. Cancellation and Amendment of Payment Order.

(1) A communication of the sender of a payment order cancelling or

amending the order may be transmitted to the receiving bank orally or in

a record. If a security procedure is in effect between the sender and

the receiving bank, the communication is not effective to cancel or

amend the order unless the communication is verified pursuant to the

security procedure or the bank agrees to the cancellation or amendment.

(2) Subject to subsection (1), a communication by the sender

cancelling or amending a payment order is effective to cancel or amend

the order if notice of the communication is received at a time and in a

manner affording the receiving bank a reasonable opportunity to act on

the communication before the bank accepts the payment order.

(3) After a payment order has been accepted, cancellation or amendment

of the order is not effective unless the receiving bank agrees or a

funds-transfer system rule allows cancellation or amendment without

agreement of the bank.

(a) With respect to a payment order accepted by a receiving bank

other than the beneficiary's bank, cancellation or amendment

is not effective unless a conforming cancellation or

amendment of the payment order issued by the receiving bank

is also made.

(b) With respect to a payment order accepted by the beneficiary's

bank, cancellation or amendment is not effective unless the

order was issued in execution of an unauthorized payment

order, or because of a mistake by a sender in the funds

transfer which resulted in the issuance of a payment order

(i) that is a duplicate of a payment order previously issued

by the sender, (ii) that orders payment to a beneficiary not

entitled to receive payment from the originator, or (iii)

that orders payment in an amount greater than the amount the

beneficiary was entitled to receive from the originator. If

the payment order is cancelled or amended, the beneficiary's

bank is entitled to recover from the beneficiary any amount

paid to the beneficiary to the extent allowed by the law

governing mistake and restitution.

(4) An unaccepted payment order is cancelled by operation of law at

the close of the fifth funds-transfer business day of the receiving bank

after the execution date or payment date of the order.

(5) A cancelled payment order cannot be accepted. If an accepted

payment order is cancelled, the acceptance is nullified and no person

has any right or obligation based on the acceptance. Amendment of a

payment order is deemed to be cancellation of the original order at the

time of amendment and issue of a new payment order in the amended form

at the same time.

(6) Unless otherwise provided in an agreement of the parties or in a

funds-transfer system rule, if the receiving bank, after accepting a

payment order, agrees to cancellation or amendment of the order by the

sender or is bound by a funds-transfer system rule allowing cancellation

or amendment without the bank's agreement, the sender, whether or not

cancellation or amendment is effective, is liable to the bank for any

loss and expenses, including reasonable attorney's fees, incurred by the

bank as a result of the cancellation or amendment or attempted

cancellation or amendment.

(7) A payment order is not revoked by the death or legal incapacity of

the sender unless the receiving bank knows of the death or of an

adjudication of incapacity by a court of competent jurisdiction and has

reasonable opportunity to act before acceptance of the order.

(8) A funds-transfer system rule is not effective to the extent it

conflicts with paragraph (b) of subsection (3).