{"data":{"id":"us-ky/krs-355.4a-404","jurisdiction":"us-ky","citation":"KRS 355.4A-404","heading":"Obligation of beneficiary's bank to pay and give notice to beneficiary.","body":"(1) Subject to KRS 355.4A -211(5), 355.4A -405(4), and 355.4A -405(5), if a\nbeneficiary's bank accepts a payment order, the bank is obliged to pay the amount of\nthe order to the beneficiary of the order. Payment is due on the payment date of the\norder, but if  acceptance occurs on the payment date after the close of the funds -\ntransfer business day of the bank, payment is due on the next funds -transfer\nbusiness day. If the bank refuses to pay after demand by the beneficiary and receipt\nof notice of particular circumstances that will give rise to consequential damages as\na result of nonpayment, the beneficiary may recover damages resulting from the\nrefusal to pay to the extent the bank had notice of the damages, unless the bank\nproves that it did not pay because o f a reasonable doubt concerning the right of the\nbeneficiary to payment.\n(2) If a payment order accepted by the beneficiary's bank instructs payment to an\naccount of the beneficiary, the bank is obliged to notify the beneficiary of receipt of\nthe order bef ore midnight of the next funds -transfer business day following the\npayment date. If the payment order does not instruct payment to an account of the\nbeneficiary, the bank is required to notify the beneficiary only if notice is required\nby the order. Notice may be given by first class mail or any other means reasonable\nin the circumstances. If the bank fails to give the required notice, the bank is obliged\nto pay interest to the beneficiary on the amount of the payment order from the day\nnotice should have been given until the day the beneficiary learned of receipt of the\npayment order by the bank. No other damages are recoverable. Reasonable\nattorney's fees are also recoverable if demand for interest is made and refused before\nan action is brought on the claim.\n(3) The right of a beneficiary to receive payment and damages as stated in subsection\n(1) may not be varied by agreement or a funds -transfer system rule. The right of a\nbeneficiary to be notified as stated in subsection (2) may be varied by agreement o f\nthe beneficiary or by a funds-transfer system rule if the beneficiary is notified of the\nrule before initiation of the funds transfer.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=33583","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:58:45Z","sha256":"71c0979dacbba7557c546c2c0fb1fbb1b82b7f3e3298337f2d8998fc28ab43d1","source_id":"us-ky","stale":false,"prev":"us-ky/krs-355.4a-403","next":"us-ky/krs-355.4a-405"},"notice":"GroundRules: Original legal text. Not legal advice."}