4201 - Status of collecting bank as agent and provisional status of credits; applicability of division; item indorsed "pay any bank."
CHAPTER 42 COLLECTION OF ITEMS: DEPOSITARY AND COLLECTING BANKS Sec. 4201. Status of collecting bank as agent and provisional status of credits; applicability of division; item indorsed "pay any bank." 4202. Responsibility for collection or return; when action timely. 4203. Effect of instructions. 4204. Methods of sending and presenting; sending directly to payor bank. 4205. Depositary bank holder of unindorsed item. 4206. Transfer between banks. 4207. Transfer warranties. 4208. Presentment warranties. 4209. Encoding and retention warranties. 4210. Security interest of collecting bank in items, accompanying documents and proceeds. 4211. When bank gives value for purposes of holder in due course. 4212. Presentment by notice of item not payable by, through or at a bank; liability of drawer or indorser. 4213. Medium and time of settlement by bank. 4214. Right of charge-back or refund; liability of collecting bank; return of item. 4215. Final payment of item by payor bank; when provisional debits and credits become final; when certain credits become available for withdrawal. 4216. Insolvency and preference. Enactment. Chapter 42 was added November 1, 1979, P.L.255, No.86, effective January 1, 1980. § 4201. Status of collecting bank as agent and provisional status of credits; applicability of division; item indorsed "pay any bank." (a) Agency status of bank and provisional status of settlement.--Unless a contrary intent clearly appears and before the time that a settlement given by a collecting bank for an item is or becomes final, the bank, with respect to the item, is an agent or sub-agent of the owner of the item and any settlement given for the item is provisional. This provision applies regardless of the form of indorsement or lack of indorsement and even though credit given for the item is subject to immediate withdrawal as of right or is in fact withdrawn; but the continuance of ownership of an item by its owner and any rights of the owner to proceeds of the item are subject to rights of a collecting bank, such as those resulting from outstanding advances on the item and rights of recoupment or setoff. If an item is handled by banks for purposes of presentment, payment, collection or return, the relevant provisions of this division apply even though action of the parties clearly establishes that a particular bank has purchased the item and is the owner of it. (b) Effect of "pay any bank" indorsement.--After an item has been indorsed with the words "pay any bank" or the like, only a bank may acquire the rights of a holder until the item has been: (1) returned to the customer initiating collection; or (2) specially indorsed by a bank to a person who is not a bank. (July 9, 1992, P.L.507, No.97, eff. one year) Cross References. Section 4201 is referred to in section 3206 of this title.