{"data":{"id":"us-ky/krs-355.4a-507","jurisdiction":"us-ky","citation":"KRS 355.4A-507","heading":"Choice of law.","body":"(1) The following rules apply unless the affected parties otherwise agree or subsection\n(3) applies:\n(a) The rights and obligations between the sender of a payment order and the\nreceiving bank are governed by the law of the jurisdiction in which the\nreceiving bank is located.\n(b) The rights and obligations between the beneficiary's bank and the beneficiary\nare governed by the law of the jurisdiction in which the beneficiary's bank is\nlocated.\n(c) The issue of when payment is made pursuant to a funds transfer by  the\noriginator to the beneficiary is governed by the law of the jurisdiction in\nwhich the beneficiary's bank is located.\n(2) If the parties described in each paragraph of subsection (1) have made an agreement\nselecting the law of a particular jurisdiction  to govern rights and obligations\nbetween each other, the law of that jurisdiction governs those rights and obligations,\nwhether or not the payment order or the funds transfer bears a reasonable relation to\nthat jurisdiction.\n(3) A funds -transfer system ru le may select the law of a particular jurisdiction to\ngovern:\n(a) Rights and obligations between participating banks with respect to payment\norders transmitted or processed through the system; or\n(b) The rights and obligations of some or all parties to a f unds transfer any part of\nwhich is carried out by means of the system.\nA choice of law made pursuant to clause (a) is binding on participating banks. A\nchoice of law made pursuant to clause (b) is binding on the originator, other sender,\nor a receiving bank having notice that the funds-transfer system might be used in the\nfunds transfer and of the choice of law by the system when the originator, other\nsender, or receiving bank issued or accepted a payment order. The beneficiary of a\nfunds transfer is bound  by the choice of law if, when the funds transfer is initiated,\nthe beneficiary has notice that the funds -transfer system might be used in the funds\ntransfer and of the choice of law by the system. The law of a jurisdiction selected\npursuant to this subsec tion may govern, whether or not that law bears a reasonable\nrelation to the matter in issue.\n(4) In the event of inconsistency between an agreement under subsection (2) and a\nchoice-of-law rule under subsection (3), the agreement under subsection (2)\nprevails.\n(5) If a funds transfer is made by use of more than one funds -transfer system and there\nis inconsistency between choice -of-law rules of the systems, the matter in issue is\ngoverned by the law of the selected jurisdiction that has the most significant\nrelationship to the matter in issue.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=33592","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:58:45Z","sha256":"1f2920a4c6469960b35fd45c68d6eb28d6541c2aeb75b4dfe8e2ff207c9697e5","source_id":"us-ky","stale":false,"prev":"us-ky/krs-355.4a-506","next":"us-ky/krs-355.5-101"},"notice":"GroundRules: Original legal text. Not legal advice."}