Tex. Bus. & Com. Code Section 3.502
Dishonor


(a)

Dishonor of a note is governed by the following rules:

(1)

If the note is payable on demand, the note is dishonored if presentment is duly made to the maker and the note is not paid on the day of presentment.

(2)

If the note is not payable on demand and is payable at or through a bank or the terms of the note require presentment, the note is dishonored if presentment is duly made and the note is not paid on the day it becomes payable or the day of presentment, whichever is later.

(3)

If the note is not payable on demand and Subdivision (2) does not apply, the note is dishonored if it is not paid on the day it becomes payable.

(b)

Dishonor of an unaccepted draft other than a documentary draft is governed by the following rules:

(1)

If a check is duly presented for payment to the payor bank otherwise than for immediate payment over the counter, the check is dishonored if the payor bank makes timely return of the check or sends timely notice of dishonor or nonpayment under Section 4.301 (Deferred Posting; Recovery of Payment by Return of Items; Time of Dishonor; Return of Items by Payor Bank) or 4.302 (Payor Bank’s Responsibility for Late Return of Item), or becomes accountable for the amount of the check under Section 4.302 (Payor Bank’s Responsibility for Late Return of Item).

(2)

If a draft is payable on demand and Subdivision (1) does not apply, the draft is dishonored if presentment for payment is duly made to the drawee and the draft is not paid on the day of presentment.

(3)

If a draft is payable on a date stated in the draft, the draft is dishonored if:

(A)

presentment for payment is duly made to the drawee and payment is not made on the day the draft becomes payable or the day of presentment, whichever is later; or

(B)

presentment for acceptance is duly made before the day the draft becomes payable and the draft is not accepted on the day of presentment.

(4)

If a draft is payable on elapse of a period of time after sight or acceptance, the draft is dishonored if presentment for acceptance is duly made and the draft is not accepted on the day of presentment.

(c)

Dishonor of an unaccepted documentary draft occurs according to the rules stated in Subsections (b)(2), (3), and (4), except that payment or acceptance may be delayed without dishonor until not later than the close of the third business day of the drawee following the day on which payment or acceptance is required by those subdivisions.

(d)

Dishonor of an accepted draft is governed by the following rules:

(1)

If the draft is payable on demand, the draft is dishonored if presentment for payment is duly made to the acceptor and the draft is not paid on the day of presentment.

(2)

If the draft is not payable on demand, the draft is dishonored if presentment for payment is duly made to the acceptor and payment is not made on the day it becomes payable or the day of presentment, whichever is later.

(e)

In any case in which presentment is otherwise required for dishonor under this section and presentment is excused under Section 3.504 (Excused Presentment and Notice of Dishonor), dishonor occurs without presentment if the instrument is not duly accepted or paid.

(f)

If a draft is dishonored because timely acceptance of the draft was not made and the person entitled to demand acceptance consents to a late acceptance, from the time of acceptance the draft is treated as never having been dishonored.
Amended by Acts 1995, 74th Leg., ch. 921, Sec. 1, eff. Jan. 1, 1996.

Source: Section 3.502 — Dishonor, https://statutes.­capitol.­texas.­gov/Docs/BC/htm/BC.­3.­htm#3.­502 (accessed Mar. 23, 2024).

3.101
Short Title
3.102
Subject Matter
3.103
Definitions
3.104
Negotiable Instrument
3.105
Issue of Instrument
3.106
Unconditional Promise or Order
3.107
Instrument Payable in Foreign Money
3.108
Payable on Demand or at Definite Time
3.109
Payable to Bearer or to Order
3.110
Identification of Person to Whom Instrument Is Payable
3.111
Place of Payment
3.112
Interest
3.113
Date of Instrument
3.114
Contradictory Terms of Instrument
3.115
Incomplete Instrument
3.116
Joint and Several Liability
3.117
Other Agreements Affecting Instrument
3.118
Statute of Limitations
3.119
Notice of Right to Defend Action
3.201
Negotiation
3.202
Negotiation Subject to Rescission
3.203
Transfer of Instrument
3.204
Indorsement
3.205
Special Indorsement
3.206
Restrictive Indorsement
3.207
Reacquisition
3.301
Person Entitled to Enforce Instrument
3.302
Holder in Due Course
3.303
Value and Consideration
3.304
Overdue Instrument
3.305
Defenses and Claims in Recoupment
3.306
Claims to an Instrument
3.307
Notice of Breach of Fiduciary Duty
3.308
Proof of Signatures and Status as Holder in Due Course
3.309
Enforcement of Lost, Destroyed, or Stolen Instrument
3.310
Effect of Instrument on Obligation for Which Taken
3.311
Accord and Satisfaction by Use of Instrument
3.312
Lost, Destroyed, or Stolen Cashier’s Check, Teller’s Check, or Certified Check
3.401
Signature
3.402
Signature by Representative
3.403
Unauthorized Signature
3.404
Impostors
3.405
Employer’s Responsibility for Fraudulent Indorsement by Employee
3.406
Negligence Contributing to Forged Signature or Alteration of Instrument
3.407
Alteration
3.408
Drawee Not Liable on Unaccepted Draft
3.409
Acceptance of Draft
3.410
Acceptance Varying Draft
3.411
Refusal to Pay Cashier’s Checks, Teller’s Checks, and Certified Checks
3.412
Obligation of Issuer of Note or Cashier’s Check
3.413
Obligation of Acceptor
3.414
Obligation of Drawer
3.415
Obligation of Indorser
3.416
Transfer Warranties
3.417
Presentment Warranties
3.418
Payment or Acceptance by Mistake
3.419
Instruments Signed for Accommodation
3.420
Conversion of Instrument
3.501
Presentment
3.502
Dishonor
3.503
Notice of Dishonor
3.504
Excused Presentment and Notice of Dishonor
3.505
Evidence of Dishonor
3.506
Processing Fee by Holder of Payment Device
3.507
Delivery Notification Fee by Holder of Check or Similar Sight Order
3.601
Discharge and Effect of Discharge
3.602
Payment
3.603
Tender of Payment
3.604
Discharge by Cancellation or Renunciation
3.605
Discharge of Secondary Obligors

Accessed:
Mar. 23, 2024

§ 3.502’s source at texas​.gov