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U.C.C. - ARTICLE 4 - BANK DEPOSITS AND COLLECTIONS
..PART 2. COLLECTION OF ITEMS: DEPOSITARY AND COLLECTING BANKS

§ 4-205. DEPOSITARY BANK HOLDER OF UNINDORSED ITEM.

If a customer delivers an item to a depositary bank for collection:

  • (1) the depositary bank becomes a holder of the item at the time it receives the item for collection if the customer at the time of delivery was a holder of the item, whether or not the customer indorses the item, and, if the bank satisfies the other requirements of Section 3-302, it is a holder in due course; and
  • (2) the depositary bank warrants to collecting banks, the payor bank or other payor, and the drawer that the amount of the item was paid to the customer or deposited to the customer's account.
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© Copyright 2005 by The American Law Institute and the National Conference of Commissioners on Uniform State Laws; reproduced, published and distributed with the permission of the Permanent Editorial Board for the Uniform Commercial Code for the limited purposes of study, teaching, and academic research.