N.Y. Uniform Commercial Code Law § 4-a-304: Duty of Sender to Report Erroneously Executed Payment Order

Section 4-A-304. Duty of Sender to Report Erroneously Executed Payment

Order.

If the sender of a payment order that is erroneously executed as

stated in Section 4-A-303 receives notification from the receiving bank

that the order was executed or that the sender's account was debited

with respect to the order, the sender has a duty to exercise ordinary

care to determine, on the basis of information available to the sender,

that the order was erroneously executed and to notify the bank of the

relevant facts within a reasonable time not exceeding ninety days after

the notification from the bank was received by the sender. If the sender

fails to perform that duty, the bank is not obliged to pay interest on

any amount refundable to the sender under subsection (4) of Section

4-A-402 for the period before the bank learns of the execution error.

The bank is not entitled to any recovery from the sender on account of a

failure by the sender to perform the duty stated in this section.