insufficiency of account. 1. Except as otherwise provided in this Article, a payor bank wrongfully dishonors an item ifitdishonors an item that isproperly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft. 2. A payor bank is liable to itscustomer for damages proximately caused by the wrongful dishonor of an item. Liability islimited to actual damages proved and may include damages for an arrest or prosecution of the customer or other consequential damages. Whether any consequential damages are proximately caused by the wrongful dishonor is a question of fact to be determined in each case. 3. A payor bank’s determination of the customer’s account balance on which a decision todishonor for insufficiency of available funds is based may be made at any time between the time the item is received by the payor bank and the time that the payor bank returns the item or gives notice in lieu of return, and no more than one determination need be made. If,at the election of the payor bank, a subsequent balance determination ismade for the purposes of reevaluating the bank’s decision to dishonor the item, the account balance at the time is determinative of whether a dishonor for insufficiency of available funds is wrongful.
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